| Metric | Current Period | Same Period of Previous Year | YoY |
|---|---|---|---|
| Revenue | ¥78.42B | ¥57.50B | +36.3% |
| Operating Income | - | - | - |
| Ordinary Income | ¥30.21B | ¥23.94B | +26.1% |
| Net Income | ¥20.60B | ¥16.50B | +24.9% |
| ROE | 4.9% | 4.2% | - |
Ordinary income, ordinary revenue, and net income all increased by double digits, resulting in higher revenue and profit, driven by expanded net interest income amid rising interest rates and improved cost efficiency. Ordinary revenue (equivalent to revenue) was ¥78.42B (¥57.50B in the previous year, YoY +36.3%), ordinary income was ¥30.21B (¥23.94B, YoY +26.1%), and net income was ¥20.60B (¥16.50B, YoY +24.9%). The primary driver of revenue growth was the increase in net interest income. In addition to interest income increasing by more than interest expenses, revenue growth outpaced the increase in general and administrative expenses, resulting in greater efficiency in the cost structure. Extraordinary income and losses were almost nonexistent, indicating that the increase in profit was attributable to the Company’s recurring operating earnings power.
【Revenue】Ordinary revenue of ¥78.42B increased significantly by YoY +36.3%. Net interest income (the amount obtained by subtracting interest expenses of ¥1.93B from interest income of ¥6.31B) was ¥43.75B (¥32.45B in the previous year), increasing by approximately +34% and serving as the primary driver of revenue growth. Net fees and commissions also expanded to ¥4.97B (¥3.58B in the previous year), while loans outstanding increased to ¥6.12T (YoY +2.9%) and deposits to ¥13.54T (YoY +3.8%), demonstrating growth in terms of volume as well. As the reported segment consists solely of the banking business, an analysis of changes by segment is not applicable.
【Profit and Loss】Ordinary income was ¥30.21B (YoY +26.1%), net income was ¥20.60B (YoY +24.9%), and net income attributable to owners of the parent was ¥20.97B (¥16.84B in the previous year, YoY +24.5%). Extraordinary income and extraordinary losses were both close to zero (with only ¥0.002B in extraordinary losses). The difference between ordinary income and net income attributable to owners of the parent was primarily due to the recognition of ¥9.60B in income taxes and other taxes, and the impact of temporary factors was limited. The reason profit growth (+24–26%) was slightly below revenue growth was the tax burden, while earnings power at the operating level continued to expand steadily. In conclusion, the Company recorded higher revenue and profit for the quarter.
【Profitability】The ordinary income margin was 38.5% (ordinary income of ¥30.21B / ordinary revenue of ¥78.42B), while the net profit margin was 26.3% (based on consolidated net income of ¥20.60B). On a net income attributable to owners of the parent basis, the margin was 26.7%. ROE was 4.9%, with the increase in net interest income and control of general and administrative expenses driving improved profitability. 【Cash Flow Quality】Comprehensive income was ¥21.54B, exceeding net income of ¥20.60B by ¥0.94B. The primary reason for the difference was that positive factors, including foreign currency translation adjustments of +¥1.14B and valuation differences on available-for-sale securities of +¥0.19B, exceeded deferred hedge losses of △¥0.39B. 【Investment Efficiency】Against total assets of ¥16,486.39B, net income was ¥20.60B, indicating that the contribution of earnings relative to the asset scale was limited and that there is room to improve asset efficiency. 【Financial Soundness】The equity ratio (net assets / total assets) was 2.5%, while the BIS capital ratio improved slightly to 2.3% (2.2% in the previous year). The loan-to-deposit ratio (loans / deposits) was 45.2%, a conservative level, confirming ample liquidity.
As the statement of cash flows has not been disclosed, funding trends are analyzed based on changes in the balance sheet. Deposits increased from ¥1,354.15B to ¥1,354.15B, representing a year-on-year increase of +3.8% in absolute terms, while loans also increased by +2.9%. This indicates that a stable funding cycle, in which loan expansion is funded by deposit growth, remains in place. Meanwhile, borrowings decreased by △20.5% year on year, indicating a move toward reducing dependence on market-based funding. Securities holdings decreased by △3.5%, suggesting a shift toward allocating funds more heavily to lending. Cash and deposits decreased by △9.2%, potentially indicating a shift of funds toward investment assets. Overall, the Company is funding loan growth on the basis of stable deposit funding, and its funding stability can be assessed as relatively high.
The Company’s profit for the quarter consisted primarily of recurring net interest income and net fees and commissions, while both extraordinary income and extraordinary losses were close to zero (with only ¥0.002B in extraordinary losses), indicating an extremely low level of dependence on temporary factors. Comprehensive income was ¥21.54B, slightly exceeding net income of ¥20.60B. The difference was attributable to positive contributions from foreign currency translation adjustments and valuation differences on available-for-sale securities, with no significant divergence from realized earnings. From an accrual perspective, the allowance for loan losses increased to ¥10.39B (¥9.56B in the previous year), confirming a gradual increase in credit costs accompanying the expansion of loan assets; however, the scale is not currently large enough to impair earnings quality. Overall, the Company’s earnings for the period can be assessed as high quality, supported by recurring sources of revenue.
Against the full-year ordinary income forecast of ¥125.78B (YoY +22.0%), the progress rate based on ordinary income of ¥30.21B for the quarter was 24.0%. Against the full-year net income attributable to owners of the parent forecast of ¥88.15B, net income attributable to owners of the parent of ¥20.97B for the quarter represented a progress rate of 23.8%. Against the EPS forecast of ¥505.10, quarterly EPS of ¥120.14 represented a progress rate of 23.8%. All figures were broadly in line with the 25% benchmark based on equal quarterly allocation, indicating progress consistent with the full-year plan.
The annual dividend forecast is ¥0, resulting in a payout ratio of 0%. There was also no dividend in the same period of the previous year, and there has been no change in the dividend policy. Profits are being accumulated as retained earnings, with retained earnings increasing to ¥365.97B (¥345.00B in the previous year), indicating that strengthening the financial foundation through the accumulation of equity is being prioritized.
Capital base: The equity ratio (net assets / total assets) was 2.5%, while the BIS capital ratio remained at 2.3% (2.2% in the previous year). Relative to total assets of ¥16,486.39B, the capital buffer is thin.
Interest rate concentration in the earnings structure: Net interest income accounts for the majority of ordinary revenue, while the proportion of non-interest income (net fees and commissions of ¥4.97B and other operating income of ¥0.77B) is relatively small. This structure has a high sensitivity of earnings to changes in the interest rate cycle.
Trend toward higher credit costs: The allowance for loan losses increased to ¥10.39B (¥9.56B in the previous year). With loans outstanding expanding to ¥6.12T, trends in credit costs will be a key monitoring point going forward.
Profitability and Returns
| Metric | Company | Median (IQR) | Delta |
|---|---|---|---|
| Net Profit Margin | 26.3% | – | – |
The net profit margin of 26.3% serves as a reference on a standalone basis, as comparative data with the industry median is limited.
Growth and Capital Efficiency
| Metric | Company | Median (IQR) | Delta |
|---|---|---|---|
| Revenue Growth Rate (Year on Year) | 36.3% | – | – |
The revenue growth rate of 36.3% serves as a reference on a standalone basis, as comparative data with the industry median is limited.
※Source: Compiled by the Company
The primary drivers of higher revenue and profit were the growth in net interest income and improved cost efficiency. Through the control of general and administrative expenses, the expense ratio (general and administrative expenses / core gross operating profit) improved to approximately 33.9% from approximately 35.8% in the previous year, with greater efficiency in the cost structure supporting profit growth.
The dividend forecast is ¥0, resulting in a payout ratio of 0%. The policy of prioritizing the strengthening of equity through the accumulation of retained earnings to ¥365.97B remains in place. Given the BIS capital ratio of 2.3%, strengthening the capital base will remain an important priority for the time being.
The full-year progress rates were 24.0% for ordinary income and 23.8% for net income, representing standard levels for Q1. A key feature is the continued parallel growth in loans and deposits under a conservative liquidity structure, with a loan-to-deposit ratio of 45.2%.
This report is an earnings analysis document automatically generated by AI based on XBRL earnings summary data. It does not recommend investment in any specific security. Industry benchmarks are reference information compiled by the Company based on publicly available earnings data. Investment decisions should be made at your own responsibility, and you should consult a professional as necessary.
---End of Report---