Nomura has grown from being a strong player in Asia into a worldwide financial services powerhouse. Managing Director, Elizabeth Moore, tells us how it happened, and where the bank is going in the future.
Nomura has been on quite a journey in recent years - but The Gateway started our chat with Elizabeth by asking her to tell us about the path she has taken in her own career: "After graduating, I went to New York to start on an investment banking training programme, opted to come to London, and ended up staying here for a few years doing primarily leveraged finance origination for LBOs, and some investment grade work as well. At that time, all our clients were moving out to Asia. We followed suit, and I worked in Hong Kong for a couple of years. And then I moved back to the UK and joined another bank, this time on their capital markets desk."
Elizabeth's next step was a move to Lehman Brothers, and she was there for a year before Nomura's acquisition of its European investment banking and equities business in autumn 2008.
Elizabeth must have had a bird's eye view of the merger of the two banks, and so The Gateway asks her to give us the inside story: "At the time the merger happened, Nomura didn't have a large investment banking presence in Europe, so the acquisition of Lehman's business in this area made sense." Elizabeth thinks the quietness of the markets at this time worked in Nomura's favour by giving everyone time to get used to the new shape of the bank: "It was the best time to go through such a merger because we had an opportunity to rebuild before the market re-opened - we were able to focus on integration and building a business. So I have found Nomura a great place to work over the last couple of years because we've been focused on growing, which means there's been a very positive atmosphere."
Elizabeth goes on to describe how Nomura has been able to stay agile during the continued turbulence in the banking industry: "We didn't expand aggressively, or overstretch ourselves on loans, or go heavily into structured products during the bull market. And, as a result, our balance sheet and capital base is in pretty sound shape."
Nomura's acqusition of parts of Lehman's European, Middle Eastern and Asian businesses was part of a broader plan to build on the bank's strength in Asia to increase its global presence. Greater weight in Europe has been the first step; the headquarters for the bank's international business are now in London, and Elizabeth adds: "There's been a large amount of investment in the European businesses through the acquisition, and also through subsequent hiring of new talent. I think that put us in a great position to compete with other banks in Europe." Next is America: "The US is the next leg of the build-out - I think we now have just under a hundred people in the investment banking business in New York, and we're already winning mandates."
Nomura continues to be a market leader in Asia: "It's not as though we've walked away to build the international businesses; we're still very focused on our clients here, and also in leveraging our expertise in the region, for example, seeing if our clients in Europe are interested in acquiring businesses or raising capital in Asia - Nomura is extremely well positioned to help them do that."
We asked Elizabeth what kind of graduates Nomura is looking to recruit to help the bank with its plans for the future: "I think that, in addition to what every investment bank is interested in - that is, high motivation, ambition - it's important for Nomura that individuals are self-starters. Because, given the fact that we are a bit smaller than some of our competitors, and because we are still evolving in Europe, we want individuals who have an entrepreneurial spirit - Nomura wants people who believe in what we want to do, and that we will succeed."
Elizabeth also reminds The Gateway's readers that applicants to the bank should want to work for Nomura, as well as in banking in general: "We are looking out for people who are genuinely interested in us. When I'm interviewing graduates, sometimes I can tell who is applying to all the banks and isn't really keen on any particular one. We look for somebody who appreciates why Nomura is different, and why it is a great place to work." And finally, the personal touch: "At every investment bank you might have to spend 14 hours a day with your colleagues, so you have to be personable and able to work in teams. That's important anywhere, but I think here in a growing firm it's even more important."
Bull market: A market in which demand and prices are increasing, either in general, or in a particular sector. The opposite is a bear market, where they are moving downwards.
Capital markets: The markets where businesses or governments can raise funds through debt finance (issuing bonds) or equity finance (issuing shares).
Investment grade: Products or entities rated as investment grade are those with credit ratings of BBB or above, that is, they are deemed by credit rating agencies to be safe for banks to invest in.
Leverage: Any technique used to magnify gains. In a specifically financial context, it often means borrowing money to multiply the profits which can be made on an investment, such as on an LBO, or leveraged buy-out. In broader business discourse, it is used to mean exploiting existing strengths to create new opportunities, for example, cross-selling.