Tear Sheet: Sumitomo Mitsui Financial Group Inc. (Holding Company); Sumitomo Mitsui Banking Corp.

The group's consolidated return on equity (ROE) will likely reach 8% in fiscal 2024, its medium-term goal for fiscal 2025 to improve capital efficiency. It is considering raising target ROE levels for fiscal 2025 onwards. Common Equity Tier 1 ratio (finalized Basel III), excluding unrealized gains, was 10.3% as of Sept. 30, 2024, consistent with its target of around 10%. Given its strong profit outlook and achievement of its regulatory capital target, the group will likely continue investing and delivering shareholder returns, in our view. Capital relative to risk, measured by risk-adjusted capital ratio, will likely remain at the current level. Sumitomo Mitsui Financial Group Inc. (Holding Company); Sumitomo Mitsui Banking Corp. (Lead Bank), Aug. 7, 2024 Banking Industry Country

...What's new: Net profit reached another record of Ñ725.2 billion in the first half of fiscal 2024 (ends March 31, 2025). This was thanks to higher interest and non-interest income and gains from sales of strategic shareholdings. The group raised its forecast full-year net profit to Ñ1.16 trillion, an all-time high. It expects Japan's two policy rate hikes in 2024 to boost net interest income by Ñ100 billion on an annualized basis. The group's consolidated return on equity (ROE) will likely reach 8% in fiscal 2024, its medium-term goal for fiscal 2025 to improve capital efficiency. It is considering raising target ROE levels for fiscal 2025 onwards. Common Equity Tier 1 ratio (finalized Basel III), excluding unrealized gains, was 10.3% as of Sept. 30, 2024, consistent with its target of around 10%. Why it matters: Profits will likely stay stable, with strong performance reflecting its diversified business and strong market position in Japan. The macro environment for interest rates, stock...

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