Nomura Holdings said its quarterly net profit rose 39 percent, beating forecasts, as strength in its asset management business offset a slight drop in retail brokerage sales. Japan's biggest investment banking and brokerage group said its July-September net profit rose to 53 billion yen ($492 million), beating a consensus forecast of 41 billion yen by analysts on Thomson Reuters StarMine.
Sales in its retail division, which serves individual and small corporate investors, fell 1 percent from a year ago as last year's stock market rally - inspired by Prime Minister Shinzo Abe's economic growth policies - cooled off, weighing on trading volumes.
The company's asset management division increased sales by 16 percent from a year earlier as it attracted more clients. Its retail client assets also rose to 99.3 trillion yen by the end of September from 90.9 trillion yen a year earlier.
Nomura Chief Executive Koji Nagai has been trying to lead his sales staff away from "churning" investment trusts, the practice of earning commissions by encouraging clients to frequently switch investment funds. Nagai has said Nomura should focus instead on boosting client assets, which he hopes will reach 150 trillion yen by the business year ending in March 2020.
Nagai launched a range of cost-cutting measures after assuming office in 2012 following an insider trading scandal involving Nomura employees.
U.S. credit ratings agency Moody's Investors Service upgraded Nomura Holdings' credit rating earlier this month to Baa1 from Baa3, placing it one notch above Morgan Stanley .
That is expected to lower its funding costs and help it to expand its global fixed-income and derivatives business as it meets more counterparty requirements.
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