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Nomura (NMR) to Bolster Wealth and Fixed Income Units in Asia

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Nomura Holdings (NMR - Free Report) is building its wealth and fixed income businesses in Asia by increasing the headcount, as it eyes the region as a growth opportunity with relatively higher interest rates than other developed economies. The news was reported by Bloomberg.

“We see the Asia region as becoming more and more important for the global economy,” Rig Karkhanis, head of global markets for Asia excluding Japan, said in an interview to Bloomberg. “Pretty much all of the West is now operating at zero interest rates, and likely to remain at zero interest rates for a long time. The only high-quality yield, so safe yield as it were, is really in the Asian economies.”

The company is planning to hire sales staff and traders for private debt, delta one products and macro business. Further, it will expand the wealth management department, particularly for Greater China and Southeast Asia.

The article also reported that the brokerage firm has hired 20 to 25 private bankers from its peers, including Deutsche Bank (DB - Free Report) and BNP Paribas (BNPQY - Free Report) in 2020 itself and is seeking to double the number in each of the next two to three years. Further, about 40 employees are expected to be added for fixed income in another 18 months.

In May, Nomura’s new CEO Kentaro Okuda sought to put the company on a growth trajectory by focusing more on the private markets rather than its traditional business with public markets.

Also, cost control continues to remain a key focus point for Nomura. The company seeks to achieve its target of Y140 billion cost-reduction by 2022, through decrease in IT-related costs, standardization of corporate functions and efforts to lower consulting and outsourcing costs.

Shares of the company have gained 17.5% on the NYSE over the past six months compared with a 20.6% growth recorded by the industry.

The stock currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

A better-ranked stock in the same space is UBS Group AG (UBS - Free Report) . It has been witnessing upward estimate revisions over the past 60 days for the ongoing year. The company’s shares have gained 25.3% over the past six months. It carries a Zacks Rank of 2 (Buy) at present.

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