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The Bank of Yokohama, the largest regional bank in Japan, said Friday its group net profit in the 2006 business year rose 8.9 percent from a year ago to a record 66.29 billion yen, thanks mainly to interest revenue.

In its consolidated earnings report for the year to March 31, the bank said its pretax profit rose 5.8 percent to 108.81 billion yen on operating revenues of 260.78 billion yen.

Interest rate revenues rose after the Bank of Japan carried out its first interest rate hike in six years last July. The BOJ raised interest rates again in February.

A large increase in profit from sales of securities holdings and improved bond dealings also contributed to the profit increase.

The bank’s parent-only profit from its core banking business edged down 0.7 percent but stayed high at 121.6 billion yen.

Its outstanding balance of nonperforming loans on a parent-only basis totaled 205.5 billion yen at the end of March, down from the year-before level of 215 billion yen.

On a consolidated basis, the bank’s capital adequacy ratio stood at 11.19 percent at the end of March, based on new stricter standards set by the Bank for International Settlements.

The ratio was 11 percent on a group basis as of the end of March 2006, based on older standards. A ratio of at least 8 percent is required for banks operating internationally.

The Bank of Yokohama plans to pay a yearend dividend of 6.50 yen per share, bringing its total dividend payments for fiscal 2006 to 10 yen, up from 9 yen the previous year.

For the 2007 business year ending next March, the bank anticipates a group net profit of 68.5 billion yen, up 3.3 percent from the previous year, and a pretax profit of 113 billion yen, up 3.8 percent, on operating revenues of 296 billion yen, up 13.5 percent.

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