I would like to share some of the article contents of The Toyo Keizai magazine posted on February 14, with the title: Original calculations highlight the disparity in profits among regional banks. 25 banks are in the red, ranking regional banks by "core business profit".
How much revenue is generated by the bank's "core business" such as interest on loans and fee income?
It's a blessing in disguise that the Covid-19 pandemic has boosted profits in our core business.
"It is fortunate that the Covid-19 pandemic has boosted our core business," said executives at regional banks.
There was a lack of demand for funds, and low interest rate competition meant that earnings remained weak.
This was the business environment surrounding regional banks.
However, loan balances have increased due to cash flow support under the impact of the Covid-19 pandemic.
Opportunities to support customers through M&A and business matching are also increasing, and fee income is also expanding.
It is appropriate to look at the balance of income and expenses from loans and fees in terms of "core business profit.
This is a more stringent measure of profits from the core business, as it excludes interest and dividends on securities from core net business profit.
Although there is no mention of core business profit in the financial statements, it is often mentioned in the Financial Services Agency's documents and is considered important.
This time, the core business profits of 99 regional banks in Japan were calculated based on their financial results for the first half of fiscal year 2021.
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https://youtu.be/ledoeXMj4pU
