The 77 Bank, Ltd.
8341・Prime Market・Banks
Business
The 77 Bank, Ltd. was established in 1932 and is headquartered in Sendai City, Miyagi Prefecture, making it the largest regional bank in the Tohoku region. Centered on the core bank, the group comprises 19 subsidiaries covering leasing, securities, credit guarantee, credit cards, insurance, consulting, and fund management. Its primary customers are individuals, small and medium-sized enterprises, and local governments within Miyagi Prefecture, boasting a 55% main bank share within the prefecture (FY2025 results). In recent years, the bank has expanded its reach by leveraging lending to corporations outside the prefecture and its overseas network (Singapore and Shanghai). It transitioned to the Prime Market of the Tokyo Stock Exchange in April 2022.
Business Model
The gap between deposit funding costs and lending/securities investment yields (net interest income) forms the core of earnings, with net interest income of ¥113,978 million in FY2026 (ending March 2026). In addition, fee income from over-the-counter sales of investment trusts, insurance, and public bonds, as well as commission-based mortgage loans (Fee-based Services Business income of ¥20,419 million), and gains on sales of equities (¥29,298 million) supplement earnings. Through cross-selling in cooperation with group companies, group assets under custody have expanded to ¥978.1 billion, diversifying non-interest income.
Company Strengths
The bank holds a 55% main bank ratio within Miyagi Prefecture (Teikoku Databank survey), loans outstanding within the prefecture of ¥4,569,619 million (non-consolidated), and a residential mortgage loan balance (within Miyagi Prefecture) of ¥1,304,434 million. Its broad customer base spanning individuals, corporations, and local governments forms a region-focused competitive advantage that is difficult for competitors to replicate in a short period.
The consolidated capital adequacy ratio (domestic standard) as of the end of March 2026 stood at 10.58%, significantly above regulatory requirements, with capital of ¥560.9 billion. The ratio of normal claims was maintained at over 99%, with ¥6,591,423 million of normal claims against total loans of ¥6,603,904 million. This financial stability underpins the bank's ability to pursue both continued loan growth and shareholder returns.
Group assets under custody increased by 20.7% year on year, from ¥810.3 billion at the end of March 2025 to ¥978.1 billion at the end of March 2026. Non-consolidated assets under custody also expanded from ¥633,541 million to ¥740,556 million. An integrated cross-selling framework leveraging collaboration among group companies such as Shichijushichi Securities, Shichijushichi Hoken Service, and Shichijushichi Partners is driving the growth in non-interest income.
ENVALITH's Perspective
Performance Trend
Ordinary revenue expanded approximately 1.8-fold over five periods, from ¥118,169 million in FY2022 (ending March 2022) to ¥211,208 million in FY2026 (ending March 2026). In FY2026 (ending March 2026), revenue increased 23.1% year on year, ordinary profit rose 39.4% year on year to ¥78,469 million, and profit attributable to owners of parent increased 37.5% year on year to ¥54,007 million, achieving a substantial profit increase. Key external drivers included the rise in loan yields (1.22%, up 0.21pt year on year) following the Bank of Japan's interest rate hike (December 2025) and the expansion of average loan balances (up 7.4% year on year). Gains on sales of securities, etc. of ¥29,298 million (up 76.7% year on year) also boosted profit. For FY2027 (ending March 2027), ordinary profit is forecast at ¥89,500 million (up 14.0% year on year) and net income at ¥61,500 million (up 13.8%), with the profit growth trend expected to continue.
Growth Strategy
Strengthening consulting functions and expanding group-wide integrated earnings based on Vision 2030
Promoting loan growth across all fronts—for SMEs, large corporations, and individuals (housing loans). The balance of loans outstanding at the end of FY2026 (ending March 2026) expanded to ¥6,627,703 million (+7.1% year on year), and the loan yield rose to 1.22% (+0.21pt year on year). The Company aims to achieve both margin improvement and balance expansion by capitalizing on the rising interest rate environment.
Promoting an increase in fee and commission income through fee-based housing loans (launched October 2024), non-interest income from corporate clients (foreign exchange derivatives, etc.), and expansion of group assets under custody (¥978.1 billion). Fee and commission income for fiscal 2025 expanded steadily to ¥16.9 billion (+16.6% year on year).
Strengthening the supply of growth capital to regional companies and support for solving their challenges through the new consolidation of Shichijushichi Partners No. 1 and No. 2 Investment Limited Partnerships (FY2026, ending March 2026), Shichijushichi Business With (established September 2024), and 77 NEXT CONSULTING PTE. LTD. (established January 2025). The Company aims to diversify its earnings base through group-wide, integrated cross-selling.
In May 2026, the Company revised its shareholder return policy, explicitly stating its plan to raise the payout ratio to 40% or more by fiscal 2027 through progressive dividends, along with flexible share buybacks. The annual dividend for FY2026 (ending March 2026) was ¥260 (payout ratio 35.7%), and the forecast for FY2027 (ending March 2027) is ¥104 (after the stock split; payout ratio 37.7%), progressing steadily toward the target.
Last updated: July 19, 2026