May 24, 2019 / 9:22 AM / in 9 months

Nomura CEO to take 30% pay cut after information leak

TOKYO (Reuters) - The chief executive of Nomura Holdings will take a 30% pay cut for three months over its improper handling of market information, marking the latest headache for CEO Koji Nagai, as he struggles to turn around the Japanese investment bank.

FILE PHOTO: Nomura Holdings' Chief Executive Officer Koji Nagai attends an interview with Reuters in Tokyo, Japan, December 27, 2017. Picture taken December 27, 2017. REUTERS/Toru Hanai

The incident comes a month after Nomura reported its first annual loss in a decade and said it would not pay out bonuses to directors.

Nagai, under pressure as Nomura wrestles with a restructuring plan that includes cutting $1 billion in costs from its wholesale business, told a news conference that he accepted responsibility for the information leak but would not step down.

“Management itself has to implement the reform measures, that is the duty of management,” he said.

Nagai, a Nomura veteran, took the helm in 2012, after the previous CEO resigned over a widening insider trading scandal.

Nomura confirmed late on Thursday that information related to listing and delisting criteria now under review by the Tokyo Stock Exchange had been “handled improperly”.

Nomura said an employee from its research unit leaked information about expected changes to the exchange’s listing criteria to the chief strategist of its security arm, who then informed sales staff.

The sales staff, in turn, told clients, it said.

The leaked information was that the minimum market value of a company on the exchange’s main board would likely be 25 billion yen ($228 million), Nomura said. The research unit employee had been a participant in a research panel to discuss a planned overhaul of the Tokyo exchange, Nomura said.

Two sources told Reuters that Japan’s Financial Services Agency is planning to slap the company with a business improvement order - a formal warning from the regulator to improve business practices.

Reporting by Taro Fuse, Takashi Umekawa and Junko Fujita; Writing by David Dolan; Editing by Anshuman Daga

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