[Company analysis] Concordia Financial Group, Inc. (コンコルディア・フィナンシャルグループ)

「Concordia Financial Group, Inc. (コンコルディア・フィナンシャルグループ)」was established by business integration between「The Bank of Yokohama,Ltd.(横浜銀行)」and「The Higashi-Nippon Bank, Limited.(東日本銀行)」in 2015. By this integration, this company became the largest regional bank in Japan in total assets, surpassing「Fukuoka Financial Group, Inc.(ふくおかフィナンシャルグループ)」. The number of consolidated employees is approximately 6,468.

 

 

1. Company Profile

2. Summary and Features

3. Major Business

4. Financial Information

 

 

 

1. Company Profile

 

※Unit is JPY million, as of 2019

Company name	Concordia Financial Group, Inc.
Company name (Japanese)	コンコルディア・フィナンシャルグループ
Date of establishment	Friday, April 1, 2016
Headquarters location	〒103-6034 東京都中央区日本橋二丁目7番1号
Capital	150,000
Consolidated sales	306,494
Consolidated operating profit	80,373
Consolidated total assets	18,947,097
Consolidated capital	1,160,147
Capital adequacy ratio	6.1%
Consolidated number of employees	6,468

 

 

 

2. Summary and Features

 
Predecessors of many Japanese regional banks are major money changers or national banks. But in the case of「Yokohama bank」, it is「Yokohama Koshin Bank(横浜興信銀行)」. This bank was established in order to restructuring「74 Banks(七十四銀行)」and「Yokohama Savings Bank(横浜貯蓄銀行)」that went bankrupt due to the Great Depression. At the time of its begining, this bank carried out unwelcome business.

However, since then, through M & A and other methoes, this bank expanded its business during the postwar reconstruction period and became the largest regional bank in Japan after the conversion of「The Saitama Bank, Ltd.(埼玉銀行)」in 1969. Since this event,「Yokohama Bank」has long been the top regional bank in Japan in terms of total assets. Even today, the name「Yokohama Bank」has many branches and brand power in Yokohama and Kawasaki area.

From 2005, when the Japanese economic recovery began gradually, they started to convert their field offices to branch offices. In addition, they opened new branches in Tokyo, it is first time since the collapse of bubble economy. Even nowadays, they are opening a mini shop with 4 to 5 employees at a slow pace.

 

On the other hand, the「The Higashi-Nippon Bank」was founded in Ibaraki Prefecture in 1924 under the name 「Joban Mutual Bank(常磐相互銀行)」, and it became a mutual bank in 1951. The following year, 「Joban Mutual Bank」moved their head office to Tokyo and started to develop branch network mainly in Tokyo. In 1989, this bank became a general bank and at the same time, and changed the name into「The Higashi-Nippon Bank」. The unique feature of the「The Higashi-Nippon Bank」was, their sales style that emphasizes mobility with a method in which bank staff visit customers by bicycle. With this, they have secured a loan-deposit ratio of 80%, mainly for small and medium-sized enterprises and individual businesses.

In 2015, the two banks implemented business integration. By this event, the stores and ATM network were expanded, and synergistic effects are also expected. In particular,「Yokohama bank」was a large regional bank, but it has few branches in Tokyo and relatively weak in the Tokyo area. On the other hand,「The Higashi-Nippon Bank」owns 49 branches in Tokyo. In other words,「Yokohama bank」carried out this business integration as leverage to conquer the Tokyo area, which has a high potential for future development.

In addition,「The Higashi-Nippon Bank」had an advantage in dealing with small and medium-sized enterprises, but it was still unable to fully expand overseas. However,「Yokohama bank」has representative offices in Shanghai, New York, London, Hong Kong, Bangkok. So,「The Higashi-Nippon Bank」can utilize this network to support their overseas expansion. Most of all, the strong banking capacity of the「Yokohama bank」allow more aggressive stance on the existing business loan business for SMEs.

 

 

3. Major Business

 

■ Bank business

 

 

 

4. Financial information

 

※Unit is JPY million

	2016	2017	2018
Consolidated sales	329,476	327,600	306,494
Consolidated operating profit	97,168	98,022	80,373
Consolidated total assets	18,739,930	18,660,581	18,947,097
Consolidated net assets	1,113,703	1,154,002	1,160,147