Koji Nagai, the group chief executive of Nomura Holdings, likes to tell a story about his first job at the Japanese bank. It was 1981 and the recent university graduate was sent to a branch in Takamatsu, the capital of Kagawa Prefecture. Nagai was there to learn the basics of selling shares, bonds and mutual funds to individual investors, and his timing was good: Japan's great stock market run still had eight years of life left in it.
His resolve faced a test one afternoon, however, when he was caught in a sudden downpour on his way to meet a client at her house. He found some shelter and rode out the storm, but only after becoming soaking wet and muddy. Once the storm broke, Nagai worried about whether he should turn up in this condition.
Embarrassed about his soggy appearance, Nagai hesitated to enter the house, but the client handed him a towel and invited him in with a smile. She thanked him for coming despite the heavy rain and, at the end of his visit, she bought some products.
Nagai earned his stripes as a salesman that day, and he remained in Nomura's retail business for the next 20 or so years, making a wide range of proposals to wealthy individuals and the management of midsize companies in the community. "These early years are the driving force behind everything I do today," he says.
Though he would go on to work on the institutional side of Nomura's business for more than a decade, he never lost his conviction that all investment ultimately begins when an individual places his or her money at risk. And it is this idea that lies at the heart of Nomura's next big initiative: setting up a retail business in mainland China aimed at the country's rising numbers of wealthy individuals.
Nomura is hoping to take advantage of a liberalization push by China to allow foreign control of financial institutions, including securities firms and asset managers, on the mainland. Chinese officials stunned the global finance industry by announcing the plans in November 2017, and Nomura -- which had been studying the feasibility of doing business on the mainland for years -- acted quickly. JPMorgan Chase has also been quick in applying for a license.
Nagai says Nomura's model, in which the retail and institutional businesses work together under one roof, is well-suited for the mainland. "I think it is the right strategy to employ an approach in China that is similar to the way we operate in Japan," he said in an interview with the Nikkei Asian Review. "I believe this will prove to be a competitive edge."