Japanese banking group Nomura is set to restructure its loss-making joint venture on the Chinese mainland.
The Shanghai-based business, Nomura Orient International Securities, was set up in November 2019 as a JV with a local partner, with Nomura taking a majority share.
The original intention was to focus on China’s onshore wealth management sector. However, the losses have racked up in the last two years, post-pandemic. In 2021, losses were US$11.48 million, but then these losses almost trebled to $30.75 million in 2022.
Headcount has also reduced, from 281 to 259 in the last three months, despite an original target to grow staff numbers to 500 by the end of the year.
A Nomura statement read: "With a presence in China for over four decades since 1982, we have consistently sought to contribute to the development of the country's capital markets and service the evolving needs of clients.
"That strategy remains unchanged. Having now fully emerged from the pandemic, we are working constructively with our joint venture partners to determine the most viable path for our onshore business to achieve this long-term objective," stated Nomura.
Nor is Nomura the only institution to reassess its China strategy.
Earlier in October, Citi sold its China consumer wealth portfolio to HSBC. Meanwhile, in September, Norges Bank Investment Management, the fund manager that oversees Norway’s sovereign wealth fund, announced that it is closing its Shanghai office and instead moving more of its activity to Singapore.
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