First Read: Japan Financial services "Japan Post Group Q4 results: boost..."

Research evidence excerpt

First Read: Japan Financial services "Japan Post Group Q4 results: boost..."

Global Research

15 May 2026ab

First Read

EquitiesJapan Financial services

Japan Post Group Q4 results: boost from rising Japan

yen interest rates is emerging, led by banking Diversified Financial

Koichi Niwa

Analyst

koichi.niwa@ubs.com

Q: How did the results for the three companies come in overall? +81-3-5208 6245

Amid the rise in yen interest rates, Japan Post Bank emerged as the primary driver of the Makoto Ishii

Group’s overall earnings. While inflation-driven cost increases are likely to weigh on Associate Analyst

near-term earnings, organic growth initiatives such as improved profitability in the postal makoto.ishii@ubs.com

and logistics business and expansion of the real estate segment are being factored in, as +81-3-5208 3097

the spotlight falls on progress in structural reforms. Overall, a policy of strengthening

shareholder returns in line with earnings growth has been confirmed, and we believe

substantial scope remains for market re-rating of the fundamentals of the three listed

companies within the Group.

Q: How were the results at Japan Post (6178)?

Positive: Management targets a total payout ratio of 50% or higher (Earnings

materials)

- What are the key takeaways from the results?: In its new medium-term

management plan (final fiscal year: FY3/29), the company disclosed targets of ROE

above 7% and a cumulative total payout ratio of 50% or more over three years,

assuming postal fee revisions. We view its stance of advancing capital profitability

management across each segment in order to reach its internally recognised cost of

capital (7-8%) positively.

- How would we expect investors to react?: We expect a positive response to

shareholder returns that surpass market expectations.