Moody’s revises Nomura view to stable

Moody’s Investors Service said it revised its outlook for Nomura Holdings, Inc. to stable from negative and affirmed its Baa1 foreign-currency long-term issuer and senior unsecured debt ratings, as well as its (P)Baa1 foreign-currency senior unsecured shelf and senior unsecured medium-term note program ratings. The agency also affirmed Nomura America Finance, LLC's Baa1 domestic currency-backed senior unsecured debt ratings.

The agency also affirmed Nomura Securities Co., Ltd.'s A3 domestic- and foreign-currency long-term issuer ratings. Moody’s also revised its outlook for the two subsidiaries to stable from negative.

“The affirmation of Nomura's rating and change in outlook to stable from negative reflect Moody's expectation that the company's earnings volatility will gradually decline, led by a recovery in its domestic retail and wholesale segments and reduced risk appetite in its overseas business, which will help lower the probability of large shocks. Nomura's enhanced risk management, ongoing cost reduction and structural reforms in its wholesale business will help stabilize the wholesale segment's earnings.

“The change in outlook also reflects Moody's expectation that Nomura's profitability, measured as return on average total assets, will improve modestly from the low level of 0.28% (annualized) for the first nine months of fiscal year ending March 2024 (fiscal 2023), driven by recoveries in domestic retail and wholesale, which together generate most of its pretax profits,” the agency said in a press release.

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