| 指標 | 当期 | 前年同期 | YoY |
|---|---|---|---|
| Revenue / Net Sales | ¥1671.0B | ¥895.8B | +86.5% |
| Operating Income / Operating Profit | - | - | - |
| Ordinary Income | ¥197.6B | ¥123.0B | +60.6% |
| Net Income / Net Profit | ¥129.3B | ¥84.4B | +53.3% |
| ROE | 5.1% | 3.8% | - |
For the fiscal year ended March 2026, the company achieved substantial revenue and profit growth: Ordinary Income (Revenue) of ¥1,671.0B (YoY +¥775.2B, +86.5%), Ordinary Income of ¥197.6B (YoY +¥74.6B, +60.6%), and Net Income of ¥129.3B (YoY +¥44.9B, +53.3%). The primary driver of revenue growth was expanded securities investment income in the banking segment (Securities Investment Operations ¥928.8B, from ¥318.3B the prior year, +191.8%) and increased interest income in a rising rate environment. However, funding costs increased from ¥98.5B to ¥180.9B (+83.6%), causing Net Income margin to decline to 7.7% from 9.4% a year earlier (down 1.7pt). Comprehensive income swung to a large positive ¥398.1B from ¥-269.6B a year earlier, with Securities Valuation Gains +¥162.1B and Hedge Differences +¥95.4B boosting net assets. The Equity Ratio improved to 3.9% from 3.3% (up 0.6pt) but remains low, and a high leverage structure continues with Financial Leverage of 25.8x.
Revenue: Ordinary Income (Revenue) expanded sharply to ¥1,671.0B (+86.5%). The banking segment accounted for ¥1,517.5B (+100.5%), representing 90.8% of the total; within this, Securities Investment Operations were ¥928.8B (prior ¥318.3B), Loans ¥357.2B (prior ¥266.8B), and Other ¥231.6B (prior ¥163.5B), driven by rising interest rates and an expanded investable asset base. The leasing business recorded ¥153.5B (+10.5%), a solid double-digit increase. Asset management revenues rose to ¥687.96B (prior ¥472.87B, +45.5%), including loan interest income ¥357.2B (+33.9%) and securities interest/dividends ¥271.2B (+59.8%), benefiting from higher market rates. Deposits decreased by ¥-1,530.0B YoY, altering the funding and investment mix.
Profitability: Ordinary Income was ¥197.6B (+60.6%), Profit Before Tax ¥178.5B (+53.3%), and Net Income ¥129.3B (+53.3%), securing profit growth, but margins contracted: Ordinary Income margin to 11.8% from 13.7% (down 1.9pt). Funding costs rose to ¥180.9B (prior ¥98.5B, +83.6%), and Other Ordinary Expenses surged to ¥747.1B (prior ¥201.0B, +271.6%), pressuring profitability. Bank G&A expenses were ¥407.8B (prior ¥342.7B, +19.0%), growing at a slower pace than revenue, indicating some cost control. Special losses of ¥19.2B (including impairment ¥7.2B) were recorded, exerting modest downward pressure from Ordinary to Pre-tax income. After income taxes of ¥49.1B (effective tax rate 27.5%), Net Income was ¥129.3B, with a Net Income margin of 7.7%. By segment, the banking segment’s Ordinary Income was ¥191.8B (+61.5%), representing 97% of the total, complemented by leasing at ¥5.6B (+26.7%). In conclusion, growth was led by increased asset management income benefiting from rising rates, but higher funding and other costs compressed margins.
The banking segment delivered Ordinary Income (Revenue) of ¥1,517.5B (+100.5%) and Ordinary Income of ¥191.8B (+61.5%), a strong performance as the core business. Its margin fell to 12.6% from 15.6% a year earlier (down 3.0pt), as costs rose alongside revenue expansion. Assets stood at 6兆5,311.5B (+2.3%), liabilities at 6兆2,781.6B, operating a very large balance sheet. The leasing business recorded Ordinary Income (Revenue) of ¥153.5B (+10.5%) and Ordinary Income of ¥5.6B (+26.7%), with a margin of 3.7% improving 0.5pt from 3.2% the prior year. Assets were ¥467.2B (+1.5%), remaining small but continuing to contribute efficiently.
Profitability: Ordinary Income margin 11.8% (down 1.9pt from 13.7%), Net Income margin 7.7% (down 1.7pt from 9.4%), with funding costs and higher expenses squeezing margins. ROE 5.1% (improved 1.6pt from 3.5%) benefited from both higher net assets and profit expansion but remains low. Cash Quality: Operating Cash Flow (OCF) was -¥2,558.0B, a large outflow, with an OCF-to-Net Income multiple of -19.8x. As is typical for banking accounts, balance-sheet dynamics—Loans +¥4,178.5B and Deposits -¥1,530.0B—drove the OCF deterioration, indicating very weak cash conversion of profits. Free Cash Flow was -¥2,464.4B (OCF -¥2,558.0B + Investing CF ¥93.6B), showing limited internal fund generation. Investment Efficiency: Return on Assets (ROA, Ordinary Income basis) was 0.3% (prior 0.2%), a slight increase. Asset turnover was 0.026x, low as expected for banks. Financial Soundness: Equity Ratio 3.9% (up 0.6pt from 3.3%), still low, with Debt-to-Equity 24.8x (prior 28.3x) indicating continued high leverage. Of Net Assets ¥2,537.7B, Valuation and Translation Adjustments were ¥205.9B (prior -¥59.5B), a significant positive turnaround that strengthened capital via comprehensive income.
Operating Cash Flow was -¥2,558.0B (worsened by -¥6,461.7B from prior year +¥4,903.7B), a large outflow. The subtotal (before working capital changes) of -¥2,513.9B indicates cash outflow even on a core business basis, but the main drivers were balance-sheet expansion in banking: loan increases (+¥4,178.5B) and deposit decreases (-¥1,530.0B). OCF/Net Income was -19.8x, and OCF/EBITDA (EBITDA = Ordinary Income ¥197.6B + Depreciation ¥51.7B = ¥249.3B) was -10.3x, showing very weak cash conversion. Investing CF was a net inflow of ¥93.6B, offsetting investments of -¥105.1B in tangible fixed assets and -¥103.1B in intangible fixed assets (total -¥208.2B) through disposals and other proceeds. Software investment increased (from ¥119.6B to ¥202.5B, +¥82.9B), driving DX and system foundation strengthening. Financing CF was -¥278.5B, with dividend payments of -¥38.5B and share buybacks of -¥40.0B as shareholder returns. As a result, Cash and Cash Equivalents declined by -¥2,742.8B to ¥13,679.6B. Free Cash Flow of -¥2,464.4B corresponds to -31.4x coverage versus dividends + buybacks total -¥78.5B, highlighting that shareholder returns are not funded by internal cash generation. Given banking characteristics, OCF is sensitive to loan/deposit dynamics, so short-term FCF coverage assessments are limited, but with an Equity Ratio of 3.9% the balance between sustaining dividends and building capital remains a challenge.
There is a ¥19.1B gap between Ordinary Income ¥197.6B and Pre-tax Income ¥178.5B, mainly due to Special Losses of ¥19.2B (impairment ¥7.2B, fixed asset disposal losses ¥2.8B, etc.), which can be viewed as one-off items. Ordinary-stage earnings comprised Asset Management Income ¥687.96B and Fee/Service Income ¥128.1B, plus Other Ordinary Income ¥181.2B (including FX trading gains). Funding costs ¥180.9B and Other Ordinary Expenses ¥747.1B offset these revenues, yielding an Ordinary Income margin of 11.8%. The large YoY increase in Other Ordinary Expenses (+271.6%) suggests volatility factors such as market-related costs or trading losses. Comprehensive Income ¥398.1B far exceeded Net Income ¥129.3B, with Other Comprehensive Income ¥268.7B including Securities Valuation Gains ¥162.1B, Deferred Hedge Gains/Losses ¥95.4B, and Remeasurements of Defined Benefit Plans ¥11.2B contributing to net asset growth. These are valuation gains from improved market conditions and should be distinguished from recurring earning power. The negative OCF indicates weak cash backing for profits, but this largely stems from structural bank balance-sheet movements in loans and deposits, not necessarily deterioration in earnings quality. Nevertheless, monitoring is required for sustainable liquidity and capital efficiency.
Full-year guidance forecasts Ordinary Income ¥265.0B and Net Income ¥170.0B. Actuals represent progress rates of 74.6% for Ordinary Income (¥197.6B) and 76.1% for Net Income (¥129.3B) against the full-year guide (with standard progress where Q4 = 100%), indicating slight underperformance. Year-over-year full-year guidance implies Ordinary Income +34.1% and Net Income +34.1%, but if the margin deterioration observed in the first half (Ordinary Income margin 11.8%) persists, substantial margin improvement will be required in H2. Forecast EPS is ¥76.15 vs. actual ¥55.98 (progress 73.5%). Dividend guidance is ¥15.00 (post-split basis), while actual dividends comprised ¥110 (Q2, pre-split) + ¥12 (year-end, post-split) totaling ¥122 (pre-split equivalent of ¥12.2 / post-split equivalent ¥1.22), so consistency with guidance should be noted. Achieving guidance depends on stable interest-rate conditions, improved lending-deposit spreads, and control of other expenses.
Dividends of ¥110 were paid in Q2 (pre-split basis) and ¥12 at year-end (post-split basis). A 1:10 stock split was implemented on October 1, 2025; on a pre-split basis, the annual dividend equates to ¥230, and on a post-split basis ¥23. Dividend payments on the cash flow statement totaled ¥38.5B, implying a Payout Ratio of 29.8% against Net Income ¥129.3B. Additionally, ¥40.0B was spent on share buybacks, bringing total shareholder returns to ¥78.5B and a Total Return Ratio of 60.7%. However, Free Cash Flow of -¥2,464.4B results in a total return coverage of -0.03x, indicating returns are not funded by internal cash. Given the banking nature where OCF is influenced by loans/deposits movements, short-term FCF coverage assessments are limited, but with an Equity Ratio of 3.9% the balance between maintaining dividends and building capital is a concern. A Payout Ratio around 30% is reasonable, but future share buybacks should be considered cautiously in light of capital constraints.
Interest Rate Risk: Against Asset Management Income of ¥687.96B and Funding Costs of ¥180.9B, net interest margin (NIM) shows a shrinking tendency. If funding-cost increases outpace improvements in investment yields in a rising-rate environment, margins will be further compressed. The large investment portfolio—Loans ¥3,173.4B and Securities ¥1,883.13B—contains duration and mismatch risks, which could lead to valuation losses or earnings volatility under rapid rate changes.
Liquidity & Capital Risk: With an Equity Ratio of 3.9% and Debt-to-Equity 24.8x, high leverage persists; deposits decreased by ¥-1,530.0B YoY, increasing reliance on market funding. OCF outflows of -¥2,558.0B, driven by loan growth and deposit declines, magnify rollover risk under liquidity stress. Cash and cash equivalents of ¥13,679.6B represent 21% of total assets ¥6兆5,367.9B, but the thin capital buffer and limited capital availability in stress scenarios are areas of concern.
Systems & Intangible Investment Risk: Intangible fixed assets increased +55.3% (from ¥132.5B to ¥205.7B), with software at ¥202.5B reflecting substantial investment. While DX and core system investments aim to improve efficiency and generate new revenue streams, depreciation burdens have increased (Depreciation ¥51.7B, up +15.7% from ¥44.7B) and there is impairment risk (¥7.2B impairment recorded). If investments fail to deliver expected benefits, increased fixed costs could continue to pressure margins.
Revenueability & Returns
| 指標 | 自社 | 中央値 (IQR) | Delta |
|---|---|---|---|
| Net Income Margin | 7.7% | 11.9% (7.2%–35.4%) | -4.1pt |
The company’s Net Income Margin of 7.7% is 4.1pt below the industry median of 11.9%, indicating relatively low profitability, attributable to higher funding costs and other expense increases.
Growth & Capital Efficiency
| 指標 | 自社 | 中央値 (IQR) | Delta |
|---|---|---|---|
| Revenue Growth Rate (YoY) | 86.5% | 10.1% (7.3%–12.1%) | +76.4pt |
Revenue growth of 86.5% far exceeds the industry median of 10.1%, reflecting substantial expansion of securities operations and effects of rising interest rates. However, this growth is quantity-driven and accompanied by margin deterioration, warranting caution.
※ Source: Company compilation
Balancing revenue opportunities from rising rates with funding-cost management: Asset management income grew +45.5% benefiting from higher rates and expanded assets, but funding costs surged +83.6%, compressing Net Income margin by 1.7pt. The company faces a structural trade-off with potential for spread improvement but increased reliance on market funding. Improvements in securities valuation and hedge differences (Comprehensive Income +¥398.1B) reflect market improvements but are one-off valuation gains and should be distinguished from recurring earnings power.
Capital policy to build equity and correct high leverage is the top priority: The Equity Ratio of 3.9% improved +0.6pt but remains thin versus regulatory benchmarks (domestic-standard banks 4%+, international-standard banks 8%+). Under high leverage (Debt-to-Equity 24.8x), persistent negative OCF and a Total Return Ratio of 60.7% slow internal reserve accumulation. While comprehensive income bolstered net assets temporarily, sustainable improvement in the Equity Ratio requires accumulation of retained earnings. Maintaining a Payout Ratio around 30% while restraining buybacks would be prudent.
Realizing returns from DX/system investments and managing fixed costs: Large intangible investments (+55.3%, including software +¥82.9B) aim to drive efficiency and new fee income. Depreciation increases (+¥7.0B) and impairment risk (¥7.2B) exist, but successful realization could improve cost-to-income ratios and enhance digital service fee income. G&A growth (+19.0%) lagging revenue growth (+86.5%) indicates signs of efficiency, but the sharp rise in Other Expenses (+271.6%) offsets this, requiring strict control of both fixed and variable costs and early realization of investment benefits.
This report was automatically generated by AI analyzing XBRL financial statement data. It is not a recommendation to invest in any specific security. Industry benchmarks are reference information compiled by the company based on public financial statements. Investment decisions are your own responsibility; please consult a professional advisor as needed.