Mitsubishi UFJ Financial Group Inc. (8306) plans to dispatch a group of traders abroad in September to tap investors for its Japanese equity business after hiring 12 stocks specialists from rival Nomura Holdings Inc. (8604)
Traders and algorithm developers will travel in Asia, Europe and the U.S. to meet with 60 investors in their first such trip, said Akihiro Kiyomi, deputy head of the equity group at Mitsubishi UFJ Morgan Stanley Securities Co., a brokerage unit of Japan’s biggest publicly traded bank.
Mitsubishi UFJ, ranked first in managing local debt sales this year, aims to narrow the gap with rivals including Nomura and Mizuho Financial Group Inc. (8411) in stock trading and managing share sales. The bank seeks to add overseas clients by offering products such as electronic trading as Japan’s stock market and economy show signs of recovery from a record earthquake.
“Overseas clients have no idea about Mitsubishi’s trading ability,” Kiyomi, 48, who oversees about 180 employees, said in an interview in Tokyo. “For starters, we’ll send up a smoke signal by visiting them and promoting Mitsubishi as a trading partner.”
Kiyomi and about four colleagues plan to visit cities including Hong Kong, Singapore, London, New York, San Francisco and Boston to meet institutional investors including hedge funds and pension managers during the one-month trip, he said.
Electronic Trading Rivalry
Japanese banks have been competing to provide computer- driven algorithmic trading for clients. Mizuho hired 16 people for electronic trading from Lehman Brothers Holdings Inc. (LEHMQ) in 2008. Mitsubishi UFJ hired the 12 equity-trading staff, including Kiyomi, from Nomura between February and April.
Mitsubishi UFJ Morgan Stanley, an investment banking joint venture formed by Mitsubishi UFJ and Morgan Stanley in May 2010, is ranked seventh in managing sales of Japanese equity and equity-linked products this year, according to data compiled by Bloomberg. The banking group holds the top position for underwriting Japanese bonds in 2011, the data show.
The Japanese bank has a majority stake in Mitsubishi UFJ Morgan Stanley. The Wall Street firm owns most of a separate joint venture, Morgan Stanley MUFG Securities Co.
Japan’s Nikkei 225 (NKY) Stock Average rose 1.1 percent to 10,082, a seventh day of gains, marking the longest winning streak in almost two years. Industrial production climbed the most in more than 50 years in May and a central bank survey last week showed companies expect profits to rebound later this year.
Build Client Base
Mitsubishi UFJ Securities Holdings Co., the parent of Mitsubishi UFJ Morgan Stanley (MS), earned 21.7 billion yen ($268 million) from stock brokerage commissions and 6.9 billion yen of equity underwriting fees for the year ended March 31. Income from equity products amounted to 31.7 billion yen, or 20 percent of the company’s total fees and commissions.
Strengthening equity trading services will also boost the firm’s investment banking business by building up a base of clients to potentially purchase shares underwritten by the company, Kiyomi said. “We will be able to bolster our market placement ability, which is a condition for the selection of underwriters,” he said.
Kiyomi joined Nomura Securities Co. in 1986 after graduating from Tokyo Metropolitan University. He worked for Nomura’s U.S. unit for about seven years, and became the head of equity sales trading in 2009.
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