Nomura CEO Apologizes After Bond Market Manipulation Probe
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(Bloomberg) -- Nomura Holdings Inc. Chief Executive Officer Kentaro Okuda apologized in his first public appearance following allegations that an employee manipulated the bond futures market.
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The investigative arm of the nation’s financial regulator last week called for a fine against Nomura’s domestic securities unit for allegedly manipulating Japanese government bond futures prices in 2021. Toyota Finance Corp. and several other firms have since excluded Japan’s biggest brokerage from deals to underwrite their debt.
“I would like to apologize for the trouble caused,” Okuda said at a Nikkei financial forum in Tokyo on Wednesday.
The move came as Nomura competes to capitalize on a revival of the Japanese bond market fueled by a shift in the country’s monetary policy.
The Securities and Exchange Surveillance Commission recommended the Financial Services Agency impose a ￥21.8 million ($152,000) fine against Nomura after finding that an a dealer profited by placing large orders for JGB futures without intending to buy or sell all of them. The FSA usually carries out such penalties weeks later.
Nomura issued a statement last week saying it has been working to revise its JGB futures trading operations since the transaction. It also pledged to continue to improve internal controls to prevent a recurrence.
Securities firms including those operated by Citigroup Inc. and Mitsubishi UFJ Financial Group Inc. have been penalized in recent years for manipulating JGB futures prices.
(Updates with details of findings in the sixth paragraph)
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