Deterioration in the financial transaction and earnings environment due to population decline and negative interest rates
First written in FY2017. 7 of 13 entries say "Worsened", first in FY2018-Q2. Latest entry: FY2026.
The First Bank Of Toyama moved to the "Worse" side of this theme in 2017, 3 years before the typical company in this theme (2020).
The whole theme swung hardest in 2020: 12 of 22 companies on the "Worse" side.
3 other companies' latest entry also says "Other".
- FY2026Progress toward an environment of rising interest ratesAnnual report
「Against this backdrop, the Bank of Japan has continued to raise policy rates in stages. As the “world with interest rates” takes shape, the Bank has reviewed deposit and lending rates and further strengthened its risk management in light of trends in the bond, equity and foreign exchange markets.」
The Company’s assessment shifted from the previous negative-interest-rate and low-interest-rate environment to a “world with interest rates” in which policy-rate increases continue, and it described reviews of deposit and lending rates and stronger market-risk management. - FY2025WorsenedAnnual report
「Against this backdrop, the Bank of Japan raised its policy rate in stages, to around 0.25% in July and around 0.50% in January. In response, the Bank also raised deposit rates, marking a return to a world with interest rates, while the environment surrounding bank management changed significantly alongside rising prices.」
The Company described the policy rate being raised in stages to around 0.50% and a return to a “world with interest rates,” including higher deposit rates. - FY2025-H1WorsenedAnnual report
「In light of these economic and price conditions, the Bank of Japan raised its policy rate to around 0.25% at its Monetary Policy Meeting at the end of July. With a virtuous cycle between wages and prices expected to continue, further interest-rate hikes are anticipated, and it is necessary to closely monitor their impact on companies and households.」
The environment changed from one of low interest rates and monetary easing to one including policy-rate increases and expectations of further rate hikes. The impact on companies and households was identified as a new area requiring attention. - FY2024ReframedAnnual report
「Against this backdrop, the Bank of Japan discontinued yield curve control at its March Monetary Policy Meeting and shifted to a normal monetary policy framework centered on managing short-term interest rates, while also raising interest rates. In response, our bank also raised deposit interest rates from 1 April, and the environment surrounding bank management is set to change significantly.」
The description of the earnings environment shifted from a focus on population decline and prolonged low interest rates to recognition of environmental changes including monetary policy normalisation and rising interest rates. - FY2022-Q2RestatedAnnual report
「Turning to domestic financial conditions, the Bank of Japan maintained large-scale monetary easing measures in response to the impact of the COVID-19 pandemic, and extremely low interest rates and monetary easing persisted.」
The Company stated that large-scale monetary easing measures were maintained in response to the COVID-19 pandemic, and that extremely low interest rates and monetary easing continued. - FY2021WorsenedAnnual report
「In the financial sector, changes in the environment, including the continuation of negative interest rate policy, population decline and a declining and ageing population, and accelerating digitalisation, are progressing at an accelerating pace. Regional financial institutions are therefore required to evolve their business models further than before, including by improving customer convenience and management efficiency.」
The Company described an environment in which negative interest rates, population decline, a declining and ageing population and accelerating digitalisation are progressing at an accelerating pace, creating a need for business-model evolution. - FY2021-Q2RestatedAnnual report
「Turning to domestic financial conditions, the Bank of Japan maintained large-scale monetary easing measures in response to the impact of the COVID-19 pandemic, and extremely low interest rates and monetary easing persisted.」
The Company stated that large-scale monetary easing measures were maintained in response to the COVID-19 pandemic, and that extremely low interest rates and monetary easing continued. - FY2020-Q2WorsenedAnnual report
「Turning to domestic financial conditions, the Bank of Japan specified that its period of ultra-low interest rates would continue “at least until around spring 2020,” and extremely low interest rates and monetary easing persisted.」
The Company stated that the Bank of Japan specified that ultra-low interest rates would continue at least until around spring 2020, and that extremely low interest rates and monetary easing persisted. - FY2019WorsenedAnnual report
「Turning to domestic financial conditions, under the Bank of Japan’s quantitative and qualitative monetary easing with yield curve control, short-term market interest rates remained in negative territory and the 10-year Japanese Government Bond yield remained near zero, while extremely low interest rates and quantitative easing continued.」
The Company stated that negative short-term interest rates, long-term interest rates near zero and quantitative easing continued, and that the prolonged low-interest-rate environment affected performance. - FY2019-Q2RestatedAnnual report
「Turning to domestic financial conditions, under the Bank of Japan’s quantitative and qualitative monetary easing with yield curve control, short-term market interest rates remained in negative territory, while the 10-year Japanese Government Bond yield, although rising within a certain range, remained at a low level, and monetary easing continued.」
The Company described short-term market interest rates in negative territory, low long-term interest rates and continued monetary easing, indicating that the issue of the impact of low interest rates on the earnings environment remained relevant. - FY2018WorsenedAnnual report
「In Japan, monitoring and appropriately addressing rapidly progressing changes in the social and economic environment, including population decline, changes in the industrial structure and the transition to a highly information-oriented society, is a medium- to long-term management issue.」
The Company positioned population decline, changes in the industrial structure and the transition to a highly information-oriented society as rapidly progressing changes in the social and economic environment and as medium- to long-term management issues. - FY2018-Q2WorsenedAnnual report
「In Japan, attention must also be paid to changes in the social and economic environment, including population decline, changes in the industrial structure and the transition to a highly information-oriented society.」
In addition to population decline, the Company newly listed changes in the industrial structure and the transition to a highly information-oriented society as factors requiring attention in the social and economic environment, expanding the scope of its risk-factor disclosures. - FY2017First statedAnnual report
「Looking ahead at the actual management environment, the Company must anticipate difficult conditions, including concerns that population decline will reduce demand for financial transactions and that the earnings environment will continue to deteriorate as negative interest rates become entrenched.」
The Company identified as risks a decline in demand for financial transactions due to population decline and the continued deterioration of the earnings environment as negative interest rates become entrenched.