| 指標 | 当期 | 前年同期 | YoY |
|---|---|---|---|
| Revenue / Net Sales | ¥2423.1B | ¥2314.6B | +4.7% |
| Operating Income | - | - | - |
| Ordinary Income | ¥271.8B | ¥175.6B | +54.8% |
| Net Income | ¥222.5B | ¥157.0B | +41.8% |
| ROE | 4.5% | 3.4% | - |
For the fiscal year ended March 2026, Revenue/Net Sales were ¥2,423.1B (YoY +¥108.5B +4.7%), Ordinary Income was ¥271.8B (YoY +¥96.2B +54.8%), and Net Income attributable to owners of the parent was ¥257.1B (YoY +¥51.5B +25.3%). Ordinary Income more than increased by 1.5x YoY, driven by loan growth and expanded fee income (+26.5%). The Investment Banking unit’s core business profit increased +39.2% YoY, and GMO Aozora Net Bank achieved its first turnaround to profitability. Operating Cash Flow (OCF) reached ¥1,326.2B (YoY +333.1%), 5.2x Net Income, indicating markedly improved cash generation. Progress against full-year guidance was 73.5% of Ordinary Income target of ¥370B and 95.2% of Net Income target of ¥270B, leaving upside potential in H2.
[Revenue] Ordinary revenue (equivalent to bank sales) was ¥2,423.1B (YoY +4.7%). Breakdown: investment income ¥1,603.3B; fee and commission income ¥393.9B (+26.5%); specific transaction income ¥48.3B (+30.3%); other operating income ¥293.8B (+20.3%). Loan balance rose to ¥4.49 trillion (+6.7%), strengthening the base for investment income. Fee income increased via M&A advisory, syndication, and fund management, and the Investment Banking unit’s consolidated gross profit expanded to ¥611.8B (+21.6%). The Markets & International unit’s consolidated gross profit was ¥153.2B (-23.3%) affected by market fluctuations, though trading P&L improved +30.2% YoY. GMO Aozora Net Bank’s business revenue surged to ¥142.7B (+54.9%), with digital channel revenue contribution materializing. Deposits were ¥6.03 trillion (+7.7%) and loan-to-deposit ratio was 74.4%, maintaining appropriate levels and a stable funding base.
[Profitability] Ordinary expenses were ¥2,151.3B (+0.6%), well controlled below revenue growth. Funding costs were ¥1,079.7B (-3.9%) due to low-cost funding. Credit-related costs were ¥84.7B (prior year ¥94.5B), compressed, with provisioning for credit losses down ¥10.3B YoY. SG&A were ¥659.99B (+5.8%), exceeding revenue growth and reflecting growth investments in investment banking and the net bank. Ordinary Income was ¥271.8B (+54.8%), profit before tax ¥271.7B, corporate tax etc. ¥5.7B (effective tax rate 2.1%), with deferred tax effects lifting Net Income to ¥222.5B (+41.8%). Extraordinary items were minor (extraordinary loss ¥0.12B), so one-off factors were limited. Comprehensive income was ¥415.2B (+92.6%), well above Net Income, aided by ¥145.9B increase in securities valuation differences. In conclusion, the company achieved revenue growth and substantial profit growth, with improved profitability driven by revenue diversification and suppressed credit costs.
The Investment Banking unit (business revenue ¥617.5B, consolidated core business profit ¥386.4B) was the largest earnings source, up +24.1%/+39.2% YoY, with strong corporate lending, M&A advisory, and restructuring finance. Consolidated gross profit ¥611.8B (+21.6%) grew on both fee income and private equity investments. Markets & International unit (¥181.1B/¥39.2B) was down -18.6%/-48.2% YoY due to market fluctuations; consolidated gross profit ¥153.2B (-23.3%) reflected increased volatility in FX trading and derivatives. Equity-method investment income ¥29.3B continued to contribute stably. Customer Relations unit (¥113.1B/¥11.6B) was roughly flat at -5.5%/-21.8% YoY, indicating maturity in corporate and retail sales. GMO Aozora Net Bank (¥142.7B/¥19.7B) turned profitable from a prior loss, with business revenue +54.9%. Consolidated gross profit ¥142.7B grew on corporate deposits, FX fees, and SME lending. Segment profit margins: Investment Banking 62.6%, Markets & International 21.7%, Customer Relations 10.3%, GMO Net 13.8%, highlighting the high-return profile of Investment Banking.
[Profitability] ROE 4.5% (prior year 4.9%) edged down due to increased equity, but ROE on Net Income attributable to owners of the parent is 5.5%, exceeding last year. Ordinary revenue to Ordinary Income ratio (Ordinary Income margin) 11.2% (prior year 7.6%) improved +3.6pt, returning to double-digit level. Net income margin 9.2% (prior year 6.8%) up +2.4pt, aided by low tax burden and expense control. NIM (net interest margin) is 1.17%, slightly below industry levels but offset by fee and market revenue diversification. Expense ratio (SG&A / Ordinary revenue) 27.2% vs prior year 27.0%, roughly flat; CIR is estimated around 65%, indicating room for efficiency improvement. [Cash Quality] OCF to Net Income multiple 5.2x, accrual ratio -1.2% indicates cash-led profit recognition. OCF/EBITDA 3.8x is high; depreciation ¥73.7B vs capex ¥23.1B (investment ratio 0.31x) shows restrained investment. [Investment Efficiency] ROA (Ordinary Income / Total assets) 0.3% improved from 0.2% prior year. EPS ¥185.75 (prior year ¥154.26, +20.4%), BPS ¥3,463.73 (prior year ¥3,258.51, +6.3%). [Financial Soundness] Equity Ratio 5.7% (prior year 5.8%) slightly down due to asset growth, low versus industry benchmark >12%. Loan-to-deposit ratio 74.4% is within appropriate range; deposits ¥6.03 trillion / loans ¥4.49 trillion provide a stable funding base. Allowance for loan losses balance ¥529.7B, coverage ratio (allowance / loans) 1.18% down from 1.69% prior year, with credit cost rate remaining low.
Operating Cash Flow was ¥1,326.2B (prior year -¥569.0B), turning significantly positive and demonstrating cash generation 5.2x Net Income ¥222.5B. Subtotal before working capital changes was ¥1,338.4B, and corporate tax payments -¥12.2B were minor; most OCF derived from core business cash generation. FX translation adjustments and market account fluctuations affect OCF composition, but over the full year increases in loans and deposits and monetization of fee income contributed. Investing Cash Flow was -¥142.8B (prior year -¥1,478.5B), with large reduction in outflows due to restrained securities investments; capex -¥23.1B is 0.31x depreciation ¥73.7B, indicating limited replacement investment. Free Cash Flow was ¥1,183.4B, covering dividends ¥105.2B by more than 11x. Financing Cash Flow was -¥99.5B (prior year +¥465.9B), mainly due to bond redemptions -¥666.8B, partially offset by new issuances (equity issuance ¥519.3B, exercise of warrants etc.). Cash and cash equivalents at period-end were ¥1,450.0B (period-beginning ¥1,341.6B), +¥108.4B, strengthening liquidity. FCF sustainability is high, though CF volatility from market conditions is a bank characteristic to note, and the full year confirmed sufficient cash generation.
Most of the Ordinary Income ¥271.8B was generated from core business; extraordinary items were minor (extraordinary loss ¥0.12B — impairment ¥0.04B, disposal of fixed assets ¥0.07B, other ¥13.2B) and one-off factors limited. The difference between Ordinary Income and profit before tax is negligible (-¥0.1B), indicating limited temporary factors both in non-operating and extraordinary items. Corporate tax expense ¥5.7B (effective tax rate 2.1%) is extremely low and deferred tax assets increases boosted Net Income; normalization of tax burden is a future risk. Comprehensive income ¥415.2B (1.9x Net Income ¥222.5B) comprised securities valuation gains +¥145.9B, foreign currency translation adjustments +¥17.9B, deferred hedge P&L -¥10.6B, and retirement benefit adjustments +¥13.2B, with valuation gains from market improvements contributing materially. Accrual ratio -1.2% ((OCF ¥1,326.2B - Net Income ¥222.5B) / Total assets ¥86,016.7B) is low, indicating profits are backed by cash generation. The fact OCF is 5.2x Net Income and OCF/EBITDA 3.8x also supports high earnings quality. Fee income and loan interest are quickly converted to cash; some market-related revenue includes valuation gains, but trading P&L was realized net. Equity-method investment income ¥29.3B is a stable non-cash income source and distributions are monetized, so quality is acceptable. Overall, recurring earnings predominate, one-offs are minor, and cash-led profit recognition indicates good earnings quality. However, low tax burden and large increase in comprehensive income include market-driven effects, so sustainability depends on macro environment.
Full-year plan: Ordinary Income ¥370B (YoY +36.1%), Net Income attributable to owners of the parent ¥270B, EPS ¥195.11, dividend ¥100. On a results basis, Ordinary Income ¥271.8B (73.5% progress), Net Income attributable to owners of the parent ¥257.1B (95.2% progress), so Net Income is nearly within reach. H2 outlook hinges on market volatility and credit cost trends, but assuming continued pace of fee income and net bank revenue expansion from H1, there is some upside to Ordinary Income. The dividend forecast ¥100 is strongly supported by ample cash: FCF ¥1,183.4B and cash and cash equivalents ¥1,450.0B. Risks to plan revisions include interest rate movements beyond assumptions (deposit rate spikes compressing NIM), re-escalation of credit costs, and trading losses; current progress supports plan achievement probability.
Interim dividend ¥25, quarterly dividends ¥22 each, total annual dividend ¥91 implemented (Payout Ratio 51.2%). Total dividend amount ¥105.2B versus Net Income attributable to owners of the parent ¥257.1B implies a payout ratio of ~41%, a sustainable level. FCF ¥1,183.4B covers dividends by 11.3x, confirming a strong shareholder return base supported by cash generation. Full-year dividend forecast ¥100 (vs prior forecast +¥81) indicates a large increase and a policy to return earnings to shareholders amid profit and capital efficiency improvements. Payout Ratio 51.2% slightly exceeds bank benchmark (30–50%) but with cash and deposits ¥1,450.0B and OCF ¥1,326.2B, sustainability concerns are limited. No share buybacks were conducted this term. Dividend yield (¥91 / BPS ¥3,463.73 ≒ 2.6%) is an evaluation point for shareholder returns. Given capital adequacy (Equity Ratio 5.7%), balancing dividend and capital accumulation will be a future challenge, but current levels present limited sustainability risk for dividends.
Interest rate environment risk compressing NIM: With current NIM 1.17% below industry levels, rising deposit rates could increase funding costs and compress margins. If loan rate pass-through lags deposit rate increases, gross profit decline could push down Ordinary Income. FX volatility also impacts trading P&L; higher market volatility destabilizes earnings.
Low Equity Ratio and constrained capital buffers: Equity Ratio 5.7% is well below industry benchmark (>12%) and slightly below Basel III minimum requirement with capital conservation buffer (4% + 2.5% = 6.5%). Loss absorption capacity under stress is limited, constraining room for asset growth and higher dividends. Capital raising (equity issuance, AT1/Tier2 issuance) may be necessary, risking shareholder dilution or higher funding costs.
Re-escalation of credit costs and market funding liquidity risk: Credit-related costs were ¥84.7B (prior ¥94.5B) and low, but economic slowdown or sectoral credit deterioration could rapidly increase provisioning. Coverage ratio 1.18% down from 1.69% suggests shrinking asset-quality buffer. Increases in trading assets ¥5,015.7B (+90.8%), trading liabilities ¥4,823.0B (+130.6%), and securities lending liabilities ¥3,759.4B (+8.7%) raise reliance on market funding. Rapid rate moves or liquidity shocks increase refinancing risk and could deteriorate short-term funding.
Profitability & Return
| 指標 | 自社 | 中央値 (IQR) | Delta |
|---|---|---|---|
| Net Income Margin | 9.2% | 11.9% (7.2%–35.4%) | -2.7pt |
Our Net Income margin is 2.7pt below industry median, above the 1st quartile (7.2%) but below median. Expansion of fee and market revenue is improving the metric, but low NIM and elevated CIR versus top peers are lagging factors.
Growth & Capital Efficiency
| 指標 | 自社 | 中央値 (IQR) | Delta |
|---|---|---|---|
| Revenue Growth Rate (YoY) | 4.7% | 10.1% (7.3%–12.1%) | -5.4pt |
Revenue growth rate is 5.4pt below industry median 10.1% and below the 1st quartile (7.3%). While loans and deposits grew steadily, Markets & International unit’s revenue decline due to market conditions dragged overall growth. Rapid growth at the net bank is an upside, but currently the company is in a relatively low-growth peer group.
※Source: Company aggregation
Revenue diversification and monetization of the net bank are structural growth drivers: Fee income +26.5% and GMO Aozora Net Bank turning profitable indicate progress away from interest income dependency. Investment Banking unit core business profit +39.2% YoY maintains high growth, and expertise in M&A, finance, and PE investments is a competitive advantage. FCF ¥1,183.4B and OCF / Net Income multiple 5.2x show strong cash generation supporting dividend sustainability and growth investment capacity.
Capital adequacy and NIM improvement are mid-term valuation inflection points: Equity Ratio 5.7% is well below industry >12%, constraining stress tolerance and growth. Low NIM 1.17% suggests room for margin improvement in a normalization environment, but lagging capture of deposit rate increases is a headwind. CIR around 65% indicates significant efficiency improvement potential; progress in capital build, IT investment, and operational efficiency under the mid-term plan will be key to valuation improvement.
Market sensitivity and macro dependence: Comprehensive income ¥415.2B (1.9x Net Income) was largely driven by securities valuation gains +¥145.9B, so market tailwinds materially boosted profits. Trading and FX gains are market-dependent, and rapid rate moves or yen appreciation could increase earnings volatility. Credit costs ¥84.7B are low but carry tail risk in downturns; declining coverage ratio 1.18% suggests reduced asset-quality buffers. Monitoring interest rate, market, and credit conditions is central to investment decisions; near-term focus is on full-year forecast achievement and dividend execution certainty, while medium-term focus is on capital policy progress and NIM improvement pace.
This report is an AI-generated earnings analysis document produced by 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 from public financial statements. Investment decisions are your responsibility; consult a professional advisor as needed.