Nomura Holdings (NYSE:NMR) Chief Executive Officer Kentaro Okuda has issued a public apology following accusations that an employee manipulated the Japanese government bond (JGB) futures market.
This marks Okuda's first public appearance since the scandal surfaced.
Last week, Japan’s Securities and Exchange Surveillance Commission (SESC) recommended a ¥21.8 million ($152,000) fine against Nomura’s domestic securities unit for alleged manipulation of JGB futures in 2021.
The Financial Services Agency (FSA) is expected to impose the fine in the coming weeks.
The investigation revealed that a dealer had placed large orders for JGB futures without intending to execute all of them, resulting in a profit.
Speaking at a financial forum hosted by Nikkei in Tokyo on Wednesday, Okuda addressed the controversy, saying, “I would like to apologize for the trouble caused.”
The scandal has already led several major firms, including Toyota Finance Corp., to exclude Nomura from underwriting deals.
The allegations come at a critical time for Nomura as it seeks to capitalize on a resurgence in Japan’s bond market, driven by shifts in the country’s monetary policy.
In response to the incident, Nomura has stated that it has been working to reform its JGB futures trading practices and is committed to improving internal controls to prevent future misconduct.
Other securities firms, including those operated by Citigroup and Mitsubishi UFJ Financial Group have faced similar penalties in recent years for manipulating JGB futures prices.