Mitsubishi UFJ Financial Group,Inc. FY2026 Q2 Earnings Report

Financial Highlights

• Net Income: ¥1.31T
• EPS: ¥113.07

Income Statement

Balance Sheet

Profitability Ratios

Year-over-Year Comparison

Share Information

Dividend Information

Full Year Forecast

Disclaimer

This data was automatically extracted from XBRL files. Please refer to the original disclosure documents for accuracy.

AI Financial Analysis

Executive Summary

MUFG (83060) reported consolidated FY2026 Q2 results (JGAAP) with net income of ¥1,292.955 billion, up 2.8% YoY, indicating modest profit growth despite a flat ordinary/operating income line at ¥1,746.675 billion. Many line items (revenue, gross profit, OCF/FCF, cash balances, and segment-level details) were unreported in XBRL, which is typical for Japanese megabanks where interest and fee-based banking formats do not map cleanly to manufacturing-style revenue metrics. Using available balance sheet data, total assets were ¥404.318 trillion, total equity ¥22.238 trillion, and total liabilities ¥391.385 trillion. The implied equity ratio is approximately 5.5% (equity/total assets), which is broadly consistent with large bank balance sheets. Financial leverage (assets/equity) is about 18.18x, aligning with the provided leverage indicator. The effective tax rate, inferred from income tax of ¥429.210 billion and pre-tax income of approximately ¥1,722.165 billion, is about 24.9%, consistent with Japan’s statutory-plus-local tax profile for financial institutions. Based on net income and period-end equity, point-in-time ROE is approximately 5.8% for the first half; annualized, that would be in the low double digits, but this is a simple extrapolation and should be treated cautiously given potential second-half seasonality and credit cost dynamics. ROA computes to roughly 0.32% for the half (annualized ~0.64%), in line with a profitable but not overheated rate environment. EPS was ¥113.07; the implied average share count is roughly 11.4 billion, consistent with MUFG’s large issued base. Operating metrics like net interest income, fee income, trading gains, and credit costs were not disclosed in this dataset, limiting detailed margin and operating leverage analysis. Cash flow statements were not reported, so we cannot assess operating cash conversion or free cash flow coverage. Dividend data were also unreported here; MUFG historically maintains a progressive dividend and buyback framework, but this cannot be confirmed from the provided inputs. Overall, profitability momentum is steady with a modest YoY net income increase, leverage and equity metrics are within typical megabank ranges, and tax efficiency appears stable. The key near-term sensitivities are interest rate paths in Japan and overseas, credit costs, and FX-driven contributions from international businesses, none of which can be quantified from this release. Data gaps necessitate reliance on high-level profitability and balance-sheet ratios derived from the few disclosed figures. Given these constraints, conclusions are directional and should be supplemented with the company’s detailed financial presentation and regulatory capital disclosures.

Profitability Analysis

ROE decomposition (bank-adapted): ROA ~0.32% for the half (¥1.293T net income / ¥404.318T assets), financial leverage ~18.18x (assets/equity), yielding a point-in-time ROE of ~5.8% (ROA × leverage), broadly consistent with a large Japanese bank. Net income grew 2.8% YoY, while ordinary (operating) income was flat, suggesting either improved tax efficiency, lower credit costs, or mix benefits offsetting top-line stagnation; however, the absence of credit cost and segment data limits precise attribution. The effective tax rate is ~24.9% (¥429.210B / ¥1.722165T pre-tax), in line with prior patterns, indicating tax effects did not distort earnings quality this quarter. Margin quality: gross margin and EBITDA are not meaningful for banks; key margin proxies (net interest margin, fee margin) are not disclosed, so we cannot assess spread dynamics or non-interest revenue mix. Operating leverage: with revenues unreported and OPEX not provided, operating leverage cannot be quantified; the flat ordinary income suggests limited operating leverage YoY at the headline level. Overall, profitability is steady with modest growth, and balance-sheet-driven returns appear consistent with megabank norms.

Growth Assessment

Revenue sustainability cannot be addressed from this dataset as banking revenue lines are unreported. Profit quality appears reasonable given the moderate effective tax rate and the modest YoY increase in net income despite flat ordinary income, implying some resilience in core earnings or lower credit costs; however, this is an inference due to missing credit cost data. Near-term outlook will hinge on rate environments in Japan and overseas, loan growth, deposit beta behavior, fee income from global and domestic franchises, and trading/market-related income—none of which are quantified here. The 2.8% YoY net income increase suggests incremental improvement, but without net interest income, fees, or expenses, sustainability cannot be confirmed. We also lack guidance updates, CET1 ratios, and risk-weighted asset growth, which typically frame growth capacity for banks.

Financial Health

Liquidity: Current and quick ratios are not applicable to banks and were unreported; bank liquidity is better judged by LCR/NSFR, which are not provided. Solvency/capital: Total equity of ¥22.238T against ¥404.318T assets implies an equity ratio ~5.5%; financial leverage ~18.18x, typical for a megabank balance sheet. Debt-to-equity of 17.60x aligns with the leverage. Regulatory capital metrics (CET1, TLAC) are not disclosed here and are critical omissions for a full solvency assessment. Liability structure details (deposits, market funding, duration) are not available, limiting analysis of funding stability and interest rate sensitivity. Overall, balance-sheet scale and equity base appear sound in context, but regulatory ratios are required for a definitive view.

Cash Flow Quality

Earnings quality assessment is constrained by the absence of cash flow statement data; operating, investing, and financing cash flows are all unreported in this dataset. For banks, OCF can be volatile due to balance-sheet movements, and FCF is not a conventional metric; still, without data we cannot reconcile earnings to cash. Working capital metrics (current assets/liabilities) are not applicable. The stable effective tax rate and modest YoY net income growth suggest no obvious one-off distortions, but we cannot rule out trading or valuation effects without segment disclosures.

Dividend Sustainability

Dividend per share and payout ratio are unreported in this dataset, so we cannot compute cash payout or FCF coverage. MUFG typically maintains a progressive dividend policy complemented by share buybacks when capital allows, but we cannot validate the current-year stance here. With net income of ¥1.293T in H1 and an equity base of ¥22.238T, internal capital generation appears adequate, yet confirmation requires CET1 ratio trajectory, risk-weighted asset growth, and management guidance—all not provided.

Risk Assessment

Business Risks:

• Interest rate risk in Japan and key overseas markets affecting net interest income and deposit betas
• Credit risk from corporate and consumer portfolios, including overseas exposures
• Market and trading risk (rate, FX, equity) given global capital markets activities
• Fee income cyclicality in investment banking, asset management, and securities businesses
• Regulatory and compliance risk across multiple jurisdictions

Financial Risks:

• Capital adequacy sensitivity (CET1/TLAC) to credit migration and market stress (not disclosed here)
• Funding and liquidity risk amid potential shifts in deposit mix and wholesale funding costs
• FX translation risk impacting reported earnings and capital
• Valuation risk on securities portfolios under rate volatility

Key Concerns:

• Limited disclosed detail on credit costs, NIM, and fee trends prevents assessing core earnings durability
• Absence of regulatory capital metrics (CET1, leverage ratio) limits solvency evaluation
• Cash flow data unreported, preventing earnings-to-cash reconciliation

Investment Implications

Key Takeaways:

• Net income grew 2.8% YoY to ¥1.293T, indicating steady profitability
• Effective tax rate ~24.9% supports earnings quality
• ROA ~0.32% for H1 and leverage ~18.18x imply point-in-time ROE ~5.8% (simple annualization would be higher but uncertain)
• Equity ratio ~5.5% is consistent with megabank norms
• Core revenue, credit costs, and capital metrics are not disclosed, constraining deeper analysis

Metrics to Watch:

• Net interest margin and loan/deposit growth
• Credit costs and non-performing loans
• Fee income trajectory and trading revenue
• CET1 ratio and TLAC buffer, plus RWA growth
• Shareholder returns (dividends and buybacks) versus earnings and capital generation

Relative Positioning: Based on limited disclosed figures, MUFG shows stable profitability and typical leverage for a Japanese megabank; however, without comparative NIM, credit cost, and CET1 disclosures, relative standing versus domestic peers (e.g., SMFG, Mizuho) cannot be conclusively assessed.

Disclaimer

This analysis was auto-generated by AI. Please note the following:

• No Guarantee of Accuracy: The accuracy and completeness of this analysis are not guaranteed. For accurate financial data, please refer to the original disclosure documents published on TDnet or other official sources
• Not Investment Advice: This analysis is for general informational purposes only and does not constitute investment advice under applicable securities laws. It is not a recommendation to buy or sell any specific securities
• At Your Own Risk: Investment decisions should be made at your own discretion and risk. We assume no liability for any losses incurred based on this analysis