Strong business position backed by a leading market presence in Japan Stable funding and strong liquidity backed by its domestic retail deposit base High likelihood of extraordinary government support if needed Continued decline in net interest margins on domestic loans because of a tough competitive environment A growing need for foreign currency-denominated funds because of rising loan assets overseas while foreign currency funding is weaker than yen funding S&P Global Ratings has stable outlooks on Japan-based SMBC Group's nonoperating holding company, Sumitomo Mitsui Financial Group Inc. (SMFG), its lead bank, Sumitomo Mitsui Banking Corp. (SMBC), and the group's core banking subsidiaries. The stable outlooks reflect our expectation that the entities' credit profiles will remain stable for the coming two years.
