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Home ＞ Corporate Information ＞ Management Strategy

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Management Strategy

The revision of Medium-term Management Plan (FY2021 through FY2025)

In May 2021, the Bank formulated a Medium-term Management Plan (FY2021 through FY2025).

In the first three years of the plan, the Bank has been promoting the five key strategies set forth in the Medium-term Management Plan and has succeeded in attaining positive results, including achievement of the financial targets for FY2023 as planned and achievement of the financial targets for FY2025 ahead of schedule.

In parallel with these achievements, the business environment surrounding the Bank has been undergoing significant changes. The changes include rising interest rates in Japan and overseas; greater-than-expected advancements in the digitalization of society, such as the penetration of generative AI; and growing interest in the Bank’s actions to implement management that is conscious of cost of capital and stock price.

In light of these changes in the business environment, the Bank has revised its plan for the remaining two years of the Medium-term Management Plan, or FY2024-FY2025, in May 2024.

With regard to financial targets, the net income target for FY2025 has been revised upward to 400.0 billion yen or more, from 350.0 billion yen or more, which was the target set at the time the Medium-term Management Plan was initially formulated, and other major financial targets have been revised in a similar manner.

figure of Reviewing our previous medium-term management plan (FY2019/3 through FY2021/3) and Basic Policies of hte Medium-term Management Plan (FY2022/3 through FY2026/3)

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As for the business strategy, while maintaining the basic direction, the Bank will also look ahead to the next Medium-term Management Plan and revise the framework to focus on its strategies in three business domains — retail business, market business, and Σ (sigma) business (a corporate business for creating futures for societies and local communities through investment) — which leverage the Bank’s unique strengths, and accelerate the transformation to a sustainable business model by strengthening the management base that supports these strategies.

figure of financial targets for the period of the Medium-Term Management Plan

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Through these efforts, the Bank aims to further enhance corporate value by continuously improving ROE while controlling the cost of shareholders’ equity.

Our Action to Implement Management that is Conscious of Cost of Capital and Stock Price

  • The Bank’s PBR as of March 31,2024 was 0.61x, which is below 1x.
    To achieve a PBR of 1x or higher, we believe that ROE must exceed the "cost of shareholders’ equity minus expected earnings growth rate".
  • The Bank's ROE for FY2023 was 3.74%, and has remained below the cost of shareholders’ equity (approximately 5%) as calculated using the Capital Asset Pricing Model (CAPM).
  • While complying with business regulations based on the Postal Service Privatization Act and fulfilling our responsibility to provide universal financial services, we aim to achieve ROE of 4% or more in FY2024 and 5% or more in excess of cost of shareholders' equity in the early stage of the next Medium-term Management Plan (from FY2026) , and aim for further improvement over the medium to long term.

For details, please see the attachment below.

JAPAN POST GROUP Management Policy

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