TOKYO, July 29 – Japan\’s top securities firm Nomura, digesting a takeover of large parts of failed US bank Lehman Brothers, announced Wednesday its first profit in six quarters, helped by a recovery in global markets.
Nomura Holdings posted a net profit of 11.42 billion yen (121 million dollars) for the fiscal first quarter to June, returning to the black after a record loss of 709.4 billion yen in the last business year through March.
Revenue jumped 41.0 percent from a year earlier to 363.60 billion yen, aided by a rebound in global stocks and a beefed-up worldwide presence following the acquisition of Lehman\’s assets in Asia, Europe and the Middle East.
"Our retail and asset management business continued to generate stable revenues and global markets made a significant contribution to earnings," Nomura president Kenichi Watanabe said.
"While market conditions remain uncertain, we are making steady progress toward our objective of achieving a full-year profit," he added.
Eyeing a global presence, Nomura last year snapped chunks of Lehman Brothers after the US investment bank became the most visible corporate casualty of the financial crisis.
The costs of the purchase cut into the Japanese company\’s profits last year, but Nomura said it was starting to reap the benefits of the deal.
"A combination of the Lehman effect and the improved market environment led to better profits" in the April-June period, chief financial officer Masafumi Nakada said at a news conference.
Nomura\’s wholesale businesses in Asia and Europe grew rapidly in the first quarter due to its acquisition of Lehman\’s operations there, he said.
"I feel the gap between us and our competitors has shrunk," although Western firms remain bigger, Nakada said.
As usual, Nomura gave no financial forecasts for the current year.
Hurt by Iceland\’s financial implosion and exposure to an alleged vast fraud by Wall Street financier Bernard Madoff, Nomura has moved to scale down, or exit, non-core businesses to reduce its costs.
Those efforts appear to be paying off, raising hopes of better times ahead for other Japanese financial firms as well.
Nomura\’s domestic rivals Daiwa Securities Group and Nikko Cordial Securities are also expected to have swung into the black for the first quarter, the Nikkei business daily reported at the weekend.