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MarketScreener Homepage  >  Equities  >  Tokyo Stock Exchange  >  Mizuho Financial Group, Inc.    8411   JP3885780001

MIZUHO FINANCIAL GROUP, INC.

(8411)
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Japan's Mizuho open to mezzanine financing as virus hits clients' capital positions, bank head says

11/09/2020 | 04:07am EST
Fujiwara, President and CEO of Mizuho Bank, core banking unit of Mizuho Financial Group, attends an interview with Reuters at the bank's headquarters in Tokyo

TOKYO (Reuters) - The banking arm of Mizuho Financial Group Inc is open to mezzanine financing such as subordinated debt and preferred stocks after the COVID-19 pandemic has eroded clients' capital positions, the bank's chief executive said in an interview.

The remarks by Mizuho Bank CEO Koji Fujiwara come as major Japanese companies, including airline operator ANA Holdings Inc and retailer Aeon Co Ltd, have recently secured funds through subordinated loans.

"We will firmly support our clients who are taking on a role as social infrastructure and are in crucial industries for Japan's growth. We are determined to do so," Fujiwara told Reuters in an interview when asked about mezzanine financing.

"We are taking risks we should take. That is our basic stance," he said, declining to specify which industries he considered important.

Although mezzanine financing means higher risk and higher return for banks than debt financing, it makes it easier for companies to maintain financial soundness and their ratings by reinforcing capital without issuing shares.

As companies have struggled to change from liquidity to solvency, virus-related mezzanine financing requests have increased and reached more than 1 trillion yen from about 40 clients so far, Fujiwara said.

The bank would build a war chest for such financing by selling shares of corporate clients, he added.

The traditional practice of cross-shareholdings, which originally aimed at cementing business ties with clients, has been criticised for hampering corporate governance and exposing banks to market swings.

Mizuho has aimed to reduce 300 billion yen worth cross-shareholdings by March 2022, and has achieved roughly half of the plan so far, the bank said.

The interview was conducted last week and embargoed for release on Monday.

(Reporting by Takashi Umekawa and Yuki Nitta. Editing by Gerry Doyle)

By Takashi Umekawa and Yuki Nitta


© Reuters 2020
Stocks mentioned in the article
ChangeLast1st jan.
AEON CO., LTD. -0.60% 3315 End-of-day quote.-2.07%
ANA HOLDINGS INC. -1.38% 2209.5 End-of-day quote.-2.96%
MIZUHO FINANCIAL GROUP, INC. 0.39% 1407.5 End-of-day quote.7.65%
NITTA CORPORATION -0.54% 2230 End-of-day quote.0.00%
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Financials
Sales 2021 2 108 B 20 306 M 20 306 M
Net income 2021 378 B 3 642 M 3 642 M
Net Debt 2021 - - -
P/E ratio 2021 9,51x
Yield 2021 5,33%
Capitalization 3 569 B 34 382 M 34 379 M
Capi. / Sales 2021 1,69x
Capi. / Sales 2022 1,76x
Nbr of Employees 57 264
Free-Float 90,7%
Chart MIZUHO FINANCIAL GROUP, INC.
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Mizuho Financial Group, Inc. Technical Analysis Chart | 8411 | JP3885780001 | MarketScreener
Technical analysis trends MIZUHO FINANCIAL GROUP, INC.
Short TermMid-TermLong Term
TrendsBullishNeutralBullish
Income Statement Evolution
Consensus
Sell
Buy
Mean consensus HOLD
Number of Analysts 14
Average target price 1 618,93 JPY
Last Close Price 1 407,50 JPY
Spread / Highest target 77,6%
Spread / Average Target 15,0%
Spread / Lowest Target -11,2%
EPS Revisions
Managers and Directors
NameTitle
Tatsufumi Sakai Executive President, Group ECO & Director
Yasuhiro Sato Co-Chairman
Hiroko Ota Co-Chairman
Satoshi Ishii Director & Group Chief Operating Officer
Makoto Umemiya Director & Group Chief Financial Officer