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Financial System Report Annex “Financial Results of Japan’s Banks for Fiscal 2020”

Summary:
September 17, 2021 Financial System and Bank Examination Department Bank of Japan Full Text [PDF 581KB] Abstract The three main features of the financial results of Japan's banks for fiscal 2020 are as follows: First, net income increased for all types of banks: major banks, regional banks, and shinkin banks. For all types of banks, the increase in pre-provision net revenue (PPNR) (excluding trading income), which indicates core profitability, exceeded the increase in credit costs. At regional banks and shinkin banks, profits were also pushed up by an increase in realized gains on stockholdings. Second, PPNR (excluding trading income) increased at major banks, regional banks, and shinkin banks. For all types of banks, PPNR (excluding trading

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September 17, 2021 Financial System and Bank Examination Department Bank of Japan

Full Text [PDF 581KB]

Abstract

The three main features of the financial results of Japan's banks for fiscal 2020 are as follows:

First, net income increased for all types of banks: major banks, regional banks, and shinkin banks. For all types of banks, the increase in pre-provision net revenue (PPNR) (excluding trading income), which indicates core profitability, exceeded the increase in credit costs. At regional banks and shinkin banks, profits were also pushed up by an increase in realized gains on stockholdings.

Second, PPNR (excluding trading income) increased at major banks, regional banks, and shinkin banks. For all types of banks, PPNR (excluding trading income) continued to be pushed down by shrinking domestic lending margins, while it was pushed up mainly by an increase in loans outstanding due to heightened funding demand associated with COVID-19. At regional banks and shinkin banks, a decrease in general and administrative expenses also contributed to raising profits.

Third, the capital adequacy ratios of financial institutions increased for all types of banks, and remain sufficiently above the regulatory requirements.

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Bank of Japan
The Bank of Japan (BOJ) also known as Nippon Ginko, is the central bank of Japan. The Bank is often called Nichigin for short. It has its headquarters in Chuo, Tokyo.

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