Share slide pushes Nomura into red
SHRINKING turnover amid plunging share prices sent Japan's largest stockbroker, Nomura, sliding into the red in the three months to end-September.
The finance house has reported a net loss of 7.6bn yen (£42.8m) against a profit of 53.5bn yen in the same period last year.
The loss sent first-half profits sliding 90% to 11.33bn yen as revenues shrank to 550.42bn yen. Nomura was hit by plummeting commissions, online competition and shrinking underwriting fees.
Trading commissions in the quarter sank 15bn yen to 20bn yen while the drying-up of new issues on the Tokyo Stock Exchange slashed underwriting earnings-from 26bn yen to 19bn yen.
The results sounded a warning of the impact on Japan's financial sector of this year's fall in stock values, which has taken the Nikkei 225 Average down by 25% to an 18-year low.
To reflect this, Nomura had to write down its investment holdings by 52bn yen over six months, a grim omen for the forthcoming earnings season of the big Japanese banks.
Nomura confirmed today, however, that it will invest $200m (£138m) in San Francisco-based investment banking and asset management group Thomas Weisel.
