Daiwa Has First Profit Gain in Seven Quarters on Trading

(Bloomberg) -- Daiwa Securities Group Inc.’s profit rose for the first time in seven quarters as it joined Wall Street firms in benefiting from a jump in bond trading.

Net income grew 11% to 15.7 billion yen ($144 million) in the three months ended Dec. 31 from a year earlier, Japan’s second-biggest brokerage said Friday.

Key Insights

• Similar to larger rival Nomura Holdings Inc., Daiwa got a boost from fixed-income trading, particularly in the U.S., spurring revenue at its wholesale division. The company’s overseas operations made money for the 15th straight quarter.
• Daiwa also posted higher revenue from its domestic retail business compared with the previous quarter, after a stock-market rally restored some risk appetite among investors.
• Still, retail revenue and pretax profit remained lower than a year earlier, and Chief Financial Officer Eiji Sato told reporters that the recent coronavirus outbreak is now affecting investor sentiment.

Market Reaction

• Shares of Daiwa closed 0.8% higher before the announcement, taking this year’s gain to 1.1%.

Get More

• For more information on the results, click here.
• Here’s our story on Nomura’s earnings a day earlier.
• See the company’s presentation here.

To contact the reporters on this story: Takashi Nakamichi in Tokyo at tnakamichi1@bloomberg.net;Takako Taniguchi in Tokyo at ttaniguchi4@bloomberg.net

To contact the editors responsible for this story: Marcus Wright at mwright115@bloomberg.net, Russell Ward

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