THE BANK OF KOCHI,LTD. FY2026 Q2 Earnings Report

Financial Highlights

• Net Income: ¥177M
• EPS: ¥15.74

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

Kochi Bank (84160) reported FY2026 Q2 consolidated results under JGAAP with limited line-item disclosure typical for Japanese banks’ XBRL, notably showing zeros for many non-bank-standard items. The bank posted operating income and ordinary income of 705 million yen, and net income of 218 million yen, representing a steep YoY decline in bottom-line profitability (-77% YoY on net income). Using period-end equity of 55,676 million yen, half-year ROE is approximately 0.39% (annualized roughly 0.8%), indicating subdued capital efficiency. Total assets were 1,162,081 million yen and total liabilities 1,099,333 million yen, implying a financial leverage of about 20.9x and an implied equity ratio of roughly 4.8% (despite the reported 0.0% placeholder). The gap between ordinary income (705 million yen) and net income (218 million yen), together with reported income tax expense of 387 million yen, suggests an elevated effective tax burden and/or the presence of non-controlling interests or special items affecting net profit. For a regional bank, revenue and gross profit metrics are not meaningful; interest and fee income are embedded within ordinary income, which is the more relevant indicator of core performance. EPS of 15.74 yen implies roughly 13.9 million shares outstanding (net income divided by EPS), though official share counts were not disclosed. Cash flow statements were not provided (zeros indicate non-disclosure), limiting assessment of earnings-to-cash conversion and capital deployment. The balance sheet scale and leverage appear consistent with a regional bank model, but capital buffers cannot be assessed given the absence of regulatory capital metrics (CET1, capital adequacy ratio). The YoY decline in net income raises questions around credit costs, securities valuation impacts, or one-off tax/extraordinary items—details of which are not disclosed in this dataset. With ordinary income stable versus operating income (both 705 million yen), non-operating distortions appear limited at the ordinary profit line, but bottom-line compression is evident. Profitability remains thin, as indicated by half-year ROA of about 0.019% (annualized ~0.04%), significantly below typical regional bank targets. Dividend information shows a DPS of 0 and payout ratio of 0%, suggesting no dividend recorded in the period; policy clarity is lacking from the data provided. Overall, the bank’s earnings quality and outlook cannot be fully assessed without net interest income, credit cost, fee income, and securities-related gains/losses, but the reported figures point to weak profitability and narrow earnings buffers. Key watchpoints include BOJ policy normalization effects on deposit beta and securities portfolios, regional credit conditions in Kochi Prefecture, and the bank’s cost discipline.

Profitability Analysis

ROE_decomposition: Traditional DuPont is not meaningful for banks given zero 'revenue' disclosure and the nature of bank P&L. Using a bank-style lens: half-year ROA ≈ 218m / 1,162,081m = 0.019% (annualized ~0.04%); financial leverage ≈ 20.87x; translating to an annualized ROE on the order of ~0.8% (half-year ROE ~0.39%). Net margin cannot be inferred due to missing top-line constructs for banks. Ordinary income to assets is ~0.061% for the half year, highlighting thin pre-tax returns. margin_quality: Ordinary income (705m) to net income (218m) indicates significant compression from taxes and/or below-the-line items. The reported income tax expense of 387m implies an effective tax rate of approximately 55% if pre-tax income is proxied by ordinary income, which is unusually high; the additional ~100m delta between (ordinary income - tax) and net income suggests minority interests or extraordinary adjustments. operating_leverage: Not directly measurable without net interest income, fee income, and expense details. However, the equality of operating and ordinary income (both 705m) suggests limited non-operating swings through the ordinary line in this period. Cost-to-income and overhead ratios are not available, restricting analysis of operating leverage.

Growth Assessment

revenue_sustainability: Top-line metrics are undisclosed (zeros reflect non-reporting). For banks, interest income/expenses and fees drive ordinary income; with ordinary income at 705m, the level suggests modest core earnings but growth trends cannot be inferred from the dataset. profit_quality: The steep YoY decline in net income (-77%) indicates deterioration in profit quality and/or elevated one-offs (tax, credit costs, or securities valuation) impacting the bottom line; details are not disclosed here. outlook: Given BOJ policy normalization risks (higher deposit beta, potential securities valuation hits) and regional credit conditions in Kochi, earnings could remain pressured without evidence of fee growth or cost reductions. Confirmation requires disclosure of net interest margin, credit costs, and securities gains/losses.

Financial Health

liquidity: Current and quick ratios are not meaningful for banks; deposit and liquidity coverage metrics are undisclosed. Cash and equivalents were not reported in this XBRL, limiting liquidity analysis. solvency: Total equity of 55,676m on total assets of 1,162,081m implies an equity ratio of ~4.8% and leverage of ~20.9x, consistent with a regional bank but offering limited loss-absorption capacity without regulatory capital details. capital_structure: Liabilities of 1,099,333m equate to a debt-to-equity ratio of ~19.75x (liabilities/equity). Regulatory capital ratios (CET1, total capital) are not provided; thus, solvency adequacy versus Basel III requirements cannot be assessed from this dataset.

Cash Flow Quality

earnings_quality: Operating, investing, and financing cash flows are undisclosed (zeros reflect non-reporting), so alignment between earnings and cash generation cannot be evaluated. FCF_analysis: Free cash flow is not applicable in the standard corporate sense for banks and is undisclosed here; capital expenditures and loan book growth funding needs are unknown. working_capital: Working capital metrics are not applicable to banks; loan/deposit dynamics and securities positions would be more informative but are not provided.

Dividend Sustainability

payout_ratio_assessment: DPS is shown as 0 and payout ratio 0%; this suggests no dividend recognized in the period, but we cannot conclude on full-year policy without management guidance. FCF_coverage: Not assessable; operating and free cash flows are undisclosed for a banking entity and are not directly comparable to non-financial FCF. policy_outlook: Without capital adequacy metrics (e.g., CET1) and earnings visibility, dividend capacity cannot be gauged. Historically, regional banks target stable dividends, but the sharp YoY net income decline raises caution until profitability normalizes.

Risk Assessment

Business Risks:

• Regional concentration risk in Kochi Prefecture with aging demographics and limited loan demand growth
• Interest rate risk from BOJ policy normalization affecting deposit beta and securities portfolio valuations
• Credit cost volatility amid potential SME weakness and real estate exposures
• Fee income dependence and competition from larger banks and digital platforms
• Operational and IT modernization costs pressuring the cost base

Financial Risks:

• Thin profitability (half-year ROA ~0.019%, annualized ROE ~0.8%) leaving limited buffers
• High leverage inherent to banking (assets/equity ~20.9x) with undisclosed regulatory capital ratios
• Potential securities valuation losses not visible in disclosed figures
• Tax and extraordinary items introducing bottom-line volatility (implied >50% effective tax rate)
• Liquidity and funding profile unclear due to absent LCR/NSFR and deposit mix data

Key Concerns:

• Net income down 77% YoY with insufficient disclosure to identify drivers
• Absence of regulatory capital metrics obscures solvency assessment
• No cash flow data to corroborate earnings resilience
• Dividend visibility limited amid weak profitability and undisclosed capital position

Investment Implications

Key Takeaways:

• Ordinary income of 705m yen but net income of 218m yen signals compression from taxes/other items
• Half-year ROE ~0.39% (annualized ~0.8%) and ROA ~0.019% indicate subdued profitability
• Equity ratio ~4.8% and leverage ~20.9x are typical for regional banks but capital adequacy is unknown
• Net income declined 77% YoY, suggesting deteriorating profit quality or one-offs
• Dividend appears absent for the period; policy and capacity unclear without CET1 and profit normalization

Metrics to Watch:

• Net interest margin and loan-deposit spread
• Credit costs (net) and NPL ratio
• Securities valuation gains/losses and OCI sensitivity to rates
• Fee and commission income growth
• Cost-to-income (overhead) ratio and structural cost actions
• Regulatory capital (CET1 ratio, total capital ratio) and RWA trends
• Ordinary income trajectory vs. credit cost normalization
• Dividend policy guidance and payout targets

Relative Positioning: Small regional bank with modest earnings capacity and thin buffers; limited visibility versus peers due to missing disclosures on capital and credit metrics.

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