THE SHIGA BANK,LTD.
8366・Prime Market・Banks
Business
The Shiga Bank, Ltd. was established in 1933 and is a regional financial group operating as the sole bank headquartered in Shiga Prefecture, with 94 domestic branches, 1 branch in Hong Kong, 5 sub-branches, and 33 agencies. Through 9 consolidated subsidiaries (leasing, credit card, guarantee, energy, capital partners, etc.), the group provides diverse financial services including deposits, lending, domestic and foreign exchange, and securities investment, in addition to consulting, GX/SX support, and business succession fund management. Its principal customers are small and medium-sized enterprises, individuals, and local governments within Shiga Prefecture, and it addresses the financial needs of both corporate and individual clients against the backdrop of the prefecture's industrial structure, which is concentrated in the semiconductor and automotive-related industries. Listed on the Prime Market of the Tokyo Stock Exchange.
Business Model
The core of earnings is net interest income (¥74,143 million), which is the difference between interest income on fund management (consolidated FY2026: ¥102,353 million) and interest expenses on fund procurement (¥28,271 million), with interest on loans (¥59,842 million) and interest and dividends on securities (¥35,436 million) as the main components. Adding fees and commissions income (¥12,504 million) to this yields consolidated gross operating profit of ¥66,590 million. The company is also working to expand non-interest income such as M&A, business succession, and asset management consulting, aiming for stable fee-based revenue generation through the accumulation of assets under custody balances.
Company Strengths
Since its establishment in 1933, the bank has consolidated multiple banks within Shiga Prefecture and has a history of over 90 years as the prefecture's only bank with its head office located there. Through a network of 94 domestic branches and 33 agencies, it maintains deposit balances of ¥5,950,294 million and loan balances of ¥4,588,660 million. Its broad customer base, including ¥414,857 million in loans to local governments, constitutes a unique asset that competitors cannot easily replicate in the short term.
The consolidated total capital adequacy ratio (international standard) at the end of FY2026 (ending March 2026) stood at 13.25%, significantly exceeding regulatory requirements. Among claims disclosed under the Financial Reconstruction Act, the ratio of normal claims is extremely high, and doubtful claims decreased from ¥51,981 million at the end of the previous fiscal year to ¥46,066 million. Credit costs also improved substantially on a non-consolidated basis, coming in at negative ¥164 million (a decrease of ¥4,399 million year on year), with high asset soundness underpinning stable earnings.
The group comprises nine consolidated subsidiaries, including leasing (Shigagin Lease), credit cards (Shiga DC Card and Shigagin JCB), guarantees (Shiga Guarantee Service), energy (Shigagin Energy), and investment (Shigagin Capital Partners), building a structure that provides diverse services complementing the bank's core lending and deposit-taking operations in an integrated manner. In September 2025, the group made its first investment through a business succession fund.
ENVALITH's Perspective
Performance Trend
Ordinary income (consolidated) rose for five consecutive periods, from ¥98,306 million in FY2022 (ended March 2022) to ¥159,056 million in FY2026 (ending March 2026). FY2026 growth accelerated to +19.5% year on year. The main driver was an increase in interest income (+¥15,720 million year on year) against the backdrop of the Bank of Japan's policy rate hikes, an external factor, with interest on loans (+¥10,523 million), interest and dividends on securities (+¥3,920 million), and interest on deposits with banks (+¥2,182 million) all expanding. Ordinary profit increased sharply to ¥29,031 million (+53.2% year on year). Profit attributable to owners of parent was ¥21,293 million (+13.7% year on year), securing profit growth even after absorbing the drop-off of the ¥8,000 million settlement income recorded in the previous period. Comprehensive income improved substantially to ¥70,627 million (from -¥38,097 million in the prior period), and the recovery in net unrealized gains on available-for-sale securities (+¥32,078 million) contributed to the expansion of net assets to ¥509,025 million (+¥64,214 million from the end of the previous period).
Growth Strategy
Aims to improve ROE and strengthen regional financial capabilities through the three strategies of the 8th Medium-Term Management Plan and alliance expansion
A strategy to design sustainable growth for customers and the region. Progress is demonstrated by steady accumulation of loan balances (non-consolidated period-end balance of ¥4,624,935 million), expansion of consumer loans (¥1,332,565 million), and an increase in assets under custody balance (¥359,025 million). The Bank is working to solve regional companies' challenges by strengthening business financing and consulting functions.
Improving productivity and strengthening the management foundation through system investment and digitalization. Intangible fixed assets (software) increased substantially from ¥121 million at the end of the previous fiscal year to ¥2,663 million, as system investment moved into full swing. Non-personnel expenses increased by ¥1,342 million year on year, mainly due to an increase in system-related costs, putting the Bank in a phase of upfront investment aimed at future efficiency gains.
Personnel expenses increased by ¥2,287 million year on year (non-consolidated: ¥21,193 million), reflecting active investment in human capital. The Bank is promoting organizational strength through investment in pay raises and talent development. Real net operating profit per employee rose to ¥7,971 thousand (+¥858 thousand year on year), with productivity also improving, indicating that the effects of investment are beginning to show in the numbers.
A capital and business alliance agreement was concluded with Ikeda Senshu Holdings on April 17, 2026. The two companies will mutually leverage their adjacent business bases in the Shiga/Kyoto area and the Osaka/Hyogo area, deepening business collaboration in five fields: corporate, individual, sustainability, and human capital/digital. A capital relationship is also planned to be established through mutual share acquisition (approximately 0.5-1%). The impact on near-term earnings is expected to be minor.
The dividend payout ratio target for FY2027 (ending March 2027) has been set at approximately 40%, with the annual dividend forecast set at ¥50 (post stock split). This represents a significant increase from the FY2026 (ending March 2026) dividend payout ratio of 30.3% (annual dividend of ¥140, pre-split). The policy is to flexibly and opportunistically conduct share buybacks in light of the business environment and capital position. In FY2026 (ended March 2026), the Bank also retired treasury shares (equivalent to ¥15,137 million).
Last updated: July 19, 2026