New Mitsubishi bank reports solid first half earnings |

New Mitsubishi bank reports solid first half earnings

TOKYO ” Mitsubishi UFJ Financial Group Inc., the world’s largest banking group by assets, said Thursday it posted strong earnings results for the half-year through September due to lower bad-loan write-off costs.

The healthy results are the latest indication that Japan’s banks are on the mend after years of losses writing off mountains of nonperforming loans that piled up during the slowdown that started in the early 1990s.

Since Mitsubishi-UFJ was created Oct. 1 through the merger of Mitsubishi Tokyo Financial Group and UFJ Holdings, earnings results were broken down between the two.

The former Mitsubishi Tokyo said its group net profit for the six-month period rose 75 percent to 300.7 billion yen ($2.5 billion) from 171.7 billion yen the same period a year earlier. Sales rose 11 percent to 1.4 trillion yen ($12 billion) from 1.26 trillion yen.

The former UFJ Holdings posted a group net profit of 411 billion yen ($3.5 billion), a sharp recovery from the 674 billion yen net loss it suffered the same period the previous year.

The results were not broken down by quarters.

“We had a good start in financial terms,” MUFG President Nobuo Kuroyanagi told a press conference.

For the fiscal year through March 31, 2006, Mitsubishi-UFJ expects to post a group net profit of 520 billion yen ($4.4 billion), up from the 400 billion yen it had projected earlier.

Mitsubishi UFJ has total assets of around 190 trillion, or $1.6 trillion, topping .S.-based Citigroup Inc.’s $1.55 trillion, based on most recent company figures.

Earlier this week, Japan’s other mammoth banks also reported upbeat results.

Mizuho Financial, the second largest banking group, reported a 45 percent rise in net profit for the fiscal half-year, and Sumitomo Mitsui Financial Group, Japan’s No. 3 banking group, said its net profit jumped seven-fold for the fiscal half-year.

Taken together, the combined group net profit for the first half at Japan’s top seven banking groups soared to 1.73 trillion yen ($15 billion) from 79.66 billion yen the same period a year ago, when the former UFJ Holdings suffered its massive loss, according to Dow Jones Newswires.

The amount of bad loans held by the seven banks dropped to 6.1 trillion yen ($51 billion) as of Sept. 30 from 7.4 trillion yen as of March 31, marking a 77 percent plunge from the peak of 26.8 trillion yen in bad debts held in March 2002.

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