Nomura Secures Securities License for Chinese Joint Venture

The license will allow the entity to operate brokerage, investment consulting businesses, among others.

Nomura Holdings, Inc., a principal member of the Nomura Group, announced this Friday that it has secured a securities business license in China for its majority-owned securities joint venture in China – Nomura Orient International Securities.

The securities business license was granted by the China Securities Regulatory Commission (CSRC). The license will allow the entity to operate brokerage, investment consulting, proprietary trading, and asset management businesses.

“Through the new business, Nomura aims to leverage its global expertise to provide clients with diverse investment products and services for the Chinese market, with the ultimate goal of growing the business into a full-fledged brokerage that will form a core part of the firms strategy in Asia ex-Japan,” the company said in the statement released today.

Nomura remains committed to China

Nomura Orient International Securities is a joint venture between Nomura and JPMorgan. According to the statement, the company was officially established in August of this year; however, the two firms received approval for the venture back in March.

The joint venture is based in Shanghai, China, and Nomura holds a 51 percent stake, while Orient International (Holding) Co. Ltd., a state-owned enterprise based in Shanghai, holds 24.9 percent and Shanghai Huangpu Investment Holding (Group) Co., Ltd. holds the remainder.

Nomura was able to set up the venture due to a relaxing in Chinese law. Specifically, in April of 2018, the Chinese regulator issued rules to raise the ceiling on foreign ownership of China-based securities firms to 51 percent. Previously, the limit was 49 percent.

Towards the end of last year in November, the CSRC gave the first approval for a foreign firm to take advantage of this, which was granted to Swiss firm UBS Group AG which raised its shareholding in UBS Securities Co. Ltd. to 51 percent.