The Bank of Nagoya, Ltd.
8522・Prime Market・Banks
Business
Nagoya Bank, founded in 1949, is a financial group centered on a regional bank headquartered in Nagoya City, Aichi Prefecture. It operates 112 domestic branches and 1 overseas branch (Nantong Branch), with core Banking Business including deposits, lending, securities investment, foreign exchange, and trust operations, alongside six group companies: Nagoya Lease (General Finance Leasing), Nagoya Card and Nagoya MC Card (Credit Card Business and Credit Guarantee Business), Nagoya Capital Partners (Formation and Management of Investment Limited Partnerships), and Nice Corporation (Medical Systems Business / ICT Support Business). Its main customers are small and medium-sized enterprises and individuals within Aichi Prefecture, and it addresses a wide range of financial needs from corporate business financing to individual housing loans and assets under custody. Consolidated total assets for FY2026 (ending March 2026) reached ¥6,272,701 million.
Business Model
The core of revenue is interest income (¥70,987 million on a consolidated basis for FY2026 (ending March 2026)), driven primarily by interest on loans (¥45,021 million) and interest and dividends on securities (¥21,254 million). This is supplemented by fee income from services transactions (¥15,473 million), with sales of assets in custody (investment trusts and insurance) and foreign exchange/securities-related fees complementing revenue. Funding is based on low-cost deposits (average balance ¥5,160,799 million, yield 0.30%), which are deployed into loans (average balance ¥4,078,538 million, yield 1.10%) and securities (average balance ¥884,696 million, yield 2.40%) to secure the interest margin.
Company Strengths
At the end of FY2026 (ending March 2026), consolidated loans outstanding reached ¥4,310,294 million (up ¥319,965 million year on year), while deposits reached ¥5,381,207 million (up ¥591,024 million year on year). Through a network of 112 domestic branches and 1 overseas branch, the Bank has broadly captured small and medium-sized enterprises across diverse industries such as manufacturing, real estate, and finance/insurance, as well as individual customers. Its stable customer base within Aichi Prefecture is a unique strength that competitors would find difficult to replicate in a short period.
At the end of FY2026 (ending March 2026), non-consolidated assets under custody reached ¥700,569 million (up ¥90,421 million year on year), driven by increased sales of investment trusts (¥197,733 million) and insurance products (¥457,265 million). Fee-based Services Business income expanded to ¥15,473 million (up ¥1,504 million year on year), with securities-related business contributing ¥2,883 million and deposit and lending business contributing ¥6,588 million, among others, diversifying revenue sources. The depth of this revenue structure, which reduces reliance on net interest income, is a strength unique to the Bank.
At the end of FY2026 (ending March 2026), the non-consolidated non-performing loan ratio improved to 1.79% (down 0.18 percentage points year on year), and total disclosed claims under the Financial Reconstruction Act decreased to ¥78,955 million (down ¥1,276 million year on year). The consolidated total capital adequacy ratio stood at 12.93% (international standard basis), significantly exceeding the regulatory requirement (8%), while the consolidated leverage ratio of 5.17% also remained at a sound level. The sophisticated risk management framework, supported by the adoption of the Foundation Internal Ratings-Based Approach, underpins the stability of the Bank's financial foundation.
ENVALITH's Perspective
Performance Trend
Ordinary income (consolidated) expanded more than 60% over five periods, from ¥77,762 million in FY2022 (ended March 2022) to ¥124,456 million in FY2026 (ending March 2026). In particular, FY2026 accelerated with growth of +21.1% year on year. Against the external backdrop of the Bank of Japan's policy interest rate hikes, interest on loans (consolidated ¥45,021 million, +¥12,445 million year on year), interest and dividends on securities (¥21,254 million, +¥5,229 million year on year), and interest on deposits with banks (¥4,375 million, +¥2,461 million year on year) all increased sharply. Meanwhile, funding costs, centered on interest on deposits, also increased to ¥20,600 million (+¥10,479 million year on year), but the increase in revenue substantially outpaced the increase in expenses, and ordinary profit reached ¥28,081 million (+34.4% year on year) and net income for the period reached ¥20,269 million (+37.6% year on year), both renewing record highs. For FY2027 (ending March 2027), the company forecasts consolidated ordinary income of ¥142,800 million, ordinary profit of ¥33,700 million, and net income of ¥23,000 million, expecting the trend of profit growth to continue.
Growth Strategy
Leap toward top-tier regional bank status through business integration with Shizuoka Financial Group and utilization of the rising interest rate environment
Entered into a basic agreement on March 27, 2026. Discussions and considerations are underway regarding a share exchange, targeted for around April 1, 2028, under which Shizuoka FG would become the wholly owning parent company and The Nagoya Bank would become a wholly owned subsidiary. Under the holding company, a two-bank structure with Shizuoka Bank will be established, aiming to strengthen regional financial capabilities through wide-area cooperation between Aichi and Shizuoka and to develop into a top-tier regional bank financial group.
Through the active promotion of business loans and housing loans, the non-consolidated loan balance expanded to ¥4,330,465 million (up ¥324,926 million year on year). Total assets under custody, including investment trusts of ¥197,733 million and insurance products of ¥457,265 million, increased to ¥700,569 million (up ¥90,421 million year on year), contributing to the expansion of fee income. The policy is to continue expanding revenue through the accumulation of loans and assets under custody in FY2027 (ending March 2027) as well.
Against the backdrop of the Bank of Japan's policy interest rate hikes, the non-consolidated total interest margin improved to 0.33% (up 0.12 percentage points year on year), and core net business profit improved to ¥32,242 million (up ¥9,825 million year on year). Core net business profit for FY2027 (ending March 2027) is forecast to improve further to ¥33,600 million (up ¥1,358 million year on year). Improvement in the yield on the securities portfolio (2.48%, up 0.47 percentage points year on year) has also continued to be a factor boosting earnings.
From FY2026 (ending March 2026), the credit risk measurement method was transitioned from the standardized approach to the foundational internal ratings-based approach. The consolidated capital adequacy ratio improved to 12.93% (up 1.19 percentage points year on year), and risk-weighted assets were reduced to ¥2,468.1 billion (down ¥72.7 billion year on year). Strengthening the financial base has secured capital stability toward the business integration.
Last updated: July 19, 2026