Sumitomo Mitsui Financial Group raised its full-year net income forecast to 1.9 trillion yen on Friday, up 200 billion yen from its earlier goal, after first-half profit rose 7.5% to a record 1.003 trillion yen on higher domestic interest income and strong advisory fees.

The Tokyo-based lender also said it would repurchase up to 220 billion yen of its own shares and raised its dividend forecast. For investors in Asia, the numbers add to evidence that the Bank of Japan's rate increases are now flowing straight into megabank earnings, and that the groups are returning much of that gain to shareholders rather than hoarding it. The new forecast would be 20% above last fiscal year's profit, according to the company's filing.

SMFG released the figures at 1:30 p.m. Tokyo time, during trading hours, the first time it has done so, according to Nikkei. Nikkei reported earlier in the week that the aim was to let investors trade on the latest information while the Tokyo Stock Exchange was open.

Where SMFG's profit came from

Consolidated net interest income rose 26.3% from a year earlier to 1.62 trillion yen in the six months to Sept. 30, the company's supplementary data showed. At Sumitomo Mitsui Banking Corp., the core bank, domestic net interest income climbed 50% to 817.7 billion yen, while international net interest income slipped 5.7% to 423.6 billion yen.

Net fees and commissions for the group rose 13.1% to 938.4 billion yen. President and Group CEO Toru Nakashima told reporters that the bank had captured busy corporate activity among its clients, which lifted fee income from mergers and acquisitions advice, Nikkei reported. Banking profit at SMBC rose 16% to 954.7 billion yen.

Deposits also grew. SMBC's domestic deposits rose 7% to about 137.3 trillion yen, Nikkei said, with gains from both companies and households as its Olive retail app and its Trunk service for small businesses picked up users. That matters because Japanese banks are now competing harder for deposits as savers start earning interest again.

Not every line moved up. General and administrative expenses rose 15% to 1.41 trillion yen. Total credit costs increased to 133.5 billion yen from 90.2 billion yen a year earlier. Gains on stock sales, which include disposals of shares held in client companies, fell 34% to 161.6 billion yen. Comprehensive income, which captures swings in the value of the bank's securities holdings, dropped 41.6% to 601.8 billion yen.

Nakashima said the higher forecast reflected rising interest rates, bigger gains from selling cross-shareholdings and upside from the core business, according to Nikkei. In July, after a 33% jump in first-quarter profit, SMFG had kept its full-year goal at 1.7 trillion yen even though 12 analysts tracked by IBES expected about 1.795 trillion yen, Reuters reported at the time. The new figure is above that earlier consensus. For the wider rate backdrop, see our report on why a December Bank of Japan hike is still in play.

Buyback, dividend and stock split

The buyback covers up to 85 million shares, or 1.1% of shares outstanding excluding treasury stock, the company said. Purchases will run from Nov. 16 through Feb. 28 through market trades, and all of the shares will be cancelled on March 19, 2027.

SMFG split its stock two for one on Oct. 1, which complicates the dividend comparison. The interim dividend, paid on the pre-split share count, was set at 100 yen, against a May forecast of 90 yen and 78 yen a year earlier. The year-end dividend forecast rises to 50 yen from 45 yen on the post-split basis, bringing the annual forecast to 100 yen a post-split share, 10 yen more than planned in May. On the old share count, that is 200 yen against 157 yen paid for last fiscal year.

A correction to last year's accounts

Alongside the results, SMFG filed an amended annual securities report with the Kanto Local Finance Bureau and corrected its results for the year ended March 31, 2026, and the April to June quarter. The company said it had found an error in the fair value measurement of monetary claims bought, a category of purchased loans and receivables.

The fix reduced that asset by 99.6 billion yen as of March 31 and cut net unrealized gains on other securities by 68.2 billion yen, according to the filing. Total net assets at the end of March were revised down 0.43% to 15.86 trillion yen. The correction ran through unrealized gains and other comprehensive income rather than the income statement, based on the items the company listed.

SMFG will file its interim securities report on Nov. 27, and the interim dividend is payable on Dec. 2. The buyback window opens on Monday.