The Hiroshima Bank,Ltd. (E03585) Stock Price

Hiroshima Bank is a regional bank headquartered in Hiroshima Prefecture that provides comprehensive financial services centered on banking operations. The company operates as a corporate group consisting of the main bank plus 9 subsidiaries and 1 affiliated company, delivering a wide range of financial services closely tailored to the local community.

The company's primary customers are individual consumers and small-to-medium enterprises in the region. Interest income from deposit and lending operations forms the core of its revenue. Additionally, fee-based income from credit guarantees, debt collection and management, and financial product trading conducted through subsidiaries represents an important revenue stream.

While the business structure operates as a single banking segment, the group as a whole provides diverse services. Subsidiaries handle collateral property appraisals, credit card operations, and investment services, while affiliated companies operate leasing businesses. This integrated approach enables the company to build a comprehensive financial services platform that meets the evolving needs of local customers.

Hiroshima Bank is pursuing a strategy to become a comprehensive financial services group that grows together with regional customers under its "Medium-Term Plan 2017" covering fiscal years 2017 through 2021. The company has set targets for fiscal 2021, the final year of the plan, including net income attributable to parent company shareholders of 300 billion yen or more and a consolidated return on equity of approximately 6%. The company also plans to expand total assets under management to 10 trillion yen or more.

As priority investment areas, the company is reforming its revenue structure through the practice of value-added sales based on customer needs. Specifically, the company is pursuing a strategy to provide high-value solutions beyond traditional banking services by building strong customer relationships based on business viability assessments. In particular, to address the succession shortage problem facing small and medium-sized enterprises, the company is focusing on inheritance and business succession consulting services, aiming to increase the non-interest income ratio to 40% or more to diversify revenue.

In developing new markets, the company is promoting the deepening and expansion of its business domains through a transition to a holding company structure in October 2020. The company is demonstrating a commitment to thoroughly addressing regional social challenges by expanding into non-financial business areas in the four-prefecture market centered on Hiroshima. The company is deploying an active commitment strategy to regional sustainable development through support for new industry creation, urban development, and redevelopment initiatives in the region.

In technological innovation, the company is advancing fundamental channel reviews and strengthening digital transformation in response to customer needs. The company is realizing structural reforms through fundamental reviews of business processes and improving the core business net profit margin to the 50% range, thereby strengthening the financial foundation to support digital investment. Through enhanced group governance under the holding company structure, the company aims to establish a management foundation capable of responding to the changing financial environment.