SBI Shinsei Bank,Limited FY2026 FY Earnings Report

クイックビュー

Executive Summary

For the fiscal year ended March 2026, ordinary revenue (経常収益) was ¥7,740.6B (YoY +¥1,600.6B +26.1%), ordinary income was ¥1,233.8B (YoY +¥455.8B +58.6%), and net income attributable to owners of the parent was ¥1,134.2B (YoY +¥290.3B +34.2%). Ordinary revenue, which corresponds to the bank's revenue, increased for the second consecutive year driven by rising interest rates and expanded non-interest income, and both ordinary income and net income recorded substantial increases. The three segments—Corporate Banking, Structured Finance, and Principal Transactions—collectively delivered profit growth of +¥2,157B YoY, and non-fund income (fees, trading, investment gains/losses) expanded to ¥1,797.5B (YoY +¥391.3B), which was the main driver. Net income was boosted by growth in investment income and equity-method gains included in non-operating income, while extraordinary items were a net burden of ¥12.6B. ROE was 4.5%, net profit margin 7.1%, and Equity Ratio 5.0%; while there remains room to improve capital efficiency and equity, the continued revenue and profit growth trend and expansion of non-interest income have strengthened the revenue base.

業績変動要因

【Revenue】

Ordinary revenue of ¥7,740.6B was a substantial increase of +26.1% YoY. Breakdown: interest income (major items excluding deposit interest within investment income) increased due to higher balances of loans and securities and rising rates; fee and commission income was ¥923.3B (¥774.9B prior year, +19.2%); specific transaction income was ¥183.8B (¥83.3B prior year, +120.7%), showing a large expansion in non-interest income. By segment, gross business profit (equivalent to ordinary revenue) for Corporate Banking was ¥407.6B (¥338.0B prior year, +20.6%), Structured Finance ¥332.5B (¥306.4B prior year, +8.5%), and Principal Transactions ¥220.5B (¥48.7B prior year, +352.6%), with the three corporate segments leading. Personal business: Retail Banking ¥391.0B (¥288.8B prior year, +35.4%), APLUS ¥762.8B (¥690.8B prior year, +10.4%) performed steadily, Shinsei Financial ¥640.0B (¥613.7B prior year, +4.3%). Overseas business decreased to ¥187.9B (¥230.8B prior year, -18.6%). Securities investment increased to ¥150.1B (¥108.2B prior year, +38.7%) due to improving market conditions. The large principal revenue increase reflects monetization in private equity and credit trading. Company-wide, the non-fund income ratio rose to 53.7% (¥1,797.5B / ¥3,346.6B prior year 47.1%), strengthening resilience to interest rate fluctuations.

【Profitability】

Ordinary income of ¥1,233.8B was a large increase of +58.6% YoY. Fund income (equivalent to fund cash flow) was ¥1,549.1B (¥1,580.9B prior year, -2.0%) and essentially flat, while expansion of non-fund income and improvement in credit-related costs drove profit growth. G&A excluding goodwill and intangible amortization was ¥1,779.8B (¥1,686.0B prior year, +5.6%) increased, but revenue growth outpaced costs and the cost-to-income ratio improved. Credit-related costs improved to ¥382.4B (¥470.7B prior year, -18.8%) in aggregate across segments; consumer finance (Shinsei Financial ¥146.5B, APLUS ¥170.9B) accounted for the bulk, while retail and corporate banking remained low. By segment, Corporate Banking posted ¥278.2B (¥160.6B prior year, +73.3%), Structured ¥170.1B (¥66.7B prior year, +155.0%), and Principal ¥155.2B (¥-5.0B prior year, turning to profit), with the three corporate segments contributing a combined profit increase of +¥257.9B. Financial Markets ¥34.4B (¥41.7B prior year, -17.5%), Securities Investment ¥100.9B (¥80.6B prior year, +25.2%). After deducting extraordinary items (net -¥12.6B) and corporate taxes of ¥91.4B from ordinary income, net income was ¥1,134.2B (¥844.1B prior year, +34.4%). Extraordinary items were mainly impairment losses ¥17.1B and negative goodwill gain ¥3.2B, both temporary. In conclusion, the company achieved revenue and profit growth driven by expanded non-interest income and improved credit costs.

セグメント別分析

Corporate Banking recorded gross business profit ¥407.6B and segment profit ¥278.2B, supported by expansion of non-fund income ¥123.9B (¥97.4B prior year, +27.2%). Structured Finance: gross business profit ¥332.5B, profit ¥170.1B, with credit-related costs improving substantially from ¥104.4B prior year to ¥20.8B. Principal Transactions: gross business profit ¥220.5B, profit ¥155.2B, driven by turnaround to positive non-fund income ¥178.6B (¥-4.5B prior year). Retail Banking profit ¥125.1B (¥59.0B prior year, +112.0%), Shinsei Financial ¥116.7B (¥116.7B prior year, flat), APLUS ¥124.9B (¥72.7B prior year, +71.8%). Financial Markets ¥34.4B (¥41.7B prior year, -17.5%), Showa Lease ¥24.1B (¥13.6B prior year, +77.2%). Overseas business ¥94.8B (¥111.8B prior year, -15.2%), Securities Investment ¥100.9B (¥80.6B prior year, +25.2%). Segment assets: Corporate Banking ¥5兆7,438B, Structured ¥2兆3,412B, Retail ¥2兆3,885B, Securities Investment ¥3兆4,965B, company total ¥18兆7,504B. The three areas—Corporate, Principal, and Retail—served as profit growth drivers.

主要財務指標

【Profitability】Net profit margin was 7.1% (= Net Income ¥550.9B / Ordinary Revenue ¥7,740.6B), down from 8.2% prior year, but ordinary income margin was 15.9% (= ¥1,233.8B / ¥7,740.6B), up +3.2pt from 12.7% prior year. ROE was 4.5% (= Net Income ¥550.9B / average shareholders' equity during period equivalent to ¥1兆2,330B) flat from prior year 4.5%. The bank-specific Net Interest Margin (NIM), estimated as loan yield minus deposit yield, is approximately 1.4%. ROA was 0.5% (= Ordinary Income ¥1,233.8B / average total assets ¥24兆7,414B). Non-interest income ratio was 53.7% (= Non-fund income ¥1,797.5B / gross business profit ¥3,346.6B), accounting for the majority and indicating diversification of revenue structure.

【Cash Quality】Operating Cash Flow (OCF) was ¥1兆8,958B, 34.4x net income, and OCF/Revenue was 244.9%, reflecting very high cash conversion and the funding flow characteristics of banking. The accrual ratio ((Net Income - OCF) / Total Assets) is -7.2%, negative, indicating strong cash backing of operating profit.

【Investment Efficiency】Total asset turnover was 0.031x (= ¥7,740.6B / ¥24兆7,414B) roughly flat from 0.030x prior year. Financial leverage was 20.1x (= Total Assets ¥24兆7,414B / Equity ¥1兆2,330B), down from 21.2x prior year. Equity-method investment income ¥95.4B includes negative goodwill ¥37.4B related to additional acquisition of NEC Capital, included as a one-off.

【Financial Soundness】Equity Ratio was 5.0% (= Equity ¥1兆2,330B / Total Assets ¥24兆7,414B), up +0.3pt from 4.7% prior year but materially below the industry median of 12%. Loan-to-deposit ratio (LDR) was 84.1% (= Loans ¥10兆9,456B / Deposits ¥13兆0,217B), within an appropriate range. Cash and deposits ¥4兆7,875B accounted for 19.4% of total assets, providing a large liquidity cushion.

キャッシュフロー分析

OCF was ¥1兆8,958B (¥1兆9,846B prior year, -4.5%), calculated as OCF subtotal ¥1兆9,159B less corporate tax payments ¥200B. OCF/Net Income is 34.4x, reflecting the bank-specific characteristic that working capital movements in deposits and loans substantially boost OCF. Investing CF was -¥1兆1,710B (prior year -¥1兆2,924B), driven by securities acquisition/disposition and acquisition of subsidiary shares. Financing CF was +¥1,270B (prior year -¥485B), including share issuance ¥770B, share buybacks -¥320B, and dividends -¥18B. Free Cash Flow was ¥7,248B (= OCF ¥1兆8,958B + Investing CF -¥1兆1,710B), and coverage of total shareholder returns (dividends + buybacks) ¥338B was 21.4x, very ample. Cash and cash equivalents at period end were ¥4兆6,236B (¥3兆7,719B prior year, +¥8,517B), indicating abundant liquidity. Strong OCF generation and restrained investing CF have secured ample funding capacity.

収益の質

Of ordinary income ¥1,233.8B, recurring revenue is primarily fund income, fee and commission income, and stable fee income; specific transaction income ¥183.8B and equity-method investment income ¥95.4B are volatile factors depending on market environment and investment performance. Equity-method investment income includes one-off negative goodwill ¥37.4B from additional acquisition of NEC Capital Solutions; excluding this yields a substantive ¥58.0B. Extraordinary items net -¥12.6B (impairment losses ¥17.1B, negative goodwill gain ¥3.2B, etc.) are minor. Comprehensive income ¥1,900.9B substantially exceeded net income ¥550.9B; the main components of the ¥1,350.0B difference were deferred hedge gains/losses +¥397.1B, valuation difference on available-for-sale securities +¥262.7B, and actuarial gains/losses +¥75.0B. Hedge accounting and fair value fluctuations of held securities are reflected in other comprehensive income, indicating high sensitivity to market interest rates and equity prices. That OCF is 34.4x net income is due to working capital movements of deposits and loans, characteristic of the banking intermediation function, and indicates strong accrual quality. Revenue quality is high due to recurring fund and fee income, while trading and equity-method income volatility and OCI exposure to interest and market risk are sources of profit variability.

株主還元

Year-end dividend was ¥42 per ordinary share, and total dividends against outstanding shares of 89,550,000 shares (after deducting treasury shares 8,500,000 shares, 88,700,000 shares) amounted to approximately ¥373B. Payout Ratio was 2.5% (= Total dividends ¥18B / Net income attributable to owners of the parent ¥1,134.2B) and is very low, but this is based on pre-stock-split (July 2025, 1:14,000,00?) figures and the post-split dividend is noted as stated. Share buybacks of ¥320B were executed, and combined with dividends total shareholder returns were ¥338B, giving a Total Return Ratio of 29.8% (= ¥338B / ¥1,134.2B). Coverage of free cash flow ¥7,248B for total returns is 21.4x, indicating strong sustainability of dividends. Note that in FY2025 a special dividend of ¥1,000B was paid on Class B preferred shares, and those shares and Class A preferred shares were all converted to common shares in August 2025. In Q2 FY2026, an in-kind dividend of Latitude Group Holdings Limited shares (book value ¥419B) was executed, demonstrating shareholder returns other than cash. Dividend policy is assessed as sustainable within the scope of profit growth and FCF generation capacity.

リスク要因

1. Interest Rate Risk: NIM of approximately 1.4% is low relative to the industry median of 2–3%, and in a rising rate environment deposit cost increases and the timing lag of loan rate revisions pose a spread compression risk. Deferred hedge gains/losses of +¥397B recorded in OCI suggest large mark-to-market volatility from interest hedges, which could increase equity volatility in the event of rapid rate moves.

2. Credit Risk: Of credit-related costs ¥382B, consumer finance accounts for over 80% at ¥317B (Shinsei Financial ¥146B, APLUS ¥171B). In an economic downturn, rising delinquencies on unsecured personal loans and credit could cause a sharp increase in credit costs, so ongoing monitoring of loan loss reserve balance ¥1,491B (1.4% of loan balances) is necessary.

3. Capital Adequacy Risk: Equity Ratio 5.0% is well below the industry median of 12%, leaving limited capital buffers under stress scenarios. High financial leverage 20.1x, while typical for banking, combined with volatility in comprehensive income (market-driven investment performance and hedge valuation changes) can depress equity, and continuous accumulation of retained earnings is required.

業種ベンチマーク（参考・当社調べ）

Profitability & Return

Net profit margin is 4.8pt below the industry median, placing profitability in the lower quartile.

Growth & Capital Efficiency

Revenue growth outperformed the industry median by 16.1pt, ranking the company among the leaders in top-line expansion.

※Source: Company compilation

決算上の注目ポイント

1. Expansion of non-interest income and improved earnings power in Corporate Banking and Principal investments resulted in two consecutive years of revenue and profit growth. The three segments—Corporate Banking +73%, Structured +155%, and Principal turning profitable—delivered a combined profit increase of +¥258B, advancing revenue base diversification. ROE 4.5% and net profit margin 7.1% place profitability in the lower part of the industry, but revenue growth +26.1% is top-class and ongoing growth momentum is a key focus.

2. Equity Ratio 5.0% is far below the industry median of 12%, limiting capital buffers. The bulk of comprehensive income ¥1,901B is composed of OCI related to deferred hedge gains and valuation differences on securities, reflecting interest rate and market risk exposures; market volatility could thus translate into equity volatility. Building retained earnings and improving capital efficiency are keys to medium-term financial soundness improvement.

3. Total Return Ratio 29.8% and FCF coverage 21.4x indicate high sustainability of shareholder returns, allowing coexistence of dividends and buybacks. Low NIM 1.4% is a structural challenge, but it is complemented by a 53.7% non-interest income ratio and improving credit costs; spread management and continued growth of non-interest income are prerequisites for improving margins and accumulating capital.

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This report is an earnings analysis document automatically generated by AI analyzing XBRL financial statement data. It does not constitute a recommendation to invest in any specific security. Industry benchmarks are compiled by the firm based on public financial statements and are for reference only. Investment decisions are your own responsibility; consult a professional advisor as needed before making any investment decisions.

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