Mitsubishi UFJ Financial Group Inc. led an increase in first-quarter profit at Japan's biggest banks as fee income and loans abroad surged.
Combined net income at Mitsubishi UFJ, Sumitomo Mitsui Financial Group Inc. and Mizuho Financial Group Inc. rose 12 percent from a year earlier to 703.7 billion yen ($5.7 billion) in the three months ended June 30, statements from the Tokyo-based lenders showed Friday. That's 30 percent of their combined fullyear profit forecast.
Mitsubishi UFJ's loans abroad exceeded its domestic corporate lending for the first time as it lent more outside the country to make up for shrinking interest margins at home. The banks are also reaping fees from Japanese who are investing more of their savings amid a stock- market boom. "Japanese banks are performing well," Akira Takai, an analyst at Daiwa Securities Group Inc. in Tokyo, said before the results. "Overseas business will drive full-year results above the banks' own estimates."
Mitsubishi UFJ's net income climbed 16 percent to 277.8 billion yen, exceeding the 253.8 billion yen average estimate of six analysts surveyed by Bloomberg. Revenue at Japan's largest bank jumped 20 percent to a record 1.56 trillion yen.
Profit at Sumitomo Mitsui, the nation's second-largest lender by market value, unexpectedly climbed 16 percent to 267.9 billion yen. Mizuho's net income rose 2.1 percent to 158 billion yen, in line with analysts' estimates. Mitsubishi UFJ, which earned an unprecedented 1.03 trillion yen last year, maintained its fullyear profit target at 950 billion yen.