Mizuho Financial Group(US:MFG)2022-12-28 11:16Financial Performance - Mizuho Financial Group reported a profit attributable to owners of the parent of ¥333.9 billion for the six months ended September 30, 2022[28]. - Net income attributable to MHFG shareholders was a loss of ¥379 billion for the six months ended September 30, 2022, compared to a profit of ¥313 billion in the same period last year, reflecting a decrease of ¥692 billion[63]. - Total comprehensive income attributable to MHFG shareholders fell from ¥350,328 million in 2021 to a loss of ¥120,153 million in 2022[167]. - Net cash provided by operating activities improved from a negative ¥1,230,661 million in 2021 to a positive ¥32,516 million in 2022[174]. Capital and Ratios - The Common Equity Tier 1 capital ratio under Basel III as of September 30, 2022 was 11.35%[29]. - The Total Capital Ratio was 15.72%, a decrease of 1.81% from March 31, 2022[153]. - Mizuho Bank's CET1 Capital Ratio decreased to 10.68% as of September 30, 2022, a decline of 1.00%[154]. - The leverage ratio improved to 4.56% as of September 30, 2022, up from 4.21%[153]. Income and Expenses - Interest and dividend income increased by ¥557 billion, or 81.4%, from ¥684 billion in the six months ended September 30, 2021 to ¥1,241 billion in the same period of 2022, primarily due to rising global interest rates[44]. - Interest expense rose by ¥466 billion, or 291.3%, from ¥160 billion to ¥626 billion, mainly driven by increases in interest expense on deposits and repurchase agreements due to rising global interest rates[45]. - Total noninterest income shifted from a gain of ¥762,395 million in 2021 to a loss of ¥213,781 million in 2022, indicating a significant decline[165]. - Total noninterest expenses rose by ¥69 billion, or 8.1%, to ¥926 billion for the six months ended September 30, 2022, largely due to increases in salaries and employee benefits and general and administrative expenses[56]. Dividends - Interim cash dividends for the fiscal year ending March 31, 2023 were ¥42.5 per share, an increase of ¥2.5 compared to the previous fiscal year[32]. - The company declared dividends per common share increased from ¥40.00 in 2021 to ¥42.50 in 2022[165]. Loans and Credit Quality - Total loans before allowance for credit losses increased by ¥8,043 billion to ¥98,334 billion as of September 30, 2022[90]. - Nonaccrual loans decreased by ¥87 billion, or 7.5%, to ¥1,081 billion as of September 30, 2022[93]. - The percentage of nonaccrual loans within gross total loans decreased from 1.3% to 1.1% from March 31, 2022, to September 30, 2022[94]. - The allowance for credit losses on loans is adjusted through provisions in each reporting period, with management assessing uncollectible loans based on detailed reviews[187]. Market Conditions - The yield on newly issued 10-year Japanese government bonds increased from 0.221% as of March 31, 2022 to 0.244% as of September 30, 2022[31]. - The Nikkei Stock Average decreased by 6.8% to ¥25,937.21 as of September 30, 2022 compared to March 31, 2022, but increased to ¥27,968.99 as of November 30, 2022[31]. - The yen to U.S. dollar spot exchange rate weakened from ¥121.64 to ¥144.32 between March 31, 2022 and September 30, 2022, before strengthening to ¥138.53 by November 30, 2022[31]. Investment Performance - Investment losses—net amounted to ¥105 billion for the six months ended September 30, 2022, a significant decline from a gain of ¥135 billion in the same period of the previous fiscal year, primarily due to deteriorating market conditions affecting Japanese equity securities[53]. - Trading account losses were ¥851 billion in the six months ended September 30, 2022, compared to gains of ¥83 billion in the same period of the previous year, attributed to changes in fair value of foreign currency-denominated securities[52]. Regulatory Compliance - The minimum capital adequacy ratio is set at 8%, with a Common Equity Tier 1 capital requirement of 4.5% and a Tier 1 capital requirement of 6.0%[130]. - The implementation of the finalized Basel III reforms was deferred to January 1, 2023, due to the impact of COVID-19[135]. - The Financial Services Agency has allowed for further delays in the implementation of the Basel III finalization framework for certain banks until March 31, 2025[138].