Nomura's overseas division to return to profit by March: COO
By Thomas Wilson and Emi Emoto
TOKYO (Reuters) - Nomura Holdings Inc's (8604.T: Quote) overseas business remains on track to return to profit by March for the first time in seven years despite Britain's vote to leave the European Union, its chief operating officer said.
Investors were seeking liquidity and hedging products in response to ultra-low interest rates and volatile foreign exchange markets, compensating for any Brexit-linked headwinds, Tetsu Ozaki said in an interview on Thursday.
"We didn't expect these conditions but our clients' needs have increased more than we imagined," Ozaki said, referring to post-Brexit market volatility. "We said we wanted to (return the overseas business to profitability), and that direction won't change."
Ozaki, 58, had said in April - before the Brexit vote - that Nomura's overseas business would return to the black by March, ending losses of 385 billion yen ($3.8 billion) racked up since 2010.
Since then, Japan's biggest brokerage had seen demand for liquidity and products for hedging rates and currency fluctuations as clients and investors grappled with an "unprecedented environment" of negative yields and forex volatility, he said.
"As the macro interest rate and foreign exchange environment becomes harder to read, skills in providing liquidity are in demand. Commercial banks are more cautious in this environment," Ozaki said.
BREXIT IMPACT Continued...