Low stock prices in the latter half of fiscal 1996 spelled dismal results for nine of the nation's 10 second-tier brokerages, almost all of which posted pretax losses for the year that ended in March, according to unconsolidated earnings reports released May 15.

With the addition of earnings reports of the Big Four securities houses and that of second-tier Kokusai Securities Co. that came out last month, the business year saw only Kokusai logging net profits. Kokusai logged net profits of 5.7 billion yen and pretax profits of 10.4 billion yen, largely helped by profits from bond market transactions.

Of the 14 firms, only Nomura Securities Co. and Kokusai managed pretax profits, as plunging stock prices and increased activity by non-Japanese brokerages generally sapped domestic firms of their opportunity to make large profits.

Despite getting out of the red in fiscal 1995, the other Big Four brokerages -- Nikko Securities, Yamaichi Securities and Daiwa Securities -- saw net profits vanish once again as they took steps to assist ailing affiliates. Even giant Nomura, which recorded pretax profits of 124.2 billion yen, a 35.7 percent rise from the previous year, incurred net losses of 271.5 billion yen. Company officials said Nomura could post losses for the current business year stemming from the impact of allegations that came to light in March that it paid compensation to a firm with links to a "sokaiya" corporate extortionist.

But the second-tier brokerages that announced their reports May 15 said they did not foresee such gloom for the current business year, given the so-far solid movements of the stock market. Kankaku Securities Vice President Shozo Hibi, whose firm could not pay out dividends for the sixth straight year, said its red ink was due to losses incurred through the tumble of stock prices and the brokerage's failure to increase commission revenue.