Russian President Vladimir Putin with former Japanese Prime Minister Junichiro Koizumi

Here are some highlights from the interview:

- Moscow is the first springboard from which Nomura plans to start its expansion into the markets of Central and Eastern Europe. Currently Nomura's Moscow office that was opened March 13, 2007 has only five employees and is working under the name Nomura (CIS) Limited.

Corrections and Personal Remarks
Although the Kommersant article was highly informative, some points need to be corrected:

- Asian investors are represented on the Russian market only by Nomura; and only Nomura may bring Asian investors here. (VFK - Japan’s Sumitomo-Mitsui Bank is already in Russia and has made a number of investments in Russian telecommunications companies since 2005)

- Nomura has a good access to both Asian and European investor communities

- The time for Russian companies’ to list shares on the Hong Kong, Singapore or Tokyo exchanges is not yet right, because their requirements are more stringent than those of the London Stock Exchange. However, someday soon when the Asian market will be saturated with Chinese companies, there might be a place for the Russians too. (VFK - This is view is also questionable - I personally met with the management of the Hong Kong Exchange, including its Chief Executive Paul Chow, and they told me a different story)

Corporate Financing – Nomura’s Goals in Russia

- The major goal of the Nomura’s Moscow office is to serve as a bridge between Russian corporate borrowers and Japanese capital (and capital from the rest of Asia as well).

- Initially, there will be no brokerage activities - the biggest priority is underwriting

- About one third of global funds worldwide have direct access to the Russian stock market – and Nomura plans to use this to its advantage.

- Educational and informational activities are one of the top priorities – in contrast with Chia, most Asian investors know little about opportunities for investing in Russia and the former Soviet Union (FSU).

Nomura's Approach to Investment Banking in Russia

- Russian clients will be pleasantly surprised by Nomura’s suggestions on how to raise capital.

- As a rule, Japanese investors will invest small amounts in Russian companies in the natural resources sector, avoiding this politically sensitive area.

- Japanese investors typically are not speculative, and value long-term growth.

- Japanese investment would greatly contribute to the stability of Russian stock markets.

- Nomura will look at investing in multiple sectors of the Russian economy: retail, finance, etc.

Nomura Holding Company's international investment funds listed by currency

Comments on the Russian Market

- the Russian stock market is now more fundamental and less speculative

- a good number of domestic and foreign investors emerged

- there are some structural deficiencies that preclude direct participation by international investments funds; however, Russian regulatory authorities at the Federal Financial Markets Service (FFMS) are working on changing this.

In conclusion, Russian companies now have the opportunity to attract significant capital investment from not only Europe and the U.S., but also East Asia.

You can read the original post at Vladimir Kuznetsov's blog, Equity Financing in Russia. The views expressed in this post and on his blog are the personal opinions of Vladimir Kuznetsov, and are reproduced here solely for educational purposes. To read more Russia Blog posts about Russian capital markets, click on the finance section or type www.russiablog.org/finance in your web browser.