Mizuho Financial Group’s chief executive officer is confident that Prime Minister Sanae Takaichi’s pro-growth policies and the Bank of Japan’s interest rate hikes will boost his bank’s businesses.
"She has a good vision,” Masahiro Kihara, CEO of Japan’s third-biggest bank, said in a Bloomberg Television interview on Tuesday, referring to the prime minister’s policy initiatives. "That is playing well in the market right now.”
Kihara spoke just after Takaichi — who became Japan’s leader last month — announced plans to compile a growth strategy for the Japanese economy, including boosting private-public investments. The nation’s stocks are trading at a record as investors anticipate growth-friendly policies under the new leader.
Meanwhile, the central bank is widely expected to raise its benchmark interest rate from the current 0.5% in coming months as inflation persists.
The BOJ has "room for another hike or two,” Kihara said on the sidelines of the Global Financial Leaders’ Investment Summit in Hong Kong. He said the central bank is ready to raise rates when it is confident about wage growth.
Japanese banks have been benefiting from rising rates since the BOJ exited from its massive monetary easing policy in March last year. Mizuho raised its annual profit outlook in July, now expecting net income to reach a record ¥1.02 trillion ($6.6 billion) in the year ending March 31.
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