Japan Big Banks' Combined 1st-Half Profits Down 10 Pct

Economy

Tokyo, Nov. 14 (Jiji Press)--Japan's five major banking groups saw their combined net profits fall 10.8 pct in April-September from a year earlier due mainly to a prolonged low interest rate environment that has driven down lending margins.

Their net profits totaled 1,512.5 billion yen, marking the first drop for the fiscal first half in three years. Under the Bank of Japan's ultralow interest rate policy, profits from lending operations dropped at all the five groups.

The dismal earnings results were also attributable to falling commission income from sales of investment trusts and other financial products amid growing uncertainty over the U.S.-China trade war.

Uncertainty over the earnings environment is "very big," Tatsufumi Sakai, president and group chief executive officer at Mizuho Financial Group Inc. <8411>, one of the five groups, said at a news conference.

A further interest rate cut of 0.1 percentage point by the central bank could "push down revenue and profits by some 30 billion yen annually," Sakai said.

[Copyright The Jiji Press, Ltd.]

Jiji Press