{"url_path":"/sec/nmr/10-k/2026/item-3","section_key":"item-3","section_title":"Item 3 Key Information","topic":"sec","document":{"doc_type":"20-F","doc_date":"2026-06-22","source_url":"https://www.sec.gov/Archives/edgar/data/1163653/0001193125-26-277134-index.html","accession_number":"0001193125-26-277134","cik":"0001163653","ticker":"NMR","issuer_name":"NOMURA HOLDINGS INC","edgar_url":"https://www.sec.gov/Archives/edgar/data/1163653/0001193125-26-277134-index.html","primary_entity_key":"0001163653","primary_entity_name":"NOMURA HOLDINGS INC"},"word_count":11700,"has_tables":true,"body_markdown":"Item 3. Key Information\n\nA. Selected Financial Data\n\nSee Item 5. “Operating and Financial Review—A. Operating Results—Other operating results—Selected Financial Data.”\n\nB. Capitalization and Indebtedness.\n\nNot applicable.\n\nC. Reasons for the Offer and Use of Proceeds.\n\nNot applicable.\n\n \n\n2\n\n##### Table of Contents\n\nD. Risk Factors.\n\nRisk Factors\n\nYou should carefully consider the risks described below before making an investment decision. If any of the risks described below actually occur, our business, financial condition, results of operations or cash flows could be adversely affected. In that event, the trading prices of securities of NHI could decline, and you may lose all or part of your investment. In addition to the risks listed below, risks not currently known to us or that we now deem immaterial may also harm us and affect your investment.\n\nINDEX\n\n \n\n•\n \n\nRisks Relating to the Business Environment\n\n \n\n1\n\nOur business may be materially affected by financial markets, economic conditions and market fluctuations in Japan and elsewhere around the world, including the ones caused by geopolitical events\n\n \n\n \n(1)\n\nGovernmental fiscal and monetary policy changes in Japan, or in any other countries or regions where we conduct business may affect our business, financial condition and results of operations\n\n \n\n \n(2)\n\nExtended market declines and decreases in market participants can reduce liquidity and lead to material losses\n\n \n\n \n(3)\n\nNatural disasters, geopolitical events and infectious diseases could adversely affect our business\n\n \n\n2\n\nThe financial services industry faces intense competition\n\n \n\n \n(1)\n\nCompetition with other financial firms and financial services by non-financial companies is increasing\n\n \n\n \n(2)\n\nIncreased consolidation and reorganization, business alliance and cooperation in the financial services industry mean increased competition for us\n\n \n\n \n(3)\n\nStrategic alliances and investments and the launching of new businesses may subject us to significant impact\n\n \n\n \n(4)\n\nOur global business continues to face intense competition and may require further revisions of our business model\n\n \n\n3\n\nEvent risk, including the ones caused by geopolitical events, may cause losses in our trading and investment assets as well as market and liquidity risk\n\n \n\n4\n\nSustainability factors including climate change and broader associated policy changes in each jurisdiction could adversely affect our business\n\n \n\n•\n \n\nRisks Relating to Our Businesses\n\n \n\n5\n\nOur business may incur losses due to various factors in the conduct of its operations\n\n \n\n \n(1)\n\nWe may incur significant losses from our trading and investment activities\n\n \n\n \n(2)\n\nHolding large and concentrated positions of securities and other assets may expose us to significant losses\n\n \n\n \n(3)\n\nOur hedging strategies may not prevent losses\n\n \n\n \n(4)\n\nOur risk management policies and procedures may not be fully effective in managing risks\n\n \n\n \n(5)\n\nMarket risk may increase other risks that we face\n\n \n\n \n(6)\n\nOur brokerage and asset management revenues may decline\n\n \n\n \n(7)\n\nOur investment banking revenues may decline\n\n \n\n3\n\n##### Table of Contents\n\n6\n\nWe may be exposed to losses when third parties do not perform their obligations to us\n\n \n\n \n(1)\n\nDefaults by a large financial institution could adversely affect the financial markets generally and us specifically\n\n \n\n \n(2)\n\nThere can be no assurance as to the accuracy of the information about our credit risk, or the sufficiency of the collateral we use in managing it\n\n \n\n \n(3)\n\nOur clients and counterparties may be unable to perform their obligations to us as a result of political or economic conditions\n\n \n\n7\n\nWe are exposed to model risk, i.e., risk of financial loss, incorrect decision making, or damage to our credibility arising from model errors or incorrect or inappropriate model application\n\n \n\n8\n\nNHI is a holding company and depends on payments from its subsidiaries\n\n \n\n9\n\nWe may not be able to realize gains we expect, and may even suffer losses, on our investments in equity securities and non-trading debt securities\n\n \n\n10\n\nWe may face an outflow of clients’ assets due to losses incurred within cash reserve funds or debt securities we offer to clients\n\n \n\n•\n \n\nRisks Relating to Our Financial Position\n\n \n\n11\n\nWe may have to recognize impairment losses with regard to the amount of goodwill, tangible assets and intangible assets recognized on our consolidated balance sheets\n\n \n\n12\n\nLiquidity risk could impair our ability to fund operations and jeopardize our financial condition\n\n \n\n \n(1)\n\nWe may be unable to access unsecured or secured funding\n\n \n\n \n(2)\n\nWe may be unable to sell assets\n\n \n\n \n(3)\n\nLowering of our credit ratings could impact our funding\n\n \n\n13\n\nEquity investments in affiliates and other investees accounted for under the equity method in our consolidated financial statements may decline significantly over a period of time and result in us recognizing impairment losses\n\n \n\n•\n \n\nRisks Relating to Legal, Compliance and Other Operational Issues\n\n \n\n14\n\nOperational risk could adversely affect our business\n\n \n\n15\n\nReputational risk could adversely affect our business\n\n \n\n16\n\nWe may identify a material weakness in our internal control over financial reporting, indicating that our internal control over financial reporting may not be effective\n\n \n\n17\n\nMisconduct, fraud or other criminal activity by an employee, director or officer, or any third-party, could occur, and our reputation in the market and our relationships with clients could be harmed\n\n \n\n18\n\nA failure to identify and appropriately address conflicts of interest could adversely affect our business\n\n \n\n19\n\nOur business is subject to substantial legal and regulatory risks\n\n \n\n \n(1)\n\nLegal liability related to our business may occur and could adversely affect our business, financial condition and results of operations\n\n \n\n4\n\n##### Table of Contents\n\n \n(2)\n\nExtensive regulation of our businesses limits our activities and may subject us to significant penalties and losses\n\n \n\n \n(3)\n\nTightening of regulations applicable to the financial system and financial industry could adversely affect our business, financial condition and results of operations\n\n \n\n \n(4)\n\nDeferred tax assets may be impacted due to a change in business condition or in laws and regulations, resulting in an adverse effect on our operating results and financial condition\n\n \n\n \n(5)\n\nDefects in our anti-money laundering and counter-terrorism financing measures could have serious consequences, such as administrative penalties or punitive fines\n\n \n\n20\n\nUnauthorized disclosure or misuse of personal information held by us may adversely affect our business\n\n \n\n21\n\nSystem failure, information leakage and cost of maintaining sufficient cybersecurity could adversely affect our business, financial condition and results of operations\n\n \n\n22\n\nOur business may be adversely affected if we are unable to hire, retain and develop qualified personnel\n\n \n\n•\n \n\nRisks Related to Holding or Trading of NHI Shares and ADRs\n\n \n\n23\n\nBecause of daily price range limitations under Japanese stock exchange rules, you may not be able to sell your shares of NHI Shares at a particular price on any particular trading day, or at all\n\n \n\n24\n\nUnder Japan’s unit share system, holders of shares of NHI Shares constituting less than one unit are subject to transfer, voting and other restrictions\n\n \n\n25\n\nAs a holder of ADRs, you will have fewer rights than a shareholder has and you will have to act through the depositary to exercise these rights\n\n \n\n26\n\nRights of shareholders under Japanese law may be more limited than under the laws of other jurisdictions\n\n \n\n27\n\nThe Company’s shareholders of record on a record date may not receive the dividend they anticipate\n\n \n\n28\n\nIt may not be possible for investors to secure personal jurisdiction within the U.S. over the Company or the Company’s directors or executive officers, or to enforce against the Company or those persons judgments obtained in U.S. courts predicated upon the civil liability provisions of the federal securities laws of the U.S.\n\n \n\n•\n \n\nSpecial Note Regarding Forward-looking Statements\n\n \n\n•\n \n\nRisks Relating to the Business Environment\n\n \n\n1.\n\nOur business may be materially affected by financial markets, economic conditions and market fluctuations in Japan and elsewhere around the world, including the ones caused by geopolitical events\n\nOur business and revenues may be affected by any adverse changes or volatility in the Japanese and global economic environments and financial markets. In addition to purely economic factors, events such as military disputes, acts of terrorism, economic or political sanctions, pandemics, natural disasters and other actual or anticipated geopolitical risks and geopolitical events could have an effect on the financial markets and economies\n\n \n\n5\n\n##### Table of Contents\n\nof each country. If any adverse events including those discussed above were to occur, a market or economic downturn may last for a long period of time, which could adversely affect our business and business continuity readiness, and could result in us incurring substantial losses. In addition to conditions in financial markets, social conditions such as the long-term trends of population aging and population decline faced by Japan are expected to continue to put downward pressure on demand in the businesses in which we operate. The following are certain risks related to the financial markets and economic conditions for our specific businesses.\n\n(1) Governmental fiscal and monetary policy changes in Japan, or in any other countries or regions where we conduct business may affect our business, financial condition and results of operations\n\nWe engage in our business globally through domestic and international offices. Governmental fiscal, monetary and other policy changes in Japan, or in any other countries or regions where we conduct business, may affect our business, financial condition and results of operations. In particular, any changes to the monetary policy of the Bank of Japan or central banks in major economies worldwide, which could potentially lead to volatility in interest rates or yields, may negatively affect our ability to provide asset management products to our clients as well as our trading and investment activities or lead to increased interest expenses. In 2025, following the Bank of Japan’s policy rate hikes in both January and December, Japan’s 10-year government bond yield rose by approximately 1 percentage point over the course of the year. In addition, around the February 2026 Japanese House of Representatives election, there were periods of volatility in the Japanese government bond market as major political parties broadly campaigned on lowering the consumption tax rate, and, in April 2026, Japanese government bonds reached their highest yields in nearly 30 years following the collapse of peace talks between the U.S. and Iran. Uncertainty surrounding fiscal policy under the current U.S. administration is also a factor that has contributed to, and may continue to contribute to, increased market volatility.\n\n(2) Extended market declines and decreases in market participants can reduce liquidity and lead to material losses\n\nExtended market declines can reduce the level of market activity and the liquidity of the assets traded in those markets in which we operate. Market liquidity may also be affected by decreases in market participants, for example, if financial institutions scale back market-related businesses due to increasing regulation or other reasons. As a result, it may be difficult for us to sell, hedge or value such assets. In the event that a market is unable to price such assets, it will be difficult to estimate their values. If we cannot properly close out or hedge our associated positions in a timely manner or in full, particularly with respect to Over-The-Counter (“OTC”) derivatives, we may incur substantial losses. Further, if the liquidity of a market significantly decreases and the market becomes unable to price financial instruments held by us, this could lead to unanticipated losses.\n\n(3) Natural disasters, geopolitical events and infectious diseases could adversely affect our business\n\nUnexpected events such as natural disasters, geopolitical events or infectious diseases could exceed the assumptions of our event response preparation and framework, and we may not always be able to respond to every situation. As a result, our officers and employees may become unable to perform their duties, and our facilities, systems, or communication networks may not function, adversely affecting our business continuity management. In particular, Japan, where Nomura has its group head office, is prone to natural disasters such as earthquakes and tsunamis; if a large-scale earthquake or other natural disasters were to occur in regions where our main offices are concentrated, it could have a serious impact on our ability to carry out business operations, our financial condition and our business performance. Geopolitical events include cases such as armed conflict or heightened military tensions, acts of terrorism, political instability, and trade fragmentation.\n\n \n\n2.\n\nThe financial services industry faces intense competition\n\nOur businesses are intensely competitive, and are expected to remain so. We compete on the basis of a number of factors, including transaction execution capability, our products and services, innovation, reputation\n\n \n\n6\n\n##### Table of Contents\n\nand price. We continue to experience intense price competition, particularly in brokerage, investment banking and other businesses.\n\n(1) Competition with other financial firms and financial services by non-financial companies is increasing\n\nWe face intense competition in the financial services sector from a wide variety of competitors. We compete with other independent securities firms as well as securities firms affiliated with commercial banks and with firms that have broad footprints across regions. As a result, our market shares and commissions earned in the sales and trading, investment banking and Wealth Management businesses in particular have been affected. We face intense competition beyond the traditional financial sector based on the increasing digitalization of the industry, not only with the rise of online securities firms but also FinTech companies and the entry of non-financial companies into the financial services sector. Moreover, the competitive environment has begun to change due to shifts in service models driven by the use of AI technology. In order to address such changes in the competitive landscape, we continue to adopt and transform our business models through various measures. However, these measures may not be successful in growing or maintaining our market share in this increasingly fierce competitive environment, and we may lose business or transactions to our competitors, harming our business and results of operations.\n\n(2) Increased consolidation and reorganization, business alliance and cooperation in the financial services industry mean increased competition for us\n\nThere has been substantial consolidation and convergence among companies in the financial services industry. In particular, a number of large commercial banks and other broad-based large financial services groups have established or acquired broker-dealers or have consolidated with other financial institutions. These large financial services groups have developed business linkage within their respective groups in order to provide comprehensive financial services to clients, offering a wide range of products, including loans, deposit-taking, insurance, brokerage, asset management and investment banking services within their group, which may enhance their competitive position compared with us. They also have the ability to supplement their investment banking and brokerage businesses with commercial banking and other financial services revenues in an effort to gain market share. In addition, the financial services industry has seen collaboration beyond the borders of businesses and industries, such as alliances between commercial banks and securities companies outside of the framework of existing corporate groups and recent alliances with non-financial companies including emerging companies. Our competitiveness may be adversely affected if our competitors are able to expand their businesses and improve their profitability through such business alliances.\n\n(3) Strategic alliances and investments and the launching of new businesses may subject us to significant impact\n\nWe may seek to grow our business from time to time through strategic alliances, investments such as acquisitions or minority investments and launch new businesses. However, if the sourcing, evaluation, development and implementation of these business strategies do not proceed as expected because of regulatory issues or otherwise, we may not be able to grow our business, maintain or improve our competitive position, achieve the expected synergies and other benefits or recoup related investments, and we may experience competition from other institutions for a limited number of attractive investment and alliance opportunities. These new strategic alliances, investments and business initiatives may also subject us to increased risk as we engage in new activities, transact with a broader array of clients and counterparties and expose ourselves to new asset classes and new markets.\n\n(4) Our global business continues to face intense competition and may require further revisions of our business model\n\nWe continue to believe there are significant opportunities in the international markets, but there is also significant competition associated with such opportunities. In order to take advantage of these opportunities, we will have to compete successfully with financial services firms based in important non-Japanese markets, including the U.S., Europe and Asia. We have been working to strengthen our global business platform, under which we aim to transform our business portfolio and pivot towards client businesses and growth areas, both organically and inorganically. The\n\n \n\n7\n\n##### Table of Contents\n\nsale of stake of Capital Nomura Securities Public Company Limited in 2023 and the acquisition of all equity interests in Macquarie Management Holdings, Inc., Macquarie Investment Management Holdings (Luxembourg) S.à r.l., and Macquarie Investment Management Holdings (Austria) GmbH in 2025 (the “Macquarie Acquisition”)* are recent examples of transforming our business platform. We will continue to review our entire business portfolio while looking at the competitive environment, and intend to implement our strategies in consideration of potential risks. However, the risk remains that we may be required to incur greater costs and expenses than we expect, or to commit greater financial, management and other resources to the strategies than we expect, which could adversely affect our business and results of operations. Moreover, the assumptions and expectations upon which these strategies are based may not be accurate, which could lead to us realizing fewer benefits or synergies than we expect or could even harm our business and results of operations. Furthermore, to the extent we reduce compensation or headcount as part of this strategy, our ability to attract and retain the employees needed to successfully run our businesses could be adversely affected. We may also be unsuccessful in designing a streamlined management structure, which could harm our ability to properly control or supervise our many businesses across the world.\n\n* See Item 4.B. “Business Overview” for further information on the nature of the Macquarie Acquisition.\n\n \n\n3.\n\nEvent risk, including the ones caused by geopolitical events, may cause losses in our trading and investment assets as well as market and liquidity risk\n\nEvent risk refers to potential losses we may suffer through unpredictable events that cause large unexpected market price movements such as natural or man-made disasters, epidemics, acts of terrorism, military disputes or political instability, as well as adverse events specifically affecting our business activities or counterparties. These events include significant events such as the COVID-19 pandemic in 2020, the invasion of Ukraine by the Russian Federation in 2022, and the geopolitical tensions in the Middle East, as well as sudden, unforeseen changes in trade and security policies resulting from decisions by the U.S. administration or otherwise. More specifically, they include the following types of events that could cause losses in our trading and investment assets:\n\n \n\n \n•\n \n\nsudden and significant reductions in credit ratings with regard to financial instruments held by our trading and investment businesses by major rating agencies,\n\n \n\n \n•\n \n\nsudden changes in trading, tax, accounting, regulatory requirements, laws and other related rules which may make our trading strategy obsolete, less competitive or no longer viable, or\n\n \n\n \n•\n \n\nan unexpected failure in a corporate transaction in which we participate resulting in us not receiving the consideration we should have received, as well as bankruptcy, deliberate acts of fraud, and administrative penalties with respect to the issuers of our trading and investment assets.\n\n \n\n4.\n\nSustainability factors including climate change and broader associated policy changes in each jurisdiction could adversely affect our business\n\nWe consider climate change one of the most important global challenges facing society. The direct impact of climate change (physical risk), and the resulting changes in the business environment (transition risk) could cause us to incur losses.\n\nIn addition, as a global financial institution, we provide a wide range of solutions that address environmental and social issues. However, amid rapidly changing circumstances around sustainability, there may be cases where we are deemed to lack sufficient focus on sustainability matters such as the environment or human rights in our business activities, and we may not be able to provide adequate support to clients pursuing decarbonization or other sustainability-related initiatives. Furthermore, regulatory and market expectations in each country continue to evolve rapidly and generate conflicting views and approaches. As a result, there may be cases where our disclosure of sustainability-related information or our compliance with regulations is insufficient, or where it is perceived as such, or conversely, our efforts toward sustainability, including participation in voluntary initiatives, may be perceived negatively by some stakeholders, potentially resulting in litigation, regulatory action or administrative penalties. In such cases, there is a possibility that our reputation, results of operations and financial condition may be adversely affected.\n\n \n\n8\n\n##### Table of Contents\n\n•\n \n\nRisks Relating to Our Businesses\n\n \n\n5.\n\nOur business may incur losses due to various factors in the conduct of its operations\n\n(1) We may incur significant losses from our trading and investment activities\n\nWe maintain trading and investment positions in fixed income, equity and other markets, both for the purpose of facilitating our clients’ trades and for proprietary purposes. Our positions consist of various types of assets, such as interest rates, currency, credit, securitized products and equities, including securities, derivatives, repurchase agreements as well as loan transactions. Fluctuations in the markets where these assets are traded can adversely affect the value of our positions. We may incur losses if the value of these assets fluctuates significantly or if the financial system is overly stressed and the markets move in a way we have not anticipated. In addition, prices of crypto-assets may fluctuate significantly due to various factors such as developments in the industry or in regulation of crypto assets.\n\nOur businesses have been, and may continue to be, affected by changes in market volatility levels. Certain of our trading businesses such as those engaged in trading and arbitrage opportunities depend on market volatility to generate revenues. Lower volatility may lead to a decrease in business opportunities which may affect the results of operations of these businesses. On the other hand, while higher volatility can increase trading volumes, it also increases risk as measured by Value-at-Risk (“VaR”). Higher volatility and wider bid offer spreads may expose us to higher risks in connection with our market-making and proprietary trading businesses, and can also cause us to reduce the outstanding positions or size of these businesses where we consider necessary.\n\nWe also commit capital to take relatively large positions in connection with our underwriting or warehousing assets to facilitate certain capital market transactions. Furthermore, we structure and take positions in pilot funds for developing financial investment products and invest seed money to set up and support financial investment products. We may incur significant losses from these positions in the event of significant market fluctuations.\n\nIn addition, if we are the party providing collateral in a transaction, significant declines in the value of the collateral or a requirement to provide additional collateral due to a decline in our creditworthiness (by way of a lowered credit rating or otherwise) can increase our costs and reduce our profitability. On the other hand, if we are the party receiving collateral from our clients and counterparties, such declines may also affect our profitability due to a decrease in client transactions. See also “—Risks Relating to Our Financial Position—12. Liquidity risk could impair our ability to fund operations and jeopardize our financial condition—(3) Lowering of our credit ratings could impact our funding.”\n\n(2) Holding large and concentrated positions of securities and other assets may expose us to significant losses\n\nWe regularly hold large and concentrated positions of certain securities in our businesses such as market-making, block trading, underwriting, asset securitization, prime brokerage, or providing business solutions to meet our clients’ needs. We have committed substantial amounts of capital to these businesses. This often requires us to take large positions in the securities of a particular issuer or issuers in a particular industry, country or region. Fluctuations in the prices of these positions can significantly affect the prices at which we are able to liquidate them when needed, resulting in us incurring significant trading losses. We generally have higher exposure to counterparties engaged in financial services businesses, including commercial banks, broker-dealers, clearing houses, exchanges and investment companies.\n\n(3) Our hedging strategies may not prevent losses\n\nWe use a variety of financial instruments and strategies to hedge our exposure to financial risks arising from the financial instruments we enter into for our clients or for proprietary purposes. If our hedging strategies are not effective, we may incur losses. We do not necessarily hedge every risk and base many of our hedging strategies\n\n \n\n9\n\n##### Table of Contents\n\non historical trading patterns and correlations. For example, if we hold an asset, we may hedge this position by taking a position in another asset which has, historically, moved in a direction that would offset a change in value of the former asset. However, historical trading patterns and correlations may not continue, as seen in the case of past financial crises, and hedging strategies aimed at certain specific risks may not be fully effective in mitigating our risk exposure because we are exposed to all types of risk in a variety of market environments. Moreover, not all hedging strategies are effective, and certain strategies may, if the risk is not otherwise appropriately managed, increase our risk.\n\n(4) Our risk management policies and procedures may not be fully effective in managing risks\n\nOur policies and procedures to identify, monitor and manage risks may not be fully effective. Although some of our methods of managing risk are based upon observed historical market data, future movements in the financial markets may not be the same as was observed in the past. As a result, we may suffer significant losses through unexpected future risk exposures. Other risk management methods that we use also rely on our evaluation of information regarding markets, clients or other matters, which is publicly available or otherwise accessible by us. This information may not be accurate, complete, up-to-date or properly evaluated, and we may be unable to properly assess our risks, and thereby suffer large losses. Furthermore, certain factors, such as market volatility, may render our risk evaluation model unsuitable for a new market environment. In such event, we may be unable to evaluate or otherwise manage our risks adequately. Moreover, regardless of how well policies and procedures are designed, they must be properly implemented and followed in order to be effective, which may not always occur despite our diligent efforts. Further, potential weaknesses in our organizational structures and governance frameworks may lead to misunderstanding roles and responsibilities.\n\n(5) Market risk may increase other risks that we face\n\nIn addition to the potentially adverse effects on our businesses described above, market risk could exacerbate other risks that we face. For example, the risks inherent in financial instruments developed through financial engineering and innovation may be increased by market risk.\n\nAlso, if we incur significant trading losses caused by our exposure to market risk, our need for liquidity could rise sharply while our access to cash may be impaired as a result of market perception of our credit risk.\n\nFurthermore, in a downturn in the market overall or for specific securities, our clients and counterparties could incur significant losses or experience other adverse events of their own, thereby weakening their financial condition and, as a result, increasing the credit risk they pose to us.\n\n(6) Our brokerage and asset management revenues may decline\n\nA market downturn could result in a decline in the revenues generated by our brokerage business because of a decline in the volume and value of securities that we broker for our clients. Also, in recent years, our asset management business has been growing in importance, both organically and through acquisitions such as the Macquarie Acquisition*, and further growth of this platform is one of the priorities of our growth strategy. However, we may be unable to achieve the benefits of this strategy overall, or of the Macquarie Acquisition in particular. Moreover, the asset management business is subject to market downturns. Within our asset management business, in most cases, we charge fees for managing our clients’ portfolios that are based on the market value of their portfolios. A market downturn that reduces the market value of our clients’ portfolios would reduce the revenue we receive from these businesses and might increase the number of withdrawals or reduce the number of new investments in these portfolios. Also, any changes in our clients’ investment preference on their asset portfolios, including shifting investment assets to deposits which are stable assets and passive funds which generate lower fee revenue, may also result in a decline in our revenues.\n\n* See Item 4.B. “Business Overview” for further information on the nature of the Macquarie Acquisition.\n\n \n\n10\n\n##### Table of Contents\n\n(7) Our investment banking revenues may decline\n\nChanges in financial or economic conditions would likely affect the number and size of transactions for which we provide securities underwriting, financial advisory and other investment banking services. Our investment banking revenues, which include fees from these services, are directly related to the number and size of the transactions in which we participate and would therefore decrease if there are financial and market changes unfavorable to our investment banking business and our clients.\n\n \n\n6.\n\nWe may be exposed to losses when third parties do not perform their obligations to us\n\nOur counterparties are from time to time indebted or otherwise owe certain obligations (such as with regard to the posting of collateral) to us as a result of transactions or contracts, including loans, commitments to lend, other contingent liabilities and derivative transactions. We may incur material losses when our counterparties default or fail to perform on their obligations to us due to their filing for bankruptcy, a deterioration in their creditworthiness, lack of liquidity, operational failure, an economic or political event, repudiation of the transaction or for other reasons. In the year ended March 31, 2024, the Company recorded a loss of approximately ¥14 billion due to a failure to settle transactions between a subsidiary of the Company and a broker in the U.K. Although we establish and maintain allowances for credit losses, such allowances reflect management judgments and assumptions based on information available to us. Such information may prove incorrect or incomplete, and these judgments and assumptions may prove to be incorrect, potentially significantly so.\n\nWe are also exposed to credit risk from holding securities issued by third parties as well as through the execution of securities, futures, currency or derivative transactions that fail to settle at the required time due to non-delivery by our counterparties such as financial institutions and hedge funds, or to system failures by clearing agents, exchanges, clearing houses, etc.\n\nIssues related to third-party credit risk may include the following:\n\n(1) Defaults by a large financial institution could adversely affect the financial markets generally and us specifically\n\nThe commercial soundness of many financial institutions is closely interrelated as a result of credit, trading, clearing or other relationships among the institutions. As a result, concern about the creditworthiness of or a default by, a certain financial institution could lead to significant liquidity problems or losses in, or defaults by, other financial institutions. This may adversely affect financial intermediaries, such as clearing agencies, clearing houses, banks, securities firms and exchanges, with which we interact on a daily basis. Actual defaults, increases in perceived default risk and other similar events could arise in the future and could have an adverse effect on the financial markets and on us.\n\n(2) There can be no assurance as to the accuracy of the information about our credit risk, or the sufficiency of the collateral we use in managing it\n\nWe regularly review our credit exposure to specific clients or counterparties and to specific countries and regions that we believe may present credit concerns. Default risk, however, may arise from events or circumstances that we do not detect, such as account-rigging and fraud. We may also fail to receive full information with respect to the risks of a counterparty, or to accurately manage and assess such information internally. In addition, in cases where we have extended credit against collateral, sudden declines in market values of the collateral could result in such collateral being insufficient to cover our exposure.\n\n(3) Our clients and counterparties may be unable to perform their obligations to us as a result of political or economic conditions\n\nCountry, regional and political risks are components of credit risk, as well as market risk. Political or economic pressures in a country or region, including those arising from local market disruptions or currency\n\n \n\n11\n\n##### Table of Contents\n\ncrises, may adversely affect the ability of clients or counterparties located in or subject to conditions in that country or region to obtain credit or foreign exchange, and therefore to perform their obligations owed to us.\n\n \n\n7.\n\nWe are exposed to model risk, i.e., risk of financial loss, incorrect decision making, or damage to our credibility arising from model errors or incorrect or inappropriate model application\n\nWe widely use models for various purposes including the valuation of illiquid derivative transactions or the estimation of the creditworthiness of certain counterparties. However, models are never perfect, and their use subjects us to model risk. Model errors or incorrect or inappropriate model applications could lead to incorrect decision making, financial losses or damage to our credibility.\n\n \n\n8.\n\nNHI is a holding company and depends on payments from its subsidiaries\n\nNHI, the issuer of the common stock underlying the ADSs to which this annual report relates, is a holding company and is heavily dependent on dividends, distributions and other payments from its subsidiaries to be able to settle its financial obligations and liabilities. Regulatory and other legal restrictions, such as those under the Companies Act, may limit NHI’s ability to transfer funds freely, either to or from its subsidiaries. In particular, many of NHI’s subsidiaries, including its broker-dealer subsidiaries, are subject to laws and regulations, including regulatory capital requirements, that authorize regulatory bodies to block or reduce the flow of funds to the parent holding company, or that prohibit such transfers altogether in certain circumstances. For example, Nomura Securities Co., Ltd. (“NSC”), Nomura Securities International, Inc., Nomura International plc and Nomura International (Hong Kong) Limited, NHI’s main broker-dealer subsidiaries, are subject to regulatory capital requirements and changes in such regulatory capital requirements and the required level could limit the transfer of funds to NHI. While NHI monitors and manages the transfer of funds within the Nomura Group on the basis of relevant laws and regulations on a daily basis, these laws and regulations may hinder NHI’s ability to access funds needed to be able to settle its financial obligations and liabilities.\n\n \n\n9.\n\nWe may not be able to realize gains we expect, and may even suffer losses, on our investments in equity securities and non-trading debt securities\n\nWe hold substantial investments in equity securities including private equity investments and investments in affiliates for which the fair value option was elected, and non-trading debt securities. Under U.S. GAAP, depending on market conditions, we may recognize significant losses in connection with these investments, which could have an adverse impact on our financial condition and results of operations. Moreover, while we may decide to dispose of these equity securities and debt securities, depending on the market conditions, we may not be able to dispose of these equity securities and debt securities when we would like to do so, as quickly as we may wish or at the desired price.\n\n \n\n10.\n\nWe may face an outflow of clients’ assets due to losses incurred within cash reserve funds or debt securities we offer to clients\n\nCash reserve funds, such as money market funds and money reserve funds are typically categorized as low risk financial products. As a result of a sudden rise in interest rates, such cash reserve funds may fall below their par value due to losses resulting from price decreases, defaults or negative interest charges arising from debt securities held by the fund. If we determine that a stable return cannot be achieved from the investment performance of cash reserve funds, we may accelerate the redemption of, or impose a deposit limit on, such cash reserve funds.\n\nIn addition, issuers of debt securities that we sell may default or otherwise delay the payment of interest and/or principal.\n\nSuch events may result in the loss of client confidence and lead to an outflow of client assets from our custody or preclude us from increasing such client assets.\n\n \n\n12\n\n##### Table of Contents\n\n•\n \n\nRisks Relating to Our Financial Position\n\n \n\n11.\n\nWe may have to recognize impairment losses with regard to the amount of goodwill, tangible assets and intangible assets recognized on our consolidated balance sheets\n\nWe have purchased all or a part of the equity interests in, or operations from, certain other companies in order to pursue our business expansion, and expect to continue to do so when and as we deem beneficial. We account for certain of those and similar purchases and acquisitions as a business combination under U.S. GAAP by allocating our acquisition costs to the assets acquired and liabilities assumed and recognizing the remaining amount as goodwill.\n\nFor example, in December 2025, we recognized additional goodwill of ¥150,976 million and additional intangible assets of ¥118,201 million on our consolidated balance sheet in connection with the Macquarie Acquisition*.\n\nWe may have to recognize impairment losses, as well as other losses associated with subsequent transactions, with regard to the amount of goodwill, tangible assets and intangible assets recognized on our consolidated group balance sheet which may adversely affect our financial condition and results of operations.\n\n* See Item 4.B. “Business Overview” for further information on the nature of the Macquarie Acquisition.\n\n \n\n12.\n\nLiquidity risk could impair our ability to fund operations and jeopardize our financial condition\n\nLiquidity, or having ready access to cash, is essential to our business. We define liquidity risk as the risk of loss arising from difficulty in securing the necessary funding, or from a significantly higher cost of funding than normal levels, due to a deterioration in our creditworthiness or a deterioration in market conditions. In addition to maintaining a readily available cash position, we seek to secure ample liquidity through repurchase agreements and securities lending transactions, long-term borrowings and the issuance of long-term debt securities as well as through diversification of our short-term funding sources such as commercial paper, and by holding a portfolio of highly liquid financial assets. Despite this, there is a risk that we may lose liquidity under certain circumstances, including the following:\n\n(1) We may be unable to access unsecured or secured funding\n\nWe continuously access unsecured funding from issuance of securities in the short-term credit markets and debt capital markets as well as bank borrowings to finance our day-to-day operations, including refinancing. We also enter into repurchase agreements and securities lending transactions to raise secured funding for our trading businesses. An inability to access unsecured or secured funding or funding at significantly higher cost than normal levels could have a substantial negative effect on our liquidity. For example, lenders could refuse to extend the credit necessary for us to conduct our business based on their assessment of our long-term or short-term financial prospects if:\n\n \n\n \n•\n \n\nWe incur large trading losses,\n\n \n\n \n•\n \n\nThe level of our business activity decreases due to a market downturn,\n\n \n\n \n•\n \n\nRegulatory authorities take significant action against us, or\n\n \n\n \n•\n \n\nOur credit rating is downgraded.\n\nIn addition to the above, our ability to borrow in the debt capital markets could also be adversely impacted by factors that are not specific to us, such as increases in market interest rates, reductions in banks’ or other financial institutions’ lending ability, a severe disruption of the financial and credit markets, negative views about the general prospects for the investment banking, brokerage or financial services industries, or negative market perceptions of Japan’s financial soundness.\n\n \n\n13\n\n##### Table of Contents\n\n(2) We may be unable to sell assets\n\nIf we are unable to raise funds or if our liquidity declines significantly, we will need to liquidate assets or take other actions in order to meet our maturing liabilities. In volatile or uncertain market environments, overall market liquidity may decline. In a time of reduced market liquidity, we may be unable to sell some of our assets, or we may have to sell at depressed prices, which could adversely affect our results of operations and financial condition. Our ability to sell assets may also be adversely impacted by other market participants seeking to sell similar assets into the market at the same time.\n\n(3) Lowering of our credit ratings could impact our funding\n\nOur funding depends significantly on our credit ratings. Rating agencies may downgrade or withdraw their ratings or place us on “credit watch” with negative implications. Downgrades could increase our funding costs and limit our funding. This, in turn, could adversely affect our results of operations and our financial condition. In addition, other factors which are not specific to us may impact our funding, such as negative market perceptions of Japan’s financial soundness.\n\n \n\n13.\n\nEquity investments in affiliates and other investees accounted for under the equity method in our consolidated financial statements may decline significantly over a period of time and result in us recognizing impairment losses\n\nUnder U.S. GAAP, we have affiliates and investees accounted for under the equity method in our consolidated financial statements and whose shares are publicly traded. If there is a decline in the market price of the shares, we hold in such affiliates below the carrying amount of our investments over a period of time, and we determine that the decline is other-than-temporary, then we recognize an impairment loss through earnings which may have an adverse effect on our financial condition and results of operations.\n\n \n\n•\n \n\nRisks Relating to Legal, Compliance and Other Operational Issues\n\n \n\n14.\n\nOperational risk could adversely affect our business\n\nOperational risk is the risk of financial loss or non-financial impact arising from inadequate or failed internal processes and systems, from a lack of appropriate personnel, from human errors, or from external events, and includes fraud, compliance, legal, IT, cyber and information security, third-party, and other non-financial risks. We always face the potential of operational risk, and if it materializes, it could adversely affect our business. Issues related to operational risk may include the risks listed in items 16 to 22 below.\n\n \n\n15.\n\nReputational risk could adversely affect our business\n\nReputational risk is the risk of possible damage to Nomura’s reputation and associated risk to earnings, capital, or liquidity arising from any association, action, or inaction which could be perceived by stakeholders to be inappropriate, unethical, or inconsistent with Nomura Group’s values and corporate philosophy. We always face the potential of reputational risk, and if any of the events described in this Item 3.D occur and such risk materializes, it could adversely affect our business outlook, financial condition, or results of operations.\n\n \n\n16.\n\nWe may identify a material weakness in our internal control over financial reporting, indicating that our internal control over financial reporting may not be effective\n\nAs a New York Stock Exchange (“NYSE”)-listed company and SEC registrant, we assess the effectiveness of internal controls over financial reporting under the U.S. Sarbanes-Oxley Act of 2002, and management’s report thereon is included in Item 15 of this annual report. We also assess the effectiveness of internal controls over financial reporting pursuant to the Financial Instruments and Exchange Act and submit the Management’s Report on Internal Control over Financial Reporting including the results of this evaluation as a part of our\n\n \n\n14\n\n##### Table of Contents\n\nJapanese language annual securities report. We have established a framework with the goal of ensuring the effectiveness and appropriateness of these controls. However, we may identify a material weakness in our internal control over financial reporting, indicating that our internal control over financial reporting may not be effective.\n\nFor example, we identified a material weakness during the quarter ended March 31, 2024 in relation to certain classification and presentation matters within the consolidated statement of cash flows as included within our consolidated financial statements, which resulted in the need to restate the consolidated statement of cash flows in certain of our annual and interim consolidated financial statements. We identified and implemented a number of remediation actions to address this material weakness and intended to mitigate the risk of similar errors occurring in the future within the consolidated statement of cash flows, and our management concluded that our internal control over financial reporting has been effective as of the end of each fiscal year, beginning with the year ended March 31, 2024.\n\nIf future material weaknesses are identified, we may be unable to provide financial information in our consolidated financial statements and elsewhere in an accurate, timely and reliable manner or require additional restatements of our consolidated financial statements or other aspects of our periodic reporting. Such issues may undermine confidence in our published financial information and other reported information by users of our consolidated financial statements, including the holders of our securities, potentially causing reductions in the price of our common stock and/or ADRs. Additionally, such issues could limit our access to capital markets, affect clients’ or counterparties’ appetite to enter into transactions with us and subject us to potential regulatory investigations and sanctions. Each of these factors may materially and adversely affect our business, results of operations and financial condition.\n\n \n\n17.\n\nMisconduct, fraud or other criminal activity by an employee, director or officer, or any third-party, could occur, and our reputation in the market and our relationships with clients could be harmed\n\nWe always face the risk that our employees, directors or officers, or any third-party, could engage in misconduct that may adversely affect our business. Misconduct by an employee, director or officer includes conduct such as entering into transactions in excess of authorized limits, acceptance of risks that exceed our limits, concealment of unauthorized or unsuccessful activities or criminal or other unlawful actions against customers. The misconduct could also involve the improper use or disclosure of non-public information relating to us or our clients, such as insider trading, improper transmission of such information and the recommendation of trades based on such information, as well as other crimes, which could result in regulatory sanctions, legal liability and serious reputational or financial damage to us.\n\nThird-parties may also engage in fraudulent activities, including devising a fraudulent scheme to induce our investment, loans, guarantee or any other form of financial commitment, both direct and indirect. Because of the broad range of businesses that we engage in and the large number of third-parties with whom we deal in our day-to-day business operations, such fraud or any other misconduct may be difficult to prevent or detect, and our future reputation and financial condition could be adversely affected, which could result in serious reputational or financial damage to us in the future.\n\nMeasures we have implemented or additional measures that may be implemented in the future may not be effective in preventing or managing the risk of misconduct or fraud in all cases, and we may not always be able to detect or deter misconduct or fraud by employees, directors, officers, or third-parties. If any administrative or judicial sanction is issued against us as a result of such fraud or misconduct, we may lose business opportunities, and our future revenue and results of operations may be materially and adversely affected, even after the sanction is lifted, if and to the extent that our clients, especially public institutions, decide not to engage us for their financial transactions.\n\nThe Company’s consolidated subsidiary, NSC, is addressing damages that occurred due to transactions, such as the purchase and sale of securities and other financial instruments, conducted by third-parties using\n\n \n\n15\n\n##### Table of Contents\n\ncustomers’ assets through unauthorized access to securities accounts due to fraudulent activities, such as phishing. In regard to customer accounts that suffered damages since January 2025, NSC will handle each case based on the individual circumstances of each customer, including, at a maximum, restoring the accounts to the state prior to the unauthorized transactions. Currently, although strengthened cooperation with relevant parties, customer alerts, enhanced authentication measures and other initiatives have reduced the number of such incidents compared with earlier periods, phishing and related techniques continue to become more sophisticated and diverse, and similar incidents may occur again in the future. If we or our customers become involved in such incidents, or if our response—such as loss compensation or security enhancements—is viewed as insufficient, our future reputation, and financial condition may be adversely affected.\n\n \n\n18.\n\nA failure to identify and appropriately address conflicts of interest could adversely affect our business\n\nWe are a global financial institution that provides a wide range of products and services to a diverse group of clients, including individuals, corporations, other financial institutions and governmental institutions. As such, we face potential conflicts of interest in the ordinary course of our business. Conflicts of interests can arise when our services to a particular client conflict or compete, or are perceived to conflict or compete, with our own interests. In addition, where non-public information is not appropriately restricted or shared within Nomura, conflicts of interest may also arise when a transaction within the Nomura Group or with another client conflicts or competes, or is perceived to conflict or compete, with a transaction with a particular client. A failure, or a perceived failure, to identify, disclose and appropriately address such conflicts could adversely affect our reputation, the willingness of current or potential clients to do business with us, and give rise to potential regulatory actions or litigation against us, which could have a material adverse effect on our financial condition and results of operations.\n\n \n\n19.\n\nOur business is subject to substantial legal and regulatory risks\n\nSubstantial legal liability or a significant regulatory action against us could have a material adverse effect on our business, financial condition or results of operations, or cause reputational harm to us. Also, material changes in regulations applicable to us or to the markets in which we operate could adversely affect our business. See Note 22 “Commitments, contingencies and guarantees” in our consolidated financial statements included in this annual report for further information regarding the significant investigations, lawsuits and other legal proceedings that we are currently facing.\n\nWe face significant legal risks in our businesses. These risks include liability under securities or other laws in connection with securities underwriting and offering transactions, liability arising from the purchase or sale of any securities or other financial products, disputes over the terms and conditions of complex trading arrangements or the validity of contracts for our transactions, disputes with our business alliance partners and legal claims concerning our other businesses.\n\n(1) Legal liability related to our business may occur and could adversely affect our business, financial condition and results of operations\n\nDuring a prolonged market downturn or upon the occurrence of an event that adversely affects one of the markets in which we operate, we may be exposed to an increase in claims or significant litigations against us. The cost of defending such claims or litigations may be substantial and our involvement in litigation may damage our reputation. For example, during the year ended March 31, 2022, approximately ¥62.0 billion related to legacy transactions in the U.S. from before the global financial crisis (2007 – 2008) was recognized including legal expenses as well as certain transactions intended to mitigate future losses. In addition, even legal transactions might be subject to adverse public reaction according to the particular details of such transactions.\n\nThese risks may be difficult to assess or quantify and their existence and magnitude may remain unknown for substantial periods of time.\n\n \n\n16\n\n##### Table of Contents\n\n(2) Extensive regulation of our businesses limits our activities and may subject us to significant penalties and losses\n\nThe financial services industry is subject to extensive regulation. We are subject to increasing regulation by governmental and self-regulatory organizations in Japan and in virtually all other jurisdictions in which we operate, and such governmental and regulatory scrutiny may increase as our operations expand or as laws change. In addition, while regulatory complexities increase, possibilities of extra-territorial application of a regulation in one jurisdiction to business activities outside of such jurisdiction may also increase. These regulations are broadly designed to ensure the stability of financial systems and the integrity of the financial markets and financial institutions, and to protect clients and other third-parties who deal with us. They may also limit our activities and/or affect our profitability, through net capital, client protection and market conduct requirements. In addition, on top of traditional finance-related legislation, the scope of laws and regulations applying to, and/or impacting on, our operations may become wider depending on the situation of the wider international political and economic environment or policy approaches taken by governmental authorities in respect of regulatory application or law enforcement. In particular, the number of investigations and proceedings against the financial services industry by governmental and self-regulatory organizations has increased substantially and the consequences of such investigations and proceedings have become more severe in recent years, and we are subject to the risk of such investigations and proceedings. We may not always be able to prevent such violations, and we could be fined, prohibited from engaging in some of our business activities, ordered to improve our internal governance procedures or be subject to revocation of our license to conduct business. Our reputation could also suffer from the adverse publicity that any administrative or judicial sanction against us may create, which may negatively affect our business opportunities and ability to secure human resources. As a result of any such sanction, we may lose business opportunities for a period of time, even after the sanction is lifted, if and to the extent that our clients, especially public institutions, decide not to engage us for their financial transactions. In addition, certain market participants may refrain from investing in or entering into transactions with us if we engage in business activities in regions subject to international sanctions, even if our activities do not constitute violations of sanctions laws and regulations.\n\n(3) Tightening of regulations applicable to the financial system and financial industry could adversely affect our business, financial condition and results of operations\n\nIf regulations that apply to our businesses are introduced, modified or removed, we could be adversely affected directly or through resulting changes in market conditions. The impact of such developments could make it economically unreasonable for us to continue to conduct all or certain of our businesses, or could cause us to incur significant costs to adjust to such changes.\n\nNew regulations or revisions to existing regulations relating to accounting standards, regulatory capital adequacy ratios, liquidity ratios and leverage ratios applicable to us could also have a material adverse effect on our business, financial condition and results of operations. Such new regulations or revisions to existing regulations include the so-called Basel III package formulated by the Basel Committee on Banking Supervision (“Basel Committee”) and the finalized Basel III reforms published in December 2017, and also finalized market risk capital framework published in January 2019. NHI is subject to the above revised regulatory capital adequacy ratios, liquidity ratios and leverage ratios since March 2025.\n\nFurthermore, in December 2015, the FSA identified NHI as one of the domestic systemically important banks (“D-SIBs”) and imposed a surcharge of 0.5% on our required capital ratio after March 2016 with 3-year transitional arrangement. In addition, FSB published the final standard requiring global systemically important banks (“G-SIBs”) to maintain a certain level of total loss-absorbing capacity (“TLAC”) upon their failure in November 2015. Under the FSA’s policy implementing the TLAC framework in Japan as updated in April 2018, the TLAC requirements in Japan apply not only to Japanese G-SIBs but also to Japanese D-SIBs that are deemed (i) of particular need for a cross-border resolution arrangement and (ii) of particular systemic significance to Japanese financial system if they fail. Based on the revised policy, in March 2019, the FSA published the notices\n\n \n\n17\n\n##### Table of Contents\n\nand guidelines of TLAC regulations in Japan. According to these notices and guidelines, NHI is subject to the TLAC requirements in Japan from March 31, 2021, although NHI is not identified as a G-SIB as of the date of this annual report. These changes in regulations may increase our funding costs or require us to liquidate financial instruments and other assets, raise additional capital or otherwise restrict our business activities in a manner that could adversely affect our operating or financing activities or the interests of our shareholders.\n\n(4) Deferred tax assets may be impacted due to a change in business condition or in laws and regulations, resulting in an adverse effect on our operating results and financial condition\n\nUnder U.S. GAAP, we recognize deferred tax assets in our consolidated balance sheets as a possible benefit of tax relief in the future if certain criteria are met. If we experience or forecast future operating losses, if tax laws or enacted tax rates in the relevant tax jurisdictions in which we operate change, or if there is a change in U.S. GAAP in the future, we may be required to reduce the deferred tax assets recognized in our consolidated balance sheets which may adversely affect our financial condition and results of operations. See Note 17 “Income taxes” in our consolidated financial statements included in this annual report for further information regarding the deferred tax assets that we currently recognize.\n\n(5) Defects in our anti-money laundering and counter-terrorism financing measures could have serious consequences, such as administrative penalties or punitive fines\n\nIn recent years, financial crimes have become more complex, sophisticated, and diverse. As the world faces growing threats of military disputes, terrorism, and cyberattacks, it is highly important to counter the financing of crimes and terrorism. Financial institutions around the world are expected to take strong anti-money laundering (AML) and countering the financing of terrorism (CFT) measures. Despite our efforts to improve our anti-money laundering and counter-terrorism financing measures, which we have implemented consistently across the Nomura Group in accordance with the recommendations provided by the Financial Action Task Force (FATF) and the FSA’s “Guidelines on Anti-Money Laundering and Terrorist Financing”, there remains a risk that such measures will not be fully effective in preventing or detecting all violations in a timely manner. As a consequence, we could be subject to administrative penalties or punitive fines, which may adversely affect our financial condition and results of operations. See also “—Risks Relating to Legal, Compliance and Other Operational Issues—19. Our business is subject to substantial legal and regulatory risks—(2) Extensive regulation of our businesses limits our activities and may subject us to significant penalties and losses” for further information regarding regulatory actions and other legal proceedings as well as consequences thereof.\n\n \n\n20.\n\nUnauthorized disclosure or misuse of personal information held by us may adversely affect our business\n\nWe keep and manage personal information obtained from clients in connection with our business. In recent years, there have been many reported cases of personal information and records in the possession of corporations and institutions being improperly accessed, disclosed or misused. There is also a risk of unauthorized acquisition of client information and misuse of customer information by former employees.\n\nAlthough we exercise care to protect the confidentiality of personal information and have in place policies and procedures designed to safeguard such information and ensure that it is used in compliance with applicable laws, rules and regulations, were any unauthorized disclosure or misuse of personal information to occur, our business could be adversely affected. For example, we could be subject to government actions such as administrative actions or penalties in case there is any violation of applicable personal data protection laws, rules and regulations or be subject to complaints and lawsuits for damages from clients if they are adversely affected due to the unauthorized disclosure or misuse of their personal information (including leakage of such information by an external service provider). In addition, we could incur additional costs associated with changing our security systems, either voluntarily or in response to administrative guidance or other regulatory initiatives. Moreover, restrictions on our ability to use personal information collected from clients may adversely affect our existing businesses or our ability to develop new ones. Furthermore, any damage to our reputation caused by\n\n \n\n18\n\n##### Table of Contents\n\nsuch unauthorized disclosure or misuse could lead to a decline in new clients and/or a loss of existing clients, as well as to increased costs and expenses incurred for public relations campaigns designed to prevent or mitigate damage to our corporate or brand image or reputation.\n\n \n\n21.\n\nSystem failure, information leakage and cost of maintaining sufficient cybersecurity could adversely affect our business, financial condition and results of operations\n\nOur businesses rely on secure processing, storage, transmission and reception of personal, confidential and proprietary information on our systems. We have been in the past and may again become the target of attempted unauthorized access, computer viruses or malware, and other cyberattacks designed to access and obtain information on our systems or to disrupt and cause other damage to our services. In recent years, many of our employees increasingly work remotely using networking or other technologies, and these technologies have become even more critical to our business. The implementation of remote work arrangements may also increase the possibility that we will be subject to cyberattacks and other information security breaches. In addition, Nomura is engaged in the cryptocurrency business, and if the cryptocurrency wallets used in that business become targets of cyberattacks or other information security breaches, there is a possibility of unauthorized outflow or loss of cryptocurrencies. We also face emerging risks from increased use of AI (including generative AI), which may introduce new data leakage, model manipulation, fraud/social engineering and third-party/vendor risks if not governed and controlled appropriately. Although these threats may originate from human error or technological failure, they may also originate from the malice or fraud of internal parties, such as employees, or third-parties, including foreign non-state actors and extremist parties. Additionally, we could also be adversely impacted if any of the third-party vendors, exchanges, clearing houses or other financial institutions to whom we are interconnected are subject to cyberattacks or other informational security breaches. Such events could cause interruptions to our systems, reputational damage, client dissatisfaction, legal liability, enforcement actions or additional costs, any and all of which could adversely affect our financial condition and operations.\n\nWhile we continue to devote significant resources to monitor and update our systems and implement information security measures to protect our systems, there can be no assurance that any controls and procedures we have in place will be sufficient to protect us from future security breaches. As cyber threats are continually evolving, our controls and procedures may become inadequate and we may be required to devote additional resources to modify or enhance our systems in the future.\n\n \n\n22.\n\nOur business may be adversely affected if we are unable to hire, retain and develop qualified personnel\n\nUnder the philosophy that our people are our greatest assets, we view recruitment, talent development, performance appraisal, and mobility and advancement strategies as one human-resources management cycle and pursue various talent-management initiatives comprehensively. Under these initiatives, we employ a large workforce globally, and face various human-resources and workplace-related risks, such as discrimination, harassment, and inconsistencies with local laws and norms. Moreover, we face intense competition for personnel due to factors such as compensation, working environment, training opportunities, employee benefits, and our reputation as an employer, and any failure to hire, retain, and develop qualified personnel as anticipated may materially and adversely affect our business, financial condition and results of operations. Furthermore, spending to secure personnel may adversely affect our profitability. In addition, developing our human resources and fostering a uniform corporate culture requires sustained and thorough efforts, and may take longer than anticipated.\n\n \n\n•\n \n\nRisks Related to Holding or Trading of NHI Shares and ADRs\n\n \n\n23.\n\nBecause of daily price range limitations under Japanese stock exchange rules, you may not be able to sell your shares of NHI Shares at a particular price on any particular trading day, or at all\n\nStock prices on Japanese stock exchanges are determined on a real-time basis by the equilibrium between bids and offers. These exchanges are order-driven markets without specialists or market makers to guide price\n\n \n\n19\n\n##### Table of Contents\n\nformation. For the purpose of protecting investors from excessive volatility, these exchanges set daily upward and downward price fluctuation limits for each stock, based on the previous day’s closing price. Although transactions may continue at the upward or downward limit price if the limit price is reached on a particular trading day, no transactions may take place outside these limits. Consequently, an investor wishing to sell at a price above or below the relevant daily limit may not be able to sell his or her shares of NHI Shares at such price on a particular trading day, or at all.\n\n \n\n24.\n\nUnder Japan’s unit share system, holders of shares of NHI Shares constituting less than one unit are subject to transfer, voting and other restrictions\n\nThe Company’s Articles of Incorporation, as permitted under the Companies Act, provide that 100 shares of NHI Shares constitute one “unit.” The Companies Act imposes significant restrictions and limitations on holdings of shares that constitute less than a whole unit. Holders of shares constituting less than one unit do not have the right to vote or any other rights relating to voting. Under the unit share system, any holders of shares constituting less than a unit may at any time request the Company to purchase their shares. Also, holders of shares constituting less than a unit may request the Company to sell them such number of shares that the Company may have as may be necessary to raise such holder’s share ownership to a whole unit. Shares constituting less than a unit are transferable under the Companies Act, but may not be traded on any Japanese stock exchange.\n\n \n\n25.\n\nAs a holder of ADRs, you will have fewer rights than a shareholder has and you will have to act through the depositary to exercise these rights\n\nThe rights of shareholders under Japanese law to take actions including voting their shares, receiving dividends and distributions, bringing derivative actions, examining the company’s accounting books and records and exercising appraisal rights are available only to holders of record. Because the depositary, through its custodian agent, is the record holder of the shares underlying the ADRs, only the depositary can exercise those rights in connection with the deposited shares. The depositary will make efforts to vote the shares underlying your ADRs as instructed by you and will pay you the dividends and distributions collected from the Company. However, in your capacity as an ADR holder, you will not be able to bring a derivative action, examine the Company’s accounting books or records or exercise appraisal rights except through the depositary.\n\n \n\n26.\n\nRights of shareholders under Japanese law may be more limited than under the laws of other jurisdictions\n\nThe Companies Act and the Company’s Articles of Incorporation and Regulations of the Board of Directors govern the Company’s corporate affairs. Legal principles relating to such matters as the validity of corporate procedures, directors’ and executive officers’ fiduciary duties and shareholders’ rights may be different from those that would apply to a non-Japanese company. Shareholders’ rights under Japanese law may not be as extensive as shareholders’ rights under the laws of other jurisdictions, including jurisdictions within the U.S. You may have more difficulty in asserting your rights as a shareholder than you would as a shareholder of a corporation organized in another jurisdiction.\n\n \n\n27.\n\nThe Company’s shareholders of record on a record date may not receive the dividend they anticipate\n\nThe customary dividend payout practice of publicly listed companies in Japan may significantly differ from that widely followed or otherwise deemed necessary or fair in foreign markets. The Company’s dividend payout practice is no exception. The Company ultimately determines whether the Company will make any dividend payment to shareholders of record as of a record date and such determination is made only after such record date. For the foregoing reasons, the Company’s shareholders of record as of a record date may not receive the dividends they anticipate. Furthermore, the Company does not announce any dividend forecasts.\n\n \n\n20\n\n##### Table of Contents\n\n28.\n\nIt may not be possible for investors to secure personal jurisdiction within the U.S. over the Company or the Company’s directors or executive officers, or to enforce against the Company or those persons judgments obtained in U.S. courts predicated upon the civil liability provisions of the federal securities laws of the U.S.\n\nThe Company is a limited liability, joint-stock corporation incorporated under the laws of Japan. Most of the Company’s directors and executive officers reside in Japan. Many of the Company’s assets and the assets of these persons are located in Japan and elsewhere outside the U.S. It may not be possible, therefore, for U.S. investors to obtain personal jurisdiction over the Company or these persons within the U.S. or to enforce against the Company or these persons judgments obtained in U.S. courts predicated upon the civil liability provisions of the federal securities laws of the U.S. The Company believes that there is doubt as to the enforceability in Japan, in original actions or in actions for enforcement of U.S. court judgments, of liabilities predicated solely upon the federal securities laws of the U.S.\n\n \n\n•\n \n\nSpecial Note Regarding Forward-looking Statements\n\nThis annual report contains forward-looking statements that are based on our current expectations, assumptions, estimates and projections about our business, our industry and capital markets around the world. These forward-looking statements are subject to various risks and uncertainties. Generally, these forward-looking statements can be identified by the use of forward-looking terminology such as “may”, “will”, “expect”, “anticipate”, “estimate”, “plan” or similar words. These statements discuss future expectations, identify strategies, contain projections of our results of operations or financial condition, or state other forward-looking information.\n\nKnown and unknown risks, uncertainties and other factors may cause our actual results, performance, achievements or financial position to differ materially from any future results, performance, achievements or financial position expressed or implied by any forward-looking statement contained in this annual report. Such risks, uncertainties and other factors are set forth in this Item 3.D and elsewhere in this annual report."}