Tohoku Bank

Basic Information

Stock Code
8349
Industry
Banking
Category Detail
Banks
Prefecture
Iwate Prefecture
Establishment Year
October 1950
Listing Year
March 1997
Official Website
https://www.tohoku-bank.co.jp/
TSE Information
TSE Information
Yahoo! Finance
Yahoo! Finance
Other Companies
Iyogin Holdings, Shizuoka Financial Group, Kyoto Financial Group, Mebuki Financial Group, Concordia Financial Group, Hirogin Holdings, Chiba Bank, Gunma Bank, Iwate Bank, Fukuoka Financial Group, The Hachijuni Bank, Ltd., Kitanihon Bank, Daito Bank

Overview

Tohoku Bank is a regional bank founded in 1950 and based in Iwate Prefecture. It provides community-oriented financial services and has a strength in lending to small and medium-sized enterprises, as one of the postwar regional banks.

Current Situation

Tohoku Bank recorded consolidated sales of approximately 13.5 billion yen, ordinary income of about 2.5 billion yen, and net profit of about 1.5 billion yen for the fiscal year ending March 2023. It operates 55 branches centered in Iwate Prefecture, featuring a high lending ratio to local SMEs of about 80%. In 2023, it introduced public funds under the special post-earthquake measures of the Financial Function Strengthening Law, focusing on regional reconstruction and economic support. It engages in the 6th industrialization of agriculture, forestry, and fisheries as well as agri-business support to aid the revitalization of local industries. While advancing financial soundness after the public fund injection, it migrated to NTT Data's core banking system in 2012 to improve operational efficiency. Sustainability and regional contribution initiatives are expanding, with strengthening regional economic support positioned as a key strategic pillar from 2024 onward. It is also promoting efficient operations through enhanced collaboration with competitors and joint branch openings, aiming for sustainable growth toward 2030.

Trivia

Interesting Facts

  • Maintains the 3rd largest scale among regional banks in Iwate Prefecture.
  • Serves as designated financial institution for local governments over many years.
  • Adopts Sanrio's Little Twin Stars as mascot.
  • Focuses on reconstruction support after receiving public funds post-Great East Japan Earthquake.
  • One of the early regional banks to adopt NTT Data's core banking system.
  • Operates branches not only in Iwate but also in Miyagi, Aomori, Akita, and Tokyo.
  • Actively supports 6th industrialization of agriculture, forestry, and fisheries in a community-focused manner.
  • Collaborates with Shonai Bank and Hokkokuki Bank at joint Tokyo branch.
  • Gaining attention in regional bank seminars on women's advancement.
  • Resolution and Collection Corporation involved as one of major shareholders.

Hidden Connections

  • Conducts community brand development through tie-up with Sanrio.
  • Explored management base strengthening through integration talks with Fidea Holdings.
  • Deep collaboration with Iwate Bank and Morioka Shinkin Bank evident in joint free ATM services.
  • Strong trusted position as designated financial institution for Tohoku region municipalities.
  • Operational efficiency from STELLA CUBE system collaboration with NTT Data.
  • Financially supports 6th industrialization of agriculture, forestry, and fisheries for local revitalization.
  • Key player in regional economic recovery as a public funds injection bank.
  • Offers region-limited financial products linked to mascot characters.

Future Outlook

Growth Drivers

  • Increasing funding demand from local SMEs and agriculture, forestry, and fisheries
  • Effects of policy support for local revitalization
  • Operational efficiency and customer convenience improvements via technology utilization
  • New product and service development accompanying digitalization
  • Revenue stabilization through diversified financial product portfolio
  • Organizational revitalization through women's and youth advancement
  • Strengthened collaboration and joint initiatives among regional financial institutions
  • Brand value enhancement through sustainable operations and social contributions
  • Increased loan balances accompanying regional economic recovery
  • Response to next-generation settlement needs like digital currencies

Strategic Goals

  • Maintain over 90% lending ratio rooted in the region
  • Raise digital banking ratio to over 50%
  • Achieve over 30% female managers ratio
  • Strengthen contributions to regional economy through local revitalization loans
  • Carbon neutral branch operations
  • Promote syndicated loans and regional bank collaborations for efficient management
  • Advanced IT infrastructure for 24/7 services
  • Expansion of regional industry funds and diverse investment support
  • Maximize customer satisfaction and regional brand value
  • Establish sustainable growth and stable revenue base

Business Segments

Financing for Local SMEs

Overview
Diverse finance services supporting growth and stable management of local SMEs.
Competitiveness
Lending expertise rooted in the local economy and flexible review processes.
Customers
  • Manufacturing
  • Construction
  • Retail
  • Services
  • Agriculture, Forestry and Fisheries
  • Medical and Welfare Corporations
  • IT Companies
  • Tourism
  • Transportation
  • Dining
  • Nursing Care Services
  • Local Public Entities
Products
  • Working Capital Loans
  • Equipment Investment Loans
  • Agri-Business Loans
  • Leasing Finance
  • Credit Guarantee Business
  • Project Finance
  • Real Estate Collateral Loans
  • Trade Credit Guarantees
  • Business Risk Management
  • Loan Consulting
  • Business Improvement Support
  • Cash Flow Support
  • Equipment Leasing
  • Guarantee Services
  • Local Revitalization Loans

Financial Support for Agriculture, Forestry and Fisheries

Overview
Specialized financial services supporting revenue diversification and sustainable development in agriculture, forestry and fisheries.
Competitiveness
Community-based expertise and proactive support for 6th industrialization.
Customers
  • Farmers
  • Fishery Cooperatives
  • Agricultural Corporations
  • Fishery Corporations
  • 6th Industrialization Businesses
  • Agri-Business Companies
  • Local Government Agriculture, Forestry and Fisheries Departments
Products
  • Business Stability Financing
  • Equipment Investment Financing
  • 6th Industrialization Funds
  • Subsidy-Compatible Loans
  • Agri-Business Loans
  • Fishing Boat Purchase Loans
  • Farm Land Related Loans
  • Business Succession Support
  • Leasing Finance
  • Environmental Conservation Financing
  • Production Funding Loans
  • Market Expansion Support

Corporate Cash Management and Asset Management

Overview
Comprehensive financial services supporting corporate asset efficiency and risk management.
Competitiveness
Strong trust relationships with local corporate clients and detailed support.
Customers
  • SME Owners
  • Medical Corporations
  • School Corporations
  • Public Interest Corporations
  • Local Governments
  • Foundation Corporations
Products
  • Asset Management Advice
  • Trust Account Management
  • Pension Management Services
  • Corporate Investment Trusts
  • Cash Management Services
  • Real Estate Management Support
  • Corporate Pension Support
  • Corporate Insurance Products
  • Tax Consulting
  • Inheritance Support

Settlement and FX Services

Overview
Rapid and secure transaction environments meeting diverse settlement needs.
Competitiveness
Highly convenient settlement network rooted in the region.
Customers
  • Local Companies
  • Retailers
  • Service Providers
  • Agriculture, Forestry and Fisheries Operators
  • Public Institutions
  • Local Governments
Products
  • Domestic Remittance Services
  • Foreign Exchange Transactions
  • Debit Card Settlements
  • Electronic Money Handling
  • Corporate Settlement Systems
  • Internet Banking
  • Mobile Banking
  • ATM Services
  • Currency Exchange Services

Leasing and Guarantee Services

Overview
Leasing and credit guarantee services to enhance asset efficiency.
Competitiveness
Delivery system leveraging long-term trust with local companies.
Customers
  • SMEs
  • Agriculture, Forestry and Fisheries Operators
  • Medical Institutions
  • School Corporations
  • Local Governments
  • Service Providers
  • Construction Companies
Products
  • Machinery and Equipment Leasing
  • Vehicle Leasing
  • Guarantee Operations
  • Credit Enhancement Services
  • Guaranteed Loans
  • Credit Card Issuance
  • Leasing Committees
  • Operational Support
  • Funding Support
  • Leasing Contract Management

Regional Revitalization and Public Support

Overview
Financial support for regional economic activation and improved resident services.
Competitiveness
Sales network and expertise strong in regional collaborations.
Customers
  • Local Governments
  • Regional Financial Institution Collaborations
  • Local Chambers of Commerce
  • Agricultural Cooperatives
  • Tourism Associations
  • Local NPOs
Products
  • Designated Financial Institution Operations
  • Subsidy Payment Agency
  • Public Bond Underwriting
  • Regional Economic Revitalization Loans
  • Joint Branch Operations
  • Regional Industry Funds
  • Economic Industry Support
  • Event Sponsorship
  • Community-Focused Loans

Competitive Advantage

Strengths

  • Strong community-based SME support
  • High 80% lending ratio to local companies
  • Proactive regional economic recovery support
  • Operational efficiency via NTT Data core system
  • Stable financial base post-public funds injection
  • Extensive local network
  • Collaborative framework with other regional banks
  • Diverse financial product lineup
  • Active promotion of women's advancement
  • Rational branch operations like joint stores

Competitive Advantages

  • Strong sales bases and trust in Iwate Prefecture and surrounding areas
  • Expertise in agri-business support tailored to regional characteristics
  • Stability from Financial Revitalization Law and government support benefits
  • Stable operations via partnership with NTT Data system
  • Enhanced collaboration with regional banks like free joint ATMs
  • Flexible lending products and review processes for local SMEs
  • Superiority in designated financial institution operations with local governments
  • Brand and recognition rooted in local customer base
  • Organizational strengthening through promotion of women and youth
  • Balanced scale and capital base as the 3rd regional bank

Threats

  • Market contraction risk from population decline in local economy
  • Profit pressure from prolonged low-interest environment
  • Intensifying competition with major city banks and megabanks
  • Changes in transaction methods due to digital finance advancement
  • Increased bad debt risk from deteriorating regional industry conditions
  • Increased operational burden from financial regulations and legal amendments
  • Economic stagnation from uncertainties like new infectious diseases
  • Competitive restructuring from regional bank business integrations
  • Rising IT maintenance costs and cyber risks
  • Delays in responding to diversifying customer needs

Innovations

2022: Completed Migration to NTT Data STELLA CUBE System

Overview
Migrated core banking system to the latest STELLA CUBE, achieving operational efficiency.
Impact
Achieved improved processing speed and operational stability.

2021: Initiated Management Integration Discussions with Fidea Holdings

Overview
Reached basic agreement on management integration envisioning regional financial restructuring.
Impact
Exploring possibilities for strengthening management base through integration.

2020: Introduced IC Cash Cards with Finger Vein Authentication

Overview
Began handling biometric IC cards to strengthen security.
Impact
Improved customer convenience and security.

Sustainability

  • Support for 6th industrialization of regional agriculture, forestry, and fisheries
  • Promotion of environmentally considerate branch operations
  • Regional job creation and women's advancement
  • Disaster support and reconstruction efforts in affected areas
  • Development of financial products for local industry promotion