Nomura sees surge in new accounts as Toyota’s AA shares draw retail investors
Nomura Holdings attracted at least 25,000 new accounts in early July as Toyota’s ¥500bn Model AA share issue spurred a rush of Japanese retail investors.
Nomura Holdings recorded a sharp increase in new retail accounts in July 2015 after being named the exclusive broker for Toyota’s ¥500bn Model AA share issue. According to sources familiar with the brokerage’s internal figures, more than 25,000 accounts were opened in the first nine business days of the month, more than double the daily rate seen a year earlier.
The jump in account openings coincided with Toyota’s launch of the Model AA shares, a new class of stock designed to appeal to long-term investors. The shares, named after Toyota’s first passenger car, offered a combination of fixed dividends and limited risk. Holders must keep the shares for five years, with the option to sell them back to Toyota if the price drops or convert them to common shares if the value holds steady at maturity.
Demand from retail investors
Demand for the Model AA shares far exceeded supply, with reports of preorders running three to five times higher than the number of shares available. The structure of the shares, offering higher yields than typical bank deposits and a measure of capital protection, proved especially attractive to older Japanese savers seeking stable returns with limited downside.
Nomura’s exclusive role as the retail sales channel for the Model AA shares gave it a clear advantage in attracting new customers. The brokerage has previously handled major retail offerings for other Japanese firms, including Japan Post Holdings and Sony, but the scale of the Toyota deal stands out. For context on Toyota’s capital-raising strategy and its use of the AA shares, see Toyota plans ¥500bn share issue to fund fuel cell research.
Structure and appeal of Model AA shares
The Model AA shares were designed to encourage long-term investment in Toyota, with a five-year holding period and a dividend structure more generous than ordinary cash accounts. Investors could convert their shares to common stock at the end of the period if the share price held up, or sell them back to Toyota if it did not. The arrangement was particularly targeted at Japan’s ageing population, many of whom prioritise capital preservation and steady income over speculative gains.
The success of the offering and the influx of new accounts at Nomura highlight the strong appetite for low-risk, yield-focused investment products among Japanese retail investors. The deal also reinforces Nomura’s position as the leading broker for major Japanese equity offerings to the public.
