Daiwa Securities Group Inc.

Second place isn't bad

Daiwa Securities Group is Japan's second-largest securities firm, next to Nomura Holdings.  Daiwa is represented internationally with branches in North America, Europe, Asia and Oceania.

Daiwa was launched in 1902 as Fujimoto Bill Broker.  For 40 years, the company's business had grown enough to change the name to Fujimoto Securities Company.  In the midst of World War II, in 1943, Fujimoto merged with Nippon Trust Bank and switched to the moniker Daiwa Securities, one of the "Big Four" of the securities market.  Today, the many arms of Daiwa Securities Group handle the trading and brokerage of securities and derivatives.  Through its many branches, the company also offers venture capital, corporate financing, investment management and real estate leasing services.  In 1999, Daiwa Securities, together with Sumitomo Mitsui, launched Daiwa Securities SMBC and adopted a holding company structure.

Increasing pressure and strain

Daiwa Securities SMBC earnings have suffered as the result of the ill effects of a struggling economy.  The Japanese economy was severely affected when Lehman Brothers in the United States declared bankruptcy in late 2008.  With the global economy spiraling down after the bankruptcy declaration, earnings deteriorated for Daiwa Securities as it recorded a net loss of $85 billion as reported in March 2009.  The depreciation has affected all of the business segments of the group.

Under pressure and strain of the struggling Japanese economy, the cracks within the relationship between Daiwa and Sumitomo Mitsui started showing when the latter bought Nikko Citigroup from Citigroup, Inc. and planned to integrate it with Daiwa Securities SMBC.  In addition, Sumitomo tried buying another 10 percent of Daiwa SMBC's stakes, which Daiwa declined; moreover, Daiwa bought back Sumitomo's 40 percent share to gain full ownership of the subsidiary and ended its joint venture with Sumitomo Mitsui by October 2009.

"Passion for the best" by 2011

Despite the depression of the Japanese economy since 2007, Daiwa Securities remains hopeful as they have created a new medium-term management plan which would span until 2011 in response to the changes and challenges in today's economy.  As part of the restructuring of plans, they are to shift their focus on income generation from developing products and services to increasing the customer's assets by stimulating sales.  Other than these, the company would also like to focus on creating a more highly professional and vibrant workforce by providing services, such as career guidance, and enabling "Daiwa Direct" to tailor the needs of customers and using more advanced technology to improve both the lives of employees and clients.  By 2011, the company is targeting its revenue to as much as $120 billion.



Daiwa Securities Group Inc.


GranTokyo North Tower
9-1, Marunouchi 1-chome, Chiyoda-ku
Tokyo 100-0005
Phone: +81-3-5555-1111
www.daiwa-grp.jp

STATS


  • Employer Type: Public
  • Stock Symbol: 8601
  • Stock Exchange: TSE
  • President & CEO: Shigeharu Suzuki
  • 2008 Employees: 15,224

Key Financials

  • 2008 Income: $-867 million
  • 2008 Revenue: $2,036 million

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