The Toho Bank, Ltd.
8346・Prime Market・Banks
Banking
The core segment of the Toho Bank Group. A community-based banking business primarily anchored in Fukushima Prefecture.
| Period | Current | Previous | Change |
|---|---|---|---|
| Banking segment ordinary income (full year, FY2026 (ending March 2026)) | ¥81,993 million | ¥60,451 million | ↑ |
| Banking segment profit (on an ordinary income basis, full year, FY2026 (ending March 2026)) | ¥16,137 million | ¥10,884 million | ↑ |
| Segment assets (as of end of March 2026) | ¥6,721,256 million | ¥6,630,305 million | ↑ |
| Depreciation expense (FY2026 (ending March 2026)) | ¥4,371 million | ¥4,072 million (estimate) | ↑ |
| Impairment loss (FY2026 (ending March 2026)) | ¥35 million | ¥283 million | ↓ |
| Core net business profit (non-consolidated, FY2026 (ending March 2026)) | ¥16,155 million | ¥11,271 million | ↑ |
| Non-consolidated loan balance (as of end of March 2026) | ¥4,250,609 million | ¥4,054,004 million | ↑ |
| Non-consolidated securities balance (as of end of March 2026) | ¥1,394,088 million | ¥1,207,558 million | ↑ |
| Consolidated capital adequacy ratio (domestic standard, as of end of March 2026) | 11.73% | 10.75% | ↑ |
| Disclosed claims ratio under the Financial Reconstruction Act (non-consolidated, as of end of March 2026) | 1.27% | 1.33% | ↓ |
Business Details
The Bank conducts deposit-taking, lending, foreign exchange, and related operations through its head office, branches, and sub-branches. As the core business of the Toho Bank Group, it accounts for approximately 88% of consolidated ordinary income. Supported by the Bank of Japan's policy rate hikes, net interest income expanded through the accumulation of business loans and yen-denominated securities holdings and improved yields. The expansion of fee income from assets under custody through the comprehensive business alliance with Nomura Securities also contributed to revenue diversification.
Recent Overview
Both ordinary income and profit increased substantially, driven by rising interest rates and the full operation of the Nomura alliance.
In FY2026 (ending March 2026), Banking segment ordinary income was ¥81,993 million (up 35.6% year on year), and segment profit was ¥16,137 million (up 48.3% year on year). The primary drivers were increases in interest income on loans (¥41,599 million, up ¥11,105 million year on year) and interest and dividend income on securities (¥14,079 million, up ¥5,531 million year on year), reflecting the Bank of Japan's policy rate hikes. Following the full transition to new brokerage accounts with Nomura Securities in October 2025, the balance of assets under custody expanded to ¥1,253.3 billion (up ¥348.1 billion from the end of the prior fiscal year). On the other hand, funding costs increased significantly to ¥16,991 million (up ¥11,765 million year on year). Credit-related costs remained at a low level of ¥733 million.
Key Products
Growth Drivers
- Expansion of net interest income through improved loan and securities yields amid the Bank of Japan's policy rate hikes (overall interest margin of 0.10%, up 0.04 percentage points year on year)
- Steady accumulation of the business loan balance (¥1,843,742 million as of the end of March 2026, up ¥68,819 million from the end of the prior fiscal year), leading to increased interest income on loans
- Rapid expansion of the new brokerage account balance through the comprehensive business alliance with Nomura Securities (¥932,080 million as of the end of March 2026) and increased fee income from assets under custody
- Accumulation of the securities balance, mainly in yen-denominated bonds (¥1,394,088 million as of the end of March 2026, up ¥186,529 million from the end of the prior fiscal year), leading to increased interest and dividend income on securities
- Profit-boosting effect from the sustained low level of credit-related costs (¥733 million in FY2026 (ending March 2026))
- Improvement in the consolidated capital adequacy ratio (11.73%, up 0.98 percentage points from the end of the prior fiscal year) due to a decrease in risk assets
Risks
- Risk of margin compression due to rising deposit and other funding costs associated with additional Bank of Japan rate hikes (funding costs of ¥16,991 million in FY2026 (ending March 2026), up ¥11,765 million year on year)
- Risk of expanded valuation losses on the bond portfolio due to rising market interest rates (net unrealized gains/losses on available-for-sale securities, after considering deferred hedges, were ¥(986) million as of the end of March 2026; bonds alone were ¥(49,352) million)
- Cost increase pressure from human capital investment such as starting salary and wage increases, as well as digital investment and investment related to the Nomura alliance (non-consolidated operating expenses of ¥38,212 million in FY2026 (ending March 2026), up ¥4,051 million year on year)
- Long-term risk of shrinking loan demand due to a shrinking regional economy driven by population decline and aging in Fukushima Prefecture
- Trends in disclosed claims under the Financial Reconstruction Act (¥54,597 million non-consolidated as of the end of March 2026, 1.27% of total credit) and the possibility of rising credit costs
- Risk of earnings volatility due to deterioration in gains/losses related to bonds such as government bonds (¥(2,191) million in FY2026 (ending March 2026))
Last updated: June 15, 2026