Nomura profit plunges 91% in first quarter

Bloomberg

Nomura Holdings Inc.’s first-quarter profit plunged to the lowest in two years as its wholesale business lost money thanks to a slump in fixed-income trading, while the domestic retail operation lost steam. Net income fell 91 percent to $47 million in the three months ended June 30 from a year earlier, Japan’s biggest brokerage said.
The firm posted its second consecutive quarterly loss overseas, led by Europe, undermining Chief Executive Officer Koji Nagai’s efforts to sustain profits outside of Japan. At home, a stagnating equity market is clouding prospects for the retail securities business.
Revenue fell 7.9 percent on year to 431 billion yen Trading profit slid 40 percent Brokerage commissions dropped 13 percent Investment banking fees rose 5.5 percent Pretax loss from overseas was 7.7 billion yen
The company’s wholesale business had a 7.4 billion yen pretax loss, the first since the three months ended March 2016. Profit at the retail division fell 20 percent to 19.9 billion yen.
“Nomura’s retail business is growing at a sluggish pace, while its global share of the wholesale business is a case of one step forward, two steps back,” Citigroup Inc. analyst Koichi Niwa said before the results were announced.

To trim costs, Nagai has been cutting jobs overseas. The brokerage is eliminating at least 50 positions in London, including some of its most senior traders, Bloomberg reported earlier this month. It also dismissed more than two dozen sales and trading staff in the U.S. last month.
Shares of Nomura have fallen 16 percent this year, more than the benchmark Topix index’s 2.9 percent decline.