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Wednesday, 19 November 2008

Global liquidity crisis over

TOKYO - THE global liquidity crisis appears to be over but much work remains to be done to rebuild the economic damage wrought by months of financial turmoil, the head of Japan's top broker said on Wednesday.

'The liquidity crisis in the financial world is over. The next step is how to rebuild the real economy,' Mr Kenichi Watanabe, chief executive of Nomura Holdings, told reporters.

'This of course involves each country's fiscal spending,' he said.

'People are paying attention to how respective governments gun their engines,' he said in reference to world leaders pledging at the recent G20 summit to galvanise economic growth.

Global banks and financial markets have been hammered by the credit crunch that began with a wave of defaults on US mortgages.

Mr Watanabe said China would be vital in an Asian economic recovery.

'When considering the Asian region as a whole, people's interest lies in how China ignites its engine,' he said.

Nomura Holdings, which moved quickly to buy the Asian and European operations of failed Wall Street bank Lehman Brothers, lost about 1.5 billion dollars in the first half of this financial year because of turmoil in world markets.

Watanabe said Nomura aims to return to profit 'as soon as possible,' helped by the acquisition of Lehman's customer base and expertise in financial products.

'Because our business is closely correlated with the business and financial environment which is currently very severe, we are in a very difficult situation,' he said. -- AFP

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