Mizuho Financial Group Inc. wants to grow its business managing overseas corporate money by $100 billion this fiscal year, as it seeks new ways to boost international earnings at a time
of negative interest rates
“We’re expanding with a focus on the cross-border transactions of non-Japanese corporations doing business in Asia,” Zenichi Tanakamaru, a senior vice president in Mizuho’s global corporate department, said.
He hopes the push into transaction businesses — which include cash management and trade finance services for corporate clients — will help to boost the volume of foreign exchange Mizuho handles by 20 percent in the year to March 31, from
$500 billion in the previous fiscal year.
With the Bank of Japan’s negative interest-rate policy squeezing the profitability of core domestic loan business, Mizuho and its megabank peers Mitsubishi UFJ Financial Group Inc. and Sumitomo Mitsui Financial Group Inc. have been expanding their international operations to shore up earnings.
Transaction banking business enables Mizuho to capture low-cost deposits in local currencies, funding its lending and investments where it can profit from margins as well as earning fees on transactions.
The global transaction-banking market generated revenues of $45 billion in the year ended March 2017, a report compiled by industry analytics firm Coalition Development Ltd. shows.
No Japanese lenders yet rank among the top 10 banks in the area, a list topped by Citigroup Inc., HSBC Holdings Plc and JPMorgan Chase & Co., the Coalition data show.