| 指標 | 当期 | 前年同期 | YoY |
|---|---|---|---|
| Revenue | ¥7740.6B | ¥6140.0B | +26.1% |
| Operating Income | - | - | - |
| Ordinary Income | ¥1233.8B | ¥778.0B | +58.6% |
| Net Income | ¥550.9B | ¥501.4B | +9.9% |
| ROE | 4.5% | 5.2% | - |
The FY2026 results: Ordinary Revenue ¥7,740.6B (YoY +¥1,600.6B +26.1%), Ordinary Income ¥1,233.8B (YoY +¥455.8B +58.6%), and Net Income attributable to owners of the parent ¥1,134.2B (YoY +¥289.2B +34.2%), achieving significant growth on both top-line and bottom-line. Banking ordinary revenue rose 26.1% due to improved interest-rate environment and expanded fee income; notably, Principal Transactions turned profitable (prior year ▲¥5.0B → current ¥1,551.7B) and Corporate Banking profit expansion (prior ¥1,605.7B → current ¥2,781.8B, +73.1%) drove results. Ordinary income margin improved to 15.9% (up +3.2pt from 12.7% prior year) and net income margin improved to 14.7% (up +0.9pt from 13.8%), reflecting higher profitability. ROE was 4.5% (prior 4.7%) showing a slight decline amid equity accumulation; shareholders' equity increased by ¥2,737.9B YoY to ¥12,330.4B, with Comprehensive Income ¥1,900.9B contributing to equity build-up.
【Revenue】 Ordinary Revenue ¥7,740.6B (YoY +26.1%) reflected expansion in both interest and non-interest income. Interest income was ¥3,662.9B (prior ¥2,927.0B, +25.1%), reflecting improved rate environment; interest expenses increased to ¥2,113.7B (prior ¥1,346.1B, +57.0%), leaving Net Interest Income at ¥1,549.1B (prior ¥1,580.9B, ▲2.0%) - a slight decline. Meanwhile, Net Fee Income ¥552.2B (prior ¥442.8B, +24.7%), Trading Income ¥183.8B (prior ¥83.3B, +121%), and Other Operating Income ¥2,358.3B (prior ¥1,988.7B, +18.6%) drove expansion of non-interest income. By segment, Corporate Banking revenue ¥407.6B (prior ¥338.0B, +20.6%), Structured Finance ¥332.5B (prior ¥306.4B, +8.5%), Principal Transactions ¥220.5B (prior ¥48.7B, +353%), and APLUS ¥762.8B (prior ¥690.8B, +10.4%) maintained revenue growth across key segments.
【Profit & Loss】 SG&A was ¥1,776.8B (prior ¥1,716.0B, +3.5%), rising at a slower pace than revenue, improving the cost-to-income ratio to about 23.0% (prior 27.9%, ▲4.9pt), indicating efficiency gains. Credit-related costs decreased to ¥382.4B (prior ¥470.7B, ▲18.8%), improving credit cost ratio. Goodwill amortization was ¥10.2B, intangible amortization ¥4.0B, and extraordinary expenses ¥19.2B; total operating expenses were ¥1,810.1B, resulting in Ordinary Income ¥1,233.8B (prior ¥778.0B, +58.6%). Extraordinary income was ¥6.4B (including negative goodwill gain ¥3.2B) and extraordinary loss ¥19.0B (impairment loss ¥17.1B), net negligible. Corporate tax etc. ¥91.4B (effective tax rate 7.5%) was low due to deferred tax asset recognition; Net Income ¥550.9B (prior ¥501.4B, +9.9%) and Net Income attributable to owners of the parent ¥1,134.2B (prior ¥844.9B, +34.2%) were boosted by equity-method investment gains ¥95.4B and contributions from comprehensive income. In conclusion, revenue and profit growth were achieved, supported by improved cost efficiency and expanded non-interest income.
Corporate Banking recorded Gross Operating Profit ¥407.6B and Segment Profit ¥2,781.8B (prior ¥1,605.7B, +73.1%), the largest contributor. Interest income ¥283.7B and non-interest income ¥123.9B contributed in balance, with credit costs ¥92.2B and expenses ¥120.2B well controlled. Structured Finance had Gross Operating Profit ¥332.5B and Segment Profit ¥1,700.6B (prior ¥666.9B, +155%), driven by expansion of non-interest income ¥156.4B. Principal Transactions showed Gross Operating Profit ¥220.5B and Segment Profit ¥1,551.7B (prior ▲¥5.0B, turned to profit), with non-interest income ¥178.6B the main driver of the turnaround. Financial Markets posted Gross Operating Profit ¥57.9B and Segment Profit ¥343.6B (prior ¥416.5B, ▲17.5%), a decline. Showa Lease had Gross Operating Profit ¥181.6B and Segment Profit ¥241.0B (prior ¥136.4B, +76.7%). Retail Banking recorded Gross Operating Profit ¥391.0B and Segment Profit ¥1,250.9B (prior ¥590.1B, +112%), Shinsei Financial Gross Operating Profit ¥640.0B and Segment Profit ¥1,167.3B (prior ¥1,167.4B, flat), and APLUS Gross Operating Profit ¥762.8B and Segment Profit ¥1,249.8B (prior ¥727.1B, +71.9%)—consumer businesses were solid. Overseas operations had Gross Operating Profit ¥187.9B and Segment Profit ¥947.9B (prior ¥1,118.4B, ▲15.2%), and Securities Investment Gross Operating Profit ¥150.1B and Segment Profit ¥1,008.8B (prior ¥805.9B, +25.2%), showing market-driven variability. Overall, Corporate, Structured Finance, and Principal segments led profit growth, while retail businesses (Retail & APLUS) provided uplift.
【Profitability】Ordinary income margin 15.9% (Ordinary Income / Ordinary Revenue, prior 12.7% +3.2pt), Net income margin 14.7% (Net Income attributable to owners of the parent / Ordinary Revenue, prior 13.8% +0.9pt), ROE 4.5% (prior 4.7% ▲0.2pt). Profit margins improved while ROE slightly declined due to equity accumulation. Net Interest Margin (NIM) was 1.42% and low, but fee income, trading income, and equity-method investment gains complemented overall profitability. 【Cash Quality】Operating Cash Flow (OCF) ¥1,914.14B (YoY ▲3.6%), OCF/Net Income 34.7x (prior 38.5x), indicating very strong cash backing of earnings. Accrual ratio ▲33.6% (= (Net Income − OCF) / Total Assets, prior ▲33.8% slight improvement) shows stable cash generation. 【Investment Efficiency】Total asset turnover 0.031x (prior 0.030x slight increase), BPS ¥1,381.19 (prior ¥1,151.40 +19.9%); no PBR data provided but equity accumulation is progressing. 【Financial Soundness】Equity Ratio 5.0% (prior 4.7% +0.3pt) is well below industry median 12%, indicating room for capital build-up. D/E ratio 19.07x (Liabilities / Net Assets, prior 20.20x decreased) reflects high leverage typical of banking. Liquidity is ample with Cash and Deposits ¥4,787.5B (19.4% of Total Assets), and Loan-to-Deposit ratio 84.1% (Loans ¥10,945.6B / Deposits ¥13,021.7B) at an appropriate level, indicating stable funding base.
OCF was ¥1,914.14B (prior ¥1,984.63B ▲3.6%), with subtotal before working capital changes ¥1,934.17B and corporate tax payments ¥20.03B deducted. Banking OCF is heavily affected by changes in deposits, loans, and securities; deposit increase ¥1,510.5B and securities increase ¥1,191.2B were cash outflows, while loan increase ¥1,441.2B was a cash inflow, resulting in net positive cash flow. Investing CF was ▲¥1,189.29B (prior ▲¥1,292.42B, reduced outflow), mainly reinvestment into securities and trading assets. Free Cash Flow was ¥724.85B (prior ¥692.21B +4.7%), sufficient to cover dividend ¥42 (total approx. ¥37.5B) and share buybacks ¥32.0B. Financing CF was cash inflow ¥126.95B (prior ▲¥48.46B reversal), supported by capital increase ¥77.1B and disposal of treasury stock ¥46.5B, leaving net positive after share buybacks ¥32.0B and dividend ¥1.8B. Cash and deposits at period end rose to ¥4,623.6B (prior ¥3,771.9B +¥851.7B), providing a substantial liquidity cushion.
Against Ordinary Income ¥1,233.8B, Net Income was ¥550.9B and Net Income attributable to owners of the parent ¥1,134.2B; equity-method investment gains ¥95.4B (including negative goodwill ¥37.4B from additional acquisition of NEC Capital Solutions) boosted net income. Net extraordinary items were ▲¥1.26B (Extraordinary Income ¥6.4B − Extraordinary Loss ¥19.0B), minor, and impairment loss ¥17.1B was a one-off expense. Comprehensive Income ¥1,900.9B far exceeded Net Income ¥550.9B, with Other Securities Valuation Difference ¥262.7B, Deferred Hedge Gains/Losses ¥397.1B, and actuarial adjustments related to retirement benefits ¥75.0B contributing to equity build-up. Non-operating income was diversified: Fee Income ¥923.3B, Trading Income ¥183.8B, Equity-method Investment Gains ¥95.4B; excluding one-offs, recurring items such as fees and card settlement income are central. OCF ¥1,914.14B is 34.7x Net Income ¥550.9B, showing very strong cash backing and high accrual quality. Corporate tax ¥91.4B (effective tax rate 7.5%) is low due to deferred tax assets and warrants monitoring for sustainability.
Forecast year-end dividend ¥42 (total approx. ¥37.5B, Payout Ratio 2.5% — possibly a misprint versus Net Income attributable to owners of the parent ¥1,134.2B, per XBRL reported value) and share buybacks ¥32.0B have been executed. Total shareholder returns (dividend + buybacks) amount to approx. ¥69.5B, implying a Total Return Ratio of about 61.3% (= ¥69.5B / Net Income attributable to owners of the parent ¥1,134.2B). Dividend coverage relative to Free Cash Flow ¥724.85B is about 19.3x, and total return coverage is about 10.4x, indicating ample capacity. Prior year included an in-kind dividend (Latitude Group Holdings shares, book value ¥41.92B) expanding effective returns, demonstrating a flexible shareholder return stance. Although Payout Ratio 2.5% is very low, on a total-return basis the return exceeds 60% and sustainability of dividend policy will hinge on internal reserves accumulation and ROE improvement.
Interest Rate Risk: NIM 1.42% is well below industry average 2–3%, with margin compression between loan yields and deposit costs persisting. In a rising-rate environment, funding costs (Borrowings ¥2,178.1B, Corporate Bonds ¥243.7B) may rise further, pressuring net interest margin; quantitatively, a 1% rate increase could raise interest expenses by approximately ¥20.0B. NIM improvement requires loan rate increases or deposit cost suppression, difficult in a competitive market, creating structural vulnerability via greater reliance on non-interest income.
Capital Risk: Equity Ratio 5.0% is materially below the industry median 12%, leaving weak capital buffers. With Total Assets ¥24,741.4B and Net Assets ¥1,233.0B, and D/E ratio 19.07x, high leverage means credit cost overruns on loans or valuation losses in marketable assets could rapidly erode equity. Quantitatively, if 1% of Loans ¥10,945.6B became non-performing, approximately ¥109.5B of credit costs would occur, reducing Equity Ratio to about 4.1%. Urgent improvement in capital efficiency via internal reserves build-up and ROE enhancement is required.
Marketable Securities Risk: Marketable securities ¥4,005.5B, Trading Assets ¥451.3B, and Money Trusts ¥506.4B—marketable assets comprise 18.5% of Total Assets—so returns are sensitive to interest-rate, FX, and equity market volatility. Comprehensive Income ¥1,900.9B includes Other Securities Valuation Difference ¥262.7B and Deferred Hedge Gains/Losses ¥397.1B; adverse markets could cause valuation losses directly hitting equity. Quantitatively, a 10% decline in market value of securities would generate about ¥400.6B valuation loss, materially deteriorating Equity Ratio.
Profitability & Return
| 指標 | 自社 | 中央値 (IQR) | Delta |
|---|---|---|---|
| Net income margin | 7.1% | 11.9% (7.2%–35.4%) | -4.8pt |
Net income margin 7.1% is below industry median 11.9%, indicating room to improve profitability.
Growth & Capital Efficiency
| 指標 | 自社 | 中央値 (IQR) | Delta |
|---|---|---|---|
| Revenue growth rate (YoY) | 26.1% | 10.1% (7.3%–12.1%) | +16.1pt |
Revenue growth 26.1% significantly exceeds industry median 10.1%, placing top-line growth among industry leaders.
※Source: Company compilation
Structural shift to non-interest income: With NIM at 1.42% and low interest margin, the revenue mix is clearly supplemented by Fee Income ¥552.2B (YoY +24.7%), Trading Income ¥183.8B (+121%), and Equity-method Investment Gains ¥95.4B. Principal Transactions turning profitable (prior ▲¥5.0B → current ¥1,551.7B) is market-dependent, but profit growth in Corporate Banking and Structured Finance (+73%, +155% respectively) reflects expansion of the operating base and has higher sustainability. Going forward, expanding fee/settlement business and stabilizing principal investments are keys to improving profitability.
Balance between capital build-up and returns: Comprehensive Income ¥1,900.9B expanded Net Assets by 28.6% YoY to ¥1,233.0B, yet Equity Ratio 5.0% remains well below industry median 12%. Total Return Ratio 61.3% (dividends + buybacks approx. ¥69.5B) is proactive, but with Free Cash Flow ¥724.85B available, optimal allocation between retained earnings and shareholder returns is needed. The very low Payout Ratio 2.5% suggests room for phased dividend increases; monitoring will focus on simultaneous improvement in dividends and Equity Ratio.
This report is an AI-generated earnings analysis based on XBRL financial statement data. It does not constitute a recommendation to invest in any particular security. Industry benchmarks are compiled by the Company from public financial statements for reference. Investment decisions are your responsibility; consult a professional advisor as needed.