Aichi Financial Group, Inc.
7389・Prime Market・Banks
Business
Aichi Financial Group, Inc. is a bank holding company established in October 2022 through a joint share transfer by The Aichi Bank and The Chukyo Bank. In January 2025, the two banks merged and began operations as The Aichi Bank, Ltd. The group is composed of 11 consolidated subsidiaries, with Banking (deposits, lending, remittance, investment trusts, insurance sales, and trust agency services) as its core business, alongside peripheral financial services such as General Leasing Business (Aichi FG Lease), Credit Card Business, credit guarantee, administrative services, Software Development Business, and Consulting Business. Its main business base is the Tokai region, centered on Aichi Prefecture, with individuals, small and medium-sized enterprises, and local public bodies as its main customer segments. It is a regional financial group with loans outstanding of ¥4,941,172 million and deposits outstanding of ¥5,989,342 million.
Business Model
The main revenue sources are net interest income of ¥52,599 million, derived from interest on loans (average loan balance of ¥4,921,307 million, yield of 1.07%) and securities investment (average balance of ¥1,139,509 million, yield of 1.58%). In addition, there is fee income of ¥18,005 million from investment trusts, over-the-counter insurance sales, agency services, etc., and gains/losses related to stocks of ¥16,419 million from the planned sale of policy shareholdings. Funding is centered on personal and corporate deposits (average balance of ¥5,961,675 million), maintaining a low-cost, stable funding base.
Company Strengths
With the merger of The Aichi Bank and The Chukyo Bank (January 2025), The Aichi Bank's non-consolidated loan balance reached ¥4,953,134 million, establishing a broad customer base within Aichi Prefecture. The elimination of system integration costs associated with the merger also achieved cost efficiencies, with The Aichi Bank's non-consolidated operating expenses decreasing by ¥3,623 million, from ¥22,068 million to ¥18,444 million.
Assets in Custody (Investment Trusts, Insurance, Public Bonds) have steadily accumulated, with investment trust balances of ¥208,038 million (up ¥32,381 million year on year) and insurance balances of ¥659,913 million (up ¥56,806 million year on year). Agency business fee income increased to ¥6,073 million (from ¥4,791 million in the previous fiscal year), expanding the fee income base that is not dependent on interest income.
The Aichi Bank's non-consolidated normal claims increased to ¥4,939.5 billion (from ¥4,835.8 billion in the previous fiscal year), while bankruptcy and reorganization claims improved to ¥16.2 billion (from ¥19.0 billion) and doubtful claims improved to ¥57.2 billion (from ¥62.3 billion). During the fiscal year under review, a reversal gain on allowance for loan losses of ¥2,024 million and a reversal gain on allowance for contingent losses of ¥449 million were recorded, resulting in credit-related costs turning positive at ¥(2,473) million.
ENVALITH's Perspective
Performance Trend
In FY2026 (ending March 2026), ordinary income reached ¥125,137 million (up 23.9% year on year), ordinary profit reached ¥30,912 million (up 200.6% year on year), and profit attributable to owners of parent reached ¥21,808 million (up 139.7% year on year), achieving substantial profit growth. The factors behind the profit increase were a quartet of: (1) an increase in interest on loans against the backdrop of the Bank of Japan's rate hikes (consolidated ¥52,728 million, versus ¥39,831 million in the previous period); (2) an increase in gains on sales of policy-holding shares (net gains on stocks, etc. of ¥16,419 million); (3) the elimination of integration-related expenses following the completion of the merger and system integration (a ¥3,623 million decrease in property expenses); and (4) the reversal of credit-related costs into income (including a ¥1,772 million reversal gain on allowance for loan losses, etc.). Comprehensive income improved substantially to ¥83,627 million (from ¥-20,892 million in the previous period), with net unrealized gains on other securities increasing by ¥46,919 million. For FY2027 (ending March 2027), ordinary profit is forecast to decline to ¥28,000 million (down 9.4% year on year) due to the elimination of one-time factors.
Growth Strategy
Moving toward a wide-area regional bank group through business integration with Thirty-Three Financial Group. Concurrently advancing expansion of non-financial services
A basic agreement was executed on May 13, 2026. Integration via an absorption-type merger is planned to be implemented effective April 1, 2027. The aim is to enhance corporate value through improved presence in Aichi, Mie and neighboring areas, and optimal utilization of management resources. Combined total assets of the two companies post-integration are expected to reach approximately ¥12 trillion.
In May 2026, the company made Toyota Engineering Co., Ltd. and Toyota Management Institute Co., Ltd. subsidiaries (acquisition cost of ¥170 million). The company aims to expand its business improvement and management consulting functions for manufacturers, pursuing realization of a "total support group that goes beyond banking."
Aigin DC Card and Chukyo Card are scheduled to merge effective April 1, 2027, to be established as Aichi FG Card Co., Ltd. The aim is to streamline management resources and maximize corporate value, while strengthening the cashless business, which is expected to grow. This also aims to enhance a sense of unity as a group.
At Aichi Bank on a standalone basis, the investment trust balance continued to expand to ¥208,038 million (up ¥32,381 million year on year), and the insurance balance to ¥659,913 million (up ¥56,806 million year on year). The company aims to capture individual asset-formation demand driven by improving employment and income conditions, and to steadily build up Fee Business (Remittance, Securities, Trust Agency) income.
Effective April 1, 2026, the company implemented a stock split at a ratio of 5 shares for every 1 share of common stock. This is intended to lower the investment unit amount, further expanding the investor base, including individual investors, and improving share liquidity. Annual dividends post-split are forecast at ¥30 (equivalent to ¥150 pre-split).
Last updated: July 19, 2026