SBI E*Trade Sec’s Group Net Profit Down 18.6 Pct

Tokyo, April 26 (Jiji Press)–Internet brokerage firm SBI E*Trade Securities Co. said Thursday its group net profit in fiscal 2006 fell 18.6 pct from the previous year to 13,811 million yen, hurt by a decline in fee income.

SBI E*Trade’s revenue in the year that ended in March dropped 4.7 pct to 57,412 million yen. The company’s income from fees was down 16.7 pct to 36,680 million yen, with brokerage commission fees shrinking 21.1 pct to 31,695 million yen, it said.

The broker is a consolidated subsidiary of SBI Holdings Inc. .

SBI E*Trade, however, posted a profit of 13,396 million yen, up 43.5 pct, on financial items with strong interest income resulting from growth in margin trading.

Despite such gains, the company reported operating profit was down 18.2 pct at 24,543 million yen and recurring profit was down 18.3 pct at 24,571 million yen.

Meanwhile, SBI Holdings announced that SBI E*Trade and SBI Securities Co., a wholly owned broker, will merge on Oct. 1, with SBI E*Trade surviving the merger.

For the merger, one SBI Securities share will be exchanged for 0.255 share of SBI E*Trade.

With SBI E*Trade’s cost advantage and ability to reach a wide range of customers and SBI Securities’ priority on service area- specific operations, chiefly over-the-counter services for wealthy seniors, the merger will have complementary effects, the holding company said.

SBI Holdings’ group net profit in fiscal 2006 was up 1.2 pct to 46,441 million yen and recurring profit jumped 76.6 pct to 90,696 million yen on revenue of 144,581 million yen, up 5.3 pct, it said. The company cited strong performance of its asset management business. [EARNINGS]END

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