Japan Banks: Refocusing on New Midterm Plan ROE Targets and Potential P/B Upside

Japanese banks are upgrading their medium-term ROE targets to over 12% to align with global peers, supported by policy rate hike tailwinds and business model expansion. This pivot is expected to catalyze a re-rating of P/B multiples across the sector.

Key Takeaways

• 1.Japanese banks are targeting 8-25% 3-year net profit CAGRs in updated midterm plans, driven by rising interest rates and business expansion.
• 2.ROE targets for major Japanese banks have increased significantly, with megabanks now targeting over 12% and some regional banks aiming for mid-teens.
• 3.Higher ROE targets are expected to unlock higher P/B multiples for Japanese bank stocks, as valuation is structurally linked to ROE.

Table of Contents

• Japan Banks: Refocusing on new midterm plan ROE targets, potential P/B upside
• Low-to-mid 10% handle ROE levels in sight
• Disclosure Appendix
• Reg AC
• GS Factor Profile
• M&A Rank
• Quantum
• Disclosures
• Regulatory disclosures
• Additional disclosures required under the laws and regulations of jurisdictions other than the United States
• Ratings, coverage universe and related definitions
• Coverage Universe
• Global product; distributing entities
• General disclosures

Document Preview

Page 1 of 5

Subscribe for full accessStart Free Trial