Nomura : Quarterly Earnings (2026 full qa)

Date: April 24, 2026

Speaker: Hiroyuki Moriuchi, Chief Financial Officer, Nomura Holdings, Inc.

A1: When we made the investment four years ago, there was strong global ESG tailwind, particularly in the U.S., and we were aiming to expand our private assets business in order to capture the shift from public to private.

However, since then, the environment surrounding ESG has changed significantly, especially in the U.S., and as revenue growth fell short of our initial plan, we recorded an impairment loss of approximately Y12 billion this time.

Going forward, we will continue to promote the business while capturing demand from operating companies for carbon offsets and related needs.

A2: As this is a traditional asset management company in the U.S., and taking into account industry trends in active mutual funds for U.S. equities, we had anticipated a certain level of net outflows from the target business, and this was reflected in the valuation at the time of acquisition.

As for performance, excluding one-off investments and expenses, it is generally tracking in line with the plan presented at the CEO Forum in December last year, and the one-time costs associated with integration and amortization of intangible assets are also within expectations.

On the other hand, we will make investments to shift to net inflows over the medium to long term by promoting the transition to active ETFs and strengthening marketing efforts.

A3: Within the Wholesale division, we seek to expand earnings through a self-funding approach-namely, by deploying the balance sheet, RWA, and leverage exposure within the bounds of profits generated. Accordingly, we expect the impact on our CET1 ratio to remain limited. We are committed to growing our Equity, and with respect to other businesses such as Securitized Products, we will continue to maintain a balanced portfolio by carefully controlling exposure in response to evolving opportunities.

A4: We have no intention of deliberately reducing the CET1 ratio, and as you have correctly pointed out, we aim to translate this into an improvement in ROE.

A5: Personnel expenses in 4Q continued to reflect the impact of the deferred compensation system revision explained in 3Q. Including the impact of the relaxation of UK compensation regulations, both factors are temporary and timing-related, and their impact is expected to decline significantly going forward.

A6: The main drivers are Rates and Equity Products, both of which are performing well. In 4Q, revenue from Rates struggled because we had to control risk in response to intensified situations in the Middle East. However, in April, Rates recovered significantly, and Equity Products also remained strong. By region, performance improved broadly across all regions, although growth in the Americas was relatively modest.

A7: In the Americas, revenue declines in 4Q were more pronounced than in other regions, due not only to seasonality but also to risk reduction, mainly in U.S. Macro Products, from mid-March onward in response to the worsening situation in the Middle East. However, since entering April, revenue has begun to recover as tensions in the Middle East have somewhat eased.

A8: By sector, it includes healthcare, business services, software and computer services, consumer, and engineering and construction. The largest shares are in healthcare and business services, while software is not a major component. We are also pursuing geographic diversification.

A9: Although some investors remain cautious, there have been no significant redemptions or disruptions at present. Our approach of carefully explaining that these are medium- to longterm investment products and ensuring clients understand that before holding them has been effective.

A10: For the fiscal year ended March 2026, the total shareholder return ratio is approximately 58% including RSUs, and exceeds 50% even excluding RSUs.

A11: The share buyback authorization is determined based on our full-year performance outlook. The Y60 billion authorization announced in 3Q was also decided by reflecting, to a certain extent, profits expected in 4Q.

A12: Expenses in the Wholesale division increased by approximately Y13 billion compared with 3Q, resulting in a somewhat elevated level. However, due in part to upfront costs related to Securitized Products and the absence of certain one-time factors in the current fiscal year, expenses are expected to remain somewhat restrained. The Wealth Management division continues to maintain a high margin. Although there will be a modest increase in costs due to AI investment and inflation, we will continue to implement rigorous cost management and secure stable profitability.

A13: Laser Digital has already established a robust risk management framework, and we are seeing the benefits of that framework. While the crypto asset market fell in 4Q to roughly the same extent as in 3Q, the effect on consolidated results was limited.

A14: We reduced the absolute level of risk in our market-making activities. While we still maintain some long positions, such as venture investments and seed capital, we believe that as our asset management business develops, we will be able to operate while controlling capital more effectively in the future.

A15: Revenue declined mainly due to year-end risk position adjustments and defensive positioning in response to the worsening situation in the Middle East. Expenses increased temporarily due to revisions to compensation regulations and year-end bonus adjustments, as well as higher commissions, floor brokerage, and the increase of professional fees related to Securitized Products.

A16: The 4Q cost-to-income ratio of 86% was clearly high, with the impact from lower revenue outweighing that of higher expenses. In any case, it was somewhat elevated.

A17: We are currently continuing internal discussions, and if there are any updates, we may communicate them at the Investor Day scheduled for May 29.

A18: To address cost increases caused by inflation, we are promoting company-wide cost controls through structural initiatives such as the use of offshore resources. At the same time, we aim to improve ROE by expanding revenues beyond the rise in costs and enhancing investment efficiency.

A19: The Private Credit market itself still has room to expand over the medium to long term, and we view it positively. On the other hand, in the short term, as other firms have also pointed out, risk management based on the credit cycle is important. Therefore, even though there are abundant opportunities and a strong pipeline in Securitized Products, we will proceed selectively and control balance so that no single product becomes overly large across the Wholesale division.

A20: In the short term, in terms of P/L and risk, it is mainly a matter for the Wholesale division. On the other hand, over the medium to long term, the Investment Management and Wealth Management divisions will also grow their private business, including Private Credit, based on appropriate risk management and suitability considerations.