Daiwa Securities Group Inc. said Friday its group pretax profit for the first half of fiscal 2001 plunged 98.9 percent from a year earlier to 1.18 billion yen.

It blamed its poor showing on the stock market slump, which sapped trading profits and brokerage fees.

As for the bottom line, Daiwa posted a group net loss of 131.58 billion yen, a sharp reversal from a profit of 41.95 billion yen a year earlier, as it booked an extraordinary loss of 127.5 billion yen for the restructuring of its real estate business.

The company said it withdrew from the property leasing business to improve financial conditions and prepare for its listing on the New York Stock Exchange.

Group operating revenues fell 28.2 percent to 256.38 billion yen, while profits from stock trading plummeted 89.9 percent to 5.56 billion yen.

Against the backdrop of a weak stock market, income from stock brokerage commissions, a key earnings source for securities houses, fell 36.6 percent to 31.69 billion yen, Daiwa said.

The company will pay no dividends for the interim period. In the previous fiscal year, Daiwa posted a group net profit of 64.55 billion yen and a group pretax profit of 177.8 billion yen on operating revenues of 718.11 billion yen.

Meanwhile, Standard & Poor's Corp. revised the outlook on its BBB long-term counterparty rating on Daiwa Securities Co. to stable from positive, and the outlook on its BBB+ long-term counterparty rating on Daiwa Securities SMBC Co. to negative from stable.

S&P affirmed its long-term and short-term ratings on the two companies, which are member firms of the Daiwa Securities group.

The U.S. credit-rating agency said the revisions are based on the negative impact of the weakening domestic real estate market on the group's real estate holdings, as well as the weakened business environment for Japanese securities firms.