Select a page

Banking News

Japanese banks back in black

Japanese banks back in black

(1 June 2004 – Japan) Japan’s long suffering banking system is finally showing signs of a turnaround with the country’s top three banks reporting solid profits for the year ended March 31. Mizuho Financial Group, Sumitomo Mitsui Financial Group, and Mitsubishi Tokyo Financial Group all recovered from vast losses the previous year to post net profits built on the strengthening economy and share market.

Mizuho Financial, which is Japan’s largest banking conglomerate, recorded a net profit of 406.98 billion yen compared with a 2.38 trillion yen loss a year earlier – the biggest loss ever recorded by Japanese corporate.

Sumitomo Mitsui Financial posted a net profit of 330.41 billion yen compared with a net loss of 465.36 billion yen a year earlier. Mitsubishi Tokyo Financial Group also recovered to record a net profit of 560.82 billion yen after a loss of 161 billion yen loss last year.

However, the story for Japan’s fourth largest bank, UFJ Holdings, was less rosy after the bank was forced to write off 1.3 trillion yen in bad bank loans – the bane of the Japanese banking sector. After adjustments, UFJ posted a net loss of 402.81 billion yen but said it would recover over the next 12 months, tipping a 330 billion yen net profit for next year.

Despite the healthier picture, analysts said banks in Japan needed to find new sources of revenue to sustain growth or risk slipping back into the red once more.

In further news, the Japanese government is set to announce a program that will seek to strengthen the structure of the financial system and the management of banks, and encourage regional banks to stimulate regional economies.

The program, which is expected to be approved by cabinet within the next few weeks, will also push banks to lift their service and credibility levels.

Comment on this article


Your comments will not be published. Required fields are marked *


Please enter the word you see in the image below:


Subscribe to our mailing list

Sign up now to keep up-to-date with the latest
market news and insights in B2B banking.

* indicates required

For more information please read our Terms and Conditions and Privacy Statements.