Nomura scales back digital asset holdings amid declining Q3 earnings
CFO Hiroyuki Moriuchi has confirmed Nomura's continued dedication to cryptocurrency investments over the long haul, though the firm must address immediate market uncertainties.
The prominent Japanese financial institution Nomura has announced plans to scale back its cryptocurrency holdings, pointing to challenging market conditions and declining international earnings during the third quarter as primary factors.
Chief financial officer Hiroyuki Moriuchi of Nomura revealed that the company intends to minimize risk exposure through its European digital asset arm Laser Digital Holdings, following financial setbacks in the quarter that concluded on Dec. 31, as reported by Bloomberg Japan on Friday.
According to Moriuchi's statement, although the subsidiary experienced difficulties during the cryptocurrency market volatility, the company plans to maintain stability by implementing strict position management practices throughout the coming months.
The CFO emphasized that Nomura's dedication to the cryptocurrency sector has not wavered and that the financial institution is planning expansion initiatives for its Switzerland-based subsidiary in the medium to long-term timeframe.
The third quarter for Nomura commenced shortly before a significant cryptocurrency market downturn in October, which resulted in Bitcoin (BTC) plummeting from its record high of $126,000 on Oct. 6 to approximately $88,000 by the quarter's end on Dec. 31, based on data from CoinGecko.
In its third-quarter financial results released on Friday, Nomura disclosed that its European operations, encompassing both cryptocurrency and non-cryptocurrency ventures, contributed to a 10.6 billion yen ($68.47 million) deficit on its financial statements. Despite this, the company managed to generate profits from its international operations, securing 16.3 billion yen ($105.29 million), representing a 70% decline compared to the corresponding period in the previous year.
The financial institution reported a net income totaling 91.6 billion yen ($590 million), reflecting a 9.7% reduction from Q3 2024. However, this decrease was partially attributed to the $1.8 billion acquisition of Macquarie Group's US and European public asset management business, in addition to other costs associated with a stock buyback program.
Trading on the Tokyo Stock Exchange saw Nomura shares decline by approximately 6.8% on Monday as investors responded to the company's third-quarter performance figures.
Bloomberg Intelligence senior analyst Hideyasu Ban commented to The Japan Times on Sunday that "there is a vague sense of unease about the overall market direction, and that seems to have combined with the surprise on the crypto front to set off selling."