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Nomura chief resigns following insider-trading scandal | |
(about 3 hours later) | |
The chief executive of Japan's Nomura Holdings has resigned following a damaging insider-trading scandal. | |
Kenichi Watanabe will step down on 31 July, bowing to pressure after Nomura was caught up in the scandal. Chief operating officer Takumi Shibata will also leave his post. | |
It is alleged that staff leaked information on share offerings to customers before it was made public. | |
Nomura shares rose more than 5% in Tokyo on the news. | Nomura shares rose more than 5% in Tokyo on the news. |
The resignations came the same day as the bank reported a 89.4% drop in net profit in the first quarter of its financial year to 1.89bn yen ($24.19m; £15.60m). | |
Revenue was up 12% from a year earlier to 369.3bn yen. | |
'Last straw' | |
Koji Nagai, president of Nomura Securities, the domestic brokerage, will replace Mr Watanabe as the new head of the group. | |
Japan's largest investment bank by revenues also appointed Atsushi Yoshikawa, head of US operations, as is new chief operating officer. | |
Last month, Nomura cut the salaries of Mr Watanabe and Mr Shibata after an internal probe into the leaks. | |
Mr Watanabe was docked half of his six-month salary, while Mr Shibata was hit for half of his five-month salary. | |
The bank also admitted that some of its staff leaked sensitive information on planned share offerings by energy firm Inpex, Mizuho Financial Group and Tokyo Electric Power in 2010. | |
But on Thursday, Nomura said it was highly possible that there were more cases of insider trading than the three already identified. | |
"When you look at their history, the number of scandals, this was the last straw," said Jim Sinegal, an analyst with research firm Morningstar. | "When you look at their history, the number of scandals, this was the last straw," said Jim Sinegal, an analyst with research firm Morningstar. |