Nomura Holdings Inc. reported its highest quarterly net income in four years for the quarter ended Sept. 30, helped by strong performance across its key business segments and cost-cutting efforts.
The Japanese group said in its Nov. 1 earnings statement that net income attributable to shareholders surged to ￥98.4 billion for the fiscal second quarter from ￥35.2 billion a year earlier, thanks to its strong performance in its wealth management, wholesale, and investment management businesses.
Profits from the three operations "were well balanced," Nomura CFO Takumi Kitamura said during a Nov. 1 conference. "We're looking at a ray of hope in the long-underperforming wholesale business."
Nomura's wholesale business pretax profit grew by more than five times to total ￥45.3 billion in the quarter, from ￥8.3 billion a year earlier, aided by a reduction of its cost-to-income ratio to 83% from 96%.
"We'll step up cost-control efforts," Kitamura said.
While the group's global markets operations, including fixed income and stock, grew in Japan, Asia and the US, its investment banking business gained momentum from M&A deals mainly in Europe and financing mainly in Japan.
Stable wealth push
Nomura will make a strong push into a fee-generating stable wealth management business, less impacted by fluctuating market sentiment.
Its wealth management segment posted pretax profit for the fiscal second quarter of ￥45.3 billion, a 56% year-over-year jump from ￥29.0 billion. Japan's resilient stock market was a contributory factor, while bond sales lost steam, hit by higher interest rates as the Japanese central bank pursues monetary policy normalization.
Pretax profit at Nomura's investment management operations grew by 38% to ￥31.9 billion, from ￥23.2 billion. The group increased its outstanding assets under management as of the end of September to ￥88.8 trillion, from ￥76.5 trillion a year ago, mainly through investment trust funds. The group's assets for higher-yielding alternative investment overseas grew to ￥2.103 trillion from ￥1.682 trillion.
Unlike commercial banks, Nomura did not provide forecasts for annual earnings for the fiscal year ending in March 2025.