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Nomura suffers massive loss

NOMURA Holdings Inc, Japan's top brokerage, has suffered one of the largest annual losses in Japanese corporate history, hit by slumping stock markets and the cost of acquiring part of collapsed investment bank Lehman Brothers.

Tokyo-based Nomura said yesterday that its net loss for the fiscal year ended March 31 swelled to 709.4 billion yen (US$7.3 billion) from 67.8 billion yen the year before.

The broker's loss is among the worst so far recorded in Japan as the world's second-largest economy withers in the face of a collapse in global demand.

Electronics firm Hitachi is predicting a loss of about 700 billion yen. It reports earnings on May 12.

Shinko Research Institute Co said the only annual loss surpassing such dismal numbers in Japanese corporate history was the 834.6 billion yen loss reported by telecommunications giant Nippon Telegraph and Telephone Corp for the fiscal year ending March 2002.

Red ink

The last time Nomura had such massive red ink was in fiscal 1998, when it racked up a 397.5 billion yen loss.

For the fourth fiscal quarter, ending March 31, Nomura posted a net loss of 217.1 billion yen - from a 153.9 billion yen loss a year earlier. Quarterly sales more than quadrupled to 99.2 billion yen from 21.5 billion yen.

Among the main causes of the annual loss was 230 billion yen in expenses for acquiring operations in Europe, Asia and the Middle East from Lehman Brothers, the United States investment bank that collapsed last year.

Trading losses amid a global stock market plunge and losses related to real-estate assets also added to the loss.

Standard & Poor's said the ratings on Nomura were unaffected by the losses, which were within expectations.

Nomura President and Chief Executive Kenichi Watanabe said Nomura remained on a sound footing with a "solid capital base" despite the losses.

"We are now focusing on returning to profitability," Watanabe said.

Nomura shares gained 1.2 percent to 605 yen yesterday.

Earnings were released after trading ended on the Tokyo Stock Exchange.


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