THE TAIKO BANK,LTD. FY2026 Q2 Earnings Report

Financial Highlights

• Net Income: ¥1.50B
• EPS: ¥158.35

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

Daiko Bank’s FY2026 Q2 (consolidated, JGAAP) results show stable core profit at the ordinary income level but weaker bottom-line earnings year on year. Ordinary income and operating income are reported at ¥2.393bn, indicating core banking profitability was broadly flat, while net income declined 16.4% YoY to ¥1.509bn, suggesting higher tax burden and/or below-the-line items weighed on the quarter. The bank’s total assets stand at ¥1,706.1bn and total equity at ¥81.0bn, implying balance-sheet leverage of roughly 21.1x (assets/equity) and a simple equity-to-asset ratio of about 4.75%. With income taxes of ¥837m and net income of ¥1,509m, the implied pre-tax income is approximately ¥2,346m and the effective tax rate is ~35.7%, which appears on the high side for a regional bank and likely contributed to the YoY decline in net income. Using period-end equity, the half-year ROE is approximately 1.86%; annualized, this implies roughly 3.7% pending second-half trends. Half-year ROA is roughly 0.09% (annualized ~0.18%), reflecting the typical low-ROA profile of domestic regional banks under margin pressure. Reported revenues, gross profit, EBITDA, cash flows, and most liquidity ratios are undisclosed in this dataset (shown as zeros), so conclusions rely on the available profit and balance-sheet figures. The ordinary-to-net drop points to higher taxes and/or non-recurring items rather than a deterioration in core ordinary income this period. Capital remains modest relative to assets on an equity/asset basis; however, regulatory capital ratios (CET1, total capital) are not provided, limiting solvency assessment under banking standards. Dividend information is not disclosed here (DPS and payout show as zero placeholders), so we cannot assess distribution policy from this dataset alone. Cash flow statements are also undisclosed, preventing a direct evaluation of earnings-to-cash conversion or funding dynamics. Overall, the picture is of a conservatively leveraged regional bank with stable ordinary income but softer net income due to tax effects, operating within a low-return environment. Key forward issues include net interest margin resilience amid rate normalization, credit cost trends, and securities portfolio valuation volatility. Absent more granular disclosures (NIM, OHR, credit costs, AFS securities unrealized gains/losses, capital adequacy ratios), visibility on medium-term profitability and capital buffers remains limited. Our assessment emphasizes the available numbers while acknowledging data gaps that constrain deeper diagnostics.

Profitability Analysis

ROE_decomposition: Based on available figures, net income is ¥1,509m and period-end equity is ¥80,990m, implying a half-year ROE of ~1.86% (annualized ~3.7% if H2 is similar). ROA is ~0.09% (¥1,509m / ¥1,706,112m). Financial leverage (assets/equity) is ~21.1x. The provided DuPont components (margin and turnover at 0%) are placeholders due to undisclosed revenue; we instead infer profitability via ROA/ROE as above. The translation from ordinary income (¥2,393m) to net (¥1,509m) highlights the tax burden as a key driver. margin_quality: Ordinary income was stable while net income fell 16.4% YoY, indicating margin compression at the bottom line due primarily to a higher effective tax rate (~35.7%) and/or items below ordinary income. With no breakdown of net interest income, fees, or credit costs, we cannot apportion contribution, but the ordinary-to-net delta suggests non-operating/tax effects rather than core margin erosion. operating_leverage: Operating/ordinary income was flat; without revenue and expense detail (e.g., OHR), operating leverage cannot be precisely measured. Stability at the ordinary level suggests cost growth was broadly matched by revenue trends in H1; the decline in net appears driven by taxes/one-offs rather than core cost dynamics.

Growth Assessment

revenue_sustainability: Revenue is undisclosed in this dataset. However, flat ordinary income indicates stable core bank earnings capacity in H1 FY2026, consistent with a steady net interest and fee environment. Sustainability will depend on net interest margin trends, loan balance growth, deposit beta, and fee income resilience. profit_quality: Net income declined despite flat ordinary income, pointing to lower quality of bottom-line growth this period. The elevated effective tax rate (~35.7%) likely depressed net. Absent detail on credit costs and securities gains/losses, we cannot confirm whether one-offs played a role. outlook: Assuming a steady macro and rate backdrop, ordinary income could remain stable near current run-rate, but net income visibility hinges on tax normalization and below-the-line items. Key swing factors in H2 include credit cost normalization, securities valuation (JGB and equity holdings), and expense control.

Financial Health

liquidity: Typical current/quick ratios are not meaningful for banks and are undisclosed here. Funding structure (deposits vs. market funding) is not provided, limiting assessment of immediate liquidity. Cash and equivalents are undisclosed in this dataset. solvency: Total assets ¥1,706.1bn; total equity ¥81.0bn implies an equity-to-asset ratio of ~4.75% and leverage of ~21.1x. Total liabilities/equity is ~19.8x. Regulatory capital ratios (CET1/Total capital) are not disclosed, so we cannot map this to Basel standards. capital_structure: Balance sheet indicates a typical regional bank leverage profile. The gap between assets and liabilities+equity in the provided data suggests other net asset components or undisclosed items; we rely on the stated totals without inferring discrepancies.

Cash Flow Quality

earnings_quality: Cash flow data (OCF/ICF/FCF) are undisclosed, preventing direct triangulation of earnings quality. For banks, operating cash flow can be volatile due to balance-sheet movements; absent detail, we use ordinary income stability as a proxy for core earnings durability. FCF_analysis: Free cash flow is not applicable in a standard corporate sense for banks and is undisclosed here. We cannot compute OCF/Net Income or FCF coverage. working_capital: Traditional working capital metrics are not meaningful for banks; loan/deposit dynamics would be the preferred lens, but are not disclosed.

Dividend Sustainability

payout_ratio_assessment: Dividend per share (DPS) and payout ratio are shown as zero placeholders, indicating non-disclosure rather than actual zero. With EPS at ¥158.35 for H1, interim payout capacity exists, but there is no disclosed policy or payout figure in this dataset. FCF_coverage: Not assessable given undisclosed cash flow data and the bank-specific nature of FCF. policy_outlook: Absent stated guidance or historical payout data, we cannot comment on the trajectory. Sustainability typically hinges on earnings stability and regulatory capital headroom, both of which require more disclosure (e.g., CET1 ratio, retained earnings policy).

Risk Assessment

Business Risks:

• Net interest margin compression due to deposit repricing and competitive loan pricing
• Credit cost normalization from low bases amid macro uncertainty
• Volatility in gains/losses on securities portfolios (JGBs/AFS equities) as rates and markets move
• Fee income softness if retail/SME activity slows
• Operational and compliance risks inherent to regional banking

Financial Risks:

• High balance-sheet leverage inherent to banking (assets/equity ~21x)
• Interest rate risk on bond holdings impacting other comprehensive income and capital
• Concentration risk in local borrowers/depositors if regional economy weakens
• Capital adequacy visibility is limited without disclosed CET1/total capital ratios
• Potential for elevated effective tax rates or one-off charges to pressure net income

Key Concerns:

• Net income down 16.4% YoY despite flat ordinary income
• Elevated implied effective tax rate (~35.7%) compressing bottom line
• Limited disclosure on cash flows, credit costs, NIM, and capital ratios constrains analysis

Investment Implications

Key Takeaways:

• Core profitability stable at the ordinary income level (¥2.393bn) in H1 FY2026
• Net income declined to ¥1.509bn (-16.4% YoY), mainly reflecting higher taxes/under-the-line items
• Simple equity-to-asset ratio ~4.75% and leverage ~21.1x, typical for a regional bank
• Half-year ROE ~1.86% (annualized ~3.7%), ROA ~0.09% (annualized ~0.18%)
• Disclosure gaps (NIM, credit costs, capital ratios, securities valuation) limit depth of assessment

Metrics to Watch:

• Net interest margin and deposit beta
• Loan and deposit growth, loan-to-deposit ratio
• Credit costs (net charge-offs, NPL ratio, coverage)
• Securities portfolio duration and unrealized gains/losses
• Operating efficiency (OHR) and expense discipline
• Regulatory capital ratios (CET1, total capital) and dividend policy announcements
• Effective tax rate normalization and one-off items

Relative Positioning: Within Japan’s regional bank cohort, Daiko Bank’s H1 profile—stable ordinary income, compressed net profit, modest ROE—fits the sector’s low-return, margin-constrained backdrop; without NIM, credit cost, and capital data, precise peer positioning remains indeterminate.

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