Asia Pacific Equity Research

Research evidence excerpt

Asia Pacific Equity Research

J P M O R G A N Asia Pacific Equity Research

01 August 2026

Sumitomo Mitsui Financial Group

(8316) Overweight

8316.T, 8316 JP

1Q results: Lacking clear catalysts, but business is Price (31 Jul 26):¥6,814

strong Price Target (Dec-26):¥7,700

Somewhat positive: 1Q FY2026 net profit grew 33% YoY and 166% QoQ to Japan Equity Research

¥501.4 billion, above our estimate of ¥388.5 billion. We take a positive view of the

Banks

better-than-expected performance not only in the global markets segment, but also

for domestic core net interest income (NII). However, while some other major Takahiro Yano, CFA AC

banks have revised guidance, SMFG did not make any changes to guidance or (81-3) 6736-8616

takahiro.yano@jpmorgan.com

shareholder returns. We think investor expectations could focus on upward

Kohichi Takano

guidance revisions and additional share buybacks at 1H results. (81-3) 6736 8621

• 1Q net profit progress rate 29%: SMFG did not revise guidance and did not kohichi.takano@jpmorgan.comJPMorgan Securities Japan Co., Ltd.

announce additional shareholder returns. However, 1Q results were strong, and

overall topline figures beat our estimates. Costs rose 19% YoY, a large increase,

but we think quarterly volatility may have also had a negative impact. We think

costs are unlikely to rise at this pace. In domestic loan and deposit business,

loan yields rose 14bps QoQ to 1.61% while deposit yields rose 4bps QoQ to

0.30%. Large corporate loan spreads improved both YoY and QoQ. The

domestic loan balance to large corporates increased 14% YoY at end-June

(+17% at end-March), and the domestic loan balance to midsize companies and

SMEs increased 7% YoY at end-June (+7% at end-March). We take a positive

view of strong volume and quality.