Mizuho Financial Group Inc. said Monday it has raised its earnings forecast for the fiscal first half, citing the recent stock market advance, lower-than-expected credit costs and special tax returns.
In its revised outlook, the nation's largest banking group said it is now expected to generate a group net profit of 230 billion yen for the April-September period, compared with the 100 billion yen it forecast in May.
Group pretax profit for the six-month period is estimated at 450 billion yen, against an earlier projected 230 billion yen, according to the financial group, which left its outlook for operating revenues unchanged at 1.6 trillion yen.
The group said in a preliminary report its capital adequacy ratio stood in the mid-10 percent range at the end of September, well above the 8 percent required for internationally active banks.
Mizuho Financial Group said its three major banking units combined to post gains of 110 billion yen by unloading their shareholdings -- mainly at Mizuho Corporate Bank.
The recent stock market upsurge began after the key index of the Tokyo Stock Exchange hit a series of two-decade lows in late April.
Credit costs at the banks totaled 159 billion yen, much lower than anticipated.
This was attributed to lighter bad-loan burdens from a year earlier and the effects of accelerated bad-loan disposals implemented during the previous fiscal year, Mizuho Financial Group said.
The preliminary first-half earnings report for the three banks and the revised outlook for the entire group came hours after the Tokyo Metropolitan Assembly passed a package of bills aimed at reducing the rate of a special bank tax to 0.9 percent from 3 percent, retroactive to April 2000.
Mizuho Financial Group said that related tax returns are estimated at 58.1 billion yen overall at its three major banking units.