The Hyakujushi Bank, Ltd.
8386・Prime Market・Banks
Business
The Hyakujushi Bank, Ltd. was established in 1924 and has approximately 150 years of history, making it the largest regional bank in Kagawa Prefecture. It commands a high market share of roughly 50% in deposits and roughly 40% in loans within Kagawa Prefecture, and operates a branch network spanning 10 prefectures and metropolitan areas nationwide. Centered on its Banking Business, the group comprises eight consolidated subsidiaries covering leasing, credit guarantee, credit cards, ICT solutions, staffing, and real estate management. As a "comprehensive consulting group," it addresses regional challenges ranging from corporate consulting (business succession, M&A, and overseas expansion support) to asset formation support for individuals. Listed on the Prime Market of the Tokyo Stock Exchange.
Business Model
The primary revenue sources consist of interest income (net interest income of ¥51,010 million), comprising interest on loans (domestic loan yield of 1.14%) and interest and dividends on securities. Adding fee income from Fee-based Services Business (¥10,204 million) yields consolidated gross profit of ¥57,756 million, forming the revenue base. The company has a multi-layered revenue structure that accumulates fee income through corporate consulting (business succession, M&A, financing) and retail sales of investment trusts and insurance (Assets in Custody balance of ¥435,825 million), with gains on sales of securities (¥11,634 million) also contributing to earnings.
Company Strengths
With approximately 150 years of history and a community-based management approach, the bank has established a deposit share of approximately 50% and a lending share of approximately 40% within Kagawa Prefecture. It boasts total deposit balances of ¥4,859,521 million and total loan balances of ¥3,688,724 million, maintaining a broad customer base spanning individuals, corporations, and public entities. This regional brand and customer relationships, difficult for competitors to replicate in a short period, form a stable earnings base.
Ship-related financing carries high barriers to entry due to the specialized nature of screening and lending methods, and the bank has built long-standing relationships of trust with a wide range of customers spanning upstream to downstream, including shipbuilders, shipowners, and shipping operators. Fund investment income in the international business division reached ¥16,586 million. The business foundation in the broader Setouchi region and major metropolitan areas, leveraging a branch network spanning 10 prefectures nationwide—including the Osaka and Tokyo branches (opened in the 1950s)—has contributed to the expansion of corporate lending (up ¥164,491 million from the end of the previous fiscal year).
In the final fiscal year (FY2025) of the previous Medium-Term Management Plan "Tsukurou I-I-Yo♪," the non-consolidated OHR (on a core gross business profit basis) improved significantly from 76.1% (FY2022) to 62.9%, exceeding the target of approximately 65.0%. The bank also achieved all its management targets, including a consolidated capital adequacy ratio of 10.41% (against a target of approximately 9.0%) and profit attributable to owners of parent of ¥18,857 million (against a target of ¥13,500 million or more).
ENVALITH's Perspective
Performance Trend
Ordinary income increased 48% over four fiscal periods, from ¥73,092 million in FY2022 (ended March 2022) to ¥108,556 million in FY2026 (ending March 2026), with the revenue growth rate accelerating from 9.6% to 20.6% over the most recent two fiscal periods. As an external factor, the Bank of Japan's policy rate hikes pushed up loan yields, expanding interest income and related income to ¥68,090 million, up ¥12,071 million year on year. Net income attributable to owners of the parent reached a record high of ¥18,857 million (+37.6% year on year), and return on equity improved to 5.2% (from 4.1% in the previous period). Comprehensive income expanded sharply to ¥62,697 million from ¥2,823 million in the previous period, driven mainly by net unrealized gains on available-for-sale securities (+¥30,222 million) and remeasurements of defined benefit plans (+¥13,678 million). For FY2027 (ending March 2027), the company forecasts consolidated ordinary income of ¥116,500 million (+7.3%) and net income of ¥21,000 million (+11.4%).
Growth Strategy
Accelerating dramatic growth as a comprehensive consulting group under the new medium-term management plan "Dakara, Idomu." (That's why we challenge.)
Advancing in parallel the buildup of corporate and individual loans (¥3,697.7 billion at end of FY2026, ending March 2026) and improvement of the securities portfolio through reduction of low-yield yen bonds and investment trusts. The yield on yen-denominated loans rose to 1.15% (0.94% in the previous fiscal year), and the Company intends to continue capturing the benefit of widening interest margins amid interest rate normalization. Net interest income is expected to increase further in FY2027 (ending March 2027).
Expanding both corporate consulting revenue (¥2,435 million, up 17.2% year on year), covering business succession/M&A, management consulting, ICT, and finance-related areas, and individual consulting revenue (¥4,047 million, up 22.7% year on year), covering mortgage loans, investment trusts, and financial instruments intermediary services, as twin growth drivers. Assets in custody balance reached ¥435.8 billion (up ¥58.8 billion from the previous fiscal year-end), and Fee-based Services Business income totaled ¥7,702 million.
During the previous medium-term management plan period, the Company achieved a reduction of ¥9.6 billion in the book value of policy-holding shares, exceeding the target of ¥6.0 billion. Under the new medium-term management plan, dialogue with cross-shareholding partners will continue, with gains on sales of shares and other securities (¥11,635 million) being utilized to enhance capital efficiency. Consolidated ROE, at 5.29% (FY2026, ending March 2026), is targeted to reach 8% or higher by the final year of the new medium-term management plan, in parallel with strengthening shareholder returns through a dividend payout ratio of 40% or more.
With approval from the Financial Services Agency dated March 25, 2026, the method for calculating credit risk assets was changed from the standardized approach to the Foundation Internal Ratings-Based approach. Risk assets were reduced to ¥2,573.5 billion (down ¥252.8 billion from the previous fiscal year), and the consolidated capital adequacy ratio rose to 10.41% (9.33% in the previous fiscal year). Under the new medium-term management plan, the Company aims for a consolidated capital adequacy ratio of 11.5%–12.5%, seeking to achieve both soundness and profitability.
Last updated: July 19, 2026