Japan Bank Sector 4Q results summary: Shareholder returns miss expectations, but profit guidance beats expectations

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Japan Bank Sector 4Q results summary: Shareholder returns miss expectations, but profit guidance beats expectations

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

18 May 2026

Japan Bank Sector

4Q results summary: Shareholder returns miss

expectations, but profit guidance beats expectations

All Japanese banks reported FY2025 results by May 15 and will start holding Japan Equity Research

results briefings with CEOs on May 18. With 4Q results, many banks issued

Banks

FY2026 net profit guidance that was higher than we expected. However, share

buyback amounts were lower than we expected in many cases. We see risk that Takahiro Yano, CFA AC

lower-than-expected shareholder returns could be viewed negatively in the short (81-3) 6736-8616

takahiro.yano@jpmorgan.com

term, but if net profits increase, we think prospects for announcements or JPMorgan Securities Japan Co., Ltd.

additional announcements of share buybacks could increase. Banks continue to

control domestic deposit yields, but we will watch for comments on deposit

competition and deposit acquisition strategies at each company’s briefing.

Updates of MTP ROE targets: Figure 1 shows ROE targets for each

company. Megabanks and Resona Holdings target ROE at 12%. Regional banks

target ROE at around 10%. Japan Post Bank presented a FY2028 ROE of 10% in

its medium-term plan (MTP), which attracted strong interest.

FY2026 net profit guidance beat expectations at many companies: Figure 2

shows FY2026 net profit guidance for each company. Guidance beat our

expectations at all regional banks. Among megabanks, we think Mitsubishi UFJ

Financial Group (MUFG)’s net profit guidance for ¥2.7 trillion was a positive

surprise. Many companies have not factored in additional rate hikes by the

BoJ.