Resona Will Benefit From Higher Margins as Interest Rates Rise and Costs Are Contained

Over the next five years, we expect Resona’s earnings to benefit from interest rate tailwinds in Japan, improving operating leverage that is lowering its cost/income ratio, and from share sale gains. These factors should help Resona’s ROE average 11.6% during the period before easing to 10% in our midcycle forecast as equity sales diminish.