Yen fixed-income trading volume (excluding Bank of Japan bond buying volume) increased approximately 25% this past year and the aggregate market share of the five largest Japanese dealers now accounts for more than 56%.

Mitsubishi UFJ Morgan Stanley Securities leads with a 16.0% market share in Japanese domestic government bond trading. Mizuho Securities ranks second with a market share of 14.4%, followed by Nomura Securities at 11.1%, SMBC Nikko Securities at 9.1% and Daiwa Securities at 7.9%. These firms are the 2014 Greenwich Share Leaders in Japanese Government Bond Trading. 

“The aggregate market share controlled by these five dealers increased last year, making this already concentrated market even more concentrated,” says Greenwich Associates consultant Tomio Sumiyoshi.

Behind the top rank of Japanese dealers is a group of no fewer than 11 foreign banks led by BNP Paribas, which captured market share last year, and Goldman Sachs. 

2014 Greenwich Share Leaders in Japanese Secondary Yen Investment-Grade Bonds 
The secondary trading market for yen investment-grade bonds is dominated by domestic banks to an even greater extent than Japanese government bonds. Due largely to their control of new investment-grade bond issues, the big Japanese dealers control up to 85% of secondary trading business. 

Daiwa Securities’ strategic commitment to credit products has helped the firm build a commanding position with an impressive market share of 21.2%. Deadlocked behind Daiwa Securities are SMBC Nikko Securities, Mitsubishi UFJ Securities, Mizuho Securities, and Nomura Securities. These banks are the 2014 Greenwich Share Leaders in Japanese Secondary Yen Investment-Grade Bonds.

2014 Greenwich Share Leaders in Japanese Non-Yen Bonds
The competition for the international (non-yen) fixed-income trading volume of Japanese investors intensified last year as trading volumes dipped, some prominent dealers lost or ceded market share and other aggressive banks gained ground. 

Leading the market are Deutsche Securities and Citi tied with market shares of 10.7-10.8%. Morgan Stanley is tied with Nomura Securities for third place.  Rounding out the top rank in this group are four foreign dealers tied in market share, led by an up-and-coming BNP Paribas. These banks are the 2014 Greenwich Share Leaders in Japanese Non-Yen Bonds.

2014 Greenwich Share Leaders Structured Notes, Repackaged Notes, Credit-Linked Notes/Loans
Japanese banks and a handful of foreign dealers compete aggressively for trading business in several fixed-income products sold mainly to regional investors—often agricultural and Shinkin banks outside Tokyo. Trading business in structured notes, repackaged notes and credit-linked notes/loans is considered attractive due to the relatively high margins it generates for dealers. 

Nomura Securities and Mitsubishi UFJ Morgan Stanley Securities tie for the lead in structured notes with market shares of 13.8-14.8%, followed by Daiwa Securities, Mizuho Securities and the lone foreign competitor, Barclays, which are all tied at 9.2-10.3%. These firms are the 2014 Greenwich Share Leaders in Japanese Interest-Rate Structured Notes.

With a market share of 19.8%, Nomura Securities is the clear leader in repackaged notes, followed by Mizuho Securities, BNP Paribas, and Bank of America Merrill Lynch, which are all tied for the second spot, while Mitsubishi UFJ Morgan Stanley Securities secures fifth. These firms are the 2014 Greenwich Share Leaders in Japanese Repackaged Notes. 

 Nomura Securities also leads in credit-linked notes/loans with a 14.2% market share, followed by Citi, Mitsubishi UFJ Morgan Stanley Securities, J.P. Morgan, and Mizuho Securities. These firms are the 2014 Greenwich Share Leaders in Japanese Credit-Linked Notes/Loans.