Nomura Holdings Inc., the large Japanese financial holding company, is planning to cut about 5 percent of its jobs in Europe to cut costs, according to reports.
The Tokyo-based company's announcement follows on the heels of major banks like Bank of America and HSBC Holdings, which have already said they'll eliminate tens of thousands of workers in a bid to compete in a tougher global environment.
The debt crisis in Europe is believed to have seriously impeded Nomura’s trading income and investment banking revenues on the continent.
According to Bloomberg, Nomura had 4,436 employees in Europe as of June 30, the majority of whom work in its wholesale unit, which includes investment banking and trading operations in London.
In July, Nomura said it would seek to reduce annual expenses at its wholesale unit by about $400 million.
Earlier this week, the company’s shares fell to a nearly four-decade low in Tokyo amid fears it couldn't expand overseas amidst a bleak global economic landscape.
“Job cuts will be inevitable under such market conditions,” Katsunobu Komizo, chief executive at recruitment firm Executive Search Partners Co. in Tokyo, told Bloomberg. “Investors cannot wait for so long and expect the bank to get fruits in a short term. Nomura will be able to increase its income by cutting human costs.”
Nomura’s international units recorded a pretax loss of 32.8 billion yen ($425 million) in the second quarter. The company’s European segment alone lost 31.7 billion yen.
The Wall Street Journal noted that Nomura has faced many questions and criticism over its cost structure ever since it acquired the Asian and European units of Lehman Brother in 2008 during the height of the global financial crisis.
However, Bloomberg notes that Nomura remains the dominant investment bank in its home Japanese market.