Annual Report 2009 for the Year Ended March 31, 2009 Nomura Holdings,Inc. Count on Nomura Create Change Nominal GDP by Country (2008) Netherlands 1.4% South Korea 1.6% Australia 1.7% Mexico 1.8% India 2.0% Canada 2.5% Brazil 2.6% Spain 2.6% Russia 2.8% Others 23.4% US 23.4% Japan 8.1% China 7.2% Germany 6.0% France 4.7% UK 4.4% Italy 3.8% Source: Nomura, based on IMF, World Economic Outlook Database, April 2009 As Asia’s global investment bank, we aim to act as an agent of change. By driving change in times of turbulence we believe we can contribute to market growth, thereby helping households, industry, and the global economy grow. We are also prepared to change from within, constantly transforming Nomura to deliver the highest level of service to our clients. We challenge existing thinking and are intensely client-focused and business-driven. We believe that creating change will in turn create growth opportunities for Nomura. Cross-border M&A by Region (# of deals) 160 140 120 100 80 60 40 20 0 Other ME/ Africa Latin America Asia Pacific Europe North America 2004 2005 2006 2007 2008 Note: Based on publicly disclosed data; includes deals not completed. Source: Thomson Reuters Annual Report 2009 1 World-Class Dow Jones Industrial Average Shanghai Stock Exchange Composite Index (US$) 10,000 9,000 8,000 7,000 6,000 Jan. Feb. Mar. Apr. May Jun. 2009 (points) 3,100 2,900 2,700 2,500 2,300 2,100 1,900 1,700 1,500 Jan. Feb. Mar. Apr. May Jun. 2009 Daily trading value US$187 billion Daily trading value US$31 billion Source: Index data from Bloomberg. Daily trading value is the average for April-June 2009 based on data from World Federation of Exchanges, compiled by Nomura. 2 Nomura Holdings, Inc. We are committed to offering world-class products and services to our clients globally while setting new standards in everything we do. We aim to earn the confidence of our clients by proposing value-enhancing solutions to remain their most trusted partner. Nikkei Stock Average FTSE 100 (yen) 11,000 10,000 9,000 8,000 7,000 6,000 5,000 4,000 Jan. Feb. Mar. Apr. May Jun. 2009 (points) 4,800 4,600 4,400 4,200 4,000 3,800 3,600 3,400 Jan. Feb. Mar. Apr. May Jun. 2009 Daily trading value US$19 billion Daily trading value US$17 billion Annual Report 2009 3 Speed Foreign Currency Reserves (millions of US$) 2,500,000 2,000,000 1,500,000 1,000,000 500,000 0 China Japan US UK 2001 2002 2003 2004 2005 2006 2007 2008 2009 Source: Nomura, based on IMF data (figure for China is Bank of Japan estimate). 4 Nomura Holdings, Inc. Speed is essential for sound and flexible decision-making. We focus on moving with speed and agility to mobilize the full resources of the company and enhance our client service offering. By doing so, times of market upheaval can lead to opportunities. We acted quickly in the past year to deal with legacy assets and pave the way for future growth. We will continue to move with speed to capitalize on new opportunities as they arise and deliver superior value to our clients. Bank Market Capitalization December 2000 June 2009 Name Country Market Capitalization (billions of US$) Name Country Market Capitalization (billions of US$) Citigroup HSBC Wells Fargo JPMorgan Chase Bank of America US UK US US US UBS RBS Lloyds Switzerland UK UK Credit Suisse Switzerland Deutsche Bank Germany 256.45 136.36 95.48 87.63 74.03 69.77 63.29 59.05 56.89 51.71 ICBC China China Construction Bank China Bank of China China HSBC JPMorgan Chase Wells Fargo Bank of America UK US US US Banco Santander Spain MUFG Japan BNP Paribas France 257.00 182.19 153.08 143.24 133.80 115.38 110.31 98.08 72.32 69.33 Source: Nomura, based on Bloomberg data. Note: Gray shading represents banks strong in Asia. White shading represents Asian-based banks. Annual Report 2009 5 “As a leading financial services group, Nomura partners with clients around the world building relationships and delivering tailored solutions for success in today’s markets. With some 26,000 people in over 30 coun- tries, our operations include Retail, Global Markets, Investment Banking, Merchant Banking, and Asset Management.” Count on Nomura for >> Forward-Looking Statements This annual report contains forward-looking statements about the future plans, strategies, beliefs, and performance of Nomura Group. These forward-looking statements are not historical facts. They are expectations, estimates, forecasts, and projections based on information currently available to the company and are subject to a number of risks, uncertainties, and assumptions, which, without limitation, include market trends, economic trends, competition in the Japanese financial industry, laws and regulations, and the tax system. As such, actual results may differ materially from those projected. 6 Nomura Holdings, Inc. Contents Message from the CEO Interview with the COO Message from the CFO Major International Business Lines Consulting Retail Innovation Global Markets Solutions Investment Banking Value Merchant Banking Expertise Asset Management Global Research Corporate Governance and Internal Control System Risk Management Board of Directors / Executive and Senior Managing Directors Corporate Social Responsibility Financial Highlights Eight-Year Financial Summary (US GAAP) Major Subsidiaries and Affiliates Nomura Securities Domestic Network Corporate and Other Data 8 12 18 20 22 26 32 36 40 44 46 49 50 52 54 56 58 59 60 Annual Report 2009 7 Message from the CEO Last year we dealt with legacy assets and positioned the firm for future growth. This year, our focus is on achieving profitability by leveraging our expanded business platform to deliver tailored solutions to our clients across all geographies. FY 2008 in Review Business Environment In my first year as President and CEO a series of events sent the global financial markets into unprecedented turmoil. What started out as a US subprime loan crisis in the summer of 2007 became a global financial crisis with effects spreading to the broader economy. This created an extraordinarily chal- lenging business environment for Nomura. Before the crisis, the global financial markets were involved in what could be described as a massive carry trade. With the world awash in liquidity, the credit-fuelled economy imploded, creating a global credit crunch that seized up the financial system. It will take time for the financial markets in the US and Europe to recover fully. On the other hand, Asia has emerged from the crisis relatively unscathed and, led by China, I see the region taking on an increasingly prominent global role. Financial Results Net revenue for the year was ¥312.6 billion. We booked a pretax loss of ¥779 billion and a net loss of ¥708.2 billion. While this represents our worst financial result ever, it also reflects our determination to deal aggressively with negative positions in legacy assets and align the company for future growth. Kenichi Watanabe President & Chief Executive Officer 8 Nomura Holdings, Inc. In dealing with these troubled assets, we reassessed the We executed these initiatives with extraordinary speed. parts of our business that were not fully focused on clients. Looking back on the global financial crisis, we have reaffirmed We were quick to review, reduce, and exit non-client busi- our resolve to reduce highly leveraged, non-client related busi- nesses and illiquid positions such as commercial mortgages. nesses and focus on delivering Nomura’s services to our As a result, we have emerged from the financial crisis with clients. We believe that our ability to service individual one of the cleanest balance sheets among global players. investors and the overall economy will become our competi- To pave the way for future growth, we acquired and tive edge, and to achieve our goals we must build a truly integrated the operations of Lehman Brothers in Asia- client-focused business. Pacific, Europe, and the Middle East. The one-off expenses from these acquisitions are similar to capital investments for a manufacturing company. Our investments allowed us Looking Ahead to transform Nomura quickly, significantly enhancing our Strategic Initiatives for FY2009 human capital, client base and business infrastructure To deliver solid profits throughout fiscal year 2009, we while also expanding the reach of our worldwide franchise. will leverage our significantly enhanced business platform to At the same time, we reinforced our capital structure by deliver solutions to our global client base. At the same time, raising ¥1.3 trillion in combined debt and equity capital to we will also take decisive steps to cut costs, rightsize, and ensure a robust financial underpinning for future growth streamline the firm in line with market conditions. and market changes. ■ Main Causes of Losses for FY 2008 (approx. figures) The important thing is that we stay client-focused. Thanks to our enhanced business platform, many new clients from around the world have approached Nomura. We need to listen Expenses Aimed at Future Growth closely to the needs of these clients and become their trusted Wholesale platform expansion One-off expenses related to the Lehman Brothers acquisitions partner. This will ultimately lead to further growth for ¥120 billion Nomura. Dealing with Legacy Assets Carry trades with less client order flow Monoline related losses/ Iceland related losses Real estate loans, other illiquid assets Private equity write-downs/ Real estate related losses Long-term asset losses/expenses Fortress impairment/ JAFCO impairment ¥150 billion ¥140 billion ¥125 billion Retail and Asset Management Business In spite of the difficult market environment, our Retail and Asset Management operations remained profitable on a pretax basis last year. The Retail division continued to grow, with a record 600,000 new customer accounts opened during the year. Market turmoil led to a reappraisal of the Japanese and Asian household savings market, particularly considering the traditionally low level of risk assets held by Japanese retail investors. Given our leading market share and proximity to these retail investors who have some of the world’s largest holdings, Nomura’s presence is set to continue growing. We Annual Report 2009 9 are also increasing collaboration between Retail and Asset Revenue Structure Management as well as other divisions to understand our cus- tomers’ needs better and deliver the true value of Nomura. These efforts will expand the stable revenue platform these businesses bring to the company. Wholesale Business The chart below illustrates our pyramid revenue structure. We are building a business portfolio in which more volatile businesses sit on top of a stable operating base. We will active- ly expand our market share in the stable business areas to bol- ster revenues while taking a calculated approach to the more volatile businesses. In doing so, we aim to increase overall rev- The sluggish financial and economic environment means enue levels while also maximizing profitability. we also need to be highly responsive to the changing needs of our corporate and institutional clients. Our new platform Shareholder Distributions allows us to expand decisively from our historic Japan focus to a market that includes all of Europe and Asia-Pacific, which is over four times larger. Through our platform and increased collaboration between Global Markets and Investment Banking, we aim to become a top-tier global player. In fiscal 2008, we focused on maintaining sufficient share- holders’ equity to allow us to move with speed to capture new business opportunities. Our dividend policy has been based on paying a target dividend with a minimum payout of 3 percent on a dividend-on-equity basis and an additional performance- linked payout when we achieve a level of profit that brings the total payout ratio to over 30 percent. ■Pyramid Revenue Structure and Business Division Targets Merchant Banking (Target pretax income: ¥35 billion) We use our own capital to revive investee companies over the long term. Our ongoing stringent screening process for possible new invest- ments and strong focus on boosting value of current investments allows us to maximize returns over the medium to long term. Investment Banking (Target pretax income: ¥70 billion) As Asia’s global investment bank, we are diversifying revenues by delivering multi-product solutions to meet the global business restructur- ing and financing needs of our expanding worldwide client base. Global Markets (Target pretax income: ¥200 billion) We are investing in flow businesses and client businesses while enhancing client solutions to become a top-class global liquidity provider. We are leveraging our expanded platform and strong sales capabilities to increase market share and become a global top-tier player. Asset Management (Target pretax income: ¥30 billion) We have adopted a multi-product, multi-channel strategy that is com- bined with close collaboration with the Nomura Securities channel. We are further enhancing our capabilities in Asia including Japan to become Asia's leading world-class asset management firm. Retail (Target pretax income: ¥165 billion) We are expanding our client coverage by structuring marketing channels to suit client needs, enhancing collaboration between face-to-face and other channels as well as in-house and other products. We aim to increase client assets and maintain the leading market share by delivering world-class services. Merchant Banking olatile V Investment Banking Global Markets Asset Management Stable Retail 10 Nomura Holdings, Inc. Our target minimum dividend for fiscal 2008 was ¥34 per share. This was divided into quarterly payments of ¥8.5 per share and paid each quarter from the first quarter to the third quarter. However, given the net loss booked for the full year we decided to forgo payment of the fourth installment. As a result, the annual dividend was ¥25.5 per share. For fiscal year 2009, we will no longer determine payouts on a dividend-on-equity basis. Instead, we have set a consoli- dated dividend payout ratio of 30 percent as a key indicator and will endeavor to deliver stable dividends to our sharehold- on our position as an independent investment bank. We ers. Dividend payments will also be revised from quarterly to believe this unique position will allow us to play a leading role semi-annual. in the capital markets as Asia’s global investment bank. We will continue to invest retained earnings into business areas with strong prospects for high growth and profitability, August 2009 as well as into further development and expansion of our infra- structure, in order to maximize value for our shareholders. Kenichi Watanabe President & Chief Executive Officer Maximizing Shareholder Value Given the drastic changes over the past year, we are working to maximize and protect shareholder value by ensur- ing we are prepared to deal with any risks that may occur in the future. Our medium-term target is to achieve ¥500 billion in pretax income and a return on equity of between 10 per- cent and 15 percent. We remain focused on achieving this goal. As it is said that the best defense is a good offense, we will continue to move with speed and create change at Nomura to become a world-class investment bank. Looking ahead, the financial services industry will contin- ue to reorganize itself over the next few years and the envi- ronment will remain in a constant state of change. This pres- ents Nomura with an unprecedented opportunity to capitalize Annual Report 2009 11 Interview with the COO With our enhanced business platform, we now have the capabilities to deliver world-class services to our clients globally. Our strategy is firmly centered on client-focused businesses. By further developing our unrivaled Japan retail business and global wholesale franchise, we will increase Nomura’s corporate value over the medium to long term. Q1 Looking back, how would you rate Nomura’s performance in FY 2008? If I were to compare our business to a house, we did three things: we cleaned the house, we reinforced the house’s structure, and we welcomed new family members into a cleaner and stronger organization. We remain concerned about the near-term business environment. But, we’re now ready to move to the next level. We’ve become leaner by putting the past behind us and created a platform to capi- talize on new business opportunities. If I were to compare our business to a house, we did three things: we cleaned the house, we reinforced the house’s structure, and we welcomed new family members into a cleaner and stronger organization. Last year represented our worst results ever. But despite the challenges, we made significant headway. We successfully completed a major capital raising and maintained a healthy financial structure. We stayed focused, cleaning up legacy assets and positioning the company for future growth. It was a particularly significant year for us in terms of business platform expansion and reinforcement. Over the past few years, we were aware that we needed to address our global strategy. We lagged behind our competitors. Our clients were going global but we had not. In mergers and acquisitions, for instance, even if we wanted to help Japanese companies grow internationally, our geographic scope and industry coverage were limited. In equities, we were behind the curve in European and Asian products. In fixed income, we were not as competitive in our ability to serve international clients. This led to an over-reliance on proprietary trading, which in turn led to the substantial losses. We addressed all of these issues over the past year by enhancing our global platform. In addi- tion, with our acquisition of an IT and operations center in India, we now have a high-speed trading engine and efficient business support platform. 12 Nomura Holdings, Inc. Takumi Shibata Deputy President & Chief Operating Officer Q2 What were the key success factors in acquiring parts of Lehman Brothers’ operations and strengthening your wholesale business platform? I’d say speed was the most decisive factor. Three Nomura executives including myself flew out from Japan on September 20 to Hong Kong and London. We negotiated from early in the morning to late at night. We agreed on most of the terms by September 23. From there, it only took 70 days from signing to the establishment of a new organizational structure. In Global Markets, the systems have been integrated and our new platform is operational. We are seeing significant results from the acquisitions. Our secondary market shares in Europe and Asia are increasing and we have won a number of high-profile investment banking mandates including being named financial advisor to San Miguel Brewery and Tsingtao Brewery on M&A transactions. We are steadily gaining traction in our drive to deliver world-class solutions to all our clients. We are steadily gaining traction in our drive to deliver world-class solutions to all our clients. Now that our global platform is established, we need to harness this momentum to drive future growth for the whole company. In Europe and Asia we are enhancing our service offering and increasing our presence to take Nomura to the next level. Even in the Americas, which was not a part of the acquisitions, we are building out our operations. In the institutional investor space, new client relationships and needs require us to continually innovate to stay ahead. Traditional institutional investors such as pension funds and mutual funds are taking on an increasingly prominent role in the wake of the global financial crisis. In the hedge fund industry, the turbulence in the markets has weeded out poor performers and made room for strong new players. High-speed trading systems are increasingly important for investors that use sophisticated finan- cial strategies. Passive managers, on the other hand, have a stronger need for best execution as they introduce new management techniques to maximize value from their passive strategies. There is also growing demand for global research. We’re looking to increase our market share by providing Annual Report 2009 13 We are leveraging our newly established global platform to address the changing needs of our clients. services that respond to these emerging trends. Given the stagnant economic environment, we expect to see an increase in demand for fundraising and business restructuring by corporate and financial institu- tion clients. With our extensive global network and dis- tribution capabilities, deep origination expertise, financing backed by risk-taking ability, and insight- ful solutions, Nomura has all the tools to provide solutions that truly add value for our clients. Q3 What challenges did you face in launching a global wholesale business? Some people have pointed to possible cultural differences between Lehman Brothers and Nomura, but we are working as one team, one firm. Everyone is focused on the same goal. After the signing of the acquisition in London, I spoke at a town hall meeting for our new colleagues and said that we welcomed them to Nomura as leaders, as thinkers, and as our partners. And I asked them to accept us as partners too. I received a standing ovation, and it was clear we saw each other as equal partners with mutual respect. Both companies share common traits of having a collegiate culture that is hard-working and results-oriented, with very diverse workforces in Europe and Asia. I think these factors were key in We are working together as one team, one firm. Everyone is focused on the same goal. ensuring that we could integrate the businesses smoothly. Now a number of our regional line heads are from the Lehman Brothers businesses. Our compensa- tion system is going through a transition as we work to tie compensation to medium and long-term incentives. Number of Employees by Region Europe/Middle East Asia (Excluding Japan) 4,300 2,000 2,500 1,200 9/2008 3/2009 9/2008 3/2009 Notes: Figures are approximate. Includes middle/back-office employees. Asia (Excluding Japan) does not include subsidiary in India. 14 Nomura Holdings, Inc. Q4 What is your strategy with regard to illiquid assets and businesses that require a long-term investment horizon? Many of our writedowns and losses in FY 2008 were related to illiquid assets such as pri- vate equity investments and real estate, as well as long-term investments including stakes in Fortress Investment Group and JAFCO. We have decided to curb new investments in assets that are illiquid or require a longer holding period. However, through proper risk controls and processes, we will continue to seek out opportunities to generate revenue. Q5 Given Retail’s role as an important contributor of stable earnings, what is the outlook for this division? At the end of March 2009, Retail client assets were ¥59.3 trillion, accounting for a significant share of the ¥166 trillion in risk assets held by individual investors in Japan. We are fully committed to enhancing our service offering by providing solutions that respond to the changing needs of this client base. To provide better service to our retail clients, we are improving the quality of our consulting skills, enhancing our lineup of products and services, and increasing convenience by adopting region-specific marketing strategies and taking a multi-channel approach to delivering services. We will continue to enhance our face-to-face services but also focus on developing services in other channels such as online and call centers to respond to the needs of investors currently building Retail Growth Strategy s e c i v r e s e s u o h - n I s e c i v r e s r e n t r a P Face-to-Face model HNW (¥80 trillion market) Affluent Affluentuene trillion market) (¥250 trillion market) (¥250 trillion mon mn Non-Face-to-Face model Asset builders AsA Asset builders sset builders (¥1,170 trillion (¥1,170 trillion market) (¥1,170 trillion market) Non face-to-face services Face-to-face services Note: Market size/segmentation figures from Nomura Research Institute. Values shown are total financial assets held by each category. Annual Report 2009 15 We will continue to enhance our face-to- face services for high net worth clients but also focus on developing services in other channels such as online and call centers to respond to the needs of investors currently building their asset base. their asset base. Japan’s brokerage and asset management sectors are now undergoing a realignment that is opening up opportunities for Nomura. We believe healthy competi- tion is all about raising the level of services we offer our clients. Q6 What initiatives are you undertaking to increase collaboration between the Retail and Asset Management business divisions? We’re stepping up our multi-product, multi-channel strategy in the Asset Management division and increasing collaboration with Retail to ensure a stable earnings base and a controlled cost structure. Our main priority is to understand our clients and their needs in a timely manner and provide products better matched to their individual requirements in order to further enhance our overall capabilities. With a solid client base in both our Retail and Asset Management divisions, Nomura is We aim to further improve our performance and be recognized as a world-class asset manager not only for Japanese and Asian products, but also global equities and bonds. well placed to turn this approach into a powerful com- petitive advantage. We are also leveraging our well- established infrastructure and enhanced capabilities to further improve performance in managing not only Japanese and Asian products but also global equities and bonds as we aim to be recognized as a world-class asset manager. Size of Assets Compared to GDP (2008) European investment managers European households*1*3 0.23 (744) European HNW*1 0.31 (1,060) 0.23 (775) 0.01 (39) 0.01 (40) European hedge funds Middle East HNW*1 0.01 (2)(((((((((((((((2222222222))))))))))))) Asian hedge funds 0.02 (15) Asian HNW*1 0.57 (570) Asian investment managers 0.19 (188)*2 3.32 （1,434） European SWFs Japanese households Middle East hedge funds African HNW*1 0.46 (100) 0.02 (6) 0.42 (124) Middle East SWFs*1 0.11 (105) Asian SWFs*1 (Unit: times) (Figures in parentheses show total asset value in trillions of yen) US hedge funds 0.03 (58) 0.76 (1,170) North American HNW*1 US investment managers Japanese investment managers 0.19 (82) 1.69 (3,700) 0.40 (870) US SWFs*1 0.001 (6.2) US households 0.97 (620) South American HNW*1 *1: 2007 data *2: As of Sept. 2008 *3: Savings only Source: Nomura, based on data from Cap Gemini, FRB, ICI, EFAMA, BoJ, Investment Trust Association, Japan. Note: HNW = High Net Worth. SWF = Sovereign Wealth Fund 16 Nomura Holdings, Inc. Q7 What direction will Nomura take with its client-focused, business-driven approach while driving internal momentum? The investment banking industry moved away from its clients over the past ten years. The indus- try needs to get back to basics and provide services focused on clients. Nomura will remain a client-focused company. We will channel our energies into our client busi- nesses, as not to do so would be detrimental to our franchise. In investment banking, our true worth as a company hinges on the value we can deliver to clients through innovative ideas that help them grow their businesses. Nomura is also a business-driven company, which means we generate rev- The way forward for Nomura is clear: To increase our corporate value, we must work with our clients, listen closely to their needs, and offer timely solutions that respond accurately to those needs. enues by adding value for our clients. To follow through on these commitments, we must first build momentum within the company. The way forward for Nomura is clear: To increase our corporate value, we must work with our clients, lis- ten closely to their needs, and offer timely solutions that respond accurately to those needs. Future Direction Client-focused Business-driven Internal momentum Annual Report 2009 17 Message from the CFO Masafumi Nakada Chief Financial Officer In the midst of last year’s financial upheaval, we strengthened our capital structure to establish Nomura as a world-class competitor. Our focus now is to maintain a robust financial position to maximize profitability and enable future growth. Robust Financial Position Strong Capital Base During the past year, we did more than just keep our In addition to dealing with the asset side of our balance head down to weather the financial storm. We saw the crisis sheet, we reorganized our capital structure to position the as an opportunity to position Nomura for future growth, so company for future growth. We raised approximately ¥1 tril- we enhanced our capabilities, financial position and capital lion in subordinated debt and ¥280 billion in common stock. structure. These moves created a platform for global competition while We started by disposing of legacy assets to clean up our also improving our balance between Tier 1 and Tier 2 capital. balance sheet. While we have always marked our assets to Shareholders’ equity at the end of March was ¥1.5 tril- market prices for transparency, the financial market turmoil lion, while our Basel II capital ratio was 18.9 percent, and made it difficult to see market prices for some assets. We our Tier 1 ratio was 11.7 percent. Nomura has built a robust made conservative reductions and writedowns on illiquid capital structure to support operations and strategic growth assets, and booked a significant loss in fiscal 2008. However, as a global financial services group. As part of our drive to the writedowns allowed us to create a leaner balance sheet, globalize, we also started reporting our Basel II capital ratio and we now have a relatively sound financial position com- from March 2009. pared to our peers. To ensure we had enough funding throughout the mar- 18 Nomura Holdings, Inc. ■ Capital Ratio based on Basel II Framework ■ Assets and Long-term Funding (As of March 31, 2009) Tier 1 Tier 2 Tier 3 Total Capital Risk-Weighted Assets Tier 1 Ratio Capital Ratio (billions of yen) 1,405 613 298 2,257 11,936 11.7% 18.9% 35.6 Total assets Long-term funding (trillions of yen) 25.2 24.8 6.6 6.3 6.2 3/2007 3/2008 3/2009 ket turmoil, we focused heavily on cash and maintained a Current cost-cutting initiatives include rightsizing the cautious approach to liquidity management. As of the end of businesses; streamlining corporate functions by offshoring March 2009, we had ¥2.4 trillion of liquidity on hand. certain information technology, finance, and administration New Risk Management Structure As we grow, disciplined risk management will remain a functions to our Powai operations in India; and increasing collaboration between business divisions to reduce overlap. priority. Over the past year, we significantly revamped our Future Outlook risk management structure. Top management now plays a Nomura’s medium-term target is to achieve ¥500 billion more hands-on role in risk management, and the firm as a in pretax income and a return on equity of 10 to 15 percent. whole is more proactive in managing risks. We have estab- To reach this target, we must increase collaboration between lished a Group Integrated Risk Management Committee and business divisions and focus intensely on client needs. appointed a Chief Risk Officer. This new structure allows for A robust financial position is also essential. By using our new quicker information gathering and sharing across all regions proactive risk management structure and gathering and ana- and markets, while also helping us manage risks proactively lyzing information in real time, we strive to maintain the over the medium to long term. We will continue to focus on optimal balance between assets and liabilities to make swift limiting potential risks and maintaining a disciplined forward-looking decisions. approach to risk management. Cost Cutting In order to maximize profitability, we are restructuring our cost base. We aim to cut 10 percent of our ¥1 trillion running costs to create a cost structure that will enable us to be prof- itable even in a tumultuous market environment. Revamping our cost structure will increase our efficiency and productivity. We need to reduce fixed costs and increase the proportion of variable costs across our cost base and specifically in compen- sation and benefits, which comprise about half our total costs. The key to our success lies in how quickly and rigorously the entire company can execute on these initiatives. Annual Report 2009 19 Major International Business Lines Sadeq Sayeed Senior Managing Director and Chief Executive Officer, EMEA Through the strong leadership and talented workforce of the combined businesses we continue to gain sustainable competitive advantage. Integration is complete and we are focused on building strong client relationships and delivering innovative products and services while managing risk. Global Markets >>>>page 26 Global Markets Rachid Bouzouba Head of Equities, EMEA Our equities business continues to gain market share, bridging Asian and Western markets with integrated, customer-focused services. A dedicated team, superior content capability and a world-class execution platform are enabling us to take our place among the top-ranked equity houses globally. Georges Assi Co-Head of Fixed Income, EMEA Kieran Higgins Co-Head of Fixed Income, EMEA We are creating a top-tier fixed income franchise with strength across flow and solutions asset classes and a firm focus on client delivery. We have industry-leading teams, supported by the best technology and risk management. We aim to be a Top 5 player in the markets we choose to target. Siggi Thorkelsson Head of Equities, Asia-Pacific Jai Rajpal Joint Head of Fixed Income, Non-Japan Asia Thomas Siegmund Joint Head of Fixed Income, Non-Japan Asia Investment Banking >>>>page 32 Investment Banking Christian Meissner Deputy Head of Investment Banking William Vereker Co-Head of Investment Banking, EMEA Glenn H. Schiffman Head of Investment Banking, Non-Japan Asia We continue to build our franchise steadily, with a growing number of deals from established and new client relationships. Our pipeline is strong and we are exploiting the cross-regional opportunities presented by our links with Asia. *EMEA : Europe, Middle East and Africa Count on Nomura in EMEA Count on Nomura 20 Nomura Holdings, Inc. Minoru Shinohara Senior Managing Director and Regional CEO, Asia By taking advantage of our enhanced capabilities, we can strategically capitalize on market opportunities, while staying focused on strengthening the partnerships we have forged with our clients. Shigesuke Kashiwagi Senior Managing Director and President of Nomura Holding America Inc. At Nomura Holding America Inc., we work closely with our global counterparts to add value to our clients. We view the recent market volatility as an opportunity to expand our product and service capability in the US and globally. >>>>page 26 Global Markets >>>>page 26 With our focus on market-leading products, state of the art execution & trading capabilities, excellence in research and an unwavering commitment to our clients, we are on our way towards achieving our goal of becoming the equity house of choice. Naoki Matsuba Senior Managing Director and Head of Global Equities In the US, we have hired teams of proven professionals that will enable us to add value to our clients. My relocation to New York City represents a commitment by Nomura to its franchise in the Americas. Our aim in Asia fixed income is to be the best in class provider of international product to our regional clients and of local market expertise and access to our international clients, while practicing the highest standards in risk management. >>>>page 32 In Asia investment banking we are focused on serving our priority clients with a solutions-based approach that puts our client in the center of everything we do, thereby achieving the status of a trusted advisor. Anthony Abenante Co-Chief Executive Officer, Instinet Inc. Fumiki Kondo Co-Chief Executive Officer, Instinet Inc. As a global agency broker, Instinet focuses solely on helping our institutional clients achieve best execution. In 2008, we saw our first ever billion share day in the US, firm-record market share levels and a steady stream of innovative new product rollouts worldwide. Asset Management >>>>page 40 Robert Levine Chief Executive Officer, Nomura Corporate Research and Asset Management NCRAM is a world-class asset manager focusing on high yield bonds, leveraged loans and emerging markets debt. We manage money for some of the largest and best known institutions in the world as well as for Japanese retail clients. in Asia-Pacific Count on Nomura in the Americas Annual Report 2009 21 Retail Count on Nomura “ Drawing on our strengths in a difficult environment Why have we been able to continue expanding in the current difficult environment? The answer lies in our unrivaled client platform and our long-standing consulta- ” Last year’s global financial crisis put the brakes on the shift from savings to investment in Japan. Risk assets held tive approach that sets us apart from the competition. Our clients have diversified their portfolios in line with by retail investors in Japan including domestic equities, the dramatic changes in the financial markets. They are bonds and investment trusts declined by roughly 30 per- now looking for more tailored products and services that cent to ¥166 trillion in fiscal 2008. Despite this significant offer higher levels of quality. They are also seeking even decline, Nomura’s retail client assets remained relatively more in-depth consulting services to help them make strong at ¥59.3 trillion. investment decisions. 171 Retail Branches (March 31, 2009) 22 Nomura Holdings, Inc. ¥59.3 Trillion Client Assets (March 31, 2009) We believe that these clients have chosen Nomura for several reasons. By understanding our clients, we can offer products closely matched to their needs. Additionally, our consulting services cover all aspects of personal finance. “ Offering more client-focused services ” Our face-to-face service at our branch offices is one of The growth we are seeing in our client platform, with our long-standing strengths. We continue to enhance our increases in both Retail client assets and client accounts, is consulting-based services and our organizational structure a testament to the trust our clients place in Nomura. to deliver services to a broader base of investors. For example, we have opened over 30 new branches since for Consulting 2006, bringing our nationwide network to 171 branches. our product and service offering we are evaluating the We have further revised our product and service offering integration of Joinvest Securities, our online broker, into and upgraded our employee training initiatives to ensure Nomura Securities. Through such initiatives we will contin- we understand and meet our clients’ needs. ue to strengthen and expand our retail operations in Japan At the same time, we are stepping up our efforts in to remain the most trusted partner for our clients. other channels to deliver the information that our clients need as quickly as possible. We are increasing services that enhance convenience. For example, we started an online securities-backed loan service in July 2008. To augment 4.5 Million Client Accounts (March 31, 2009) Annual Report 2009 23 My job puts me at the forefront of Nomura’s retail busi- ness in Japan. I work with both individual and corporate clients who demand sophisticated financial services, helping them solve any financial issues they face. This means I have to be very quick to adapt to their rapidly changing needs. I need to be able to provide advice on a full range of financial services including managing personal assets, tax strategies, real estate, IPOs, and corporate actions such as mergers and acquisitions. To do so, I need to draw on the full resources of Nomura. The acquisition of parts of Lehman Brothers’ operations has further extended those resources, allowing me to offer more value and bring world-class services to my clients. Count on Nomura Retail Client Assets and Client Accounts* Retail Client Assets (trillions of yen) Client Accounts (thousands) 85.2 80.5 61.2 3,678 3,678 3,678 3,953 3,953 3,953 3,780 3,780 3,780 72.2 4,165 4,165 4,165 4,467 4,467 4,467 4,494 4,494 4,494 67.2 59.3 3/2005 3/2006 3/2007 3/2008 3/2009 6/2009 *Accounts with a positive balance 24 Nomura Holdings, Inc. Mizuho Sugiura Okazaki Branch Office We’re bringing world-class services to Japanese investors. I’m always looking to raise the bar to be the best partner for my clients’ investment needs. I work with retail investors in Japan to provide To respond to the diverse needs of my clients, them with solutions on how to best manage I have to constantly broaden my knowledge of their personal assets. I first sit down with my financial products, inheritance planning, and tax clients to discuss where they are in life and issues. But knowledge alone is not enough. I where they are headed in terms of managing also work on improving my communication skills and growing their asset base. to build closer relationships with my clients and Naturally, our clients’ needs come first. It is better understand their needs. essential that we ascertain precisely what those The part of my job I love the most is being needs are and how we can provide the best solu- able to help my clients map out their life plan by tions from our broad product offering. providing advice on how to manage their assets. Atsushi Onuma Umeda Branch Office for Consulting Yuji Hibino Deputy Managing Director, Shibuya Branch Office In the branch office where I work in Tokyo, our clients include public interest corporations such as foundations and edu- cational institutes, listed companies, and individual retail investors. Each of these client groups has different requirements. For corporations and institutions we pro- vide financial products and services, advice on mergers and acquisitions and fundrais- ing, and support for their core operations. We advise retail investors on how to man- age their assets in line with prevailing mar- ket conditions and their plans for the future. We also leverage all of Nomura’s resources We’re intensely focused on creating value for our clients, remaining as their most trusted part- ner while staying one step ahead of the compe- tition. to provide advice on inheritance planning and business succession as well as to intro- duce our clients to trusted real estate bro- kers and certified tax accountants. In addition to working with my own client base, I am in charge of formulating marketing strategies for our branch, moti- vating team members, and ensuring Nomura’s high compliance standards are maintained. Tokyo is a competitive market and we are building the number one pres- ence in our area through an intense focus on creating value for our clients to contin- ue as their most trusted partner for finan- cial services. Annual Report 2009 25 4,467 4,494 4,165 3,953 3,780 3,678 Global Markets Count on Nomura “ Delivering sophisticated financial services to our clients The trading environment deteriorated significantly last year due to the global financial crisis. The subsequent dry- ” cial products and specialist financial services including best execution. Due to recent market conditions, our clients are now more focused on liquidity and transparency in their trans- actions. Responding to these trends requires sophisticated ing up of market liquidity impacted many financial institu- financial engineering skills and leading information tech- tions’ performance. At the same time our main clients, nology capabilities together with solid professional experi- such as traditional institutional investors, hedge funds, and ence and best execution capacity. These are all areas private equity funds, are demanding more advanced finan- where Nomura has a competitive advantage. For example, 13x Increase in Cash Equity Trades from Non-Japan Operations (September 2008 vs. June 2009) 26 Nomura Holdings, Inc. #1 London Stock Exchange Share (July 2009) we have significantly increased our market share on the Nomura to become a world-class player in both fixed Tokyo and London stock exchanges due to our leading income and equities. We have added a new international research capabilities and execution platform. client base to our already solid base of Japanese institu- “ Building a new franchise to become a global top-tier player Our acquisition of parts of Lehman Brothers’ operations in Asia-Pacific, Europe, and the Middle East enabled ” tional investors and have substantially enhanced our research and product origination capabilities. Our systems are integrated, providing an infrastructure enabling us to generate synergies across the business. In fixed income, we are rolling out our product lines globally and aiming to become a top-tier player in our tar- for Innovation get markets. Our focus is on liquid businesses such as create win-win solutions for our client franchise. interest rates, currency and flow credit trading. We also In asset finance areas such as real estate and acquisi- offer structured solutions in response to our clients’ tion financings, we continue to develop the business in increasingly complex needs. response to changing market conditions and client needs. In equities, we aim to become the world’s leading provider of liquidity. We offer our clients the best execution based on our cutting-edge technology and highly diverse sources of order flow. We are also enhancing our service offering to deliver products with unrivaled value-add and 5x Increase in Flow Rate & Credit Trades from Non-Japan Operations (January 2009 vs. June 2009) Annual Report 2009 27 As part of the government bond team, I trade Japanese government bonds, one of the biggest and most liquid fixed income markets in the world. Naoya Murata Executive Director, Fixed Income Department JGB Trading Count on Nomura FX Trades from Non-Japan Operations (Index) 14.5x 100 9/2008 1,449 6/2009 Flow Rate & Flow Credit Trades from Non-Japan Operations (Index) 5.0x 100 1/2009 502 6/2009 Note: Start date of indexing based on pre-integration or go-live period of each business line. 28 Nomura Holdings, Inc. My job mainly involves market-making clients on a global basis allowed us to Nomura is consistently positioned in the activities in the secondary market for increase our clients’ confidence in us even top ranks for JGB auction results. Japanese government bonds (JGBs). We throughout the unprecedented financial The key for us now is to continue encour- work with a broad base of institutional market turmoil in 2008. aging international investors to invest in investors, offering stable, competitive pric- Participating in JGB auctions is another JGBs on the back of expected issuance ing and supplying liquidity under all market important aspect of my job. With nearly increases. We will focus on driving rev- conditions to generate revenues for ¥800 trillion in long-term debt outstanding, enues by expanding our overseas business Nomura based on client order flow. This is the Japanese government needs to be able platform, enhancing the client experience, the core of our fixed income and yen busi- to issue bonds to manage debt and facili- and maximizing our strengths in yen-related nesses and is an essential part of Nomura’s tate economic growth. By participating in businesses. flow business. JGB auctions, we are supporting the coun- Our established framework for consis- try’s fundraising activities and playing a tently delivering stable liquidity to our part in setting appropriate interest rates. for Innovation We are building a truly global foreign exchange franchise, offering the most comprehensive range of client-focused capabilities through dedicated profes- sionals and market-leading technology. Nomura’s strategic objective in foreign liquidity to clients where and when they exchange (FX) is to be a leading dealer in need it. Our industry-leading FX structurers the wholesale global markets, offering our and research professionals provide bespoke clients 24-hour market-making services and solutions and analysis. In emerging markets operational support in FX cash and deriva- we offer the rates products that go hand-in- tive products. We recently opened a new FX hand with the currency needs of our clients. hub in Singapore to complement our exist- A market-leading firm requires market- ing centers in Tokyo and London. leading infrastructure to support a large We help clients navigate challenging and demanding client base. We invested heavily in technology, product control and operations to support not only the clients that we have now but those we will have in two years time. We launched an e-trading platform offering clients executable stream- ing prices and request-for-quote functional- ity in over 200 currency pairs. We plan to dominate electronic trading through our stability, speed, and innovation. We are committed to building deep, col- laborative relationships with our clients and placing them at the heart of our strategy. markets by offering innovative solutions and market intelligence across G10 and emerging market currencies, providing Richard Gladwin Global Co-Head of Foreign Exchange Annual Report 2009 29 Over the past year Nomura in Europe has every way. We now have the scale, scope and vision of becoming a world-class investment As head of the Global Markets Client Strategy Group for Europe, Middle East, and Africa (EMEA), I am responsible for centralizing the client planning process and guiding resource allocation decisions. Our goal is to achieve the best commercial outcome through efficient cross- divisional planning and action. Our group works together with all of Global Markets’ sales and product teams to identify client opportuni- ties, prioritize resource allocation, and establish robust client plans. We are committed to putting clients at the center of our business. More than ever, both our clients and the business are looking for the best results. This requires coordination from within and between our divisional teams. I believe effective client planning will play a key part in the future success of our division. Count on Nomura Cash Equity Trades from Non-Japan Operations (Index) 13.0x 100 9/2008 1,307 6/2009 London Stock Exchange Market Share (%) 8 6 4 2 0 9 10 11 12 1 2 3 2008 5 6 7 4 2009 30 Nomura Holdings, Inc. Note: Start date of indexing based on pre-integration or go-live period. transformed in talent to realize our bank. Jennifer Shields Head of Global Markets Client Strategy, EMEA Powai: Global Support Center Nomura Services India (Powai) supports Nomura’s offices around the world. Powai’s world-class capabilities in information technology, operations and trading support, financial processing and con- trol, risk management, and legal processing have played a key role in facilitating Nomura’s global oper- ations and are an integral part of Nomura’s global expansion plans. Powai’s 2,300 talented profession- als all have at least one graduate degree, while many also hold MBAs or PhDs or are qualified as certi- fied accountants or engineers. Powai delivers timely, proactive, and detailed analytics to support informed decision-making by Nomura’s businesses. Powai staff provide risk reporting for Global Fixed Income, quantitative analytics for Global Equities, and Investment Banking cov- erage for 30 industry and product groups across Asia and EMEA. Powai’s research team assists lead analysts globally and provides lead coverage for multiple EMEA equities. The Powai operation is a critical part of the platform to support the growth of Nomura’s global business. for Innovation Tim Wannenmacher Global Co-Head of Prime Services settlement, financial reporting, and other reporting. We are committed to continuous- services our clients require to successfully ly developing our technology and services navigate the capital markets worldwide. to be the prime services partner of choice in Our global futures and options platform the dynamic financial environment. offers clients access to all major markets for As Nomura is the preeminent Asia-based listed derivatives with advanced trading, investment bank with global expertise and Prime Services is a core component of allocation, and clearing. Tailored to quanti- unrivaled access to the Japanese market, Nomura’s global markets strategy as an tative funds, we offer an ultra-low latency we are uniquely positioned to service our essential partner to institutional asset man- execution platform fully integrated with clients worldwide. agers, hedge funds, and other market par- straight-through processing, financing, and ticipants through cross-asset financing, execution, and clearing. Our prime broker- age platform provides financing solutions for long and short positions, clearing and We are passionate about delivering firm-wide client partnerships. As a core component of Nomura’s global markets strategy, Prime Services enhances our global reach and client solutions. Annual Report 2009 31 Investment Banking Count on Nomura “ Building client trust by leveraging Nomura’s strengths high-profile cross-border deals over the past year included border transactions involving Japanese companies. Our a tender offer by Daiichi Sankyo for Ranbaxy Laboratories ” Given the increasing speed of global consolidation in many industries, the strategic use of mergers and acquisi- and TDK’s tender offer for EPCOS. We also realized synergies from our acquisition of parts tions continues to grow in importance. Despite the impact of Lehman Brothers’ operations in Asia-Pacific, Europe and of the global financial crisis, M&A transactions involving the Middle East. Some examples include advising on Japanese companies remained strong in calendar year Sinopec’s acquisition of Tanganyika Oil Company and Asahi 2008 with a total of 2,399 deals representing a total value Breweries’ acquisition of Tsingtao Brewery. On the corporate of ¥12.4 trillion, roughly unchanged from 2007. finance side, we acted as joint coordinator on a global offer- One long-term trend is the continuing rise in cross- ing by Mitsubishi UFJ Financial Group. As a result, Nomura 60% + Japanese Listed Companies Using Nomura as Underwriter 32 Nomura Holdings, Inc. 35.9% Equity Finance Share* (Japan, January-June 2009) maintained the top position in both the Japanese M&A finan- cial advisory league table and the Japanese equity and equity-related bookrunner league table for 2008. This continued support from our clients in spite of the harsh business environment is a testament to our strength “ Aiming to be a global leader in investment banking Investment banking business models can be divided into four groups based on geographic breadth and product ” as an independent investment bank with world-class range: regional leaders, boutiques, mega boutiques, and expertise, a global client base and network, and a long- global leaders. standing track record. Nomura has traditionally been considered a regional leader. In the past, our global expansion and international for Solutions offices were designed to support our Japan-related busi- Principal Business Model Choices nesses. However, with our newly acquired business opera- tions, we have quickly built a platform to deepen our global coverage. Our focus now is to recapture the mar- ket share previously held by the acquired franchise in Asia and Europe as soon as possible to become a true global leader in investment banking. e g n a R s t c u d o r P Regional Leaders Global Leaders Boutiques Mega Boutiques Geographic Spread Best M&A House in China Euromoney (April 2008-March 2009) *Source: Dealogic Annual Report 2009 33 Japanese companies are entering a period of change following the global financial crisis. Industries and corporate groups are realigning as firms strug- gle to survive in a shrinking domestic market. Cross-border mergers and acquisitions aimed at growth are increasing and capital-raising activities are on the rise. Japanese companies are moving faster than ever to emerge as winners in today’s globally competitive environment. Our role is to help our corporate clients capitalize on these trends by providing solutions tailored to their specific needs. Nomura works as underwriter for more than 60 percent of companies listed in Japan and we enjoy an unrivalled position as the only independent investment bank in Japan. Last year, our powerful presence in Japan was augmented by our newly extended international franchise. This significant advantage allows us to deliver better solutions to a broader base of corporate clients. In my position overseeing our domestic operations, I see our mission as meeting the diverse needs of our clients in the most optimal way to help stimulate the Japanese economy. Count on Nomura (January–June 2009) Equity Capital Markets Bookrunner League Table Rank Bookrunner Proceeds (US$m) Mkt. share No. of deals 1 2 3 4 5 5 Nomura 6,257 Daiwa Securities SMBC 2,847 Goldman Sachs 2,515 Nikko Citi JP Morgan Barclays 948 943 943 35.9％ 16.3% 14.4％ 5.4％ 5.4％ 5.4％ 11 4 1 2 1 1 (January–June 2009) M&A Financial Advisors League Table Mkt. Rank Advisor share Rank Value (US$m) No. of deals 1 2 3 Nomura Citi Goldman Sachs 10,557 9,251 6,492 4 Mizuho Financial Group 5,793 5 Deutsche Bank 4,697 23.6％ 20.7% 14.5％ 12.9％ 10.5％ 64 29 7 71 7 Source: Thomson Reuters for M&A, Dealogic for equity capital markets 34 Nomura Holdings, Inc. We’re providing tailored solutions to help stimulate the Japanese economy. Koji Nagai Deputy Head of Investment Banking, Executive Vice President, Nomura Securities Hiroyuki Suzuki Deputy Head of Investment Banking, Senior Corporate Managing Director, Nomura Securities We’re making full use of our newly extended business platform to deliver competitive services to our clients. Nomura’s acquisition of parts of Lehman As the world becomes further interlinked, the Brothers’ operations in Asia-Pacific, Europe, and Investment Banking division, and indeed the Middle East last year allowed us to step up Nomura as a whole, faces an exciting challenge our product platform to a world-class level and and unprecedented opportunity to use our new rapidly extend our distribution network. This business platform to deliver competitive services equates to higher quality services for our world- to our clients around the world. It’s now time for wide client base. The acquisitions also helped us to take up that challenge and provide a Nomura build on our already solid client base in diverse range of services on a global scale. Japan and establish a firm presence in the rest of Asia and Europe. for Solutions Christian Meissner Deputy Head of Investment Banking Against that backdrop, our clients trusted us with key assignments that demonstrated the strength of the new Nomura platform. We were involved in two Our clients trusted us with key assign- ments that demon- strated the strength of the new Nomura platform. Nomura acquired Lehman Brothers’ European landmark transactions by financial sponsors in and Asian investment banking operations in Europe and Asia, as joint financial advisor and lead September 2008. The integration into Nomura’s arranger of the acquisition financing for wider investment banking business has been suc- Charterhouse in its acquisition of Wood Mackenzie cessfully concluded and our combined teams supple- in the UK and to KKR in its acquisition of Oriental mented by strategic hires complete the build-out of Brewery Company in Korea. We advised clients on a our operations in these markets. The combination number of other substantial M&A transactions has established Nomura as a global firm with world- including Sinopec’s acquisition of Tanganyika Oil class capabilities, able to serve our clients around Company and Kirin Holdings’ acquisition of San the world. Miguel’s brewery business in the Philippines. We operated in an extraordinarily difficult market We have also been active in a large number of environment, characterized by low volumes and volatile financing transactions for diverse clients such as secondary markets. M&A volumes globally fell 31 per- Beijing Enterprises, SK Telecom, First Quantum and cent from fiscal 2007 to fiscal 2008, as clients adjusted Givaudan, and have provided risk mitigation solu- to a recessionary economic environment coupled with tions to clients via our corporate fixed income and limited access to capital markets. equity derivative businesses. Annual Report 2009 35 Merchant Banking Count on Nomura “ more cautious approach to new investments and wrote down existing ones. As principal investors, we provide expertise, commitment and hands-on involvement to boost corporate value Despite the difficult environment, private equity funds In recent years, private equity funds have served an important role by providing financial support to companies trying to build their operations. However, last year’s finan- cial market turmoil and credit crunch have forced many pri- vate equity funds to modify their strategies. At Nomura, our portfolio size as of March 2009 had declined by 4 per- cent from the prior year to ¥366.3 billion as we took a ” continue to play an important role in the economy. Indeed, the environment is now forcing many companies to focus on their core businesses to maintain their competitive advantage and drive future growth. Our clients are increas- ingly looking for new financial solutions, such as restruc- turing their business portfolios or even delisting their shares through management buyouts. We take a comprehensive approach that goes far ¥366.3 Billion in Investments (March 31, 2009) 36 Nomura Holdings, Inc. 25% Internal Rate of Return (IRR)* (March 31, 2009) beyond simply lending funds to investee companies. We to the local community. make a commitment to partner with our clients and collab- These strengths have helped us build a solid track orate with them to boost the value of the company. We record in a diverse range of industry sectors and become a can provide talent for hands-on management, an extensive trusted partner to a broad base of clients. Some of our network, and industry-leading expertise in addition to sup- recent major investments in Japan include Skylark, a group plying the necessary capital. of restaurant chains, and Ashikaga Holdings, a regional In short, our main strength lies in being able to mobi- financial services provider. We remain focused on deliver- lize Nomura’s full resources at all stages in the business ing a high degree of expertise to our clients to provide restructuring process. Our long-term approach also takes solutions to the issues they face. into account the needs of all stakeholders from employees for Value “ Building an efficient operating structure to navigate a difficult environment ” We expect the business environment to remain difficult for the time being. However, we will continue to focus on projects in which we can be actively engaged in increasing the corporate value of investee companies. We will also continue to direct our efforts into building an operating platform that can withstand changes in the business envi- ronment and generate strong revenues. In our search for new investment opportunities, we will continue to utilize Nomura’s entire network with an even more rigorous focus on profitability when considering new investments. For existing investments, we will leverage all of Nomura’s available resources to increase the value of our investee com- panies and consider the best means to recoup our invest- ments. We are also reviewing our organizational structure to ensure our operations run as efficiently as possible. 18 Investee Companies to Date* *Nomura Principal Finance Annual Report 2009 37 We put risk capital to use to solve our clients’ management issues. Shuntaro Moritani Executive Officer, Nomura Principal Finance Count on Nomura Nomura Principal Finance Equity lnvestments (Cumulative) (billions of yen) 278 227 189 119 77 0 2000 12 2 2001 2002 21 2003 2004 2005 2006 2007 2008 (Calendar Years) Nomura Principal Finance Nomura Principal Finance (NPF) is Nomura’s main private equity investment business in Japan. Since it was established in July 2000, NPF has invested private capital into client firms to provide solutions to capital structure issues. Leveraging Nomura’s overall network, NPF has invested in 18 companies in the past nine years, for a total equity investment of approximately ¥280 billion. After investing in a company, NPF focuses on raising the value of the investee company and has recouped a total of 12 investments to date. 38 Nomura Holdings, Inc. My department is responsible for finding By providing risk capital financing out- That said, companies can only take on promising companies to invest in, originat- side traditional capital markets, we give so much financial risk. With the environ- ing investment schemes, and executing managers the support they need to enter ment becoming increasingly uncertain and investments. We use our own risk capital new businesses or restructure existing business risk volatility increasing, we are to provide solutions for the issues that businesses to improve the corporate value taking a cautious approach to developing companies face such as group company of their companies. new investment opportunities. reorganizations, business succession, joint The business environment has been investment, and turnaround sponsorship. transformed following last year’s financial The key to a successful investment is to crisis. As such, we are seeing many promis- partner with the management of the com- ing investment opportunities due to the pany to formulate the management policy changes occurring as companies shift strate- and draw up a business plan. gic direction and industries realign through high-profile mergers and acquisitions. for Value We are quick to put the right measures in place to respond to the changing business environment and competitive landscape. My department is responsible for increas- move quickly to implement measures to pursue capital alliances to boost their posi- ing the value of the companies we have respond to the changing business environ- tion within their respective industries. invested in, monitoring their operations, ment and competitive landscape. This approach has proven successful. and exiting from our investments. We have In gathering information and seeking out Since Nomura Principal Finance was estab- a team of about 20 professionals with back- new business partners, we make full use of lished we have achieved an internal rate of grounds in research, mergers and acquisi- Nomura’s extensive network and manage- return above the industry standard of 20 tions, and IPOs, as well as a number of ment resources to differentiate ourselves percent across our portfolio. chartered accountants. Our team also pro- from independent private equity houses. vides on-site management support for some We also turn to Nomura’s strengths when of our investee companies. it comes to exiting our investments. We pre- When we first invest in a company, we pare our investee companies to list and also open an in-depth dialogue with the man- agement to formulate a business plan. We then monitor the progress of the plan and Shoji Fukui Executive Officer, Nomura Principal Finance Annual Report 2009 39 Asset Management Count on Nomura “ Building client trust through a visible presence in tough times The recent financial market turmoil caused a flight to quality by investors, depressing global equity markets. As a ” In the medium to long term, however, we expect the investment trust market to continue growing. There will be significant asset management needs from baby boomers entering retirement as well as increased demand from younger investors looking to build asset bases for the future. result, assets under management in Japanese investment Our clients continue to trust us because of our outstanding trusts dropped 26.2 percent to ¥51.5 trillion in fiscal 2008. track record, which is backed by our leading market share in Due to the downturn, Nomura’s assets under management Japan, comprehensive capabilities, solid operations, and also declined 21.7 percent to ¥20.2 trillion. timely development of products that meet their needs. ¥20.2 Trillion Assets under Management (March 31, 2009) 40 Nomura Holdings, Inc. 22.0% Share of Japanese Public Investment Trust Market (March 31, 2009) Celebrating our 50th year in asset management this year, Nomura has always been at the forefront of the indus- try in Japan. At this important milestone in our history, we reaffirm our commitment to being at the frontier of the asset management business. Our heritage positions us as a “ Driving growth through client focus ” In the investment trust business, we take a multipro- duct, multichannel approach to offer products and services leading force in these difficult times, which in turn will let tailored to our clients’ requirements. We have an extensive us win the further trust of our clients. product offering and continue to innovate to meet clients’ changing needs. We offer a broad spectrum of support to our distribution channels, which include Nomura Securities for Expertise and other brokerage houses, commercial banks, Japan Post talizing on this trend to increase our investment advisory Bank, and post offices throughout Japan. To improve our assets by leveraging our expertise in Japanese and Asian products and services we are creating more opportunities equities as well as Japanese and foreign bonds. We are for direct client contact through seminars and informative also developing new products, such as equity funds that sessions. are based on the RAFI® (Research Affiliates Fundamentals In the investment advisory business, institutional Index) strategy and sharia-compliant equities and bonds in investors were hit hard by the market turmoil in the past the Islamic finance space. These developments represent year. They are reviewing their portfolio allocations and our constant commitment to pursue new fields and new reconsidering their choices of asset managers. We are capi- methodologies to deliver the latest products to our clients. 9,533 # of Seminars and Forums Held (FY 2008) Annual Report 2009 41 Rejina Rahim Managing Director, Nomura Asset Management Malaysia Nomura has the best of both worlds: a Japanese legacy coupled with an international network operating in a globalized world with a strong com- mitment to Asia. Count on Nomura Global Expansion Agreed to invest in LIC Mutual Fund, a subsidiary of India’s largest insurer Life Insurance Corporation of India, and to form a joint venture. life Major Awards Received Asian Investor Investment Performance Awards 2009 “Asset Manager of the Year (ETFs Japan)” “Best in Hong Kong Equities” “Japan Onshore Fund House of the Year” Global Pensions Awards 2009 “Specialist equities manager of the year” European Pensions Awards 2009 “Emerging Markets Manager of the Year” 42 Nomura Holdings, Inc. Since Nomura Asset Management diversity while meeting our objective of Malaysia was set up at the end of 2006, being a client-focused fund management the Malaysian office has grown rapidly and house. is now the largest foreign fund manage- Nomura has the best of both worlds: a ment company in Malaysia. The reason: Japanese legacy coupled with an interna- 23.1 We have been managing money on behalf tional network operating in a globalized of our clients in Malaysia since the 1990s world with a strong commitment to Asia. 17.9 and Nomura Asset Management’s name is Nomura respects and values diversity synonymous with trust, consistent perform- and the Malaysian office is a clear testa- ance and exceptional client service. We are ment to this. I am proud to be a part of the now actively moving into the Islamic fund global family that is Nomura. Asset Management Division Total Assets under Management (trillions of yen) 27.0 25.8 22.2 20.2 management space where we have posi- tioned Malaysia as our global Islamic hub. Islamic fund management is consistent with Nomura’s values of transparency and 3/2005 3/2006 3/2007 3/2008 3/2009 6/2009 for Expertise The Nomura US High Yield Bond Multi-Currency Fund is one of our most important funds. is to achieve strong total returns while maintaining a high level of current income. We invest in a diversified portfolio of US dollar denominated bonds rated I joined Nomura Corporate Research and ly followed this philosophy at NCRAM since single-B and higher, issued principally by Asset Management (NCRAM) in 1999 as a the company’s founding, growing assets US companies. We invest according to our high yield analyst, eventually being promot- and maintaining an excellent track record. “Strong Horse” philosophy and choose ed to assistant portfolio manager and then I currently manage the High Yield Bond companies based on bottom-up credit to portfolio manager. NCRAM is a US-based Open Fund and our newest fund: the Nomura research while applying our top-down investment manager specializing in high US High Yield Bond Multi-Currency Fund, one industry and macro views. yield, leveraged loan, and emerging market of the most important funds for NCRAM that investments for leading US corporate pen- was the top-selling fund launched outside sion funds. the US in January-March 2009. NCRAM’s strategy is to invest according The fund’s primary investment objective to our “Strong Horse” philosophy, meaning we invest in strong companies able to carry a large amount of debt. We have successful- Amy Yu Executive Director, Portfolio Manager, Nomura Corporate Research and Asset Management Annual Report 2009 43 Global Research Nomura has emphasized research since it was established in 1925. Our founder, Tokushichi Nomura II, realized the importance of a scientific approach to securities analysis early on. The database of research and analytical expertise we have built since then is now one of our core strengths. Nomura’s global research network collaborates closely across regions to track economic changes and market developments, forecast future scenarios, and communicate topical informa- tion to investors via research reports and seminars. We focus solely on providing information that helps our clients generate strong investment performance. This approach has proven to be successful, and Nomura’s research remains a vital part of our clients’ investment activities. With the acquisition of parts of Lehman Brothers’ operations in Asia-Pacific, Europe, and the Middle East in September 2008, we enhanced our global research footprint dramatically. We are now more closely connected than ever, and deliver collaborative research coverage around the world. We continue to enhance our global research capabilities to respond to our clients’ needs and provide research that backs up Nomura’s commitment to being client-focused. Count on Nomura Equity Research Nomura has the deepest pool of equity analysts in Japan. We provide insights for investment ideas based on extremely rigorous analysis, and our research is highly regarded by investment managers around the world. We significantly enhanced our capabilities in September 2008. In the following six months, we increased our research coverage by nearly 50 percent – from 1,000 compa- nies to 1,500. We are now better equipped than ever to provide world-class research to our global client base. Equity Strategy The research team has strategists located in Tokyo, London, New York, Hong Kong, and Mumbai. Our flagship report, Global Weekly Strategy, provides a wealth of infor- mation on the latest topics from the world’s equity markets. We make asset allocation recommendations based on stock indices and corporate earnings forecasts. Our recommenda- tions for individual equities and asset class choices also reflect the results of quantitative model-based analysis. Ian Scott Equity Strategist 44 Nomura Holdings, Inc. Research Coverage Europe (Companies Covered) Asia (Excluding Japan) (Companies Covered) 394 130 543 296 Japan (Companies Covered) 603 581 9/2008 3/2009 9/2008 3/2009 9/2008 3/2009 GDP Forecasts Foreign Exchange Forecasts GDP/Foreign Exchange Forecasts for Insight Global Macroeconomics We have a total of 30 economists based in Tokyo, Hong Kong, London, Mumbai, Singapore, Sydney, and New York. We provide com- prehensive analysis of economic trends in major markets around the world and formulate Nomura’s macroeconomic forecasts. Our main report is the Global Weekly Economic Monitor, which provides topical analysis and updates on the latest economic indicators. Paul Sheard Global Chief Economist Global Foreign Exchange Our foreign exchange team provides research on 32 currencies. The team’s Global FX Weeklyreport offers trading ideas based on quantitative analysis of economic fundamentals that affect exchange rates and models that incorporate business confidence indicators. Each week the report pro- vides an updated global foreign exchange outlook taking into account daily exchange rate movements. Simon Flint Asia-Pacific Global FX Research Annual Report 2009 45 Corporate Governance and Internal Control System Overall Approach Nomura Holdings aims for transparency in all its operations and strives to ensure the quick, responsive management of Nomura Group as a whole. While working to enhance the cor- porate value of the Group in the medium to long term, we place the highest importance on strengthening and further developing our corporate governance initiatives. We continually work to improve our governance to ensure management transparency. When we became a holding company in October 2001, we appointed outside directors to our Board of Directors in order to strengthen management oversight functions. Nomura Holdings also formed an Internal Controls Committee in which an outside director also participates, created a Compensation Committee with a majority of outside directors, and formed an Advisory Board composed of independent experts. When Nomura listed on the New York Stock Exchange in tion, audit, and compensation committees that consist of a majority of outside directors. This substantially enhanced man- agement oversight and increased transparency. Along with this, greater authority was delegated to executive officers allowing for quicker, more responsive management of our operations on a consolidated basis. In 2004, we drew up the Code of Ethics of Nomura Group, which outlines issues related to corporate governance and cor- porate responsibility that all Nomura people should comply with in order to fulfill their responsibilities to Nomura Holdings shareholders and other stakeholders. Corporate Governance at Nomura Holdings Business Execution, Audit/Oversight, Nomination, and Compensation Processes December 2001, we further expanded our information disclo- As Nomura Holdings has adopted a committee system for sure to increase management transparency. In June 2003, we corporate governance, the Board of Directors has delegated adopted a corporate governance model based on committees substantial authority to executive officers to allow them to carry and separated management oversight functions from the day- out business operations in a flexible manner. to-day execution of business activities. We also formed nomina- We are strengthening and expanding our internal control Management Structure Management Structure Shareholders’ Meeting Shareholders’ Meeting Board of Directors Board of Directors (10*) (10*) Nomination Committee Nomination Committee (2*) (2*) Audit Committee Audit Committee (24*) (24*) Compensation Committee Compensation Committee (6*) (6*) Office of Audit Committee *N *Number of meetings held in fiscal 2008 President & CEO President & CEO Executive Management Board Executive Management Board Advisory Board Group Integrated Group Integrated Risk Management Committee Risk Management Committee Global Risk Management Committee Global Risk Management Committee Internal Controls Committee Internal Controls Committee Advises the Executive Management Board Members are prominent businesspeople 46 Nomura Holdings, Inc. systems to ensure the proper conduct of corporate activities Executive Management Board, Group Integrated Risk group-wide. Our aim is to ensure management transparency Management Committee, and Internal Controls Committee. and efficiency, compliance with laws and regulations, disciplined risk management, reliable operating and financial reporting, as well as timely and appropriate disclosure. ● Three Committees Executive Management Board Chaired by the CEO, the Executive Management Board includes the COO, business division CEOs, and other person(s) designated by the CEO. The Executive Management Board is Management oversight is conducted by the Board of responsible for deliberating and making decisions related to Directors and the Nomination Committee, Audit Committee, important management issues for Nomura Group, such as and Compensation Committee have been given the authority to strategy, business plans, and budgets as well as the allocation make decisions on issues including candidates for the Board of of resources. Directors, auditing of the duties carried out by directors and executive officers, and compensation for directors and executive officers, respectively. ○ Nomination Committee Group Integrated Risk Management Committee The Group Integrated Risk Management Committee is chaired by the CEO and includes the COO, business division CEOs, and other person(s) designated by the CEO. Under the The Nomination Committee is composed of a majority of delegation of the Executive Management Board, the Group outside directors and is responsible for decisions regarding Integrated Risk Management Committee is responsible for proposals made to the annual meeting of shareholders deliberating and deciding on important risk management issues concerning the appointment and dismissal of directors. No for Nomura Group, such as the Group’s response to directors who serve concurrently as representative executive requirements under Basel II. A Global Risk Management officers, including the CEO, or executive officers are members of Committee has been established under the Group Integrated the Nomination Committee. ○ Audit Committee The Audit Committee is responsible for auditing the duties Risk Management Committee to make assessments and decisions regarding individual positions and important risk management issues. carried out by directors and executive officers. The Audit Internal Controls Committee Committee also prepares audit reports and makes decisions The Internal Controls Committee is chaired by the CEO and regarding proposals to be submitted to the annual meeting of is comprised of persons designated by the CEO, Audit shareholders concerning the appointment and dismissal of Committee members designated by the Audit Committee, and independent auditors. All members of the Audit Committee are Directors (Audit Mission Directors) designated by the Board of outside directors, and meet the requirements of independent Directors. The Internal Controls Committee is responsible for directors under the Sarbanes-Oxley Act. establishing and evaluating the internal controls of Nomura ○ Compensation Committee The Compensation Committee is also composed of a Group’s operations as well as for deliberating and making decisions to promote proper corporate behavior. majority of outside directors. This committee determines policy In order to further enhance our business execution for decision making regarding compensation and related matters structure in response to the increasing need for sophisticated for directors and executive officers, and decides specific expertise in the financial services industry, we have appointed compensation and related matters for individual directors and senior managing directors who are responsible for business executive officers. No directors who serve concurrently as representative executive officers, including the CEO, or executive officers are members of the Compensation Committee. and operations in their respective areas under the partial delegation of authority by executive managing directors. Business Execution To ensure that executive officers make business decisions smoothly and in an appropriate manner, we have set up an Internal Controls Nomura Holdings has implemented a range of measures to ensure that decision making related to the conduct of operations by executive officers is carried out smoothly and appropriately. Annual Report 2009 47 Fair Disclosure To ensure investors have fair access to information posed of a base salary, cash bonus, and stock bonus. More details on the calculation of compensation for directors and regarding Nomura Group, we have drawn up Nomura Group’s executive officers can be found online at: www.nomura.com (1) Base Salary Base salary is the sum of amounts based on each individual’s career, posts held to date, and responsibilities, as well as the degree of attainment of the company’s target consolidated return on equity. (2) Cash Bonus The cash bonus is based on quantitative factors such as consoli- dated net income, return on equity, and business division perform- ance. This bonus is also based on qualitative items, such as the degree of attainment of management targets and personal targets, assessments of the individual’s personal contributions, and other factors. The aggregate cash bonuses of directors and executive offi- cers may not exceed 1 percent of consolidated net income. (3) Stock Bonus The stock bonus is determined separately for each individual by taking into consideration all applicable factors. These include consol- idated net income and return on equity, the level of this compensa- tion relative to the base salary and cash bonus, and the costs and benefits of providing such compensation. Compensation for Directors and Executive Officers (For Fiscal 2008) Position Directors (Outside directors) Executive Officers Total Number1 Compensation 11 (6) 20 31 ¥424 million (¥139 million) ¥829 million ¥1,253 million 2,3 1. Compensation of the persons holding offices of director and execu- tive officer concurrently is included in the compensation figure for executive officers. 2. The figure of ¥1,253 million includes ¥459 million in compensation paid in the form of stock options (stock-related compensation). (A total of 31 persons received compensation in the form of stock options.) 3. The figure of ¥1,253 million includes ¥1 million in compensation paid in a nonmonetary form. Statement of Global Corporate Policy Regarding Public Disclosure of Information. A Disclosure Committee was set up in line with this policy to deliberate and make decisions regarding the appropriate disclosure of material information related to Nomura Group, the preparation of legally mandated disclosure documents, and important items related to the disclosure of corporate information. Crisis Management To minimize the impact of natural disasters, fires, and other crises, both in Japan and overseas, and to ensure operations return to normal as quickly as possible following such incidents, Nomura Group has drawn up the Nomura Group Crisis Management Policy. In addition, the Nomura Group Crisis Management Committee is responsible for Group-wide crisis management plans and action programs. Information Security Nomura Group has established an information security policy outlining the handling of client information to ensure that such information is strictly protected and managed. Nomura Securities has also prepared internal regulations that include regulations regarding insider trading to strictly manage information related to corporate clients. Compliance Nomura Group works to prevent behavior that may give rise to the suspicion of violations of legal regulations. The following measures have been taken to ensure that all related information is promptly communicated to management without exception should such behavior be found to exist. ● Appointment of a group compliance officer ● Appointment of compliance officers ● Establishment of a compliance hotline ● Global approach to legal risk Compensation Compensation for directors and executive officers is adjust- ed in accordance with the attainment of management targets in order to increase management motivation and empower indi- viduals to realize their maximum potential. Share-based com- pensation has also been introduced to enhance long term incen- tives. Compensation for directors and executive officers is com- 48 Nomura Holdings, Inc. Risk Management We have implemented the following measures to ensure ● Established Group Integrated Risk Management Committee and the integrated control, monitoring, and reporting of risks Global Risk Management Committee to ensure integrated inherent in the activities of Nomura Group. approach to risk management ● Top management actively committed to risk management ● Risks managed by globally linked risk management departments ● Appointed a chief risk officer to strengthen proactive risk management structure and risk management at the operating level Risk Management Initiatives Risk management is a key factor in determining the success of our business, so we continually build on our demonstrated commitment to this critical function. We take an integrated, fact-based approach to risk management that employs traditional quantitative techniques while also dealing with reputational, legal and other risks that are difficult to quantify. We also maintain a unified risk management function, share information continuously throughout our global organization, and employ standardized methodologies wherever possible. As Nomura expands in Asia-Pacific and Europe, we must deal decisively with new and intensified risks. We are addressing them with a number of measures, such as managing each region’s risks directly in-market. In the diverse Asian region, we are making sure that Nomura complements these in-market resources by applying its global risk management standards in each market and country. One of my key responsibilities is to remind my colleagues that risks present opportunities, and rewards are a function of risks. We need to avoid the mentality in which risk management focuses exclusively on limiting the downside. We must also help our businesses take intelligent risks to generate top-line growth and earnings, and we intend to make sure that Nomura is well-positioned for future opportunities. For example, fragmentation in Asian equity markets presents the chance for Nomura to add value for customers by providing a single, integrat- ed platform. We are therefore embedding our risk management standards in the new product development process so that together with our clients we realize the benefits of our business development initiatives. David Benson Chief Risk Officer Annual Report 2009 49 Board of Directors / Executive and Senior Managing Directors From left:[Front row] Junichi Ujiie, Kenichi Watanabe, Takumi Shibata From left:[Back row] Masanori Itatani, Hideaki Kubori, Fumihide Nomura, Masaharu Shibata, Haruo Tsuji, Masahiro Sakane, Tsuguoki Fujinuma, Hajime Sawabe, Yoshifumi Kawabata Board of Directors Title Name Responsibilities and Status in Other Companies (As of June 25, 2009) Nomination Committee Audit Committee Compensation Committee Audit Mission Director Chairman of the Board of Directors Junichi Ujiie Director Director Kenichi Watanabe Takumi Shibata Director Masaharu Shibata Director Hideaki Kubori Director Director Masahiro Sakane Haruo Tsuji Director Tsuguoki Fujinuma Director Hajime Sawabe Director Director Director Masanori Itatani Yoshifumi Kawabata Fumihide Nomura President & Chief Executive Officer Deputy President & Chief Operating Officer Chairman of NGK Insulators, Ltd. Chairman of NGK Technica, Ltd. Statutory Auditor of Chubu-Nippon Broadcasting Co., Ltd. Chairman of Hibiya Park Law Office Statutory Auditor of SOURCENEXT CORPORATION Chairman of the Board of Komatsu Ltd. External Corporate Director of Tokyo Electron Limited Corporate Advisor of Sharp Corporation Outside Director of Kobayashi Pharmaceutical Co., Ltd. Advisor of the Japanese Institute of Certified Public Accountants Director of Tokyo Stock Exchange Group, Inc. Governor of Tokyo Stock Exchange Regulation Statutory Auditor of Sumitomo Corporation Statutory Auditor of Takeda Pharmaceutical Co., Ltd. Outside Director of Sumitomo Life Insurance Company Chairman of TDK Corporation Outside Director of Asahi Glass Company, Limited Outside Director of TEIJIN LIMITED President of Nomura Shokusan Co., Ltd. ◎ ○ ○ ○ ◎ ○ ○ ○ ◎ ○ ○ ○ ○ Note:A double circle indicates the committee chair. 50 Nomura Holdings, Inc. Executive Managing Directors (As of June 25, 2009) Title President Name Responsibilities Kenichi Watanabe Chief Executive Officer Deputy President Takumi Shibata Chief Operating Officer Executive Managing Director Hitoshi Tada Retail CEO Executive Managing Director Hiromi Yamaji Investment Banking CEO Executive Managing Director Akira Maruyama Global Markets CEO Executive Managing Director Shoichi Nagamatsu Merchant Banking CEO Executive Managing Director Atsushi Yoshikawa Asset Management CEO Executive Managing Director Hiroshi Tanaka Group Compliance Head, CIO Executive Managing Director Masafumi Nakada Chief Financial Officer Executive Managing Director Noriaki Nagai Head of Corporate Office Senior Managing Directors (As of June 25, 2009) Title Name Responsibilities Senior Corporate Managing Director Hideyuki Takahashi Global Research Senior Corporate Managing Director Shinichiro Watanabe Group Corporate Communications Senior Corporate Managing Director Hiromasa Yamazaki Global Markets Deputy CEO Senior Managing Director Akihito Watanabe Global Human Resources Senior Managing Director David Farrant Global Human Resources Senior Managing Director Yoshihiro Fukuta Nomura Group Internal Audit Senior Managing Director Shigeki Fujitani Deputy CFO Senior Managing Director Naoki Matsuba Global Equities Senior Managing Director David Benson Chief Risk Officer Senior Managing Director Shigesuke Kashiwagi Regional CEO, Americas Senior Managing Director Sadeq Sayeed Regional CEO, Europe Senior Managing Director Kenji Kimura Regional COO, Europe Senior Managing Director Paul Spanswick Senior Managing Director Minoru Shinohara Regional CEO, Asia Senior Managing Director Yoshinori Go Wealth Management, Asia Annual Report 2009 51 Corporate Social Responsibility Our Commitment to the Environment Reducing Nomura’s Environmental Footprint At Nomura, we aim to lower our overall environmental impact and resolve environmental issues. We established an environmen- tal management system to drive comprehensive efforts in Japan, while our overseas offices are endeavoring to reduce their environ- mental footprint through local initiatives. In Japan, Nomura is expanding the electronic distribution of prospectuses and other documents to promote paperless opera- tions. As of the end of May 2009, some 490,000 customers, or approximately 10 percent of all accounts, had agreed to delivery of such documents by e-mail. Relationship with Society Expanding Financial and Economic Education Nomura Group is committed to helping communities and con- tributing to a better future by supporting the economy, the arts, and education through its operations. In times of intense economic and social change, we believe In addition, we are working to reduce paper usage within Nomura through the elimination and electronic conversion of busi- ness forms. In fiscal 2008, we used 867 metric tons of A4 size copy paper, down approximately 16 percent from fiscal 2006. As electrical power accounts for the majority of Nomura’s CO2 emissions, we have promoted reduced power con- sumption by switching to energy-saving equipment when conducting renova- tions. We began purchasing 5.9 million kWh in Green Power Certificates annual- ly in fiscal 2006 to reduce CO2 emissions even further. that financial and economic knowledge is important not simply for making profits, but for proper asset formation from a long-term perspective. Nomura Group was among the first to educate the younger generation in finance and the economy in order to nurture a sound financial market. Starting in 2001 with lectures for univer- sity students, we currently focus on educational and development activities for a wide range of age groups, from elementary and jun- ior high school students to adults. ■Educational Programs Offered Program “The Economics Classroom” “An Introduction to the Economy: The T-Shirt Shop” Special sponsorship of Nikkei Stock League Contest Finance courses for university students Finance seminars for lifelong learning (All figures approximate) Relationship with Employees Achievements Donated 170,000 textbooks to 2,000 elementary schools Donated 330,000 copies to 3,300 junior high schools Assessed the reports of 60,000 participants from 14,000 teams Attended by 150,000 students Participation of 200,000 adults world including Tokyo, this training deepens awareness of the impor- tance of building relationships with customers and fellow employees. Creating a Diverse and Inclusive Work Environment Nomura Group is committed to creating a working environment where all employees can realize their full potential. Collaboration among diverse teams of people is indispensable in responding to globalization and the increasingly varied needs of cus- tomers. As part of activities launched in fiscal 2008 to focus on diversity at offices around the world, we established Diversity & Inclusion Offices in Europe and Asia-Pacific. We aim to expand busi- ness opportunities by promoting a corporate culture of mutual respect among employees. Employee Development Framework We are committed to continuously upgrading our employee development programs so that employees with diverse careers and values may realize their full potential. With employment conditions and a reemployment system adaptable to a variety of work styles, we provide an environment where employees are able to demonstrate their skills and abilities and receive performance-based evaluations. Comprehensive educational and training programs support employees’ career development, and in fiscal 2008 we launched training in global business etiquette to promote understanding of dif- ferences in culture and background. Held at seven offices around the 52 Nomura Holdings, Inc. Addressing Environmental Issues through Investing Companies face increasing demands to address environmental problems. We consider it crucial to address these issues through our core business, such as funding technology ventures around the world that focus on new energies and clean technologies. In 2008, Nomura International (Hong Kong) Limited (NIHK) agreed with Moser Baer India Limited, a leading Indian electronic devices company, to invest in its subsidiary Moser Baer Solar Plc., a photovoltaic equipment manufacturer. This was NIHK’s second investment in an Indian enterprise and its first in an environment- related firm, demonstrating a commitment to the expansion of environmental business by encouraging the global spread of photo- voltaic technology and supporting promising manufacturers. Contributing to the Community At Nomura, we engage in cultural and educational, welfare, and volunteer initiatives, and contribute to local economic growth. Out of 171 branches throughout Japan, 115 reported on their com- munity activities. Wide-ranging activities matching each communi- ty’s special characteristics included youth education and environ- mental conservation initiatives. Our total of 215 community activi- ties in fiscal 2008 involved more than 8,050 participants. As an example of initiatives overseas, Nomura International plc began a partnership with Teenage Cancer Trust, an organiza- tion supporting teenagers and young adults with cancer and leukemia, as one link between employees and society. In addition, as support for the overall development of commu- nities, we have established partnerships with two schools in eco- Moreover, we work to ensure an inclusive work environment for employees by creating support systems for child care and nurs- ing in response to Japan’s Law for Measures to Support the Development of the Next Generation. Respect for Diversity and Human Rights Nomura Group recognizes that respecting the human rights of employees working in its offices around the world is its most basic nomically disadvantaged areas of London (Oaklands and Southwark Park) to provide assistance for students and instructors through a variety of activities. Nomura Group also funds the Josh Lewsey Rugby Academy, which teaches rugby to young people. responsibility. In order to prevent discrimination and harassment, we work to deepen human rights understanding on a global level centered on our Human Rights Education Committee and implement human rights awareness training for executives and employees on a regular basis. The training aims to ensure that all employees deepen their understanding of human rights issues and take a personal interest in these issues with a commitment to the fundamental principle of neither practicing, enduring nor tolerating discrimination. More than 14,000 people attended a total of 29 training sessions held during fiscal 2008. Annual Report 2009 53 Financial Highlights Net Revenue Income (Loss) before Income Taxes All business divisions posted a decline in net revenue due to the pretax basis, losses widened due to factors including one-off financial market turmoil. In particular, net revenues in Global losses in Global Markets and expenses related to the Lehman Markets and Merchant Banking were negative for the year. Brothers acquisitions. As a result, we booked a loss before Although Retail and Asset Management were profitable on a income taxes for the period under review. (millions of yen) 1,000,000 800,000 600,000 400,000 200,000 0 -200,000 (millions of yen) 400,000 Other Asset Management Merchant Banking 200,000 Investment Banking Global Markets Retail 0 -200,000 -400,000 -600,000 Other Asset Management Merchant Banking Investment Banking Global Markets Retail 3/2005 3/2006 3/2007 3/2008 3/2009 3/2005 3/2006 3/2007 3/2008 3/2009 Net Income (Loss) and ROE Shareholders’ Equity We booked a net loss of ¥708.2 billion due to one-off expenses public offering, shareholders’ equity declined by ¥448.7 billion to related to the expansion of our wholesale platform and write- ¥1.54 trillion at the end of March 2009 as a result of the net loss downs on illiquid assets and long-term investment assets. booked for the full year. Our Basel II capital ratio at the end of Although we enhanced our capital base by raising capital in a March was 18.9 percent and our Tier 1 ratio was 11.7 percent. (millions of yen) 400,000 200,000 0 -200,000 -400,000 -600,000 (%) 16 12 8 4 0 (millions of yen) 2,500,000 2,000,000 1,500,000 Net Income (Loss) (Left axis) 1,000,000 ROE (Right axis) 500,000 0 3/2005 3/2006 3/2007 3/2008 3/2009 3/2005 3/2006 3/2007 3/2008 3/2009 54 Nomura Holdings, Inc. Total Assets Short-term and Long-term Unsecured Debt Total assets declined by ¥398.2 billion to ¥24.84 trillion as we wrote down assets to reflect market conditions and reduced illiquid assets in order to ensure a more robust balance sheet. Long-term unsecured debt increased ¥27.2 billion year on year to ¥4.65 trillion at the end of March 2009 as we shifted from short-term debt to long-term debt in order to enhance the com- pany’s financial stability. (millions of yen) 35,000,000 30,000,000 25,000,000 20,000,000 15,000,000 10,000,000 5,000,000 0 (millions of yen) 7,000,000 6,000,000 5,000,000 4,000,000 3,000,000 2,000,000 1,000,000 0 Long-term Unsecured Debt Short-term Unsecured Debt 3/2005 3/2006 3/2007 3/2008 3/2009 3/2005 3/2006 3/2007 3/2008 3/2009 Net Income (Loss) per Share and Total Assets per Share Dividends per Share Net income per share was – ¥364.7. Total assets per share declined by ¥451.6 to ¥591.0. A quarterly dividend of ¥8.5 per share was paid in the first three quarters of the fiscal year. Due to the full-year net loss, we decided to forgo paying a dividend in the fourth quarter. As a result, the full-year dividend declined by ¥8.5 from the prior year to ¥25.5 per share. (yen) 1,400 1,200 1,000 800 600 400 200 0 (yen) 200 0 -200 -400 (yen) 60.0 50.0 40.0 30.0 Total Assets per Share (Left axis) 20.0 Net Income (Loss) per Share (Right axis) 10.0 0.0 3/2005 3/2006 3/2007 3/2008 3/2009 3/2005 3/2006 3/2007 3/2008 3/2009 Annual Report 2009 55 Eight-Year Financial Summary (US GAAP) For the fiscal years beginning April 1 and ending March 31 of the following year Note: This financial summary is prepared solely for convenience. Readers are recommended to refer to the Form 20-F. Operating Results: Revenue: Commissions Fees from investment banking Asset management and portfolio service fees Net gain on trading Gain (loss) on private equity investments Interest and dividends Gain (loss) on investments in equity securities Gain from changes in equity of an affiliated company PFG entities product sales PFG entities rental income Gain on sales of PFG entities Private equity entities product sales Other Total revenue Interest expense Net revenue Non-interest expenses: Compensation and benefits Commissions and floor brokerage Information processing and communications Occupancy and related depreciation Business development expenses PFG entities cost of goods sold PFG entities expenses associated with rental income Private equity entities cost of goods sold Other Total non-interest expenses Income (loss) from continuing operations before income taxes and cumulative effect of accounting change Income from discontinued operations before income taxes and cumulative effect of accounting change Income tax expense Income (loss) from continuing operations before cumulative effect of accounting change Gain on discontinued operations Cumulative effect of accounting change Net income (loss) Balance Sheets (Period End): Cash and cash deposits Loans and receivables Collateralized agreements Trading assets and private equity investments Other assets Total assets Short-term borrowings Payables and deposits Collateralized financing Trading liabilities Other liabilities Long-term borrowings Total liabilities Total shareholders’ equity Total liabilities and shareholders’ equity Cash Flows: Net cash provided by (used in) operating activities from continuing operations Net cash provided by (used in) investing activities from continuing operations Net cash provided by (used in) financing activities from continuing operations Effect of initial adoption of SOP 07-1 on cash and cash equivalents Effect of exchange rate changes on cash and cash equivalents Discontinued operations, net Net increase (decrease) in cash and cash equivalents 3/2002 3/2003 3/2004 ¥ 140,001 75,255 109,985 162,228 232,472 500,541 (55,860) 3,504 294,931 177,053 116,324 — 68,965 1,825,399 504,048 1,321,351 379,540 20,962 87,252 73,787 26,652 200,871 111,529 — 247,786 1,148,379 172,972 — 4,926 168,046 — — ¥ 168,046 ¥ 775,734 1,046,014 6,680,001 7,841,533 1,414,991 ¥17,758,273 ¥ 629,279 1,251,592 9,087,597 2,693,746 518,156 1,972,974 16,153,344 1,604,929 ¥17,758,273 ¥ (1,170,028) (42,882) 1,052,851 — 13,018 — ¥ (147,041) ¥ 141,640 81,847 79,290 172,308 (14,391) 368,656 (41,288) — — — — 6,229 13,360 807,651 241,377 566,274 244,167 20,844 77,389 57,152 24,361 — — 4,968 89,984 518,865 47,409 — 37,295 10,114 — 109,799 ¥ 119,913 ¥ 955,509 1,137,265 8,603,170 9,286,507 1,186,995 ¥21,169,446 ¥ 343,837 821,659 11,791,833 3,888,720 411,699 2,269,370 19,527,118 1,642,328 ¥21,169,446 ¥ 133,892 120,851 (111,189) — (8,952) — ¥ 134,602 ¥ 210,216 86,994 66,193 229,042 13,138 343,260 55,888 — — — — 17,640 23,565 1,045,936 242,833 803,103 259,336 19,169 80,031 54,221 23,100 — — 11,852 72,718 520,427 282,676 — 110,347 172,329 — — ¥ 172,329 ¥ 930,637 1,013,636 12,881,752 13,838,396 1,088,545 ¥29,752,966 ¥ 437,124 1,384,096 17,367,758 5,976,966 415,865 2,385,469 27,967,278 1,785,688 ¥29,752,966 ¥ (57,125) 20,971 201,267 — (18,978) — ¥ 146,135 Note 1: Calculated using the yen-dollar exchange rate of US$1.00=¥99.15, the noon buying rate in New York City for cable transfers in foreign currencies as certified for customs purposes by the Federal Reserve Bank of New York on March 31, 2009. 2: Figures for the fiscal years ended March 31, 2006, 2007 and 2008 have been restated to reflect the retroactive application of Financial Accounting Standard Board’s Staff Position No. FIN 39-1, “Amendment of FASB Interpretation No. 39” (“FSP FIN 39-1”). 56 Nomura Holdings, Inc. 3/2005 3/2006 3/2007 3/2008 3/2009 3/2009 millions of yen millions of US dollars* ¥ 221,963 92,322 78,452 201,686 7,744 401,379 15,314 — — — — 75,061 32,316 1,126,237 327,047 799,190 274,988 23,910 81,408 53,534 28,214 — — 44,681 87,620 594,355 204,835 — 110,103 94,732 — — ¥ 94,732 ¥ 1,047,234 1,221,083 14,389,045 15,600,521 2,230,970 ¥34,488,853 ¥ 520,605 963,965 21,666,185 5,332,173 1,309,944 2,827,552 32,620,424 1,868,429 ¥34,488,853 ¥ 356,325 108,819 102,667 304,223 12,328 693,813 67,702 — — — — 88,210 58,753 1,792,840 647,190 1,145,650 325,431 32,931 89,600 55,049 32,790 — — 48,802 115,447 700,050 445,600 99,413 240,685 256,628 47,700 — ¥ 304,328 ¥ 1,555,636 1,099,568 17,027,807 13,630,199 1,381,470 ¥34,694,679 ¥ 691,759 1,172,489 20,263,012 6,263,514 641,980 3,598,599 32,698,595 2,063,327 ¥34,694,679 ¥ (360,780) (103,443) 448,531 — 13,697 (50,262) ¥ (52,257) ¥ (565,214) (4,678) 829,219 — 16,419 131,100 ¥ 406,846 ¥ 337,458 99,276 145,977 290,008 47,590 981,344 (20,103) — — — — 100,126 67,425 2,049,101 958,000 1,091,101 345,936 50,812 109,987 61,279 38,106 — — 57,184 106,039 769,343 321,758 — 145,930 175,828 — — ¥ 175,828 ¥ 1,054,012 1,406,216 17,838,227 13,094,552 2,184,504 ¥35,577,511 ¥ 1,093,529 1,262,187 20,599,256 4,588,208 845,522 5,002,890 33,475,260 2,185,919 ¥35,577,511 ¥ (1,627,156) (533,813) 1,568,703 — 10,333 — ¥ (581,933) ¥ 404,659 85,096 189,712 61,720 76,505 796,540 (48,695) — — — — — 28,185 1,593,722 806,465 787,257 366,805 90,192 135,004 64,841 38,135 — — — 156,868 851,845 (64,588) — 3,259 (67,847) — — ¥ (67,847) ¥ 1,434,067 1,187,600 10,391,367 10,278,188 1,944,832 ¥25,236,054 ¥ 1,426,266 950,381 10,540,731 4,469,942 636,184 5,224,426 23,247,930 1,988,124 ¥25,236,054 ¥ (647,906) (102,019) 942,879 (38,427) (57,319) — ¥ 97,208 ¥ 306,803 54,953 140,166 (128,339) (54,791) 331,356 (25,500) — — — — — 39,863 664,511 351,884 312,627 491,555 73,681 154,980 78,480 31,638 — — — 261,339 1,091,673 (779,046) — (70,854) (708,192) — — (708,192) ¥ millions of yen ¥ 1,422,709 1,643,007 8,412,618 11,672,612 1,686,902 ¥24,837,848 ¥ 1,183,374 1,242,318 10,157,954 4,752,054 479,724 5,483,028 23,298,452 1,539,396 ¥24,837,848 millions of yen ¥ (712,629) (98,905) 999,760 — (81,896) — ¥ 106,330 $ 3,094 554 1,414 (1,294) (553) 3,342 (257) — — — — — 402 6,702 3,549 3,153 4,958 743 1,563 792 319 — — — 2,635 11,010 (7,857) — (714) (7,143) — — $ (7,143) millions of US dollars* $ 14,349 16,571 84,847 117,727 17,014 $250,508 $ 11,935 12,530 102,450 47,928 4,839 55,300 234,982 15,526 $250,508 millions of US dollars* $ (7,187) (998) 10,083 — (826) — $ 1,072 Annual Report 2009 57 Major Subsidiaries and Affiliates (As of July 1, 2009) JAPAN NOMURA SECURITIES CO., LTD. NOMURA RESEARCH & ADVISORY CO., LTD. NOMURA ASSET MANAGEMENT CO., LTD. NOMURA BUSINESS SERVICES CO., LTD. THE NOMURA TRUST & BANKING CO., LTD. NOMURA FACILITIES, INC. NOMURA BABCOCK & BROWN CO., LTD. NOMURA CAPITAL INVESTMENT CO., LTD. NOMURA INVESTOR RELATIONS CO., LTD. NOMURA PRINCIPAL FINANCE CO., LTD. NOMURA INSTITUTE OF CAPITAL MARKETS RESEARCH JOINVEST SECURITIES CO., LTD. NOMURA HEALTHCARE CO., LTD. NOMURA FUNDS RESEARCH AND TECHNOLOGIES CO., LTD. NOMURA PENSION SUPPORT & SERVICE CO., LTD. PRIVATE EQUITY FUNDS RESEARCH AND INVESTMENTS CO., LTD. Europe & Middle East NOMURA EUROPE HOLDINGS PLC (London) NOMURA INTERNATIONAL PLC (London) ・Madrid Office・Vienna Representative Office ・Dubai Office・Qatar Office NOMURA CODE SECURITIES LTD. (London) NOMURA BANK INTERNATIONAL PLC (London) ・ Italy Office BANQUE NOMURA FRANCE (Paris) NOMURA BANK (LUXEMBOURG) S.A. NOMURA BANK (DEUTSCHLAND) GMBH (Frankfurt) MAINTRUST KAG (Frankfurt) NOMURA BANK (SWITZERLAND) LTD. (Zurich) ・ Geneva Office NOMURA ITALIA S.I.M.p.A. (Milan) NOMURA NEDERLAND N.V (Amsterdam) OOO NOMURA (Moscow) NOMURA SWEDEN AB (Umea) NOMURA INVESTMENT BANKING (MIDDLE EAST) B.S.C. (c) (Bahrain) NOMURA (CIS) LIMITED (London) ・Moscow Office NOMURA CORPORATE ADVISORY (CENTRAL EUROPE) PRIVATE COMPANY LTD. (Budapest) NOMURA CORPORATE ADVISORY (CENTRAL & EASTERN EUROPE) Sp.z.o.o. (Warsaw) NOMURA ISTANBUL CORPORATE ADVISORY SERVICES AS NOMURA FUNDING FACILITY CORPORATION LIMITED (Dublin) NOMURA GLOBAL FUNDING PLC (London) NOMURA EUROPE FINANCE N.V. (Amsterdam) NOMURA PRINCIPAL INVESTMENT PLC (London) NOMURA CAPITAL MARKETS PLC (London) Americas NOMURA HOLDING AMERICA INC. (New York) NOMURA SECURITIES INTERNATIONAL, INC. (New York) ・ San Francisco Office・São Paulo Representative Office・Boston Office NOMURA CORPORATE RESEARCH AND ASSET MANAGEMENT INC. (New York) NOMURA AMERICA MORTGAGE FINANCE, LLC (New York) NOMURA CREDIT AND CAPITAL INC. (New York) NOMURA DERIVATIVE PRODUCTS, INC. (New York) NOMURA FUNDS RESEARCH AND TECHNOLOGIES AMERICA, INC. (New York) NOMURA INTERNATIONAL TRUST COMPANY (Piscataway) NOMURA SECURITIES (BERMUDA) LTD. NOMURA CANADA INC. (Toronto) NOMURA GLOBAL FINANCIAL PRODUCTS INC. (New York) NOMURA REALTY ADVISORS, INC. (New York) NOMURA ASSET MANAGEMENT USA INC. Instinet NHI ACQUISITION HOLDING INC. (NEW YORK) INSTINET INCORPORATED (New York) Asia-Pacific NOMURA ASIA HOLDING N.V. (Amsterdam) NOMURA INTERNATIONAL (HONG KONG) LIMITED ・Seoul Branch Office・Taipei Branch Office・Hanoi Representative Office NOMURA SECURITIES (HONG KONG) LIMITED NOMURA ASIA LTD (Cayman) NOMURA SINGAPORE LIMITED NOMURA SECURITIES SINGAPORE PTE. LTD. NOMURA COMMODITIES SINGAPORE PTE. LTD. NOMURA MALAYSIA SDN. BHD. (Kuala Lumpur) NOMURA AUSTRALIA LIMITED (Sydney) NOMURA SECURITIES PHILIPPINES, INC. P.T. NOMURA INDONESIA (Jakarta) CAPITAL NOMURA SECURITIES PUBLIC COMPANY LIMITED (Bangkok) NOMURA STRUCTURED HOLDINGS PLC (Dublin) NOMURA CORPORATE ADVISORY (SHANGHAI) CO., LTD. NOMURA EUROPEAN INVESTMENT LIMITED (London) NOMURA FINANCIAL ADVISORY AND SECURITIES (INDIA) PRIVATE LIMITED (Mumbai) NOMURA ASIA INVESTMENT (INDIA POWAI) PTE. LTD. NOMURA SERVICES INDIA PTE.LTD. NOMURA ASSET MANAGEMENT SINGAPORE LTD. NOMURA ASSET MANAGEMENT MALAYSIA SDN. BHD. NOMURA ASSET MANAGEMENT HONG KONG LTD. 58 Nomura Holdings, Inc. Nomura Securities Domestic Network (As of July 1, 2009) Kanto (42 Branches) ・Ota Branch ・Sagamihara Branch ・Saitama Branch ・Shiki Branch ・Shinyokohama Branch ・Shinyurigaoka Branch ・Takasaki Branch ・Tama Plaza Branch ・Tokorozawa Branch ・Totsuka Branch ・Tsuchiura Branch ・Tsukuba Branch ・Tsurumi Branch ・Urawa Branch ・Utsunomiya Branch ・Yachiyodai Branch ・Yokohama Bashamichi Branch ・Yokohama Branch ・Yokohama-eki Nishiguchi Branch ・Yokosuka Branch ・Aobadai Branch ・Atsugi Branch ・Chiba Branch ・Fujisawa Branch ・Funabashi Branch ・Futamatagawa Branch ・Hiratsuka Branch ・Ichikawa Branch ・Kamakura Branch ・Kashiwa Branch ・Kawagoe Branch ・Kawaguchi Branch ・Kawasaki Branch ・Kofu Branch ・Konandai Branch ・Koshigaya Branch ・Kumagaya Branch ・Matsudo Branch ・Mito Branch ・Odawara Branch ・Omiya Branch ・Omiya Nishiguchi Branch Hokuriku (4 Branches) ・Fukui Branch ・Kanazawa Branch ・Niigata Branch ・Toyama Branch Kinki (31 Branches) ・Akashi Branch ・Daito Branch ・Esaka Branch ・Gakuenmae Branch ・Higashiosaka Branch ・Himeji Branch ・Hirakata Branch ・Ibaraki Branch ・Kawanishi Branch ・Kishiwada Branch ・Kobe Branch ・Kurakuen Branch ・Kyoto Branch ・Kyoto Branch, Kyoto Station Building, The Cube Office ・Nanba Branch ・Nara Branch ・Nishinomiya Branch ・Okamoto Branch ・Osaka Branch ・Otsu Branch ・Sakai Branch ・Senri Branch ・Takarazuka Branch ・Takatsuki Branch ・Tennoji-eki Branch ・Toyonaka Branch ・Tsukaguchi Branch ・Uehonmachi Branch ・Umeda Branch ・Umeda Branch, Diamor Office ・Wakayama Branch Chugoku (8 Branches) ・Fukuyama Branch ・Hiroshima Branch ・Kurashiki Branch ・Matsue Branch ・Okayama Branch ・Shimonoseki Branch ・Tokuyama Branch ・Yonago Branch Kyushu (10 Branches) ・Fukuoka Branch ・Kagoshima Branch ・Kitakyushu Branch ・Kumamoto Branch ・Kurume Branch ・Miyazaki Branch ・Nagasaki Branch ・Oita Branch ・Saga Branch ・Sasebo Branch Shikoku (4 Branches) ・Kochi Branch ・Matsuyama Branch ・Takamatsu Branch ・Tokushima Branch Chubu (16 Branches) ・Gifu Branch ・Hamamatsu Branch ・Kanayama Branch ・Kariya Branch ・Kasugai Branch ・Matsumoto Branch ・Nagano Branch ・Nagoya Branch ・Nagoya-ekimae Branch ・Numazu Branch ・Okazaki Branch ・Shizuoka Branch ・Toyohashi Branch ・Toyota Branch ・Tsu Branch ・Yokkaichi Branch Hokkaido (4 Branches) ・Asahikawa Branch ・Hakodate Branch ・Kushiro Branch ・Sapporo Branch Tohoku (8 Branches) ・Akita Branch ・Aomori Branch ・Fukushima Branch ・Hachinohe Branch ・Koriyama Branch ・Morioka Branch ・Sendai Branch ・Yamagata Branch Tokyo Metropolitan Area (42 Branches) ・Chofu Branch ・Denenchofu Branch ・Fuchu Branch ・Gotanda Branch ・Hachioji Branch ・Hamadayama Branch ・Hatagaya Branch ・Head Office ・Iidabashi Branch ・Ikebukuro Branch ・Ikebukuro Metropolitan Plaza Branch ・Jiyugaoka Branch ・Kamata Branch ・Kanda Branch ・Kichijoji Branch ・Kinshicho Branch ・Koishikawa Branch ・Koiwa Branch ・Kojimachi Branch ・Kokubunji Branch ・Machida Branch ・Mita Branch ・Nakameguro Branch ・Nakano Branch ・Nerima Branch ・Ogikubo Branch ・Omori Branch ・Sakurashinmachi Branch ・Sangenjaya Branch ・Seijo Branch ・Senju Branch ・Shibuya Branch ・Shinbashi Branch ・Shinjuku Branch ・Shinjuku Nomura Building Branch ・Shinjuku-eki Nishiguchi Branch ・Tachikawa Branch ・Tamagawa Branch ・Tanashi Branch ・Tokyo Branch ・Toranomon Branch ・Ueno Branch Okinawa (1 Branch) ・Naha Branch Annual Report 2009 59 Corporate and Other Data Corporate Data Company Name Nomura Holdings, Inc. President & CEO Kenichi Watanabe Date of Incorporation December 25, 1925 Paid-in Capital ¥321.7 billion (As of March 31, 2009) Head Office 1-9-1, Nihonbashi, Chuo-ku, Tokyo Group Employees 25,626 (As of March 31, 2009) 103-8645, Japan Share Data Common Stock Issued Number of Shareholders 2,661,092,760 shares (As of March 31, 2009) 383,795 (Unit shareholders: 360,105) (As of March 31, 2009) Listing Transfer Agent and Registrar The common shares of Nomura Holdings, Inc. are listed on the Mitsubishi UFJ Trust and Banking Corporation Tokyo, Osaka, Nagoya and Singapore stock exchanges. The Corporate Agency Department: +81 (3) 5391-1900 shares are also listed on the NYSE in the form of American Depositary Shares (ADSs) evidenced by American Depositary Receipts (ADRs). Each ADS represents one share of Common Depositary for American Depositary Receipts (ADRs) The Bank of New York Mellon Depositary Receipts Division: +1 (866) 680-6825 http://www.adrbnymellon.com Ratio: 1 ADR = 1 ordinary share Component Ratio of Shareholders Stock. (As of March 31, 2009) Securities Code 8604 (Tokyo Stock Exchange) NMR (New York Stock Exchange) Major Shareholders (Top 10) Shareholder Name Japan Trustee Services Bank, Ltd. (Trust Account) The Master Trust Bank of Japan, Ltd. (Trust Account) Japan Trustee Services Bank, Ltd. (Trust Account 4G) The Chase Manhattan Bank N.A. London S.L.Omnibus Account The Bank of New York Mellon as Depositary Bank for DR Holders Japan Trustee Services Bank, Ltd. (Trust Account 4) The Chase Manhattan Bank 385036 State Street Bank and Trust Company 505103 State Street Bank and Trust Company 505225 Investors Bank and Trust Company (West) - Treaty Individuals and Others Foreign Legal Entities Other Legal Entities Financial Institutions Shares Held (thousand shares) Percentage of Issued Shares (%) （%） 100 164,008 153,837 143,151 49,116 42,234 32,653 28,695 24,508 22,202 20,480 6.16 5.78 5.38 1.85 1.59 1.23 1.08 0.92 0.83 0.77 80 60 40 20 0 3/2005 3/2006 3/2007 3/2008 3/2009 Note: The company had 55,128 thousand shares of treasury stock as of March 31, 2009 which are not included in the Major Shareholders list above. Date of Record for Dividend Payments Dividend Payment Date Second Quarter September 30 December 1 Year-end March 31 June 1 Other Credit Rating S&P Moody’s R&I JCR *As of May 27, 2009 60 Nomura Holdings, Inc. Nomura Holdings Nomura Securities Long-term Short-term Long-term Short-term BBB+ Baa2 A+ AA- A-2 ― a-1 ― A- Baa1 A+ AA- A-2 P-2 aｰ1 ― For More Information Investor Relations Department Nomura Holdings, Inc. Otemachi Nomura Building 2-1-1, Otemachi, Chiyoda-ku, Tokyo 100-8170, Japan Tel. +81 (3) 5255-1000 www.nomuraholdings.com/investor/ Nomura Holdings Website Top Page www.nomura.com News Releases Click here to see the latest news releases, including the quarterly earnings reports of Nomura Holdings. Investor Relations www.nomuraholdings.com/investor/ Summary and Facts IR Library News Release Subscription Services Our e-mail alert service informs sub- scribers when a news release is issued or new content is uploaded to our website. Annual Report 2009 61
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