Investor Presentation 2007 - Nomura Holdings · Investor Presentation 2007 Nobuyuki Koga President...

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Investor Presentation 2007

Nobuyuki Koga

President and CEONomura Holdings, Inc.

May 14, 2007

Below is a summary of Nomura Holdings’ May 2007 investor presentation.

Date: May 14, 2007Place: 7th Floor, Nomura Securities Co., Ltd.Speaker: Nobuyuki Koga

President and CEONomura Holdings, Inc.

1

1

1. This document is produced by Nomura Holdings, Inc. ("Nomura"). Copyright 2007 Nomura Holdings, Inc. All rights reserved.2. Nothing in this document shall be considered as an offer to sell or solicitation of an offer to buy any security, commodity or

other instrument, including securities issued by Nomura or any affiliate thereof. Offers to sell, sales, solicitations to buy, or purchases of any securities issued by Nomura or any affiliate thereof may only be made or entered into pursuant to appropriate offering materials or a prospectus prepared and distributed according to the laws, regulations, rules and market practices of the jurisdictions in which such offers or sales may be made.

3. No part of this document shall be reproduced, stored in a retrieval system or transmitted in any form or by any means, electronic, mechanical, photocopying, recording or otherwise, without the prior written permission of Nomura.

4. The information and opinions contained in this document have been obtained from sources believed to be reliable, but no representations or warranty, express or implied, are made that such information is accurate or complete and no responsibility or liability can be accepted by Nomura for errors or omissions or for any losses arising from the use of this information.

5. This document contains statements that may constitute, and from time to time our management may make "forward-looking statements" within the meaning of the safe harbor provisions of The Private Securities Litigation Reform Act of 1995. Any such statements must be read in the context of the offering materials pursuant to which any securities may be offered or sold in the United States. These forward-looking statements are not historical facts but instead represent only our belief regarding future events, many of which, by their nature, are inherently uncertain and outside our control. Important factors that could cause actual results to differ from those in specific forward-looking statements include, without limitation, economic and market conditions, political events and investor sentiments, liquidity of secondary markets, level and volatility of interest rates, currency exchange rates, security valuations, competitive conditions and size, and the number and timing of transactions.

6. The consolidated financial information in this document is unaudited.

1. This document is produced by Nomura Holdings, Inc. ("Nomura"). Copyright 2007 Nomura Holdings, Inc. All rights reserved.2. Nothing in this document shall be considered as an offer to sell or solicitation of an offer to buy any security, commodity or other instrument, including securities issued by Nomura or any affiliate thereof. Offers to sell, sales, solicitations to buy, or purchases of any securities issued by Nomura or any affiliate thereof may only be made or entered into pursuant to appropriate offering materials or a prospectus prepared and distributed according to the laws, regulations, rules and market practices of the jurisdictions in which such offers or sales may be made.3. No part of this document shall be reproduced, stored in a retrieval system or transmitted in any form or by any means, electronic, mechanical, photocopying, recording or otherwise, without the prior written permission of Nomura.4. The information and opinions contained in this document have been obtained from sources believed to be reliable, but no representations or warranty, express or implied, are made that such information is accurate or complete and no responsibility or liability can be accepted by Nomura for errors or omissions or for any losses arising from the use of this information.5. This document contains statements that may constitute, and from time to time our management may make "forward-looking statements" within the meaning of the safe harbor provisions of The Private Securities Litigation Reform Act of 1995. Any such statements must be read in the context of the offering materials pursuant to which any securities may be offered or sold in the United States. These forward-looking statements are not historical facts but instead represent only our belief regarding future events, many of which, by their nature, are inherently uncertain and outside our control. Important factors that could cause actual results to differ from those in specific forward-looking statements include, without limitation, economic and market conditions, political events and investor sentiments, liquidity of secondary markets, level and volatility of interest rates, currency exchange rates, security valuations, competitive conditions and size, and the number and timing of transactions.6. The consolidated financial information in this document is unaudited.

2

2

15.5%

5.2%7.4%

10.1%8.3%

-100

0

100

200

300

400

500

FY2003.3 FY2004.3 FY2005.3 FY2006.3 FY2007.3-5%

0%

5%

10%

15%

20%

25%

Changes Since Apr. 2003 – Profitability

Segment Income before Income Taxes and Consolidated ROE

Achieve an average consolidated ROE of 10%-15% in the medium to long term

Profitability improved significantly in past 4 years

Our Goal

OtherAsset ManagementGlobal Merchant Banking Global Investment BankingGlobal MarketsDomestic Retail

ROE

(billions of yen)

Good afternoon ladies and gentlemen. Thank you for attending Nomura Holdings’ investor presentation.

Today, I would like to outline the direction we will take going forward. In the four years since I became CEO, we have significantly transformed Nomura. First, I will take a few moments to speak about this transformation, before outlining what I see as our issues at hand and what we are doing to address these issues.

As we announced on April 26, net income for the year ended March 31, 2007, was 175.8 billion yen, and ROE was 8.3%. Total income before income taxes from business segments for the year was 377.3 billion yen, up from 89.2 billion yen four years ago. As such, revenue has increased significantly over the past four years.

3

3

AM 4%

Changes Since Apr. 2003 – Revenue Structure

FY2003.3Income before income taxes from all business segments

89.2 billion yen

GMB = LossAM 3%

FY2006.3 FY2007.3Income before income taxes from all business segments

377.3 billion yen

Large Large profitprofit

+7+73.33.3%%

+36+36.6%.6%

+45.7%+45.7%

--111.01.0%%% CAGR

FY2003.3-2007.3

Shifted to revenue structure balanced across 5 divisions

*DR = Domestic RetailGM = Global MarketsGIB = Global Investment Banking

AM10%

GMB15%

GIB13%

DR45%

GM17%

AM10%

GMB15%

GIB13%

DR45%

GM17%

Note: Pie charts based on income before income taxes of the five business segments

GMB11%

GIB11%

DR41%

GM33%

GMB11%

GIB11%

DR41%

GM33%

GIB9% DR

24%

GM64%

GIB9% DR

24%

GM64%

GMB = Global Merchant BankingAM = Asset Management

Looking at a breakdown of income before income taxes by segment, you can see that four years ago we relied heavily on Global Markets.

Revenue is now much more balanced across all five business divisions. I believe we have made much progress over the past four years to build up a revenue base that allows us to achieve sustainable ROE of 10-15%.

However, ROE in the prior fiscal year did not reach 10% for the full year, clearly pointing to issues that need to be resolved.

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4

22 Develop new businessesDevelop new businesses

33 Revamp international operationsRevamp international operations

11 Strengthen domestic client base, increase revenue sourcesStrengthen domestic client base, increase revenue sources

Next, I will outline the challenges I believe we face regarding the three issues for further growth I outlined at last year’s presentation, namely, strengthening our domestic client base and increasing our revenue sources, developing new businesses, and revamping our international operations.

5

5

GMB11%

GIB11%

DR41%

GM33%

GMB11%

GIB11%

DR41%

GM33%

AM10%

GMB15%

GIB13%

DR45%

GM17%

AM10%

GMB15%

GIB13%

DR45%

GM17%

22 Develop new businesses

+7+73.33.3%%

+45.7%+45.7%

% CAGR FY2003.3-2007.3

AM 4%GMB = LossAM 3%


33 Revamp international operations


GIB9% DR

24%

GM64%

GIB9% DR

24%

GM64%



First, we have made significant progress in strengthening our domestic client base.

In particular, we are seeing noticeable results in our retail and asset management businesses on the back of the shift of the 1,540 trillion yen in personal financial assets in Japan from savings accounts to investment products.

6

6

0

50

100

150

200

250

X Y Nomura Z Group JapanPost

0

50

100

150

200

250

X Y Nomura Z Group Japan Post

Changes in Domestic Retail Business

Source: Company documents; Z Group personal deposits as of December 2006

Mar. 31, 2003 and Mar. 31, 2007 assets/deposits in custody

Mar. 31, 2003Mar. 31, 2007

(trillions of yen) (trillions of yen)

Personal depositsAssets in custody

Assets/deposits in custody(as at Mar.31, 2007)

Domestic Client Assets, the most important yardstick in our retail business, have more than doubled over the past four years from 40 trillion yen to 85 trillion yen.

7

7

2.23.0 3.3

5.3

7.4

1.1

1.61.9

2.3

2.0

0

2

4

6

8

10

Mar. 31,2003

Mar. 31,2004

Mar. 31,2005

Mar. 31,2006

Mar. 31,2007

0

10

20

30

40

50

60

1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q

FY2004.3 FY2005.3 FY2006.3 FY2007.3

Changes in Domestic Retail Business

Revenue base not significantly affected

by equity market movements

Revenue base not significantly affected

by equity market movements

Investment trust sales and steady investment trust administration fees expanding

Investment trust assets Domestic Retail equity and investment trust related revenue

Assets in overseas mutual fundsAssets in stock investment trusts

Investment trust administration fees and otherCommissions for distribution of investment trusts*Retail stock brokerage commissions

Volatile equity marketsVolatile equity markets

(billions of yen)(trillions of yen)

*Nomura Securities

Commissions for distribution of investment trusts have been expanding steadily and assets under management in investment trusts have grown markedly. As a result, investment trust administration fees have increased significantly in the last four years.

We have made steady progress in building a revenue base that is not strongly affected by equity market movements.

8

8

0

500

1,000

1,500

2,000

May 05 Nov 05 May 06 Nov 06

Background to Changes in Domestic Retail BusinessRetirement money flowing into investments

mainly through FA channelAssets under management in My Story Profit

Distribution-type Fund (B Course)Sales of My Story Profit Distribution-type Fund

(B Course) by channel (Jan.-Mar. 2007)

Total sales of 280 billion yen59% from FA channel

Total sales of 280 billion yen59% from FA channel

(billions of yen)

CustomerService Section

31%

FinancialConsulting

Section10%

FinancialAdvisorSection

59%

We were also quick to focus on building up our financial advisorchannel, which now accounts for over 50% of sales of the My Story Profit Distribution-type Fund, a balanced fund marketed to match the needs of retirees. This underscores the full-fledged flow of retiree funds into investment trusts in Japan.

9

9

3.8% 3.2%

4.8%

11.7%

19.5%

0

2

4

6

8

10

12

Mar. 31,2003

Mar. 31,2004

Mar. 31,2005

Mar. 31,2006

Mar. 31,2007

0%

5%

10%

15%

20%

25%90.1

65.8

49.0

40.340.4

4.00.5

10.0

20.6

36.5

0

20

40

60

80

100

FY2003.3 FY2004.3 FY2005.3 FY2006.3 FY2007.3

Changes in Asset Management

*Sales by banks from Mar. 31, 2005, exclude Nomura Trust & Banking

Nomura Asset Management AuM in public stock investment trusts Asset Management results

Diversification of sales channels contributes to revenue of Nomura Group

Sales by Nomura Securities and othersSales by Japan PostSales by banks*

Ratio of NAM investment trusts sold by banks and Japan Post*

Net revenue

Income before income taxes

(billions of yen)(trillions of yen)

In our asset management business four years ago, we relied heavily on Nomura Securities’ distribution network of branch offices. We have since diversified our sales channels, tying up with Japan Post, megabanks, and regional financial institutions.

As a result, overall assets under management have increased significantly and income before income taxes of asset managementdivision has jumped from 500 million yen three years ago to 36.5billion yen.

10

10

4155

61

80 8516

1818

2327

0

20

40

60

80

100

120

Mar. 31, 2003 Mar. 31, 2004 Mar. 31, 2005 Mar. 31, 2006 Mar. 31, 2007

218

197

8091

40

0

50

100

150

200

250

FY2003.3 FY2004.3 FY2005.3 FY2006.3 FY2007.3

Growth in Domestic Retail and Asset Management

Domestic Client Assets/Asset Management assets under management

Domestic Retail and Asset Management combined income before income taxes

Asset Management AuMDomestic Client Assets

Asset ManagementDomestic Retail

（billions of yen）(trillions of yen)

Spurred on by the shift from savings to investment, combined income before income taxes from both Domestic Retail and Asset Management has surged fivefold over the past four years, and we expect the contribution to earnings to remain stable.

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11

AM10%

GMB15%

GIB13%

DR45%

GM17%

AM10%

GMB15%

GIB13%

DR45%

GM17%


33 Revamp international operations

22 Develop new businessesDevelop new businesses

Large Large profitprofit

+36.+36.66%%

% CAGR FY2003.3-2007.3

AM 4%GMB = Loss

AM 3%

GMB11%

GIB11%

DR41%

GM33%

GMB11%

GIB11%

DR41%

GM33%


GIB9% DR

24%

GM64%

GIB9% DR

24%

GM64%



We are also seeing results in our efforts to increase revenue sources and develop new businesses.

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Feb. 2007Tsubaki Nakashima

Capital restructure by purchase of preferred shares

Capital restructure by Capital restructure by purchase of preferred sharespurchase of preferred shares

Use risk capital to contribute to clients’ growth strategies

Strategic delistingStrategic delistingStrategic delisting

Tender offer aimed at industry realignment

Tender offer aimed at Tender offer aimed at industry realignmentindustry realignment

Strategic delistingStrategic delistingStrategic delisting

Strategic delistingStrategic delistingStrategic delistingFeb. 2007Sunstar

Aug. 2006Oji Paper

Jul. 2006Skylark

Apr. 2006Sojitz

40bn yenNCI loan

commitment

30bn yenNPF

170bn yen NCI loan commitment

53bn yenNPF

300bn yen MPO

80bn yenNCI loan

commitment

New Businesses

During the past fiscal year, we were able to establish a strong foothold in new businesses that use our own capital to deliver solutions for our clients’ growth strategies. Some examples include Oji Paper’s drive to realign the paper industry, Sojitz’sstepped-up restructuring of its capital structure by purchasing preferred shares via an MPO, and Skylark and TsubakiNakashima’s decision to conduct management buy-outs due to the need to reorganize their operations.

In particular, we have been building up Nomura Capital Investment as part of our drive into new businesses and saw steady results in the provision of loans for MBOs.

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13

New Businesses

-3

2618

97107

-20

0

20

40

60

80

100

120

FY2003.3 FY2004.3 FY2005.3 FY2006.3 FY2007.3

Global Investment Banking, Global Merchant Banking combined income before income taxes

Revenue growth by adding new businesses to traditional operations

Global Merchant BankingGlobal Investment Banking

（billions of yen）

Combined income before income taxes from Global Investment Banking and Global Merchant Banking has increased significantly from negative territory four years ago to 100 billion yen due tochanges in corporate activity in Japan and a transformation of our business model.

14

14

295325

11798

37

-50

0

50

100

150

200

250

300

350

400

FY2003.3 FY2004.3 FY2005.3 FY2006.3 FY2007.3

Revenue from 4 Divisions

26

10797

18

-3-20

0

20

40

60

80

100

120

FY2003.3 FY2004.3 FY2005.3 FY2006.3 FY2007.3

40

80 91

197218

0

50

100

150

200

250

FY2003.3 FY2004.3 FY2005.3 FY2006.3 FY2007.3

Total income before income taxes from 4 divisions up threefold to 300bn yen

4 division combined income before income taxes

Asset Management

Global Merchant BankingGlobal Investment Banking

Domestic Retail

Income before income taxes 300 billion yen



Asset ManagementDomestic Retail

Global Merchant Banking

Global Investment Banking

（billions of yen）（billions of yen）


As a result of this progress, income before income taxes from these four business divisions, that is excluding Global Markets,has increased from 100 billion yen to 300 billion yen.

15

15

452

377

188226

89

-100

0

100

200

300

400

500

600

FY2003.3 FY2004.3 FY2005.3 FY2006.3 FY2007.3 FY2008.3 FY2009.3 FY2010.3

Raising income before income taxes to 500bn yen and higher

Income before income taxes from all business segments

Income before income taxes from all business segments

OtherGlobal Markets

Global Merchant BankingGlobal Investment BankingAsset Management

Domestic Retail

Need to reform wholesale business Need to reform wholesale business including international operationsincluding international operations

Raising income before income taxes to

500bn yen and higher

Raising income before income taxes to

500bn yen and higher


We have built up a platform for income before income taxes from all business segments including Global Markets and Other, to reach 400 billion by strengthening our domestic client base and increasing revenue sources.

However, to take income before income taxes to 500 billion yen and higher on a sustainable basis, we must reform our wholesale business, including international operations. This will be majorfocus for the year ahead.

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16

Nomura-style Growth in Wholesale

Deliver solutionsto clients

Focus resourcesin Asia

Use capitalUse capitalUse capital

Grow wholesale business asglobally competitive Japanese and Asian Nomura

Grow wholesale business asGrow wholesale business asglobally competitive Japanese and Asian Nomuraglobally competitive Japanese and Asian Nomura

International strategyInternational strategyInternational strategy

Nomura’s strength is our client base in Japan and Asia built up over many years. Our wholesale business, meanwhile, centers on proving solutions to our clients, rather than putting profits first through proprietary trading.

We do not intend to change this approach. We will use our capital to expand our wholesale business while managing risks appropriately.

In our international operations, we will increasingly focus management resources such as human resources and capital on Asia in order to establish ourselves as a globally competitive Japanese and Asian financial services group.

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17

Using Capital

Not limited to organic growth; pursue alliances and M&A if needed

FY2003.3 FY2006.3 FY2007.3FY2005.3FY2004.3

MPO/HPO370 billion yen

Unified Partners

Taishin Financial HD15 billion yen

Code Securities


MPO 36 billion yen

Go on the offensive, mobilize capital for business and strategic purposes

Note: MPOs and HPOs are issued amount (as of issue date); NCI loan transactions are corporate loans only（１） NPF/NFP＝Skylark, Tsubaki Nakashima, and Mitsui Life Insurance

NPF（Millennium Retailing）50 billion yen

NPF（Misawa Homes HD）

Joinvest Securities12 billion yen

Real estate fund（DBJ）20 billion yen

NPF（Tungaloy, Sliontec）

NPF （Wanbishi Archives,Resort Solutions）


Fortress$888 million

Real estate fund(DBJ/Resona Bank)60 billion yen

NCI loan transactions170 billion yen

Research Affiliates

NPF/NFP(1)

100 billion yen

Joinvest Securities30 billion yen

Instinet$1.2 billion

In regards to using our own capital, we have been shifting course in two ways.

First, we have been making full use of risk capital to further expand our client-related businesses.

Second, we are not limiting ourselves to organic growth; insteadwe are seeking to accelerate growth through alliances and acquisitions, as we did with the acquisition of Instinet.

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18

Using Capital

Traditional securities business

New businessesEffective use of capital gives competitive edge

Provide risk capital

Proactive M&A

Expand infrastructure

2003.3 2007.3

Shareholders’Equity

1.64 trillion yen


1.64 trillion yen

Untapped capital

Untapped capital

WholesaleWholesale

DR/AMDR/AM

Strategic capital

Strategic Strategic capitalcapital

WholesaleWholesaleWholesale

DR/AMDR/AM


2.18trillion yen


2.18trillion yen

*AM=Asset Management, DR=Domestic Retail

Shareholders’ equity is a necessary driver of growth for us. Over the past four years, we have steadily increased business using our own funds and we intend to expand this even further this year.

We will particularly focus on strengthening areas where we have been lacking such as businesses for hedge funds and private equity funds as well as emerging markets.

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19

Instinet Growth StoryTe

chno

logi

es

Global / Hedge Funds

Electronic access to over 50 markets

Japan / Asia

Res

earc

h

No. 1 in Japanese equities, research

sales

Strengthen equity business globally by complementary relationship

Strengthen equity business globally by complementary relationship

Instinet acquisitionClosed Feb. 07

US$ 1.2bn

Instinet outline (FY2006)Operating profit US$ 70 mil

Use Nomura’s presence to access

growth markets

Respond to global ordersNew client base

Price

As part of this effort, we announced in November last year that we were acquiring Instinet.

With this, we can expect to see synergies that expand our hedge fund client base and increase our response to orders for not only Japanese equities but also global equities by tapping Instinet’shigh execution capabilities and US client base.

Instinet will also be able to access growing markets through fully utilizing Nomura’s solid client base in Japan and Asia. As such, we believe the acquisition of Instinet will give rise to an ideal complementary relationship for both companies.

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Instinet Growth Story

Investor needsInvestor needs

Investors focusing on best technologies and platforms to get best execution

Investors focusing on best technologies and platforms to get best execution

Client order flowClient order flow moving away from exchanges to alternative trading systems, market dispersion

US/Europe regulatory changes

US: Regulation NMSEU: MiFID

JapanCrossing CollaborateCollaborate

Japan/AsiaJapan/Asia

Growth markets

EuropeEuropeMove away from

exchanges

USUSAccess to best liquidity pools

(Markets in Financial Instruments Directive)

SMART ROUTER

In addition, with Regulation NMS in the US and MiFID in Europe, the environment surrounding global markets is going through sweeping changes. The best technologies and platforms will become more important than ever to ensure best execution.

The regulatory reforms in Europe present Instinet with a significant business opportunity. And in the US, proprietary trading systemsmay become as important as NASDAQ in terms of order execution. We can expect to see Instinet open the door to new clients looking to access the best liquidity pools.

In addition, Chi-X, launched in this April, will make a strong contribution to gaining orders from client’s looking for best execution as markets are opened up in Europe.

This trend will no doubt come to Japan as well. Considering the increasing importance of best execution, the levels of liquidityprovided by Japan Crossing will offer huge potential going forward.

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Fortress

Investment in Fortress Investment Group

Announced in Dec. 2006; $888 million (approx. 100 billion yen, $16.12 per share)Listed on NYSE in Feb. 2007 (price at end Apr. $29.01)

Outline of Fortress Investment Group (FY2006)

AuM: Approx. $35 billion (Hedge funds, private equity funds, real estate funds etc.)

America Europe

USUS EuropeEurope Asia TraditionalTraditional Alternative

Our investment in Fortress Investment Group announced in December last year has already seen a strong potential gain due to Fortress’ IPO. However, our investment in Fortress is for the long-term.While Fortress has a strong base in Europe and the US, Asia is adifferent story and this is one area for a complementary relationship.Further, although Nomura is strong when it comes to traditional investment products, our offerings of alternative products are weak. This is a second area where together we can achieve a complementary relationship.By building up a good partnership with Fortress, we can expect to achieve synergies for our hedge fund and private equity businesses in Global Markets and Global Investment Banking.Looking ahead, we will continue to make full use of M&A, confident that we can make one plus one equal more than two, and that M&A will be an effective means to implement our strategy of putting our clients at the heart of our business.

22

22

Focus on core competencies

AmericasAmericasAmericas

Expand operations

AsiaAsiaAsia

33 Revamp international operationsRevamp international operations

Accelerate efforts

Increase function as product supply hub

EuropeEuropeEurope

Now, turning to revamping our international operations, we took on a new approach one year ago to create different business models for the US, Europe and Asia in order to boost earnings. We will continue to accelerate this approach throughout the year ahead.

In the US, we will speed up our focus on core competencies to strengthen profitability.

In Europe, we have achieved a significant improvement in earnings. We have opened an office in Russia and strengthened our emerging equities team. We intend to continue this growth in ouremerging markets business. Last year, our equity derivatives team in Europe started delivering products to Asia, further underscoring Europe’s position as a hub to supply products to Asia including Japan.And in the coming year we will make a strong push in Asia.

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23

Asian company listings in JapanKorea POSCO （’05）China AsiaMedia （’07）

Offer investment opportunities

Asia

Lead manager of global offerings by Asian companies

India Infosys Technologies（’05,’06）

India ICICI Bank（’05） Korea Lotte Shopping（’06）

Taiwan PowerchipSemiconductor （’06）

Deliver added value

AuM in Asia-focused stock investment trusts*Asia Attractive Dividend Stock Fund 440bn yen

Nomura India Investment Fund 130bn yenFidelity Japan Asia Growth Fund 85bn yen

Additional QFII quota in ChinaTotal quota $350 million= largest for Japanese securities firm

*As of April 27, 2007

We are already seeing results when it comes to delivering investment opportunities to the Japanese retail market from Asia, such as distributing investment trusts that make use of our QFIIquota in China.

We will continue to leverage the pool of personal financial assets available in Japan along with our global network to deliver results such as winning investment banking business to build on recent successes including the IPO of China’s Asia Media, and global offerings by Infosys Technologies and Powerchip Semiconductor

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24

Started selling Nomura Japan Open fund

Samsung Securities Samsung Securities Samsung Securities

Strengthen local asset management capabilities, expand investment advisory business

Established Nomura Asset Management MalaysiaEstablished Nomura Asset Management MalaysiaEstablished Nomura Asset Management Malaysia

Supply products to local high-net-worth investors, mutual introduction of investment banking

opportunities and exchange of research

Taishin Financial HoldingTaishin Financial HoldingTaishin Financial HoldingTaishin International Bank Taiwan SecuritiesSigned memorandum of understanding to

collaborate on equitization of Vietnamese state-owned enterprises

State Capital Investment CorporationState Capital Investment CorporationState Capital Investment Corporation

Tie up with leading Asian financial institutions through alliances and M&A to deliver further solutions

FY2008.3Establish ourselves as Asia’s Nomura

Established Asia Merchant BankingEnhanced Asia Wealth Management

In addition to existing businesses that tap our strong client base in Japan, we are delivering solutions that meet the increasingly diverse needs of our Asian clients.

We will continue to build up our network by actively tying up with leading Asian financial institutions through alliances and M&A as we have done so far through collaborations with Taiwan’s Taishinand Vietnam’s SCIC. In doing so, we will act swiftly to build up a competitive edge in delivering solutions across Asia.

25

25

504.0 521.4

607.8

680.5

0

200

400

600

800

FY2004.3 FY2005.3 FY2006.3 FY2007.3

Strategic Investment

607.8bn yen607.8

bn yen

680.5bn yen680.5

bn yen

Non-interest expenses

Breakdown of FY2007.3 expense increases

FY2006.3 FY2007.3

Information processing and communications, and Occupancy and related depreciationCompensation and benefits

Other

*Two months consolidated for FY2007.3

DR

GIB

AM

Instinet*

others


As I mentioned last year, one of our most important issues is toinvest in human resources and infrastructure. We will continue to invest in talented people as well as highly reliable informationtechnologies and execution infrastructure. Last fiscal year, non-interest expenses increased 12% from the prior year due mostly to a build up of human resources, IT, and branch offices in Domestic Retail, an increase in overseas headcount in Global Investment Banking, a strengthening of the wholesaler channel in Asset Management, and the acquisition of Instinet completed in February this year.

This all represents strategic investment for future growth. We plan to continue with this while keeping an eye on costs.

26

26

1Q = 8.5 yen2Q = 8.5 yen3Q = 8.5 yen4Q = 8.5 yen +α(performance-linked)

Dividend target (minimum level of dividend) = Dividend target (minimum level of dividend) = DOE 3.0%DOE 3.0%

PerformancePerformance--linked portion based on fulllinked portion based on full--year year dividend payout ratio of dividend payout ratio of over 30%over 30%

Low ROE High

Dividend per

share (yen)

DOE3.0%

Dividend payout ratio over 30%

Dividend Policy

Fiscal Year ending Mar. 2008

Before finishing, I would like to briefly outline our efforts in returning profits to shareholders.

Our target dividend for this year is 34 yen per share, up 2 yen from 32 yen per share last year, representing a dividend-on-equity of 3%. In regards to the performance-linked portion, we remain committed to a payout ratio of 30% or more and will continue to actively return profits to our shareholders.

27

27

17%

24%

18%

48%41%

30%

0

30

60

90

120

150

0%

10%

20%

30%

40%

50%

Returning Profits to Shareholders

Fixed dividend

Share buybacks （lhs）

Dividend（lhs）

Payout ratio（rhs）

Minimum level +performance-linked

(billions of yen)

FY2002.3 FY2003.3 FY2004.3 FY2005.3 FY2006.3 FY2007.315 15 15 20 48 44

11.1% 7.4% 10.1% 5.2% 15.5% 8.3%18% 24% 17% 41% 30% 48%

Dividend per share（yen）

ROEPayout ratio

Over the past four years, we have clarified our policy on returning profits to shareholders, while also greatly increasing our dividend level.

We will continue to look into share buybacks. However, strengthening our wholesale business is our highest priority this year.

28

28

FY2007.3Dividend＝44yen

Payout ratio＝47.7 %

Total＝83.9 billion yen

Dividend growthDividend growthDividend growth

FY2007.3Instinet acquisition, Fortress investment

Total: US$2.1 billion（approx. 250 billion yen)

Profit growthProfit growthProfit growth

Grow profit and dividend

Last year I said that Nomura would seek to grow both profits anddividends simultaneously. As you can see, the year ended March 2007 has paved the way for this.

This year, we will focus on making more active use of our capital to deliver growth in the company and growth in dividends to our shareholders.

29

Appendix

30

30

Macroeconomic Data

31

31

(yen)

Household Financial Assets926 trillion yen

Household Financial Assets1,356 trillion yen

Household Financial Assets1,541 trillion yen

Household Financial Assets332 trillion yen

Bonds 2.3%Equities 13.6%

Investment Trusts 1.3%

Cash &Deposits

58.7%Insurance & Annuities13.0%

Mar.1980

Mar.1989


Cash & Deposits

44.3%

Insurance &Annuities

18.0%

Mar.2003

Equities 5.3%

Cash & Deposits

57.2%Insurance &Annuities

27.8%

Dec.2006


Cash & Deposits

50.5%Insurance &Annuities25.9%

Investment Trusts 4.1%Bonds 1.7%Investment Trusts 2.1% Investment Trusts 4.3%

Nikkei-225 and Distribution of Household Financial Assets

Early Early ’’80s80s11 Bubble periodBubble period22 Economic troughEconomic trough33 CurrentCurrent44

Source: Nomura, based on Bank of Japan data; ; as of end Mar. 2007, Dec. 2006 figures are preliminary amounts

05,000

10,00015,00020,00025,00030,00035,00040,00045,000

11

22

3344

32

32

Household Financial Assets 1,541 trillion yen

Household Financial Assets 42.1 trillion dollars

JapanJapan

Dec.2006

Cash &Deposits50.5%Insurance &

Annuities25.9%



USUS

Dec.2006

Cash &Deposits13.2%

Insurance & Annuities

31.6%



Comparison of Households Financial Asset in Japan and US

Source: Nomura, based on Bank of Japan and FRB data; as of end Mar. 2007

(Dec. 2006 preliminary figures)

Total18.6%TotalTotal18.6%18.6%

Total52.2%TotalTotal52.2%52.2%

33

33

45 49 48 53 72 77 100140

184217 203

172126 119 123 118

144103 90 96

138107 85 72

116 132

196 18314

23

33

3838

34

28 27 28 2229

2825 26

3234

3028

3438

55 66

1922

22

21

18 18

23

28 31 31 32

29

2827 25

2427

2623

2330

34 37

12106544

17

8141110

57 64 64 7399 108

137

184

238

273 260229

182 177 182 173202

159142 147

194168

142123

173200

285 287

0

50

100

150

200

250

300

350

195 217 242 263 283 305 329 355 382 410 448 482 517 540 567 601 630 658 694 724 745 751 765 775 780 775 770 779

0

200

400

600

800

0.01.02.03.04.05.06.07.08.0

Source: Nomura, based on Bank of Japan, Japan Post data; As of end Mar. 2007, Dec. 2006 figures are preliminary amounts

Investment Assets among Households

（P）

Cash & DepositsCash & Deposits

Investment AssetsInvestment Assets

(%)

(trillions of yen)

(trillions of yen)

BondsInvestment Trusts Equities

Japan Post "Teigaku Saving(fixed 3y)” (lhs)Cash & deposits (rhs)

Mar.'80

Mar.'81

Mar.'82

Mar.'83

Mar.'84

Mar.'85

Mar.'86

Mar.'87

Mar.'88

Mar.'89

Mar.'90

Mar.'91

Mar.'92

Mar.'93

Mar.'94

Mar.'95

Mar.'96

Mar.'97

Mar.'98

Mar.'99

Mar.'00

Mar.'01

Mar.'02

Mar.'03

Mar.'04

Mar.'05

Mar.'06

Dec.'06

34

34

0

10

20

30

40

50

60

70

80

1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 20070

5,000

10,000

15,000

20,000

25,000

30,000

35,000

40,000

45,000

Nikkei-225 Stock Average

Publicly Offered Investment Trusts Net Assets

(yen)

45.5 trillion yen

Dec. 1989Publicly Offered Stock

Investment Trusts

60.5 trillion yen

Jun. 2000Publicly Offered

Investment Trusts

72.6trillion yen59.4trillion yen

Mar. 2007Publicly Offered Stock

Investment Trusts Publicly Offered

Investment Trusts (trillions of yen)

Source: The Investment Trusts Association, Japan

Publicly Offered Bond Investment Trusts （Including Money Management Funds）

Publicly Offered Stock Investment Trusts

35

35

0

50

100

150

200

250

69 72 75 78 81 84 87 90 93 96 99 2002 20050502

Sixth straight year of profit growth expectedSixth straight year of profit growth expected

Japanese Corporate Earnings Outlook

(FY1989=100)

NOMURA400 recurring profit NOMURA400 recurring profit (consolidated)(consolidated)

(FY)Note: FY06/07 are estimate/forecast by Nomura Securities Financial & Economic Research Center (as of April 26, 2007)

Source: Nomura Securities Financial & Economic Research Center

FY RecurringProfit Growth

2002 142.4%2003 69.6%2004 19.9%2005 20.5%

2006（e） 6.8%2007（f） 12.6%

36

36

0.0

5.0

10.0

15.0

20.0

25.0

30.0

35.0

1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005

(%)

Corporates

Individuals

Banks

Life insurers

Trust banks

Non-Japanese Annuity trusts

Investment trusts

Shareholders of Listed Japanese Companies

（FY）Note: Distribution of listed common stock of domestic companies as at end of each fiscal year. Trust banks includes shares held only on bank accounts.Source: Nomura Securities Financial & Economic Research Center based on data from Japanese securities exchanges.

37

37

0.0

2.0

4.0

6.0

8.0

10.0

12.0

14.0

CY2001 CY2002 CY2003 CY2004 CY2005

GDPGDP

Australia

Canada

UK

US

France

Japan

GDP and M&A Ratios

( % )M&A / GDP ratioM&A / GDP ratio

(billions of US$)

Source: IMF, Thomson Financial etc. Prepared by Nomura.

0

2,000

4,000

6,000

8,000

10,000

12,000

14,000

USJapan UK

France

Canada

Australia

38

38

0

50

100

150

200

250

300

350

97 98 99 00 01 02 03 04 05 06 07

TOPIX (Japan)

Standard & Poor's 500 Index (US)

NASDAQ Composite Index (US)

FTSE 100 Index (UK)

All Ordinaries Index (Australia)

Hang Seng Index (Hong Kong)

Straits Times Index (Singpore)

0

200

400

600

800

1000

1200

1400

1600

1800

85 87 89 91 93 95 97 99 01 03 05 07

TOPIX (Japan)

Standard & Poor's 500 Index (US)

NASDAQ Composite Index (US)

FTSE 100 Index (UK)

All Ordinaries Index (Australia)

Hang Seng Index (Hong Kong)

Straits Times Index (Singpore)

Source: Nomura, based on stock exchange websites; Stock prices up to Apr. 20, 2007.

World Stock Indices

Stock indices since 1985Stock indices since 1985 Stock indices for past 10 yearsStock indices for past 10 years(Jan. 1985 = 100) (Jan. 1997 = 100)

39

39

Domestic Retail

40

400

5

10

15

20

25

FY2003.3 FY2004.3 FY2005.3 FY2006.3 FY2007.3

Expanding Contact with Customers Domestic RetailDomestic Retail

Further acceleration of net asset inflow(announced)

Target: 50-100 new branchesTarget: 3,000 staff Target: 1,000 staff

Financial advisorsFinancial advisors Branch officesBranch offices Call centersCall centers

Apr. 2007158

Mar. 2006134

Mar. 2007700

Mar. 2006600

Mar. 20061,948

Apr. 20072,296

Strategy to expand customer contact pointsStrategy to expand customer contact points

(trillions of yen)

Accumulated net inflow of Domestic Client Assets since fiscal year ended Mar. 2003

= approx. 22.5 trillion yen

Accumulated net inflow of Domestic Client Assets since fiscal year ended Mar. 2003

= approx. 22.5 trillion yen

41

41

1 My Story Profit Distribution-type Fund (6 times/year) 1,4532 Global Attractive Dividend Stock Fund (Monthly) 4113 Nomura Multi-currency Japan Stock Fund 3394 Asia Attractive Dividend Stock Fund 3395 Nomura Global REIT Fund 3346 Nomura Japan Stock Strategic Fund (Big Project-N) 3047 Nomura All-In-One Fund 2698 Nomura Fund Masters Global Bond 2489 Japan Attractive Dividend Stock Fund 233

10 Fidelity Japan Open 2254,154Total

Japanese equities27 %

Global equities 18 %

Balanced-type41 %

Global bonds 6 %

Product Strategy Matched to Customer Needs Domestic RetailDomestic Retail

Domestic Retail top-ranking* investment trusts (as of Mar. 2000)




Global bonds 3%Global equities 4%

Balanced-type 3%

Japanese equities 90%

(billions of yen) (billions of yen)

1 Nomura Japan Stock Strategic Fund (Big Project-N) 1,0892 Fidelity Japan Open 4333 Nomura Japan Open 3134 Small Capitalization Blue Chip Open 1815 Nomura Information/Electronics RF Rainbow 1096 Janus Global Technology Fund 1007 Nomura Index Open Nikkei 300 978 Asset Backed Securities Open 849 Invesco GT Global Investment Open 82

10 Nomura Accumulation Stock Fund - MIP 782,566Total

Global REITs 8 %

*Excluding short-term (MMFs, foreign currency MMFs etc) and bond investment trusts

42

42

1008581

6155

4144

5055

5256

52

61

0

20

40

60

80

100

120

FY2002.3 FY2003.3 FY2004.3 FY2005.3 FY2006.3 FY2007.3 FY2010.30

100

200

300

400

500

600

Note: Return on Domestic Client Assets = Domestic retail net revenue/Domestic Client Assets (end of period)

Targeting 100 trillion yen in Domestic Client Assets Domestic RetailDomestic Retail

Domestic Client Assets (trillions of yen)Return on Domestic Client Assets (bps)

Net revenue(billions of yen)

Domestic Client Assets target: 100 trillionRevenue of around 500 billion yen

Domestic Client Assets (at end, lhs)Return on Domestic Client Assets (lhs)Domestic Retail net revenue (rhs)

43

43

Global Markets

44

44

Dispersion of trading risk and increase in revenue opportunities by diversifying product offering

FY2007.3 : 670 billion yen

FY2007.3 : 1,200 billion yen

FY2007.3 : 580 billion yen

Retail foreign Retail foreign currency bondscurrency bonds

Interest rate/forexInterest rate/forex--linked structured linked structured

bondsbonds

EquityEquity--linked linked structured bonds/structured bonds/Fund derivativesFund derivatives

CreditCredit--linked linked productsproducts

CommodityCommodity--linked linked structured bondsstructured bonds

Diversification of Product Offering Global MarketsGlobal Markets

In addition to retail foreign currency bonds, we have diversified our product lineup by significantly increasing distribution of interest rate and foreign exchange structured bonds since 2000.

In 2004, we set up specialist teams in Europe for equity-linked structured bonds and fund derivatives. This business was fully up and running in the second half of last fiscal year and is now becoming a new pillar of revenue.

Moving forward, we plan to step up commodity-linked structured bond sales and our operations in credit-linked products. By including credit and commodity products in our portfolio in addition to interest rate and foreign exchange products and stocks, we will be able to disperse trading risks and increase revenue opportunities.

45

45

Outline of Real Estate Fund based on Alliance

Urban Revitalization Private FundUrban Revitalization Private Fund Green R FundGreen R Fund

Outline: DBJ and Nomura Holdings partnered to establish and operate Urban Revitalization Private Mezzanine Fund in May 2004, pioneering mezzanine finance in real estate in Japan.With establishment of this fund, investment extended to equity, making it possible to respond to various real estate financing needs.

Established: December 2006

Office buildings, rental apartments, commercial facilities, warehouses, hotels, others

Investments:

Funds invested:

Outline: Real estate investment fund established by Nomura Holdings, Resona Bank, and Nomura Real Estate.Nomura Holdings is responsible for raising funds and other securities related issues, Resona Bank gathers information on appropriate real estate investment targets, and Nomura Real Estate manages the actual properties and runs the fund.

Established: December 2006

Office buildings, commercial facilities, others

Investments:

Target asset level:

Funds invested:

Aim for about 100 billion yen based on increase in investment.

AuM: Currently 16 billion yen

10 billion yen

Global MarketsGlobal Markets

Total 30 billion yen (plan to increase to 50 billion yen in future)

Possible to invest in real estate businesses with scale of around 500 billion yen by raising debt from external sources.

Target asset level:

46

46

Global Investment Banking

47

47

FY2003.3 FY2004.3 FY2005.3 FY2006.3 FY2007.3

Rank Value($mil) 12,478 20,204 65,675 40,044 36,925

Mkt.Share(%) 19% 23% 49% 27% 21%

Rank 2nd 3rd 1st 1st 3rd

No. ofDeals 108 126 132 134 156

FY2003.3 FY2004.3 FY2005.3 FY2006.3 FY2007.3

Proceeds($mil) 7,243 14,054 13,571 14,118 19,150

Mkt. Share(%) 30% 30% 25% 26% 33%

Rank 1st 1st 1st 1st 1st

0.0

0.5

1.0

1.5

2.0

2.5

3.0

FY2003.3 FY2004.3 FY2005.3 FY2006.3 FY2007.3

0

20

40

60

80

100

120

FY2003.3 FY2004.3 FY2005.3 FY2006.3 FY2007.3

Global Investment Banking Global Investment BankingGlobal Investment Banking

League tables

Any Japanese involvement financial advisors (announced deals, value base)

Global equity & equity-related (Japan)

Source: Nomura, based on Thomson Financial

GIB Net revenue and Income before income taxes

Equity finance results

Net revenueIncome before income taxes

PO/IPO/CB/REIT lead managerMPO/HPO

(billions of yen)

(trillions of yen)

Source: Nomura

48

48

Global Merchant Banking

49

49

231.2

98.7132.1

84.535.9

543.4

439.1457.6

375.7

301.6

0.0

100.0

200.0

300.0

400.0

500.0

600.0

Business Exposure Global Merchant BankingGlobal Merchant Banking

Business exposure at fiscal year end

Terra FirmaEurope (ex. Terra Firma)Japan

(billions of yen)

Note: Japan is total of Nomura Principal Finance, Nomura Financial Partners, Nomura Research & Advisory and othersEurope (excluding Terra Firma) is total of the Private Equity Group and Nomura Phase4 Ventures

FY2003.3 FY2004.3 FY2005.3 FY2006.3 FY2007.3Japan 20.1 68.9 108.4 59.9 195.5Europe (excluding Terra Firma) 15.9 15.6 23.7 38.8 35.7

Sub Total 35.9 84.5 132.1 98.7 231.2

Terra Firma 265.7 291.2 325.5 340.4 312.2Total 301.6 375.7 457.6 439.1 543.4

50

50

0

50

100

150

200

250

300

FY2003.3 FY2004.3 FY2005.3 FY2006.3 FY2007.3

-20

0

20

40

60

80

FY2003.3 FY2004.3 FY2005.3 FY2006.3 FY2007.3

Main Investments and Exits

Sale of businessTaiyo ElectricTaiyo Electric

Build investment portfolio of 250-300bn yenIRR over 20%, time-span of 3-5 years

Global Merchant BankingGlobal Merchant Banking

(billions of yen)

(billions of yen)

Partial sale of stakeWanbishiWanbishi ArchivesArchives

Sale of stakeMillennium RetailingMillennium Retailing Sale of stake, etc.

Resort Resort SolutionsSolutions

Partial sale of stakeTungaloyTungaloy

Net revenueIncome before income taxes

Global Merchant Banking Business exposure (ex. Terra Firma ; at end of period)

MBO

Capital increase

WanbishiWanbishi ArchivesArchives

Resort Solutions Resort Solutions (formerly Misawa Resort)(formerly Misawa Resort)

MBO

MBO

MBO

Taiyo ElectricTaiyo Electric(Parent: NEC)(Parent: NEC)

TungaloyTungaloy(formerly Toshiba Tungaloy)(formerly Toshiba Tungaloy)

SliontecSliontec(Parent: Hitachi)(Parent: Hitachi)

Revitalization sponsor

Capital increase

Huis Ten BoschHuis Ten Bosch

Millennium RetailingMillennium Retailing

Review of shareholder compositionYMCYMC

Capital increaseMisawa HomesMisawa Homes

SkylarkSkylarkMitsui Life InsuranceMitsui Life Insurance

EasternEasternCapital increase

MBO

Capital increase

Kawamura ElectricKawamura Electric Review of shareholdercomposition

TsubakiTsubaki NakashimaNakashima MBO

51

51

Merchant Banking Strengths and Results

Main strength is sourcing capability via nationwide network

MBO

November 2003Tungaloy (Kanagawa)

November 2003Tungaloy (Kanagawa)

MBO

February 2007Tsubaki Nakashima

(Nara)

February 2007Tsubaki Nakashima

(Nara)Review of shareholder

profile

March 2007Kawamura Electric

(Aichi)

March 2007Kawamura Electric

(Aichi)

Invest: 50bn yenExit: Approx. 130bn yen

July 2004Millennium Retailing

(Tokyo)

July 2004Millennium Retailing

(Tokyo)

MBO

June 2006Skylark (Tokyo)

June 2006Skylark (Tokyo)

MBO

December 2003Sliontec (Kanagawa)

December 2003Sliontec (Kanagawa)

MBO

Review of shareholderprofile

July 2001CCI (Gifu)July 2001

CCI (Gifu)

March 2005YMC (Kyoto)

March 2005YMC (Kyoto)

Business revitalization

June 2004Huis Ten Bosch

(Nagasaki)

June 2004Huis Ten Bosch

(Nagasaki)

Capital increase

September 2006Eastern (Nagano)

September 2006Eastern (Nagano)

Global Merchant BankingGlobal Merchant Banking

52

52

Asset Management

53

53

2.20.90.3

1.3%

2.2%

4.0%

0

10

20

30

40

50

60

Mar. 31, 2005 Mar. 31, 2006 Mar. 31, 20070%

1%

2%

3%

4%

5%

6%

0

100

200

300

400

500

600

700

800

2005/10/07 　2006/03/31 　2006/09/22 　2007/03/16

*Excludes funds sold by Nomura Trust & Banking

Aiming to Boost Share of Funds for Bank Customers Asset ManagementAsset Management

(billions of yen) (trillions of yen)Nomura Asset Management share of investment trusts

sold by Japan Post

Nomura Asset Management share of investment trusts

sold by Japan Post

Nomura Asset Management share of funds for bank and

Japan Post customers

Nomura Asset Management share of funds for bank and

Japan Post customers

*As of April 27, 2007

Nomura Global 6 Assets Diversified Fund

Competitor productsNomura Asset Management fundsfor bank* & Japan Post customers

Nomura Asset Management share*(rhs)

Funds for bank & Japan Post customers

Source: The Investment Trusts Association, Japan

470 billion yen*(60%)

470 billion yen*(60%)

54

54

Corporate Data

55

55

-

5,000

10,000

15,000

20,000

25,000

30,000

35,000

40,000

45,000

50,000

55,000

60,000

65,000

70,000

80/0

1

81/0

1

82/0

1

83/0

1

84/0

1

85/0

1

86/0

1

87/0

1

88/0

1

89/0

1

90/0

1

91/0

1

92/0

1

93/0

1

94/0

1

95/0

1

96/0

1

97/0

1

98/0

1

99/0

1

00/0

1

01/0

1

02/0

1

03/0

1

04/0

1

05/0

1

06/0

1

07/0

1 -1,000

-500

0

500

1,000

1,500

2,000

2,500

3,000

3,500

4,000

4,500

5,000

5,500

6,000

0

Nomura Holdings Share Price

Share price (monthly) and trading volume* since 1980Share price (monthly) and trading volume* since 1980(yen)

(thousandsof shares)

* Daily average by month

1980/01 - 2007/04

285(80/04)

5,816(87/04)

805(98/10)

3,510(00/02)

1,087(03/04)

56

56

0

5,000

10,000

15,000

20,000

25,000

30,000

35,000

40,000

May 06 Jun 06 Jul 06 Aug 06 Sep 06 Oct 06 Nov 06 Dec 06 Jan 07 Feb 07 Mar 07

Joinvest Securities

Joinvest Securities tops monthly account

openings for online brokerages

Joinvest Securities tops monthly account

openings for online brokerages

Continue to expand servicesContinue to expand servicesContinue to expand services

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