Aozora Bank (8304) Q1 2025 earnings summary

Executive summary

• Profit attributable to owners of parent rose 12% to ¥7.5–7.6B, while ordinary profit fell 20.2% to ¥5.9B.

• Net revenue increased 17% year-over-year to ¥20.7B.

• Comprehensive income improved to ¥4.0B from a ¥1.0B loss in Q1 FY2023.

• Progress on U.S. non-recourse office loan workouts, reducing "In Danger of Bankruptcy" borrowers by five since March 2024.

• Strategic alliance with Daiwa Securities advanced, including capital increase and board appointment.

Financial highlights

• Net revenue: ¥20.7B (+¥3.0B YoY); net interest income stable at ¥12.0B; non-interest income rose ¥2.9B to ¥8.6B.

• Net income per share (basic) increased to ¥64.81 from ¥57.98 YoY.

• Total assets grew to ¥7.68T; net assets rose to ¥397.6B; net assets per share at ¥3,322.68.

• Extraordinary profit of ¥3.4B from FX gains on subsidiary liquidation.

• 1Q dividend: ¥19/share; full-year forecast: ¥76/share.

Outlook and guidance

• 1Q results represent 25% of net revenue and 42% of profit targets for FY2024.

• Full-year forecast: ordinary profit ¥24.0B, profit attributable to owners of parent ¥18.0B, EPS ¥135.37.

• Forecast includes new shares issued via third-party allotment completed July 1, 2024.

• GANB expected to become profitable on a monthly basis in 2H FY2024.

• Capital adequacy ratio projected to rise to 10.3% after Daiwa's capital injection.