THE FIRST BANK OF TOYAMA,LTD.

Business Details

A core group business that provides deposit business, lending business, domestic exchange business, foreign exchange business, securities investment business, and other services through the head office and branches of the Bank. The consolidated subsidiary Toyama First Business Co., Ltd. handles banking administrative agency operations. As a regional financial institution with Toyama Prefecture as its main base, it provides a wide range of financial services, from consulting for businesses to asset formation support for individuals. In FY2026 (ending March 2026), against the backdrop of the progression of a "world with interest rates," interest on loans and interest and dividends on securities increased, and segment profit reached a new record high.

Recent Overview

Interest on loans and securities expanded on the back of rising interest rates, and Banking segment profit reached a new record high of ¥20,355 million

In FY2026 (ending March 2026), against the backdrop of the Bank of Japan's gradual policy rate hikes, interest on loans (non-consolidated ¥12,705 million, up ¥2,158 million from the previous fiscal year) and interest and dividends on securities (non-consolidated ¥14,262 million, up ¥1,705 million) expanded. Gains on sale of stocks, etc. (non-consolidated ¥12,652 million) also remained at a high level. On the other hand, interest on deposits (non-consolidated ¥3,581 million, up ¥2,410 million from the previous fiscal year) and provision for allowance for loan losses (non-consolidated ¥423 million) increased. The Bank's non-consolidated core net business profit reached ¥11,867 million, a new record high for the fourth consecutive year. Unrealized gains on other securities (non-consolidated) increased by ¥47,320 million from the end of the previous fiscal year to ¥89,821 million, significantly expanding net assets. As a subsequent event, in May 2026 the Bank resolved to acquire up to 2,000,000 shares of treasury stock with an upper limit of ¥5,500,000,000, and to cancel 1,309,700 shares.

Key Products

Growth Drivers

• Expansion of net interest income due to rising loan yield (all branches: 1.05% → 1.23%) and improved overall interest margin (0.54% → 0.63%), reflecting the Bank of Japan's gradual policy rate hikes
• Continued expansion of loan balance (non-consolidated: ¥1,023,980 million → ¥1,059,728 million) through expanded corporate financing and increased housing loans
• Increased interest and dividend income and realized gains on sale of stocks through active review of the securities portfolio (non-consolidated gains/losses on stocks, etc.: ¥10,758 million)
• Expansion of investment trust balance (non-consolidated ¥73,651 million, up ¥15,799 million from the end of the previous fiscal year) and increased fee-based services income through strengthened support for individual asset formation, including utilization of the new NISA
• Expansion of non-interest income through deepening of consulting services for businesses starting from management improvement support
• Continued funding demand backed by a steady recovery trend in the Hokuriku regional economy and capital expenditure (related to DX) and wage increases

Risks

• Risk of margin compression due to rising deposit funding costs (non-consolidated interest on deposits: ¥1,171 million in the previous fiscal year → ¥3,581 million in the current fiscal year, a significant increase) accompanying additional rate hikes by the Bank of Japan
• Risk of impact on corporate performance and capital expenditure of businesses in the Hokuriku region, and increased credit costs, due to a slowdown in the global economy from expanding US trade policy and geopolitical risks (additional credit costs are expected in the forecast for FY2027, ending March 2027)
• Risk of earnings fluctuation due to high dependence on gains on sale of stocks, etc. (non-consolidated ¥12,652 million) amid stock market volatility
• Risk of increased expenses due to rising personnel costs from wage increases (non-consolidated ¥6,069 million, up ¥180 million from the previous fiscal year) and costs related to consideration and preparation for future core system renewal
• Risk of valuation losses on the bond portfolio amid rising interest rates (non-consolidated bond valuation gain/loss: ¥-673 million) and risk of fluctuation in unrealized gains on securities
• Although the non-performing loan ratio improved by 0.16 points from the end of the previous fiscal year to 2.32%, the balance of doubtful claims remains at a high level of ¥17,854 million (non-consolidated), posing a risk of increased credit costs in the event of a deterioration in the economic environment