3 major financial groups cost more than 1 trillion yen to cover loan losses

3 major financial group companies Costs for loan losses totaled over 1 trillion yen 21:43 on May 15

The three major financial groups that own a megabank believe that the outlook for the economy is uncertain due to the new coronavirus, and that costs to prepare for a loan loss due to the deterioration of business of a business partner will increase significantly this year. The combined cost of the three companies exceeds 1 trillion yen, showing the severity of the outlook.

Three major financial groups announced their financial results for the fiscal year ending March 31, the final profits of Sumitomo Mitsui Financial Group of 703.8 billion yen, Mitsubishi UFJ Financial Group of 528.1 billion yen, and Mizuho Financial Group of 448.5 billion yen. It was a circle.

Of these, Mitsubishi UFJ posted an extraordinary loss, resulting in a 39% decline in profits, as the financial markets shook due to the global spread of the new coronavirus and the stock prices of overseas group banks fell sharply.

For the current fiscal year, we are forecasting a final profit of 320 to 550.0 billion yen.

However, all three companies announced that the outlook for the economy is uncertain due to the effect of the new coronavirus, and that the cost of preparing for a situation in which the management of the customer deteriorates and the loan becomes bad will greatly increase.

Sumitomo Mitsui and Mitsubishi UFJ expect 450 billion yen each and Mizuho 200 billion yen each, and the combined cost of the three companies will reach 1.1 trillion yen, reflecting a strict view on the future.

For banks, in addition to financing for companies affected by the new coronavirus, how to support the business itself may become an issue.