Nomura used to have a reputation for paying senior staff at its Angel Lane office in London pretty well. Not, it seems, any more. Results released today for Nomura International reflect the extent to which pay has dropped at the Japanese bank.
In the year to March 31st 2019, the 2,181 staff at Nomura’s International business earned an average of $271k each. This was down from $316k the previous year – a drop of 14%. 2019 was the second year in which Nomura’s pay fell – in 2017, staff at the International business were earning $320k each.
It could have been worse. Nomura International’s operating loss deepened 80% in the year to March, to $387m, so the bank was kind of generous in the circumstances. Directors seemed to bear the brunt of the pain – their bonuses were cut 67% last year, although the highest paid among them still earned $2.2m, up from $1.7m the year before.
Most of Nomura International’s staff work in London, with a small contingent elsewhere in Europe and in the Middle East or Africa. The Japanese bank has set up a new company, ‘Nomura Financial Products Europe GmbH’ in Germany to house its European operations after Brexit.
Needless to say, Nomura has already set about remedying its persistent international losses. – In April it announced a restructuring programme, which saw it “optimize” G10 rates and downscale G10 FX and emerging markets in Europe, with associated job losses.
Based upon the recent year’s results, however, the focus of Nomura’s cuts seems curious. In the year to March 2019, the International business made a big loss ($1.4m) on interest rate derivatives and a big profit ($1.1m) on currency derivatives. – Rates should surely have been exited, and FX maintained? Unless of course the loss was in the emerging markets rates business, which seems eminently possible.
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