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Squeezed at home, Japan's Nomura seeks to push into Wall Street's home turf

Monday, June 19, 2017 - 17:40

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Under pressure in Japan from Wall Street rivals and anticipating more deals in the United States or by American companies overseas, Nomura Holdings is boosting its US investment banking business, including some senior hires in the technology and finance sectors.

[TOKYO] Under pressure in Japan from Wall Street rivals and anticipating more deals in the United States or by American companies overseas, Nomura Holdings is boosting its US investment banking business, including some senior hires in the technology and finance sectors.

Two sources familiar with the matter said Nomura plans to add a dozen senior- and mid-level investment bankers over the next 12 to 18 months in the United States, covering mergers and acquisitions, equity capital markets and leveraged financing - building out a team of around 200 there.

Nomura has poached investment bankers from global investment banks as well as boutiques such as Jefferies and Houlihan Lokey since the beginning of this year.

It has hired Jim Voorheis from UBS, where he was head of speciality finance in the Americas, as managing director for its financial institutions group, and Credit Suisse veteran Thomas Chung as managing director for US equity capital markets.

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The number of hires could eventually be much higher, one of the sources said, depending on deals momentum and the outlook for the profitability of Nomura's international operations.

The sources, who have direct knowledge of Nomura plans, did not want to be named as they were not authorised to speak to the media.

They said Nomura has made a US expansion of its wholesale business, which includes global markets and investment banking, one of its priorities.

This comes after a major restructuring - including a big shrinking of its operations in Europe last year - following its disastrous acquisition of Lehman Brothers' Asian and European businesses in 2008. That led to internal clashes, and was followed by six consecutive years of losses for its international operations.

As a result previous plans to expand in the US were put on hold and Nomura reduced its total staff across all divisions in the Americas to 2,279 at the end of 2016 from 2,501 a year earlier. The number had crept back up to 2,314 by the end of March.

In March, it named company veteran Kentaro Okuda, head of investment banking and a contender to become Nomura's future chief executive, as head of its Americas arm.

"He knows all of our clients from Japan and he can look after their deals," said one of the sources. "If Okuda does well in the US, he might emerge as a strong candidate to become group CEO." Two of the sources said Nomura plans to bolster its coverage of the technology, financial and healthcare sectors in the US where it sees growing dealmaking opportunities within the country and outside.

REUTERS

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