Segment and geographic information

12 Months Ended

Mar. 31, 2021

Segment and Geographic Information [Abstract]

Segment and geographic information

22. 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 results of the Merchant Banking division are included in “Other.”

The accounting policies for segment information follow U.S. GAAP, except for a part of the impact of unrealized gains/losses on certain 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(1)			Other (Incl. elimination)			Total
Year ended March 31, 2019
Non-interest revenue	¥	331,743	¥	89,607	¥	496,484		¥	147,524		¥	1,065,358
Net interest revenue		7,737		8,238		58,904			(16,263	)		58,616
Net revenue		339,480		97,845		555,388			131,261			1,123,974
Non-interest expenses		289,990		63,660		666,787			134,034			1,154,471
Income (loss) before income taxes	¥	49,490	¥	34,185	¥	(111,399	)	¥	(2,773	)	¥	(30,497	)
Year ended March 31, 2020
Non-interest revenue	¥	329,983	¥	85,190	¥	506,203		¥	257,961		¥	1,179,337
Net interest revenue		6,376		7,415		142,416			(26,388	)		129,819
Net revenue		336,359		92,605		648,619			231,573			1,309,156
Non-interest expenses		286,926		63,833		556,399			132,410			1,039,568
Income (loss) before income taxes	¥	49,433	¥	28,772	¥	92,220		¥	99,163		¥	269,588
Year ended March 31, 2021
Non-interest revenue	¥	366,271	¥	126,874	¥	524,019		¥	232,060		¥	1,249,224
Net interest revenue		2,538		7,900		167,337			(36,672	)		141,103
Net revenue		368,809		134,774		691,356			195,388			1,390,327
Non-interest expenses		276,480		60,529		627,051			207,141			1,171,201
Income (loss) before income taxes	¥	92,329	¥	74,245	¥	64,305		¥	(11,753	)	¥	219,126

(1) Non-interest revenue and Non-interest expense for the year ended March 31, 2021 include losses arising from the U.S. Prime Brokerage Event. See Note.23 “Loss Arising from U.S. Prime Brokerage Event.”

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” for the years ended March 31, 2019, 2020 and 2021.

	Millions of yen
	Year ended March 31
	2019			2020			2021
Net gain (loss) related to economic hedging transactions	¥	1,800		¥	17,548		¥	(11,450	)
Realized gain on investments in equity securities held for operating purposes		221			6,601			1,731
Equity in earnings of affiliates(1)		32,532			34,990			(16,410	)
Corporate items		(35,996	)		(22,240	)		4,956
Other(2)(3)(4)		(1,330	)		62,264			9,420
Total	¥	(2,773	)	¥	99,163		¥	(11,753	)

(1) Includes an impairment loss of ¥47,661 million on Nomura’s investment in Nomura Real Estate holdings, Inc. for the year ended March 31, 2021. Considering the period and extent to which the share price was below carrying value, Nomura determined the impairment was other-than-temporary and therefore the impairment loss was recognized. The loss was classified within Non-interest expenses—Other in the consolidated statements of income.

(2) The income before income taxes for the year ended March 31, 2021 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.

(3) Includes gain of ¥73,293 million from the partial sale of Nomura’s investment in ordinary shares of Nomura Research Institute, Ltd. for the year ended March 31, 2020.

(4) 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 (loss) before income taxes in the consolidated statements of income for the years ended March 31, 2019, 2020 and 2021.

	Millions of yen
	Year ended March 31
	2019			2020			2021
Net revenue	¥	1,123,974		¥	1,309,156		¥	1,390,327
Unrealized gain (loss) on investments in equity securities held for operating purposes		(7,204	)		(21,327	)		11,545
Consolidated net revenue	¥	1,116,770		¥	1,287,829		¥	1,401,872
Non-interest expenses	¥	1,154,471		¥	1,039,568		¥	1,171,201
Unrealized gain (loss) on investments in equity securities held for operating purposes		—			—			—
Consolidated non-interest expenses	¥	1,154,471		¥	1,039,568		¥	1,171,201
Income (loss) before income taxes	¥	(30,497	)	¥	269,588		¥	219,126
Unrealized gain (loss) on investments in equity securities held for operating purposes		(7,204	)		(21,327	)		11,545
Consolidated income (loss) before income taxes	¥	(37,701	)	¥	248,261		¥	230,671

Subsequent events

Effective for the first quarter of the year ending March 31, 2022, we combined our Asset Management Division and Merchant Banking Division to form a new operating segment called the Investment Management Division. This change is consistent with the updated organizational structure of our businesses and how the chief operating decision maker will assess operating performance going forward. As a result of this change in segment reporting, Nomura will have the following three operating segments: Retail, Wholesale and Investment Management.

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 tables below present a geographic allocation of Net revenue and Income (loss) before income taxes from operations by geographic areas for the years ended March 31, 2019, 2020 and 2021 and Long-lived assets associated with Nomura’s operations as of March 31, 2019, 2020 and 2021. 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 has been allocated based on the inclusion of intersegment transactions.

	Millions of yen
	Year ended March 31
	2019			2020			2021(2)
Net revenue(1):
Americas	¥	169,581		¥	229,265		¥	226,741
Europe		131,175			115,483			142,941
Asia and Oceania		47,977			42,571			66,985
Subtotal		348,733			387,319			436,667
Japan		768,037			900,510			965,205
Consolidated	¥	1,116,770		¥	1,287,829		¥	1,401,872
Income (loss) before income taxes:
Americas	¥	(114,081	)	¥	7,354		¥	(76,963	)
Europe		(56,851	)		(14,067	)		14,283
Asia and Oceania		5,014			19,817			49,205
Subtotal		(165,918	)		13,104			(13,475	)
Japan		128,217			235,157			244,146
Consolidated	¥	(37,701	)	¥	248,261		¥	230,671

	March 31
	2019		2020		2021
Long-lived assets:
Americas	¥	50,829	¥	84,904	¥	98,611
Europe		56,821		52,179		65,165
Asia and Oceania		9,588		29,618		26,690
Subtotal		117,238		166,701		190,466
Japan		252,420		292,212		303,355
Consolidated	¥	369,658	¥	458,913	¥	493,821

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

(2) Includes losses arising from the U.S. Prime Brokerage Event. See Note. 23 “Loss Arising from U.S. Prime Brokerage Event.”