On behalf of my management team, I want to express our gratitude for your ongoing support of operations at MUFG, and to share our recent financial results.
For the interim period of the fiscal year ending March 31, 2024, net interest income from deposits and loans increased steadily, as did fee income. With these and other factors indicating growth in the earnings power of MUFG’s customer-segment and other operations, our net operating profits – which represent the profitability of our mainstay operations – were 1,085.7 billion yen, a significant increase of 190.5 billion yen from the record high we achieved a year earlier.
Furthermore, profits attributable to owners of parent increased 696.1 billion yen year-on-year, to 927.2 billion yen. This rise was attributable to growth in net operating profits; the absence of one-off losses recorded in the previous fiscal year due to the sale of MUFG Union Bank, a former subsidiary in the United States; and the change in the closing date of Morgan Stanley’s financial results when applying equity-method accounting, which had a positive impact on profit. These profits represent an all-time best in terms of our interim operating results. Thus, we have become more confident than ever about achieving our full-year target of 1.3 trillion yen in profits attributable to owners of parent, as well as our Medium-Term Business Plan (MTBP) target of raising ROE to 7.5%.
We will pay interim dividends of 20.5 yen per share in line with our forecast at the beginning of the fiscal year, and we maintain our forecast for fiscal 2023 annual dividends at 41 yen per share, an increase of 9 yen from the previous fiscal year. In addition, our Board of Directors has resolved to execute the repurchase of our own shares up to 400.0 billion yen to improve capital efficiency. This represents the largest budget ever allocated by MUFG to repurchase shares.
Under our current MTBP, we are striving to embody our Purpose of being “Committed to empowering a brighter future.” Having positioned the MTBP period as “three years of new challenges and transformation,” we have identified three strategic pillars, Corporate Transformation, Strategies for Growth, and Structural Reforms, and have executed a variety of measures to support each pillar.
Regarding Strategies for Growth and Structural Reforms, we have delivered robust net operating profits far exceeding our initial plans, thanks in large part to these measures. For example, in our “Asia business” category – a component of our Growth pillar – we completed multiple investment and acquisition deals in line with our multifaceted approach to capitalize on opportunities from Asia’s economic expansion and growing digital-financing needs. This has helped us enhance our portfolio and prepare us for future corporate growth.
Regarding Corporate Transformation, we issued our MUFG Transition Whitepaper 2023 as part of our sustainability initiatives. We are leveraging this publication to increase transparency of Japan’s plans for transition toward carbon neutrality, and to help the international community understand these plans.
Our strategic alliance with Morgan Stanley remains robust, as we work together to expand the scope of our collaboration, which has grown from a start in investment banking to include wealth and asset management, among other undertakings. We intend to elevate this collaboration through “Alliance 2.0” – a new phase attuned to resilience and longevity. Over decades, we will deepen our collaboration in established fields and launch joint endeavors in new areas.
Our next MTBP will launch after our current plan in April 2024. We will pursue further growth proactively with an agility and speed-oriented approach throughout its three-year cycle amid the radically evolving market environment. We will also deploy purpose-driven management and maintain our focus on achieving a higher ROE, even as we step up investment for growth and strengthen our business foundation. We will also deploy purpose-driven management and maintain our focus on achieving a higher ROE, even as we step up investment for growth and strengthen our business foundation.
We are fully aware that we operate in an era shaped by powerful forces of division. Thus we intend to deploy our financial and digital strengths to serve as a bridge connecting stakeholders around the globe, in the spirit of our stated purpose – being “Committed to Empowering a Brighter Future.”
We ask for your continued support.
President & Group CEO