Sumitomo Mitsui Financial Group Inc., Japan’s second-largest bank, plans to hire two analysts from former investment-banking partner Daiwa Securities Group Inc. to build its equity research business, said two people with knowledge of the matter.
Nikko Cordial Securities Inc., the investment banking unit of Sumitomo Mitsui, will appoint Hiroki Kawashima as a senior analyst covering the construction industry and Hiroshi Torii for real estate, said the people, who declined to be identified before a public announcement. Kawashima and Torii will start on Oct. 1, the people said.
Sumitomo Mitsui is expanding its brokerage business after acquiring Nikko Cordial and investment banking operations from Citigroup Inc. for $6.5 billion last year. Daiwa has lost at least four analysts in about three months, and its Japanese stock underwriting rank has slipped since it ended a 10-year investment banking venture with Sumitomo Mitsui.
“We will continue to strengthen our equity research department,” said Shojiro Hirota, a spokesman for Nikko Cordial in Tokyo. He declined to comment on any specific hiring. Kenichi Kanda, a Tokyo-based spokesman for Daiwa Securities Capital Markets Co., declined to comment.
Nikko Cordial, which employs 30 equity research staff, plans to increase the unit’s headcount to 50 this year, the people said. The equity research department was formed in August and is headed by Kenichiro Yoshida, who was hired from Goldman Sachs Group Inc. Former Daiwa analyst Kazuharu Miura also moved to Nikko Cordial to cover the electronics sector.
Sumitomo Mitsui rose 19 yen, or 0.7 percent, to close at 2,609 yen in Tokyo.
Nikko hired Hiroyuki Okaseri on Sept. 16 from Mitsubishi UFJ Morgan Stanley Securities Co. as a senior analyst at the pulp and paper industry, the people said. Okaseri was rated the best analyst of the industry by the Nikkei Veritas newspaper this year.
The brokerage is also expanding abroad, aiming to set up offices in London, New York and Hong Kong by March 31, Sumitomo Mitsui Chief Executive Officer Teisuke Kitayama said at an investors’ conference on Sept. 8.
Sumitomo Mitsui and Nikko will start brokerage for Japanese stocks and bonds as well as merger and acquisition advisory businesses in the U.K. from Oct. 1, the two firms said in an e- mailed statement today.
Daiwa, Japan’s second-biggest brokerage, is losing talent and business to its rivals. Analyst Masao Muraki left the firm to join Deutsche Bank AG on Sept. 1. Muraki was rated the best analyst of the brokerage and insurance industries in Japan by Nikkei Veritas for the past three years.
Daiwa slipped to fifth place in Japanese equity underwriting this year from second in 2009, when its alliance with Sumitomo Mitsui was still in effect. Sumitomo Mitsui is ranked No. 4 this year, according to data compiled by Bloomberg.