TOKYO – Nomura Holdings is crafting plans to rebuild its currency options business after a wave of staff exited the division in London and New York, according to sources familiar with the matter.
At least eight traders have left the team or gone on leave in the past year, leaving just a handful still trading across the two cities, the sources said. Most of the departures were staffers who had joined since the start of 2022, they said, asking not to be identified discussing non-public information.
Mr David Leigh, who moved to Nomura from Deutsche Bank in recent months, is responsible for rebuilding the desk, the sources said.
A Nomura spokesperson said the business continued to play a key role in enhancing the firm’s client franchise and trading capabilities globally. “As a profitable business for Nomura, we will continue to invest,” the spokesperson said.
Already, Mr Leigh’s co-head of currencies and emerging markets, Mr Nagaraj Pangal, has helped lead the division’s remaining traders to generate nearly US$50 million (S$68 million) in revenue in recent months. This largely came from successful bets on the US presidential election, sources familiar with the matter said.
Large macro wagers helped the unit’s revenue for its current fiscal year – which started on April 1 – reach US$60 million, they said. The division generated a US$50 million haul in 2024.
Trading desks saw a trade-weighted index of the US dollar advance about 5 per cent between late September and Donald Trump’s victory in November 2024.
Traders using so-called barrier options to wager on the greenback strengthening against the euro, for example, saw a fivefold return on their notional invested amount over that period, according to Bloomberg calculations.
Nomura declined to comment on what derivatives its team had used. “Our FX options business is seeing significant growth year on year, with double-digit growth in revenues driven by strong momentum in our client franchise,” the bank’s spokesperson said.
Mr Leigh is now on the hunt for skilled traders to replace those who have left, the sources said. Having talented traders is crucial in a business such as foreign exchange options, a market known for products that are more complex and less standardised. Old school-style voice trading is still the norm, given many prices are still constructed manually.
The departures had been a setback for Nomura’s broader ambitions to grow its currency trading business. In 2021, the firm hired Mr Kevin Connors to build out the bank’s foreign exchange and emerging markets desks.
In 2023, the former partner at Goldman Sachs promised in a memo to Nomura staff that the foreign exchange options desk would “play a key role in enhancing our client franchise offering and trading capabilities”.
Mr Connors left the bank in September 2024 and Mr Leigh joined shortly after.
Nomura’s bounce back in the fourth quarter was echoed on Wall Street. Industry-wide revenue for foreign exchange options had reached US$1.8 billion in the first nine months of 2024, before jumping to end up at US$2.5 billion, beating the previous year’s total of US$2.3 billion, according to data from Crisil Coalition Greenwich. BLOOMBERG
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