The Bank of Toyama,Ltd.
8365・Standard Market・Banks
Business
The Bank of Toyama, Ltd. was founded in 1954 and is a regional financial institution operating primarily in Toyama and Ishikawa Prefectures. Through its head office and 38 branches, it offers deposit-taking, lending, domestic and foreign exchange services, and over-the-counter sales of investment trusts and insurance. Its consolidated subsidiaries include Toyama Lease Co., Ltd. (Leasing Business) and Toyama Guarantee Service Co., Ltd. (housing loan and other credit guarantee business), forming a group structure that provides complementary financial services centered on Banking. Its main customers are individuals, small and medium-sized enterprises, and local governments in Toyama and Ishikawa Prefectures. As of the end of FY2026 (ending March 2026), outstanding loans stood at ¥381,916 million and deposits at ¥511,544 million. The company is listed on the Standard Market of the Tokyo Stock Exchange.
Business Model
The core earnings driver is the traditional interest margin model, in which funds raised from deposits from individuals and corporations are deployed into loans (¥381,916 million at the end of FY2026 (ending March 2026)) and securities (¥135,592 million for the same period). Net interest income for FY2026 (ending March 2026) was ¥5,553 million. On top of this, the company has a multi-layered revenue structure that adds fee income (¥849 million) from sources such as commissions on over-the-counter sales of investment trusts and insurance, as well as leasing revenue from external customers generated by subsidiaries (¥1,743 million) and guarantee revenue (¥33 million).
Company Strengths
Individual deposit balances at the end of FY2026 (ending March 2026) expanded steadily to ¥379,002 million (up ¥11,649 million from the end of the previous fiscal year). Individual deposits account for approximately 74% of total deposits of ¥511,544 million, forming a low-cost and stable funding base. This is underpinned by customer relationships built over many years through a regionally focused branch network (39 branches).
The loan yield reached 1.18% in FY2026 (ending March 2026) (up 0.19 percentage points from the previous fiscal year). Interest on loans was ¥4,532 million against an average loan balance of ¥382,686 million, an increase of ¥753 million from the previous fiscal year. Business loan balances also increased to ¥309,134 million (up ¥757 million from the previous fiscal year), with a profitability-focused lending stance contributing to the improvement in yield.
The consolidated capital adequacy ratio (domestic standard) at the end of FY2026 (ending March 2026) was 9.28% (up 0.18 percentage points from the end of the previous fiscal year), well above the 4% required of domestic standard banks. Capital of ¥28.2 billion was secured against risk assets of ¥304.1 billion. Non-performing loans (total of bankrupt/reorganization claims, doubtful claims, and substandard claims) stood at ¥11,091 million, a manageable level.
ENVALITH's Perspective
Performance Trend
Consolidated ordinary income trended as follows: ¥8,462 million in FY2022 → ¥10,821 million in FY2023 → ¥10,146 million in FY2024 → ¥9,675 million in FY2025 → ¥13,771 million in FY2026 (ending March 2026). The substantial increase in revenue in FY2026 (ending March 2026) was primarily driven by other ordinary income (consolidated: ¥4,100 million, up ¥3,138 million year on year), supported by a gain on sale of equity holdings of ¥3,680 million (non-consolidated). As an external factor, the Bank of Japan's policy rate hikes pushed short-term interest rates above 0.7% and long-term interest rates to around 2.4%, improving interest on loans (consolidated: ¥4,517 million, up ¥748 million year on year) and interest on deposits with banks (consolidated: ¥236 million, up ¥143 million year on year). Meanwhile, funding costs (consolidated: ¥1,145 million, up ¥811 million year on year) also increased sharply. A significant decrease in credit costs (the provision for allowance for loan losses of ¥569 million recorded in the previous period fell to zero) contributed to the improvement in ordinary profit. For FY2027 (ending March 2027), ordinary profit is forecast at ¥1,400 million (down 21.3% year on year), reflecting the anticipated disappearance of these temporary gains.
Growth Strategy
Aiming for net income of ¥1 billion or more in FY2028 through issue-solving lending, retail business enhancement, and efficient management
Against the backdrop of the Bank of Japan's monetary policy normalization, the Bank improved its lending yield (1.18%, up 0.19 percentage points year on year) while increasing its securities balance to ¥135,462 million (non-consolidated), continuing an investment policy that balances stable earnings with liquidity assurance. The basic policy for FY2027 (ending March 2027) is to maintain and expand net interest income.
The balance of investment trusts expanded significantly to ¥24,644 million as of the end of March 2026 (up ¥4,234 million from the previous fiscal year-end). Against the backdrop of growth in individual deposits (¥379,002 million), the Bank is strengthening over-the-counter sales to capture asset management needs. It aims to boost non-interest income by maintaining and expanding fee and commission income (¥1,225 million on a consolidated basis).
In FY2026 (ended March 2026), the Bank achieved zero provision for allowance for loan losses and a reversal gain of ¥40 million (non-consolidated), with a coverage ratio of 95.59%. By continuing to support business improvement for client companies, the Bank aims to keep credit costs stably low through stable management of the non-performing loan ratio at 2.84% (non-consolidated).
Under the finalized Basel III framework (applied from the end of March 2025), the Bank achieved a non-consolidated capital adequacy ratio of 9.09% (up 0.16 percentage points year on year) and a consolidated ratio of 9.28% (up 0.18 percentage points year on year), maintaining a level well above the domestic soundness standard of 4%. The Bank aims to balance the accumulation of net assets (¥31,968 million on a consolidated basis) with maintaining a dividend payout ratio of around 28%.
Last updated: July 19, 2026