Mizuho Financial Group on Tuesday reported an 8.3 percent rise in its quarterly net profit as it booked a one-time gain from the reorganisation of its asset management business, although lower lending income continued to drag on its results.
Weak economic growth has stifled demand for corporate loans in Japan for years, and lenders were dealt another blow in early 2016 when the central bank turned to negative rates - a move that has so far failed to encourage new borrowing.
Mizuho, Japan's No.2 lender by assets, said its net profit rose to 146.5 billion yen ($1.3 billion) for the third quarter ended December from 135.3 billion yen a year ago, pushed up by a special gain of 56.2 billion yen stemming from a change in the ownership structure of its asset management unit.
Two analysts on an average expected a quarterly profit of 140.6 billion yen, Thomson Reuters data shows. Mizuho's main loan business, however, remained weak.
The company's net interest income, or profits from lending business, fell to 206.6 billion yen during the quarter, from 237.8 billion yen a year earlier. For the nine months to December, it fell by almost 16 percent to 643 billion yen.
For the year to March, Mizuho kept its net profit view of 600 billion yen, down 10.5 percent from a year ago. Sixteen analysts on an average expect a full-year profit of 617.8 billion yen, Thomson Reuters data shows.
Separately, Mizuho named Koji Fujiwara as head of Mizuho Bank, replacing Nobuhide Hayashi, effective April 1.
Fujiwara is currently the managing executive officer of the banking unit that accounts for more than half of the group's revenue. Hayashi will become chairman of Mizuho Bank.
Last week, Japan's No.3 lender Sumitomo Mitsui Financial Group posted a 22 percent drop in quarterly profits. Industry leader Mitsubishi UFJ Financial Group will announce results on Friday.
The top three Japanese lenders posted falls in first-half profits, dragged down by low interest rates.
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