Sentiment Analysis of the earnings transcript to help figure out if there are any bullish or bearish sentiments that could be gathered from it. We're doing ML and AI based analysis on the earnings call to get some more insights.
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| Statement |
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| The bottom left shows flow business client numbers up 10% year-on-year at 896,000 mainly due to improved market sentiment and the reorganization of our people to provide services to inactive clients |
| In credit, the interest rate differential between Japan and overseas drove a strong increase in revenues from foreign denominated bonds in Japan while international regions also reported higher revenues due to credit spread tightening and a strong client activity |
| Despite ongoing declines in global fee pools, our Advisory business booked stronger revenues on contributions from completed M&A deals in EMEA in focus sectors such as consumer and retail and health care |
| To sum up, we saw results from our ongoing initiatives this quarter and tailwind from the Japan market rally helped improve performance both quarter-on-quarter and year-on-year |
| Regarding equities, as you pointed out, the interest or attention to Japanese equities is very strong, so is execution and derivatives equity products regarding Japan, those business lines were strong |
| Our Japan related businesses had a strong quarter, particularly our Retail business |
| Net revenue increased 7% to JPY190.9 billion and income before income taxes was JPY2.1 billion improving from a loss last quarter |
| Investment Management delivered a broad range of products across both public and private markets to global investors resulting in inflows that helped lift assets under management to a record high |
| Under this optimized organizational structure, we provided detailed consulting services resulting in stronger sales across all products and services and higher revenues |
| We believe the momentum in the JGB and Japan stock markets will continue on the back of adjustments to Bank of Japan monetary policy, corporate actions by Japanese companies to improve profitability and capital efficiency and the new NISA scheme due to be significantly expanded next year |
| At the Retail division for the first time in a while and since the December quarter of 2020, we have achieved good numbers |
| Flow revenue was JPY57.8 billion, an increase of 38% driven by significantly stronger sales of stocks and investment trusts |
| The asset management business continued to deliver stable revenues and performance in our aircraft leasing business grew |
| Our Retail business has remained solid in July, performing above the monthly average of the first quarter |
| But Retail division revenue grew by 22% while suppressing costs increased by 6% |
| And as a result, recurring revenue is expected to grow through our continued and sustained efforts |
| FX/EM slowed in AEJ on lower volatility and slower client activity while rates improved in the Americas and continued to perform well in Japan |
| Wage increase was achieved for the first time in several years, which was bright news, and end of deflation is much talked about |
| Group-wide net revenue was JPY348.9 billion, up 7% quarter-on- quarter; pretax income increased 104% to JPY46.3 billion; net income was JPY23.3 billion, 3.2x higher than the previous quarter; EPS was JPY7.4; and annualized ROE was 2.9% |
| In Wholesale, our international business got off to a slow start, but fixed income and equities in Japan are doing well and ECM deals in Investment Banking are showing signs of improving |
| For other business lines, all in all the situation is solid |
| We saw the results of our efforts from last year to promote the attractiveness of investing in Japanese stocks and a tailwind from the market rally from May led to a significant increase in sales of Japanese secondary stocks |
| Although international client activity was slow, our Japan equity related business continued to see inflows from outside Japan and both cash equities and derivatives booked revenue growth |
| Retail completed its reorganization to better understand client needs and was able to deepen its business across both in-person and non-face-to-face channels while also expanding its client base |
| In Japan, the move towards ending deflation and speculation over the changes to the BOJ monetary policy combined with expectations of structural reforms to boost profitability at Japanese corporates led to inflows of risk capital from abroad lifting the Nikkei Average to a 33-year high and bringing some bright news for the first time in a while |
| Retail net revenue increased 22% to JPY92.1 billion and income before income taxes increased 133% to JPY22.9 billion |
| We are also making progress on the JPY50 billion cost reduction program announced at our Investor Day |
| So if we can broaden our partner base, then we will start to see the benefit in the sense of revenue and assets |
| We are having very active dialog with clients and will continue to work to deliver the best solutions leveraging the full capabilities of the group |
| Fixed income revenue was JPY97.4 billion up 11% |
| Statement |
|---|
| had fast-based rate hike and our core product agency mortgage last year and Securitized Products struggled and the struggle has continued into this year |
| securities volume itself has come down, so the execution business struggled |
| But from customers that our partners have not contacted yet, Q-on-Q progress has been negative |
| And in Americas compared to our peers, our numbers performance seem lackluster |
| Our core business Asia FX/EM, that’s our core product line and clients’ activity in this segment dropped significantly and also position management in comparison to the previous quarter there was a drop |
| But recently our businesses are not performing to the best of their potential and the overall revenue is not sufficient |
| Internationally while the Americas improved from the previous tough 2 quarters, overall it was a challenging quarter as market participants remained on the sidelines in the first half of the quarter due to macro environment uncertainty |
| Wholesale had a challenging quarter as volatility in international markets dropped and market participants were in risk-off mode |
| Net revenue declined 30% to JPY26.5 billion |
| Takumi Kitamura When we look at the adjusted revenue, yes, the numbers looked weak, but the profit line other regions did not drag down the average |
| On the other hand, we faced various issues related to cost structure |
| Net inflows of recurring revenue assets was negative JPY71.4 billion as some corporate clients sold out |
| Even without ACI hedging, Americas is in loss and EMEA is making loss as well |
| Rates business in itself is not performing so poorly |
| On the other hand for wholesale, the bottom line profit is not remaining much so that’s a huge issue and challenge |
| Uncertainties remain in the international environment |
| But when we look at the year-on-year, it seems that there has been a drop in macro products |
| During the first half of the quarter, international market participants sat on the sidelines due to the bankruptcies of U.S |
| In July due to seasonal factors, the pace has slowed down once again |
| But 34% increase Q-on-Q in the case of Daiwa and EMEA and Americas must have been weak in your case |
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