SMBC Nikko Securities Inc. posted record quarterly losses, indicating the deepening effects of the trading scandal at the brokerage firm of Japan’s second-largest banking group.

The company also reported personnel reshuffles and was not optimistic about a quick business recovery.

Sumitomo Mitsui Financial Group Inc.’s securities unit posted a net loss of 5.7 billion yen ($38.5 million) in its second fiscal quarter ended Sept. 30, topping the previous quarter’s deficit, the company said in a statement Monday. The company said the aftermath of the scandal, as well as rising interest rates in Europe and the U.S. and worsening investor sentiment, hurt profits.

The losses add to the problems of Chief Executive Officer Yuichiro Kondo, who is struggling to retain customers. According to Shinsuke Ushijima, SMBC Nikko’s chief financial officer, in a phone conversation with him, the decline in revenue from market-fraud allegations this quarter amounted to about 15 billion yen, affecting bond underwriting and secondary trading in particular. The company plans to make personnel decisions about the scandal in “due course,” the executive said.

Allegations of stock manipulation hit SMBC Nikko hard, forcing corporate clients to move their business elsewhere. Meanwhile, global economic factors, from the energy crisis to China’s slowing economy, have led to a reduction in stock trading and deal-making fees. In July, the company said it was making “emergency” spending cuts after reporting its biggest quarterly loss in more than a decade.