Mitsubishi UFJ, Sumitomo Mitsui, and Mizuho report all-time high earnings but face slowing growth as risks escalate.
Japan’s three largest banks posted record annual profits for the fiscal year ended March 2026, driven by higher lending margins and strong corporate demand. Mitsubishi UFJ Financial Group’s net profit surged 30% to 2.4 trillion yen, marking a third consecutive record year. Sumitomo Mitsui and Mizuho also reported gains of 34% and 41%, respectively.
The earnings boost stemmed from improved net interest income, fee-based revenue, and one-off gains, including market-related profits and acquisitions. Analysts noted that while current valuations remain attractive, growth may moderate as credit costs rise and geopolitical uncertainties weigh on the outlook.
Nomura maintained a bullish stance on the sector, citing undervaluation relative to earnings strength. However, competition for deposits and macroeconomic pressures could challenge sustained profit growth.