Mizuho Financial Group Inc. reported a 16% decline in profit in the April-June period from a year earlier as the Bank of Japan’s negative interest-rate policy hurt its bread-and-butter lending.
Japan’s second-largest bank by assets said group net profit for the fiscal first quarter was ¥132.6 billion ($1.30 billion), compared with ¥158 billion a year earlier.
The weak performance underscores how lenders are grappling with a tough business environment surrounded by a combination of ultrathin loan spreads, weak loan demand and lower economic growth.
The Bank of Japan owns more than one-third of outstanding government bonds and continues to purchase ¥80 trillion of bonds annually.
Its balance sheet has risen to 85% of gross domestic product as of May.
http://www.wsj.com/articles/negative-rates-hit-mizuho-earnings-1469984739