• Bloomberg


Nomura Holdings Inc. more than tripled pay to top managers last fiscal year as it returned to profit from a record loss, according to a financial report sent to shareholders.

Chief Executive Officer Kenichi Watanabe and his executive team received an average of ¥145 million for the 12 months that ended March 31, up from ¥41.5 million a year earlier, according to the report.

Nomura shares rose 35 percent during the fiscal year as the firm recovered from losses partly caused by its 2008 acquisition of Lehman Brothers Holdings Inc.’s Asian and European businesses. In the previous 12 months, the stock lost two-thirds of its value. Nomura posted a profit of ¥67.8 billion for the 12 months to March 31, compared with a loss of ¥708.2 billion a year earlier.

The company paid a total of ¥1.45 billion to Watanabe and nine other executives in base salary and cash and stock bonuses, Nomura said. The previous year, it paid 20 top managers a total of ¥829 million. The pool of executives was larger in the year-earlier period because it included eight people who have since retired, as well as their replacements.

“Motivation matters for this type of business,” said Shiro Yoshioka, an analyst at Japaninvest Group PLC. “Compensation reflecting performance is critical, as is a claw-back system for bonuses.”

Nomura has introduced new compensation guidelines to “ensure we attract, retain, motivate and develop talent,” according to the document.

Executives may receive a portion of their base salary in equity and part of their bonuses may be deferred or clawed back if necessary, Nomura said.

At least 12 senior former Lehman managers, including Nomura’s deputy investment banking chief, have defected since the firm began paying out final portions of guaranteed bonuses in March. Meanwhile, Nomura is almost tripling annual salaries for some investment-banking and trading recruits to close a compensation gap with workers who joined from Lehman.

Nomura took over 8,000 Lehman employees in 2008, guaranteeing salaries and bonuses for some.

Lehman paid employees an average of $332,000 in the fiscal year that ended on Nov. 30, 2007.

Nomura’s average pay was $144,000 for the 12 months through March 2008.

Nomura will hold a general shareholders’ meeting June 25.

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