Pan-Asia Catalysts/Events, Quiddity Advisors

Travis Lundy

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

Hokkoku Financial Holdings / Event-Driven

<ul>
<li>Japanese banks have been in a relative sweetspot for a couple of years. Higher rates, higher inflation, more FX volatility, better earnings, stronger buybacks. Cross-holding sales up but not spectacular.</li>
<li>The BOJ may raise rates but Trump Tariff retaliation/mitigation is a question. Elections the next two weeks and earnings the 2-3 weeks after that may keep things a question. </li>
<li>But buybacks should pick up. Lots announced in spring end at or before Q1 earnings. And I expect substantial new buybacks to be announced throughout the from Q1 results on.</li>
</ul>


Japanese banks have been in a relative sweetspot for a couple of years. Higher rates, higher inflation, more FX volatility, better earnings, stronger buybacks. Cross-holding sales up but not spectacular.
The BOJ may raise rates but Trump Tariff retaliation/mitigation is a question. Elections the next two weeks and earnings the 2-3 weeks after that may keep things a question. 
But buybacks should pick up. Lots announced in spring end at or before Q1 earnings. And I expect substantial new buybacks to be announced throughout the from Q1 results on.


[Japan Buybacks] - Japan Bank Metrics, Cross-Holdings and Banks Part 1

Global Equities, Multi-Asset PM, Dantes Outlook

Damanick Dantes, CMT

Global Equities, Multi-Asset PM

Dantes Outlook

We invest over a full market cycle, using multi-asset portfolios tailored to each global client, from individuals to family offices.

Built to Endure

Cross Asset Strategy

<ul>
<li>
Return dispersion among banks is wide enough to select on. Individual outcomes range from <a href="https://www.smartkarma.com/entities/fukui-bank-ltd" target="_blank" data-smartkarma-citation="entities:9011:1" rel="noopener">Fukui Bank (8362 JP)</a> at +264% to <a href="https://www.smartkarma.com/entities/rakuten-bank-ltd" target="_blank" data-smartkarma-citation="entities:35638:1" rel="noopener">Rakuten Bank (5838 JP)</a> at -23%.</li>
<li>
Leadership is rotating. Money is moving from small cheap regionals back toward larger names.</li>
<li>
We constructed a barbel portfolio. Leg A holds six trend-confirmed momentum leaders. Leg B holds six accelerating laggards.</li>
</ul>



Return dispersion among banks is wide enough to select on. Individual outcomes range from Fukui Bank (8362 JP) at +264% to Rakuten Bank (5838 JP) at -23%.

Leadership is rotating. Money is moving from small cheap regionals back toward larger names.

We constructed a barbel portfolio. Leg A holds six trend-confirmed momentum leaders. Leg B holds six accelerating laggards.


Japanese Banks: Rotating Beneath the Surface

<ul>
<li>Regional bank consolidation is on the menu in Japan. Expect more of it.</li>
<li>Intra-Prefecture is the obvious case. In rural prefectures, JA and the Post Bank are credible deposit-taker competition. SME lending is less obvious, though cross-border (neighbouring prefecture) combinations could arise.</li>
<li>A new transaction suggests another combination is on its way. I'd buy.</li>
</ul>


Regional bank consolidation is on the menu in Japan. Expect more of it.
Intra-Prefecture is the obvious case. In rural prefectures, JA and the Post Bank are credible deposit-taker competition. SME lending is less obvious, though cross-border (neighbouring prefecture) combinations could arise.
A new transaction suggests another combination is on its way. I'd buy.


[Japan M&A] Regional Bank Consolidation Efforts May Pick Up

Equity Analyst

Ravi Kumar

Equity Bottom-Up

<ul>
<li>
Strong earnings on margin tailwinds: 9M26 net interest income rose +17.1% YoY, driving core revenue +12.8% YoY, supported by a steepening JGB yield curve and reflationary policy backdrop.</li>
<li>
Solid profitability and asset quality: Net income +7.1% YoY with RoE at 4%, underpinned by near-zero LLPs and a low NPL ratio of 1.59%.</li>
<li>
Attractive valuation: Having achieved our prior +20% return target, the share still offers ~10% upside to a target price of ¥9,600, supported by continued NII growth and cost optimization potential.</li>
</ul>



Strong earnings on margin tailwinds: 9M26 net interest income rose +17.1% YoY, driving core revenue +12.8% YoY, supported by a steepening JGB yield curve and reflationary policy backdrop.

Solid profitability and asset quality: Net income +7.1% YoY with RoE at 4%, underpinned by near-zero LLPs and a low NPL ratio of 1.59%.

Attractive valuation: Having achieved our prior +20% return target, the share still offers ~10% upside to a target price of ¥9,600, supported by continued NII growth and cost optimization potential.


Shiga Bank (8366 JP) 9M26 Earnings Review: Navigating Rising Yields Amid Policy Tailwinds

<ul>
<li>
Target achieved: Shiga Bank reached our ¥7,850 target, delivering ~20% returns as the BoJ rate-hike cycle and regional revitalization tailwinds drove earnings momentum. </li>
<li>
Earnings &amp; balance sheet strength: Double-digit NII growth, rising NIMs, and a 14.0% CET1 ratio supported valuation re-rating despite a strong share price run-up. </li>
<li>
Next catalyst: Potential for a further ~20% upside will be reassessed post upcoming results, focusing on NIM sustainability, capital returns, and RoE trajectory.</li>
</ul>



Target achieved: Shiga Bank reached our ¥7,850 target, delivering ~20% returns as the BoJ rate-hike cycle and regional revitalization tailwinds drove earnings momentum. 

Earnings &amp; balance sheet strength: Double-digit NII growth, rising NIMs, and a 14.0% CET1 ratio supported valuation re-rating despite a strong share price run-up. 

Next catalyst: Potential for a further ~20% upside will be reassessed post upcoming results, focusing on NIM sustainability, capital returns, and RoE trajectory.


Shiga Bank (8366 JP): +20% Return Target Achieved, Initiated on 24 September 2025

Japan

THE SHIGA BANK, LTD. is a regional bank mainly operating in Shiga.  The Bank also provides financial services including credit card and leasing as well as data management services.

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Shiga Bank (8366 JP)

[Japan Buybacks] - Japan Bank Metrics, Cross-Holdings and Banks Part 1

This is the first of several episodes regarding Japanese Banks. I want to make the size palatable and offer base data and framework with which to...

Travis Lundy

Japanese Banks: Rotating Beneath the Surface

Japanese banks are outperforming, although dispersion is wide. There's a rotation between small/large and cheap/expensive, so we built a barbel...

Damanick Dantes, CMT

[Japan M&A] Regional Bank Consolidation Efforts May Pick Up

Japan regional bank consolidation will continue. We may have a new candidate. I'd be long the small target in this case, assuming that value will out.

Travis Lundy