Core Viewpoint - Mizuho Financial Group is finalizing the acquisition of KKR-backed Avendus Capital at a valuation of ₹5,900 crore, marking a significant investment in India and highlighting the growing interest of Japanese financial institutions in the Indian market [1][19]. Transaction Details - The transaction will result in Mizuho owning 65-70% of Avendus, with KKR exiting its entire 58% stake. Gaja Capital will retain its 7% shareholding, while co-founders Gaurav Deepak and Kaushal Aggarwal will maintain a combined 12% stake and operational control, although Mizuho will have veto rights and four board seats [2][19]. - This acquisition is noted as Mizuho's largest investment in India, emphasizing the strategic interest of Japanese financial groups in the region [6][19]. Historical Context - KKR initially acquired a controlling stake in Avendus in 2015 for ₹950 crore-1,000 crore and is expected to achieve a blended return of 3.5x in rupee terms over a nine-year period upon exit [8][19]. - Avendus was founded in 1999 and has diversified its investment banking practice beyond technology and internet sectors into consumer, financial services, industrials, and healthcare [11][13]. Financial Performance - Avendus reported a net profit of ₹170 crore for the nine months ending April 2025, an increase from ₹118 crore in FY24 and ₹138 crore in FY23. The firm is projected to achieve profits of ₹250-300 crore in FY26 [14][19]. - The investment banking division has shown strong performance in FY22 and FY23, although FY24 faced challenges due to extended deal completion timelines. A revival was noted in FY25, with nine-month revenue from investment banking surpassing the total revenue of FY24 [13][19]. Strategic Focus - Mizuho's CEO has indicated a commitment to supporting the growth of Indian and Japanese companies, viewing India as a crucial market for future opportunities [10][16]. - Mizuho has been expanding its wholesale banking franchise in India since 2015 and has made significant investments in local financial institutions, including a recent $145 million investment in a credit card issuer [17][18].

Group 1 - Mizuho Financial Group's CEO expresses optimism about the investment banking business due to Japan's largest fiscal stimulus and the Federal Reserve's interest rate cuts [1][2] - The acquisition and integration of Greenhill & Co. is yielding positive results, allowing Mizuho to pursue large merger and acquisition deals again [1] - Mizuho ranks 22nd globally in merger advisory, with significant involvement in high-profile deals, including a $9.4 billion acquisition of Skechers USA Inc. [2] Group 2 - Major Japanese banks, including Mizuho, are expected to achieve record profits due to higher loan income from increased benchmark interest rates [3] - Mizuho has raised its profit forecast for the fiscal year ending in March, marking the second upward revision this year [3] - The Japanese stock market, particularly financial stocks, is performing well due to strong fiscal stimulus and rising shareholder return initiatives [3] Group 3 - The new Prime Minister's fiscal policies are expected to clarify Japan's economic growth path, despite concerns over rising public debt [4] - Mizuho anticipates that the Bank of Japan will raise interest rates this month, aligning with market expectations [4] - The USD/JPY exchange rate is projected to fluctuate between 145 and 150 yen, with the current rate at 155.64 yen [4] Group 4 - Mizuho is negotiating to acquire a stake in Avendus Capital Pvt. in India and aims to expand its presence in the Chinese market, focusing initially on the debt capital market [5] - The company plans to establish a wholly-owned securities firm in China, having received regulatory approval [5] - Mizuho has appointed a former Daiwa Securities executive to lead its new entity in China, indicating a commitment to this challenging market [5]

Mizuho CEO Upbeat on Dealmaking Prospects Masahiro Kihara, President and Group CEO at Mizuho Financial Group, expresses optimism that momentum in investment banking will continue both at home and in the US, where Japan's third-biggest lender has been expanding. He speaks with Shery Ahn on "Bloomberg: The Asia Trade". ...

Market Overview - The Nikkei fell 1.68% to 49,407.31, marking a weak start to the month after seven consecutive months of gains in November [1] - The broader Topix index decreased by 1.01% to 3,344.48 [1] - Japanese government bond (JGB) yields reached 17-year highs, contributing to market volatility [1] Currency and Interest Rates - The yen strengthened against the dollar, influenced by comments from Bank of Japan Governor Kazuo Ueda, which increased speculation about a potential interest rate hike this month [1] - Market reactions were noted as different from previous trends, with rising yields and currency movements impacting investor sentiment [1] Company Performance - Advantest, a chip-testing equipment maker, saw a decline of 4.37%, significantly impacting the Nikkei [3] - Fast Retailing, owner of the Uniqlo brand, experienced a loss of 1.58% [3] - Fujikura, an optic fibre cable manufacturer, dropped 8.58%, becoming the largest percentage loser on the Nikkei [4] - Mitsui Kinzoku, a producer of materials for data centres, fell by 7.15% [5] Banking Sector - The banking sector showed resilience, with Sumitomo Mitsui Financial Group gaining 2.75% and Mitsubishi UFJ Financial Group rising by 2.33%, making them the top percentage gainers on the Nikkei [5] - Mizuho Financial Group also increased by 1.55% [5] - The bank index rose by 1.96%, contrasting with the overall market trend [5] Industry Performance - All but two of the Tokyo Stock Exchange's 33 industry sub-indexes declined, with energy explorers falling 3.55%, marking the worst performance [5] - The bank index emerged as the best performer, reflecting positive sentiment towards potential interest rate hikes [5]

Financial Performance Highlights - Profit Attributable to Owners of Parent reached JPY 689.9 billion in FY25 H1, with a progress of 67% against the July outlook[7] - The company is revising its FY25 earnings outlook upward to JPY 1,130 billion, an increase of JPY 110 billion compared to the July outlook and JPY 190 billion compared to the May outlook[7] - Consolidated Net Business Profits increased by 4.7% year-over-year, reaching JPY 729.9 billion, with Customer Groups contributing JPY 511.8 billion and Markets contributing JPY 203.0 billion[9, 12] - The company announced an additional share buyback of JPY 200 billion, bringing the total for FY25 to JPY 300 billion[8] Balance Sheet Overview - Total Assets reached JPY 288 trillion, an increase of JPY 5.4 trillion[22] - Loans amounted to JPY 94 trillion, while Deposits/NCDs reached JPY 174 trillion[22] - Securities totaled JPY 38 trillion, including JGBs at JPY 11.4 trillion and Foreign Bonds at JPY 16.9 trillion[22] Capital and Regulatory Ratios - The CET1 Capital Ratio stood at 13.70%[51] - Total Capital reached JPY 13,662.3 billion[51] - The Leverage Ratio was 5.07%[53] Earnings Outlook and Shareholder Returns - The revised outlook for Consolidated Net Business Profits is JPY 1,350 billion[55] - The revised outlook for Profit Attributable to owners of Parent is JPY 1,130 billion[55] - The annual cash dividend is estimated at JPY 145.00 per share[56, 57]

Core Insights - Mizuho Financial Group is exploring opportunities to expand its investment banking operations in India, leveraging its corporate advisory and finance experience from other regions [1][2] - The bank aims to focus on serving corporate and institutional clients rather than commercial clients, aligning its approach in India with its global strategy [2] - Mizuho has engaged in discussions to acquire a controlling interest in Avendus Capital, an Indian investment bank, although these negotiations are currently paused [2][3] Strategic Goals - Mizuho has set a target to become the leading investment bank in Asia within five years [4] - The acquisition of Greenhill & Co in 2023 is part of Mizuho's strategy to enhance its capabilities in cross-border M&A mandates [4] - The bank aims to transition from being a Japanese bank with international operations to a truly global bank, with nearly 40% of its gross profit coming from its global corporate and investment banking division [5] Leadership and Personnel Development - Suneel Bakhshi, the deputy president of Mizuho, emphasizes the importance of developing skilled personnel to achieve international goals, particularly by increasing the number of non-Japanese staff working abroad [6] - Thomas Hartnett has been appointed as head of fixed income activities across the Americas, Europe, Middle East, and Africa to support Mizuho's ambitions [5]

Financial Performance - Consolidated ordinary income for the first half of fiscal 2025 was ¥4,337,537 million, a decrease of 5.4% compared to the previous year[8] - Profit attributable to owners of the parent for the first half of fiscal 2025 was ¥689,947 million, an increase of 21.8% year-over-year[8] - Comprehensive income for the first half of fiscal 2025 was ¥845,578 million, a significant increase of 42.8% compared to ¥591,838 million in the previous year[9] - Profit before income taxes for the six months ended September 30, 2025, was ¥898,716 million, compared to ¥791,158 million for the same period in 2024, indicating an increase of approximately 13.6%[28] - Ordinary profits amounted to ¥849,626 million, an increase of ¥102,547 million from ¥747,079 million in the first half of fiscal 2024[44] - Profit before income taxes rose to ¥638,931 million, an increase of ¥79,546 million compared to ¥559,384 million for the six months ended September 30, 2024[148] Assets and Liabilities - Total assets as of September 30, 2025, were ¥288,757,081 million, up from ¥283,320,404 million as of March 31, 2025[10] - Total liabilities as of September 30, 2025, amounted to ¥277,681,073 million, an increase from ¥272,796,651 million as of March 31, 2025, indicating a growth of approximately 1.4%[27] - Total net assets increased to ¥11,076,007 million as of September 30, 2025, up from ¥10,523,753 million as of March 31, 2025, marking an increase of about 5.2%[27] - Total liabilities increased to ¥234,473,209 million as of September 30, 2025, up ¥249,131 million from ¥234,224,077 million as of March 31, 2025[147] Shareholder Information - The own capital ratio increased to 3.8% in the first half of fiscal 2025, compared to 3.6% in fiscal 2024[10] - The number of issued shares as of September 30, 2025, was 2,489,848,594, a decrease from 2,513,757,794 shares as of March 31, 2025[15] - Cash dividends for the second quarter of fiscal 2025 are estimated at ¥72.50, with a total estimated annual dividend of ¥145.00[12] - Cash dividends declared for the six months ended September 30, 2025, totaled ¥188,463 million, an increase from ¥139,610 million in the same period of 2024[32] Earnings Estimates - The company revised its consolidated earnings estimates for fiscal 2025 to ¥1,130,000 million, reflecting a 27.6% increase from the previous fiscal year[13] - Diluted earnings per share for fiscal 2025 are estimated at ¥453.49, up from the previous estimate of ¥1,020,000 million[14] Income and Expenses - General and administrative expenses increased to ¥966,147 million, up by ¥88,978 million compared to ¥877,168 million in the previous year[44] - Interest income for the six months ended September 30, 2025, was ¥2,891,300 million, down from ¥3,045,939 million in the same period of 2024, representing a decrease of about 5.1%[28] - Net interest income rose to ¥652,680 million, up by ¥169,823 million from ¥482,856 million year-over-year[44] Non-Performing Loans and Risk Management - Non-performing loans (NPL) for Mizuho Bank amounted to ¥43,699 million, an increase of ¥11,215 million from the previous period[88] - The NPL ratio for Mizuho Bank stood at 0.69%, a decrease of 0.24% compared to the previous period[95] - The total allowance for loan losses across the two banks was ¥242.3 billion as of September 30, 2025, down by ¥241.6 billion from ¥483.9 billion as of March 31, 2025[108] Capital Ratios - Total Capital Ratio as of September 30, 2025, is 18.41%, an increase of 0.66% from 17.75% as of March 31, 2025[85] - Tier 1 Capital Ratio improved to 16.55%, up by 0.90% from 15.65%[85] - Common Equity Tier 1 Capital Ratio reached 13.70%, reflecting a 0.47% increase from 13.23%[85] Future Projections - The estimated future taxable income for Mizuho Bank from October 1, 2025, to September 30, 2030, is projected at ¥6,103.9 billion[132] - Total deferred tax assets as of September 30, 2025, amounted to 939.6 billion yen, a decrease of 39.9 billion yen from March 31, 2025[135]

Group 1 - The article does not provide any specific information or insights regarding a company or industry [1]

Group 1 - Mizuho Americas recognized four exceptional women at the 2025 Markets Choice Women in Finance Awards for their achievements and contributions to the financial industry [1] - The awards highlight the importance of female leadership in finance and aim to inspire others in the sector [1] - Jerry Rizzieri, President & CEO of Mizuho Securities USA, emphasized that these women are role models who enhance the company's commitment to exceptional client service [1] Group 2 - Mizuho Financial Group is one of the largest financial institutions globally, with total assets of approximately $2 trillion [2] - The company employs around 65,000 people and operates in 36 countries with 850 offices [2] - Mizuho Americas provides a full range of corporate and investment banking services, including strategic advisory and capital markets solutions [3] Group 3 - Mizuho Americas has enhanced its M&A, restructuring, and private capital advisory capabilities through the acquisition of Greenhill [3] - The company employs about 4,000 professionals dedicated to serving corporate, government, and institutional clients in the Americas [3]

Core Viewpoint - Japanese financial institutions are revising their forecasts for the yen's exchange rate against the US dollar, expecting it to depreciate to a range of 149 to 156 yen by the end of the year due to fading expectations of early interest rate hikes by the Bank of Japan and concerns over Prime Minister Kishida's expansionary fiscal policies [2][4]. Summary by Relevant Sections Exchange Rate Predictions - JPMorgan has significantly lowered its forecast for the yen, predicting it will depreciate to 156 yen by the end of 2025 (previously 142 yen) and to 152 yen by the end of March 2026 (previously 139 yen) [4]. - Other banks, including Mitsubishi UFJ and Sumitomo Mitsui, have also adjusted their predictions for the yen's depreciation [4][6]. Monetary Policy and Market Reactions - The Bank of Japan maintained its policy interest rate at a recent meeting, with Governor Ueda indicating no immediate plans for rate hikes, leading to increased selling pressure on the yen [5]. - Market sentiment reflects a cautious stance on potential early rate hikes, with a 57% probability of a rate increase in December as of November 7 [6]. Fiscal Policy Concerns - There is growing caution regarding Kishida's "responsible active fiscal" policies, with expectations that the supplementary budget for 2025 will exceed that of 2024, potentially increasing yen selling pressure [7]. - Analysts note that the government appears to tolerate yen depreciation, which has led to a stronger market reaction than initially anticipated [7]. Potential for Yen Appreciation - Some analysts, like Citigroup's Takashima, predict that the yen may appreciate due to stock market adjustments and a reversal of the current depreciation trend, forecasting a rate of 147 yen per dollar by the end of 2025 [8]. Effective Exchange Rate - The nominal effective exchange rate, as measured by the Nikkei Currency Index, reached a low of 71.4 on October 31, indicating a significant depreciation since the last intervention in July 2024 [10].