Kyushu Financial Group

Basic Information

Stock Code
7180
Industry
Banking
Category Detail
Banks
Prefecture
Kumamoto Prefecture
Establishment Year
October 2015
Listing Year
October 2015
Official Website
https://www.kyushu-fg.co.jp/
TSE Information
TSE Information
Yahoo! Finance
Yahoo! Finance
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Overview

Kyushu Financial Group is a major regional bank financial holding company established in 2015, which has built a strong position in the Kyushu region's banking industry through the integration of Higo Bank and Kagoshima Bank.

Current Situation

Kyushu Financial Group was established through the management integration of Higo Bank and Kagoshima Bank in 2015, securing the fourth-largest asset size among banks in the Kyushu region. As of the end of March 2023, consolidated total assets reached 8.9399 trillion yen, with 4,575 consolidated employees. Group subsidiaries include Kyushu FG Securities and multiple leasing and card companies, offering a diverse range of financial services. In 2019, it completed a new head office building in Kumamoto City to strengthen its operational base and improve services. It is actively pursuing digitalization, contributing to regional economic revitalization through the introduction of the smartphone app 'Hugmeg' and the launch of the e-commerce mall 'Yokamoru'. In recent years, it has focused on supporting sales of local agricultural products and enhancing corporate financial services that emphasize environmental contributions, while swiftly responding to disaster support and disaster response during the COVID-19 pandemic. Moving forward, it aims for medium- to long-term growth and regional community development by balancing community-oriented management strategies with improved convenience through digital technologies.

Trivia

Interesting Facts

  • First management integration between regional banks leading to holding company establishment.
  • Head office functions located in Kumamoto City despite registered headquarters in Kagoshima City—an unusual structure.
  • Former Toyota Motor president served as outside director.
  • New head office KFG Building is located near JR Kumamoto Station.
  • Subsidiary Kyushu FG Securities is a young securities firm that began operations in 2018.
  • Operates a cafe selling local agricultural products on the first floor of the Fukuoka building.
  • Promotes enhanced services for individual customers via smartphone app 'Hugmeg'.
  • Launched southern Kyushu-focused EC mall 'Yokamoru' in 2023.
  • Former president Motohiro Uemura rose from Kagoshima Bank president and had presence even before integration.
  • Strong customer base in Kumamoto and Kagoshima as a community-oriented financial holding company.
  • Paid-in capital of approximately ¥36 billion (as of March 2016), with stable financial base.
  • Group net profit of approximately ¥108.4 billion on a consolidated basis (FY2016).
  • Challenging new business areas in financial system sales through collaboration with IT company.
  • Composed of top-share regional banks Higo Bank and Kagoshima Bank.
  • Possesses a regional economic research institute with strengths in analyzing regional economic trends.

Hidden Connections

  • Thick connections to the automotive industry through the appointment of former Toyota president as outside director.
  • Uniquely engaged in promoting local production and consumption of agricultural products in collaboration with local agricultural corporations.
  • Fukuoka building cafe sells products from client companies, contributing to regional economic revitalization.
  • Focuses on supporting regional SMEs through Kyushu Mirai Creation.
  • Management integration of Higo Bank and Kagoshima Bank promotes financial collaboration between the two prefectures.
  • Strengthens connections to capital markets through securities operations and digitalization.
  • Engages in joint projects with local universities and government for local revitalization support.
  • Leasing and card businesses among group companies contribute to operational efficiency.

Future Outlook

Growth Drivers

  • Expansion of strong community-based customer base
  • Improved convenience through enhanced digital services
  • Strengthened financial support for regional economic recovery and revitalization
  • Diversification and sophistication of corporate financial services
  • Development of financial products considering environmental and social issues
  • Strengthened ties with regional economy through new businesses like EC mall
  • Improved management efficiency through group collaboration
  • Enhanced competitiveness through IT system investments
  • Comprehensive medium- to long-term human resource development and recruitment
  • Business expansion through expanded support for regional agriculture and SMEs
  • Maintaining financial soundness and improving capital efficiency
  • Brand strengthening through deepened trust with local community

Strategic Goals

  • Complete DX transformation of regional financial services
  • Achieve double-digit revenue growth for the entire group
  • Create new businesses contributing to regional economic revitalization
  • Over 50% of products considering sustainability
  • Top customer satisfaction with community-oriented finance
  • Improve employee diversity and work-life satisfaction
  • Further strengthen disaster risk management systems
  • Expand social contribution activities in collaboration with regions
  • Promote digital talent development centered on new head office building
  • Support for regional carbon neutrality as first among regional banks

Business Segments

Corporate Lending

Overview
Provides diverse lending products for corporations that support the core of the regional economy.
Competitiveness
Detailed screening and services rooted in the regional economy
Customers
  • Small and Medium Enterprises
  • Large Corporations
  • Local Governments
  • Medical Institutions
  • School Corporations
  • Agricultural Corporations
Products
  • Working Capital Loans
  • Equipment Investment Loans
  • Policy-Based Financial Loans
  • Real Estate Collateral Loans

Funds Management and Operation Services

Overview
Deploys operation support services aimed at efficient funds management.
Competitiveness
Improved funds management efficiency through subsidiary bank integration
Customers
  • Local Public Entities
  • Financial Institutions
  • Large Corporations
Products
  • Unified Funds Management
  • Funds Procurement Support
  • Asset Management

Securities Services

Overview
Provides a wide range of securities products to corporations and individuals through Kyushu FG Securities.
Competitiveness
Regionally tailored financial product proposals
Customers
  • Investors
  • Corporate Pension Funds
  • Individual Investors
Products
  • Stock Brokerage
  • Investment Trusts
  • Bond Sales

Leasing and Support Business

Overview
Deploys diverse leasing products to support corporate equipment investments.
Competitiveness
Close collaboration with group leasing operations
Customers
  • Manufacturing
  • Construction
  • Medical Institutions
  • Offices
Products
  • Equipment Leasing
  • Vehicle Leasing
  • IT Equipment Leasing

Card and Installment Services

Overview
Provides card and installment services tailored to customer needs.
Competitiveness
Promotion and service deployment closely tied to the region
Customers
  • Individual Customers
  • Corporate Customers
  • Affiliated Stores
Products
  • Credit Card Issuance
  • Cashless Payments
  • Loan Services

IT Solutions

Overview
Deploys financial IT system development and sales to group and external entities.
Competitiveness
High-quality system development through joint investments with banks
Customers
  • Group Banks
  • External Companies
  • Financial Institutions
Products
  • Financial System Development
  • Software Sales
  • System Maintenance

Agriculture-Related Finance

Overview
Provides funding and services to support regional agriculture revitalization.
Competitiveness
Unique services in collaboration with local agricultural corporations
Customers
  • Agricultural Corporations
  • Individual Farmers
  • Sales Businesses
Products
  • Agricultural Product Finance
  • Farm Equipment Loans
  • Sales Support

Regional Economic Research and Consulting

Overview
Conducts research and consulting to support regional economic development.
Competitiveness
Analytical and proposal strengths specialized in the Kyushu region
Customers
  • Local Governments
  • Companies
  • Financial Institutions
Products
  • Economic Research Reports
  • Management Consulting
  • Risk Analysis

Asset Management Services

Overview
Supports asset preservation and growth through diverse asset management services.
Competitiveness
One-stop services through collaboration with trust banks
Customers
  • High-Net-Worth Individuals
  • Corporations
  • Government Agencies
Products
  • Trust Agency Services
  • Estate Management
  • Corporate Asset Management

Loan Guarantees and Credit Risk Management

Overview
Services to support corporate funding procurement and reduce credit risks for financial institutions.
Competitiveness
Utilization of regionally tailored credit guarantee systems
Customers
  • Small and Medium Enterprises
  • Financial Institutions
Products
  • Credit Guarantees
  • Loan Loss Risk Management
  • Guarantee Operations

Education-Related Financial Services

Overview
Plans and sells financial products specialized for students and school corporations.
Competitiveness
Close collaboration with regional educational institutions
Customers
  • School Corporations
  • Students
  • Parents
Products
  • Education Loans
  • Tuition Payment Services
  • Scholarship Management

Overseas Expansion Support

Overview
Supports overseas expansion of Kyushu region companies from a financial perspective.
Competitiveness
Comprehensive international financial services for local companies
Customers
  • Local Companies
  • Small and Medium Enterprises
Products
  • Foreign Exchange Transactions
  • Overseas Remittances
  • International Credit Guarantees

Competitive Advantage

Strengths

  • Deep market knowledge specialized in the Kyushu region
  • Synergies from the management integration of Higo Bank and Kagoshima Bank
  • Community-based customer base
  • Group-wide deployment of diverse financial products and services
  • Enhanced infrastructure such as the new head office building
  • Improved convenience through digitalization initiatives
  • Strong commitment to regional economic revitalization
  • Strengthened collaboration within the group
  • Solid financial foundation
  • Extensive network and partnerships
  • Specialized corporate sales support
  • Rapid disaster area response capabilities
  • Operation of unique e-commerce mall
  • Top share as a regional bank
  • Utilization of diverse sales channels

Competitive Advantages

  • Economies of scale from the first large-scale management integration between regional banks
  • Ability to provide a wide range of financial services in a one-stop manner
  • Creditworthiness and reliability rooted in the region
  • In-house group collaboration on IT and financial system development
  • Integrated strategy of local agriculture promotion and financial support
  • Unique marketing leveraging regional specialty products
  • Maintenance of effective community-based sales capabilities
  • Convenience of head office functions near the Kyushu Finance Bureau
  • Diversified business in securities, cards, leasing, etc.
  • Brand image enhancement through new head office building
  • Strong information gathering through ties with local community
  • Flexible finance provision for SMEs
  • Service enhancement through proactive digitalization strategy
  • Strengthened corporate sales base in Fukuoka building
  • Top asset size group compared to many regional banks

Threats

  • Profit pressure from low interest rate environment
  • Market contraction due to regional population decline
  • Risks from economic environment changes such as COVID-19
  • Intensifying competition with digital financial providers
  • Cost increases from strengthened financial regulations
  • Risk of frequent natural disasters
  • Increased credit costs from rising credit risks
  • Loan loss risks from poor performance of local companies
  • Challenges in talent acquisition due to hiring competition
  • Intensifying competition with other regional banks
  • Impacts from exchange rate fluctuations
  • Rise of new fintech companies

Innovations

2023: Launch of e-commerce mall 'Yokamoru'

Overview
Established an EC mall for southern Kyushu to contribute to regional economic revitalization.
Impact
Achieved expansion of sales channels for regional specialties and strengthening of customer base.

2021: Completion of new head office building 'KFG Building' in Kumamoto City

Overview
Constructed a large office building locally to strengthen the group's management base.
Impact
Contributed to improved operational efficiency and brand image.

2021: Launch of smartphone app 'Hugmeg'

Overview
Introduced an app to enhance convenience of personal financial services.
Impact
Successfully improved customer satisfaction and usage rates.

2020: Strengthening financial system development in collaboration with IT company

Overview
Considering establishment of a new company for IT system development and sales for banks.
Impact
Aims to enhance competitiveness of group financial services.

2023: Enhancement of corporate environmental contribution services

Overview
Actively deploying environmentally considerate financial products to corporate customers.
Impact
Contributed to support from regional corporations and deposit acquisition.

Sustainability

  • Support for expanding sales channels of local agricultural products
  • Development of environmentally friendly financial products
  • Building rapid disaster support systems
  • CSR activities through collaboration with local communities
  • Promotion of paper resource reduction through digitalization
  • Promotion of work-style reforms for employees
  • Strengthening group governance
  • Active recruitment and development of diverse talent
  • Advancing financial support for local revitalization
  • Enhancement of disaster risk countermeasures
  • Strict privacy protection for customer information
  • Information dissemination through regional economic research institute