- ABN Amro is leaving Japan.
- ING Barings is moving equity trading and investment banking to Hong Kong, cutting payroll in Japan by 50%
- Commerz Securities will leave the Japanese equities business next year.
- J.P. Morgan Securities Asia cut its staff about 40% in October
- CSFB is cutting 10% of its Japanese equities traders
- Merrill Lynch is basically out of Japan.
The reason, in a nutshell, is that trading on the Tokyo Stock Exchange now represents about 4% of the global market, down from 22% a decade ago.
Via Japan Digest
I’m not surprised by this news but it is still stunning nonetheless. Yet another negative sign for Japan’s path out of it’s recession.


Foreign Brokers Said To Cut Back in Japan Because of Slow Sales

A number of foreign securities houses are cutting their brokerage operations in Japan because the underlying weakness of the Tokyo market has taken commission revenues down substantially, Nihon Keizai said. Two new developments on that front, the paper said, came this week from the Dutch houses ABN Amro Securities and ING Barings Securities. ABN Amro plans to tell the TSE it’s leaving, and to stop operating as a broker in Japan, the paper said. It will maintain a smaller operation in bond futures and other derivatives. ING Barings warned staffers yesterday that it will move equity trading and investment banking to Hong Kong, and trim its Japanese payroll from 210 to less than 100 by early next year. The paper said it has heard that Commerz Securities will quit the Japanese equities business next year, and cut its Japanese workforce by two thirds. A number of others are already gone–J.P. Morgan Securities Asia cut its staff about 40% in October, and Credit Suisse First Boston is expect to fire about 60 of its 650 Japanese equities traders. Earlier, Merrill Lynch all but closed its retail operation. The reason, in a nutshell, is that trading on the Tokyo Stock Exchange now represents about 4% of the global market, down from 22% a decade ago. And with the averages now below a quarter of their all time peak in late 1989, the Tokyo market’s capitalization is down to 9% of the global total, from 31%. Nikkei said it’s a self- reinforcing cycle. The more foreign brokers leave, the slower the trading gets–and the more others also decide to go.