Segment and geographic information

6 Months Ended

Sep. 30, 2020

Segment and Geographic Information [Abstract]

Segment and geographic information

17. Segment and geographic information:

Operating segments—

Nomura’s operating management and management reporting are prepared based on the Retail, the Asset Management, and the Wholesale segments. Nomura structures its business segments based upon the nature of its main products and services, its client base and its management structure. The operating result of Merchant Banking Division is included in “Other.”

The accounting policies for segment information follow U.S. GAAP, except for the impact of unrealized gains/losses on investments in equity securities held for operating purposes, which under U.S. GAAP are included in Income (loss) before income taxes, but excluded from segment information.

Revenues and expenses directly associated with each business segment are included in the operating results of each respective segment. Revenues and expenses that are not directly attributable to a particular segment are allocated to each respective business segment or included in “Other”, based upon Nomura’s allocation methodologies as used by management to assess each segment’s performance.

Business segments’ results are shown in the following tables. Net interest revenue is disclosed because management views interest revenue net of interest expense for its operating decisions. Business segments’ information on total assets is not disclosed because management does not utilize such information for its operating decisions and therefore, it is not reported to management.

	Millions of yen
	Retail		Asset Management			Wholesale		Other (Incl. elimination)			Total
Six months ended September 30, 2019
Non-interest revenue	¥	154,373	¥	61,597		¥	271,558	¥	184,486		¥	672,014
Net interest revenue		3,149		(1,421	)		44,626		(902	)		45,452
Net revenue		157,522		60,176			316,184		183,584			717,466
Non-interest expenses		144,143		31,988			277,256		58,702			512,089
Income before income taxes	¥	13,379	¥	28,188		¥	38,928	¥	124,882		¥	205,377
Six months ended September 30, 2020
Non-interest revenue	¥	172,676	¥	61,487		¥	376,148	¥	129,786		¥	740,097
Net interest revenue		1,197		(621	)		92,826		(8,011	)		85,391
Net revenue		173,873		60,866			468,974		121,775			825,488
Non-interest expenses		135,979		30,312			315,628		82,388			564,307
Income before income taxes	¥	37,894	¥	30,554		¥	153,346	¥	39,387		¥	261,181
	Millions of yen
	Retail		Asset Management			Wholesale		Other (Incl. elimination)			Total
Three months ended September 30, 2019
Non-interest revenue	¥	75,350	¥	26,384		¥	134,934	¥	120,526		¥	357,194
Net interest revenue		1,532		(708	)		21,764		2,769			25,357
Net revenue		76,882		25,676			156,698		123,295			382,551
Non-interest expenses		71,621		15,630			137,777		29,866			254,894
Income before income taxes	¥	5,261	¥	10,046		¥	18,921	¥	93,429		¥	127,657
Three months ended September 30, 2020
Non-interest revenue	¥	92,331	¥	27,132		¥	185,601	¥	29,829		¥	334,893
Net interest revenue		464		(290	)		34,704		(2,727	)		32,151
Net revenue		92,795		26,842			220,305		27,102			367,044
Non-interest expenses		69,970		15,442			154,828		45,131			285,371
Income (loss) before income taxes	¥	22,825	¥	11,400		¥	65,477	¥	(18,029	)	¥	81,673

Transactions between operating segments are recorded within segment results on commercial terms and conditions and are eliminated in “Other.”

The following table presents the major components of Income (loss) before income taxes in “Other.”

	Millions of yen
	Six months ended September 30
	2019			2020
Net gain related to economic hedging transactions	¥	19,837		¥	612
Realized gain on investments in equity securities held for operating purposes		1,330			809
Equity in earnings of affiliates		16,274			11,860
Corporate items(1)		(3,244	)		29,085
Other(2)(3)		90,685			(2,979	)
Total	¥	124,882		¥	39,387
	Millions of yen
	Three months ended September 30
	2019			2020
Net gain (loss) related to economic hedging transactions	¥	7,043		¥	(4,965	)
Realized gain on investments in equity securities held for operating purposes		1,254			124
Equity in earnings of affiliates		8,009			5,251
Corporate items		(4,635	)		(16,005	)
Other(2)(3)		81,758			(2,434	)
Total	¥	93,429		¥	(18,029	)

(1) The income before income taxes for the six months ended September 30, 2020 includes a gain of ¥ 71,075 million which represents the difference between the fair value of the assets acquired and the carrying value of the assets transferred by Nomura as a result of the rights conversion of the Tokyo Nihonbashi district redevelopment project.

(2) The income before income taxes for the six months and three months ended September 30, 2019 includes gain of ¥73,293 million from the sale of Nomura Research Institute, Ltd. ordinary shares.

(3) Includes the impact of Nomura’s own creditworthiness.

The table below presents reconciliations of the combined business segments’ results included in the preceding table to Nomura’s reported Net revenue, Non-interest expenses and Income before income taxes in the consolidated statements of income.

	Millions of yen
	Six months ended September 30
	2019			2020
Net revenue	¥	717,466		¥	825,488
Unrealized gain (loss) on investments in equity securities held for operating purposes		(2,085	)		4,257
Consolidated net revenue	¥	715,381		¥	829,745
Non-interest expenses	¥	512,089		¥	564,307
Unrealized gain on investments in equity securities held for operating purposes		—			—
Consolidated non-interest expenses	¥	512,089		¥	564,307
Income before income taxes	¥	205,377		¥	261,181
Unrealized gain (loss) on investments in equity securities held for operating purposes		(2,085	)		4,257
Consolidated income before income taxes	¥	203,292		¥	265,438
	Millions of yen
	Three months ended September 30
	2019			2020
Net revenue	¥	382,551		¥	367,044
Unrealized gain on investments in equity securities held for operating purposes		829			1,954
Consolidated net revenue	¥	383,380		¥	368,998
Non-interest expenses	¥	254,894		¥	285,371
Unrealized gain on investments in equity securities held for operating purposes		—			—
Consolidated non-interest expenses	¥	254,894		¥	285,371
Income before income taxes	¥	127,657		¥	81,673
Unrealized gain on investments in equity securities held for operating purposes		829			1,954
Consolidated income before income taxes	¥	128,486		¥	83,627

Geographic information—

Nomura’s identifiable assets, revenues and expenses are generally allocated based on the country of domicile of the legal entity providing the service. However, because of the integration of the global capital markets and the corresponding global nature of Nomura’s activities and services, it is not always possible to make a precise separation by location. As a result, various assumptions, which are consistent among years, have been made in presenting the following geographic data.

The table below presents a geographic allocation of Net revenue and Income (loss) before income taxes from operations by geographic areas, and long-lived assets associated with Nomura’s operations. Net revenue in “Americas” and “Europe” substantially represents Nomura’s operations in the U.S. and the U.K., respectively. Net revenue and Long-lived assets have been allocated based on transactions with external customers while Income (loss) before income taxes have been allocated based on the inclusion of intersegment transactions.

	Millions of yen
	Six months ended September 30
	2019			2020
Net revenue(1):
Americas	¥	125,274		¥	222,091
Europe		60,921			59,681
Asia and Oceania		33,257			27,605
Subtotal		219,452			309,377
Japan		495,929			520,368
Consolidated	¥	715,381		¥	829,745
Income (loss) before income taxes:
Americas	¥	15,409		¥	79,157
Europe		3,039			6,580
Asia and Oceania		22,172			21,915
Subtotal		40,620			107,652
Japan		162,672			157,786
Consolidated	¥	203,292		¥	265,438
	Millions of yen
	Three months ended September 30
	2019			2020
Net revenue(1):
Americas	¥	52,735		¥	112,903
Europe		30,091			39,510
Asia and Oceania		16,441			17,369
Subtotal		99,267			169,782
Japan		284,113			199,216
Consolidated	¥	383,380		¥	368,998
Income (loss) before income taxes:
Americas	¥	1,143		¥	39,159
Europe		(1,490	)		(8,437	)
Asia and Oceania		10,530			12,720
Subtotal		10,183			43,442
Japan		118,303			40,185
Consolidated	¥	128,486		¥	83,627

(1) There is no revenue derived from transactions with a single major external customer.

	Millions of yen
	March 31, 2020		September 30, 2020
Long-lived assets:
Americas	¥	84,904	¥	93,175
Europe		52,179		61,857
Asia and Oceania		29,618		28,016
Subtotal		166,701		183,048
Japan		292,212		312,610
Consolidated	¥	458,913	¥	495,658