Japan's five major banking groups are expected to report a combined net profit of 1.7 trillion yen for the business year ended March, close to the level recorded prior to the collapse of Lehman Brothers Holdings Inc. in autumn 2008, indicating the industry's improving business conditions, industry sources said Saturday.
But the likely size of the financial conglomerates' profits in the current business year through March 2012 remain unclear given the worsening prospects for the Japanese economy following the March 11 earthquake and tsunami that devastated the nation's northeast.
Mitsubishi UFJ Financial Group Inc. appears to have surpassed its 500 billion yen net profit goal for fiscal 2010, while Mizuho Financial Group Inc. is expected to report less than the 500 billion yen it had forecast, according to the sources.
Sumitomo Mitsui Financial Group Inc. said its net profit would be roughly 470 billion yen, down from its earlier forecast of 540 billion yen.
Both Sumitomo Mitsui and Mizuho are taking evaluation losses on holdings of Tokyo Electric Power Co. shares, which have been battered in the aftermath of the quake and tsunami that crippled one of the utility's nuclear power plants in Fukushima Prefecture.
Sumitomo Mitsui Trust Holdings Inc., created in April in a merger between Sumitomo Trust & Banking Co. and Chuo Mitsui Trust Holdings Inc., is expecting a net profit of roughly 130 billion yen based on the projections of the merged firms.
Resona Holdings Inc. is likely to report a higher net profit than the 135 billion yen previously forecast, the sources said.
The recovery trend is mainly attributable to gains made on a rapid rise in prices of government bonds last year. The prices of such bonds, however, have since dropped and business in the January-March quarter also suffered as a result of the quake and tsunami disaster.
The groups' earnings have also been tempered by losses taken by consumer loan companies under their wings.
http://mdn.mainichi.jp/mdnnews/business/news/20110508p2g00m0bu014000c.html
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