FY2027 first-half earnings are off to a strong start against the full-year forecast, but the focus will be on results against the revised forecast.

In the first quarter of the fiscal year ending March 2027, ordinary revenue was ¥22,697 million, ordinary income was ¥4,365 million, and net income attributable to owners of the parent was ¥2,981 million. Income rose 24.9% and 15.9% year on year, respectively. The company explained that the main factors driving the increases were higher net interest income from lending and deposits, due to higher loan yields, and increased interest and dividend income on securities.

Simple progress against the full-year forecasts was approximately 29.3% for ordinary income and 29.8% for net income. Bank earnings fluctuate from quarter to quarter depending on market conditions, gains and losses on securities transactions, and credit costs, so full-year achievement cannot be judged solely on the basis of exceeding one-quarter of the forecast. Nevertheless, first-quarter results represent reasonable progress against full-year forecasts of ¥14,900 million and ¥10,000 million, respectively.

It was reported on 23 October that the first-half ordinary income forecast for the fiscal year ending March 2027 had been raised to ¥8,384 million and the net income forecast to ¥5,672 million. Meanwhile, the full-year net income forecast was reportedly maintained at ¥10,000 million. The issue at the next earnings announcement will therefore be whether the first-half upgrades reflect a more conservative outlook for the second half, or whether there is additional upside potential for the full-year forecasts.

The financial summary provided confirms the revised first-half forecasts, but not the actual figures for the second quarter of the fiscal year ending March 2027, the breakdown of the factors behind the upgrades, or whether the full-year forecasts were revised again based on first-half results. At the next earnings announcement, we will look for the achievement rates against ordinary income of ¥8,384 million and net income of ¥5,672 million, the profit required in the second half, and breakdowns of interest on loans, interest and dividend income on securities, market division earnings, and credit costs.