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Time of India
5 days ago
- Business
- Time of India
SMFG and SBI join hands to target Japan's growing affluent class with $69 billion plan
Sumitomo Mitsui Financial Group Inc. and SBI Holdings Inc. plan to jointly offer wealth management services to affluent clients in Japan, aiming to manage ¥10 trillion ($69 billion) in assets over the next five years. The new joint venture will be funded by SMFG and two of its group companies — Sumitomo Mitsui Banking Corp. and SMBC Nikko Securities Inc. — along with SBI Holdings Inc. and its main domestic brokerage, SBI Securities Co., according to a statement issued on Monday. 'The widespread adoption of mobile financial services is expected to accelerate the growth of the digital affluent segment, creating a significant market opportunity,' said Toru Nakashima, SMFG's chief executive officer, at a press conference. He said the joint venture aims to become profitable in three years and is targeting pre-tax profits of ¥10 billion within five years. by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like Why Seniors Are Snapping Up This TV Box, We Explain! Techno Mag Learn More Undo The move highlights the growing potential of the wealth management sector in Japan. According to forecasts by the Daiwa Institute of Research, the proportion of Japanese households with financial assets of ¥50 million ($347,000) is expected to increase to 6.1% by the end of the fiscal year starting April 2035, up from 5% in fiscal 2019. The total amount of assets held by such households is also projected to rise by around a third to ¥953 trillion by the end of fiscal 2035, compared with the end of fiscal 2024. Policymakers in Japan have been encouraging individual investors to move more of their savings into riskier assets like equities, as part of broader efforts to reduce reliance on government spending. These efforts come at a time when Japan's ageing population is putting pressure on the social security system. Live Events Despite these pushes, Japanese households remained cautious. As of the end of March last year, about 51% of their financial assets were still held in bank accounts, showing a conservative investment culture. This contrasts with roughly 12% in the US and 34% in the euro zone, based on data compiled by the Daiwa Institute of Research. Other firms in Japan's financial sector have launched similar ventures. Rakuten Securities Inc., which has a capital and business alliance with Mizuho Securities Co., set up a joint venture that began operations in April last year. That venture is targeting households with financial assets of ¥20 million or more. It is focusing on individuals in their 40s and 50s who are already Rakuten Securities customers and have a need for face-to-face financial services.
Time of India
16-06-2025
- Business
- Time of India
SBI and SMFG set sights on $69 bn treasure in Japan's digital wealth boom
Sumitomo Mitsui Financial Group Inc. (SMFG) and SBI Holdings Inc. are planning a new joint venture to offer wealth management services in Japan . The two firms are targeting affluent individuals in the country, with plans to manage assets worth ¥10 trillion ($69 billion) within five years. According to a statement issued on Monday, the venture will be funded by SMFG and its group companies — Sumitomo Mitsui Banking Corp. and SMBC Nikko Securities Inc. — along with SBI Holdings Inc. and its main domestic brokerage, SBI Securities Co. 'The widespread adoption of mobile financial services is expected to accelerate the growth of the digital affluent segment, creating a significant market opportunity,' SMFG's chief executive officer Toru Nakashima said at a press conference. He added that the joint venture is aiming to become profitable within three years and targets pre-tax profits of ¥10 billion over five years. by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like An engineer reveals: 1 simple trick to get all TV channels Techno Mag Learn More Undo The partnership highlights rising interest in the wealth management sector in Japan, where high-net-worth households are expected to grow steadily. According to projections from the Daiwa Institute of Research, the share of households with financial assets of ¥50 million ($347,000) is expected to increase from 5% in fiscal 2019 to 6.1% by the end of fiscal 2035. Over the same period, total financial assets held by these households are forecast to grow by about a third, from ¥714 trillion at the end of fiscal 2024 to ¥953 trillion by the end of fiscal 2035. Japanese policymakers are trying to encourage individuals to shift their money from bank savings to riskier investments such as equities. The goal is to reduce dependence on government spending at a time when the country's ageing population is placing increasing pressure on the social security system. Live Events Despite these policy nudges, Japanese households have remained cautious investors. At the end of March last year, around 51% of their financial assets were held in bank accounts. That compares with just 12% in the United States and 34% in the eurozone, according to data compiled by Daiwa Institute of Research. The SMFG–SBI joint venture is part of a broader trend in Japan's financial sector. Similar partnerships have been launched to tap into the growing wealth market. In April last year, Rakuten Securities Inc. began operations with a new joint venture formed alongside Mizuho Securities Co., with which it shares both capital and business ties. That company is targeting households with financial assets of ¥20 million or more, especially individuals in their 40s and 50s who are already Rakuten Securities clients and prefer face-to-face financial services. (with inputs from Bloomberg)
Gulf Today
15-05-2025
- Business
- Gulf Today
Japan's three largest banks make record annual profits
Japan's three largest banking groups posted record annual net profit in the last financial year, benefitting from increased corporate activity due to the end of deflation in Japan. The banks also expect to increase earnings this financial year - forecasting record profits once again - even though the economic outlook has been muddied by US President Donald Trump's sweeping global tariffs. Mitsubishi UFJ Financial Group, Sumitomo Mitsui Financial Group and Mizuho Financial Group booked net profits of 1.86 trillion yen ($12.76 billion), 1.18 trillion yen and 885 billion yen, respectively, in the 12 months ended March 2025. The banks said the impact of the tariffs and the resulting uncertainty was already being felt, and was accounted for in their forecasts. Japan's largest lender MUFG cited a global economic slowdown, continued market volatility and lost trust in the US dollar among risk factors, but nevertheless forecast a record net profit this financial year of 2 trillion yen. SMFG projected net profit of 1.3 trillion yen and Mizuho 940 billion yen, including downward adjustments of 100 billion yen and 110 billion yen, respectively, to account for continued uncertainty. Mizuho's pipeline of equity capital markets and mergers and acquisitions deals is currently backed up as shifting business conditions make decision making on large-scale investment challenging, Chief Executive Masahiro Kihara told a press briefing in Tokyo. But the banks expect Japanese companies to keep investing and each has extensive overseas operations across different financial services including retail and investment banking, asset management and wealth management. 'We have operations across Japan, Asia and the Americas with varied sources of profit, so we are strong in any business environment,' MUFG Chief Executive Hironori Kamezawa told a press briefing. MUFG owns 24 per cent of US bank Morgan Stanley, a business alliance that began in 2008. The holding contributed more than a quarter of MUFG's annual net profit. Asia has also been a growth market for the banks. Most recently, SMFG announced last week its acquisition of a 20 per cent stake in Indian private lender Yes Bank. But the tariff uncertainty means SMFG too is holding off on further acquisitions, CEO Toru Nakashima said on Wednesday. Japan's banks have been among the largest beneficiaries of the end of deflation in Japan, which has encouraged Japanese companies to borrow to invest at home and abroad and carry out mergers and acquisitions. The return of inflation also pushed the Bank of Japan to end its policy of negative interest rates in March 2024 and hike rates twice thereafter, raising lending margins for Japanese banks. PayPay CEO Ichiro Nakayama, SoftBank Corp CEO Junichi Miyakawa, Sumitomo Mitsui Financial Group CEO Toru Nakashima and Sumitomo Mitsui Card President Yukihiko Onishi pose attended a press conference in Tokyo, Japan, on Thursday. Meanwhile talk of big fiscal spending and a subsequent spike in super-long yields are raising questions over just how quickly the Bank of Japan can taper its bond purchases, adding to the challenges it faces in removing remnants of its massive monetary stimulus.
15-05-2025
- Business
S'tomo Mitsui, SoftBank to Form Payment Service Alliance
News from Japan Economy Technology May 15, 2025 21:36 (JST) Tokyo, May 15 (Jiji Press)--Japan's Sumitomo Mitsui Card Co. and mobile phone carrier SoftBank Corp. said Thursday that they have agreed to form a comprehensive partnership in the digital financial service field. Under the deal, the PayPay mobile payment service of a SoftBank affiliate will be available for transactions, including payment and loading, on the Olive general financial app of Sumitomo Mitsui Banking Corp., which, along with Sumitomo Mitsui Card, is under the wing of Sumitomo Mitsui Financial Group Inc. The partnership between the two payment service giants will allow customers to exchange V points, earned mainly through credit card use on Olive, and PayPay reward points, merging the two sides' huge customer bases. The deal is a major development in intensifying competition to attract customers to so-called economic blocs of affiliated services with reward point programs. "We'll realize a grand coalition that would lead our country's shift to a cashless (society)," Sumitomo Mitsui Financial Group President Toru Nakashima said. [Copyright The Jiji Press, Ltd.] Jiji Press
Japan Times
15-05-2025
- Business
- Japan Times
Sumitomo Mitsui braces for tariff fallout with more buffers
Sumitomo Mitsui Financial Group is shoring its buffers to prepare for U.S. President Donald Trump's trade war, even as it forecast another year of record profit. Japan's second-largest lender expects net income to climb about 10% to ¥1.3 trillion ($8.8 billion) in the year that started in April, it said on Wednesday. That is slightly less than the ¥1.37 trillion average estimate of analysts as the company said the U.S. tariff measures may have a ¥100 billion impact on profit. Tokyo-based Sumitomo Mitsui is the first of Japan's biggest banks to give profit guidance as earnings drivers come under strain from Trump's tariffs. Lending income has benefited from the Bank of Japan's interest-rate hikes — a campaign that is now in doubt as recession fears mount. Net income for the fourth quarter tumbled 75% to ¥42 billion as the bank booked losses on bonds and securities trading and set aside ¥90 billion in "forward-looking provisions' for "recession risks initiated by U.S. tariffs' and high interest rates, Sumitomo Mitsui said in a presentation. It still beat its ¥1.16 trillion profit goal for the year, posting a record ¥1.18 trillion. The bank's clients are becoming cautious about making deals and investments, CEO Toru Nakashima said at a briefing in Tokyo. Companies in the U.S. have paused mergers and equity underwriting transactions, he added. For Sumitomo Mitsui, too, Nakashima said now is not the time to aggressively pursue more acquisitions. His hesitation comes after a flurry of dealmaking to expand globally. The company's main banking unit last week agreed to buy a 20% stake in India's Yes Bank for about 135 billion rupees ($1.6 billion), as it seeks opportunities in faster-growing markets. It also clinched a deal to expand in private credit in the U.S. Sumitomo Mitsui unveiled plans to buy back up to 1% of its shares for as much as ¥100 billion and cancel them. It will consider further repurchases this fiscal year, depending on performance and capital conditions. Bank stocks are among the worst performers in Japan since Trump announced his so-called reciprocal tariffs on April 2. Shares of Sumitomo Mitsui have slid about 12% from an 18-year high in March. The Bank of Japan earlier this month slashed its growth forecasts, citing "extremely high' uncertainties. Japan's economy probably shrank in the first quarter, even before the tariffs started hitting the country in earnest. Sumitomo Mitsui said bad-loan costs are likely to reach ¥300 billion this fiscal year, down from ¥344.5 billion in the previous year.
