Mizuho posts 18% Q1 earnings increase, bolstered by Japan’s end to deflation
3:15 am Wednesday, July 31st, 2024
By Anton Bridge
TOKYO (Reuters) -Japan’s third-largest lender by assets, Mizuho Financial Group, reported an 18% growth in first-quarter profit on Wednesday as the long-awaited end of negative interest rates lifted profit margins on lending.
For the April-June quarter, Mizuho reported group net profit of 289 billion yen ($1.9 billion), compared with 245 billion yen in the same period a year earlier.
Mizuho is the first of Japan’s three “megabanks” to report earnings, to be followed by Mitsubishi UFJ Financial Group on Thursday and Sumitomo Mitsui Financial Group on Friday.
The results came on the same day the Bank of Japan raised the short-term interest rate to 0.25%, causing a surge in shares of banks, including Mizuho, which ended the day up some 5%.
That move by the central bank came after it lifted interest rates out of negative territory in March for the first time since 2016, ending a period that had long squeezed the amount of money banks could make from loans.
Mizuho maintained its forecast of record full-year profit of 750 billion yen in the 12 months to March 2025.
Its loan and deposit rate margin, a measure of profitability at is core lending business, rose to 0.85% for April-June from 0.76% in the same period a year ago.
Mizuho’s consolidated net profit of 678 billion yen for the last financial year was close to a record high even before the impact of higher interest rates could be felt.
($1 = 152.8200 yen)
(Reporting by Anton Bridge; Editing by Himani Sarkar)
