Nomura CEO Paid $2.9 Million in Year Capped by Archegos Saga

Nomura Holdings Inc.’s Kentaro Okuda was paid 320.4 million yen ($2.9 million) during his first year as chief executive officer that concluded with the implosion of Archegos Capital Management.

Okuda also received a 16 million yen housing allowance, according to an annual securities filing on Friday. That compares with the 422 million yen Okuda’s predecessor Koji Nagai was paid during his final year as CEO. Nagai, now the chairman of Japan’s largest brokerage, received 192.2 million yen in pay last year, according to the filing.

Nomura was among global banks shaken by the implosion in late March of Archegos, a little known U.S. investment firm set up to manage the fortune of trader Bill Hwang. The Japanese company suffered a $2.9 billion loss due to the saga, trailing only Credit Suisse Group AG. In April, the brokerage logged a fourth-quarter net loss of 155.4 billion yen, its biggest since the global financial crisis.

Before the Archegos collapse, Okuda, who became CEO in April 2020, had enjoyed a bumper inaugural year in charge. Net income had reached a 19-year high of 308.5 billion yen in the nine months ended December, driven by a boom in trading and investment banking at home and abroad.

Okuda later apologized to Nomura stockholders for the Archegos incident, but signaled he will persist with plans to build a presence in the U.S. even after the Archegos meltdown, saying there is no major change in the firm’s overall strategy for its wholesale business.

The brokerage has outlined what it called “remedial measures” to rein in risks when catering to hedge funds. That includes reducing leverage to clients lacking a broader relationship with the firm.

Executives have privately predicted that Nomura’s reaction to the losses earlier this year would include shrinking the prime brokerage unit in Asia, and curtailing it more dramatically in the U.S. and Europe, Bloomberg has reported.

©2021 Bloomberg L.P.

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