4. Building a high-quality capital base
Having completed the repayment of capital injections in October 2006, SMFG issued non-cumulative perpetual preferred securities in December 2006 through an overseas special-purpose subsidiary to increase its own capital, with the aim of ensuring implementation of future growth strategies.
However, SMFG’s capital policy was heavily affected by the international trends toward tightening financial regulations. These trends were spurred by a direction agreed on at the first G20 summit meeting held in Washington, D.C. in November 2008, which called for stronger financial control, notably requirements for financial institutions to improve the quality and quantity of equity capital.
Responding to the above requirement, SMFG carried out a series of steps to build a high-quality, solid capital base. SMFG started with refinancing outstanding preferred securities with higher-quality capital-raising instruments newly issued. This was followed by the issuance and public offering of common stocks in June and July 2009, which raised a total of 861 billion yen. Then, in January and February 2010, SMFG ran the fiscal year’s second session of common stock issuance and public offering and raised 973 billion yen in total. Conducting more than one major fund-raising program in the same fiscal year was an exceptional measure. It was a decision in response to the Basel III draft of December 2009 that SMFG should accelerate efforts for capital enhancement. Additionally, in February 2010, SMFG bought back perpetual preferred securities and perpetual subordinated bonds to be retired.
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Chapter 1The Financial Crisis and Realignment of the Financial Sector
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Chapter 2The Birth of SMBC and SMFG
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Chapter 3Initiatives Pursued by SMBC Banking Units in the Early Years
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Chapter 3Initiatives Pursued by SMBC Banking Units in the Early Years
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- Enhancing our retail consulting and payments & consumer finance businesses
- Enhancing corporate financial solutions
- Banking-Securities collaboration in the wholesale securities business
- Challenges facing our global banking business
- Actions by Treasury Unit in preparation for rising interest rates
- Integration of operating systems and administrative functions
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Chapter 4Embarking on Fresh Challenges Under New Leadership
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Chapter 4Embarking on Fresh Challenges Under New Leadership
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- Changes of leadership and the announcement of our new management policy
- Developing group business strategies
- Addressing antitrust issues
- Completing repayment of public funds
- LEAD THE VALUE
- Enhancing our retail financial consulting business
- Enhancing our corporate solution business
- Enhancing our investment banking business
- Global banking business turnaround
- Upgrading risk management in preparation for Basel II
- Development of human resources
- CSR activities
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Chapter 5SMFG’s Response to Global Economic and Financial Turmoil
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Chapter 6Preparing for the Next Decade
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Chapter 1Business Model Reform Under Challenging Business Conditions
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Chapter 1Business Model Reform Under Challenging Business Conditions
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- Our journey under new leadership (the second decade)
- Focusing on growth industries and businesses
- Reforming domestic business operations
- Promoting banking-securities collaboration in Wholesale Banking Unit
- Structural reform of our retail business
- Meeting the needs of an aging society
- Abenomics and Treasury Unit's nimble portfolio management
- Operating in a negative-interest-rate environment
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Chapter 2Enhancing Group Businesses
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Chapter 3Expanding Our Global Business
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Chapter 4Enhancing Corporate Infrastructure Under a New Governance Framework
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Chapter 4Enhancing Corporate Infrastructure Under a New Governance Framework
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- New leadership and enhancing corporate governance
- Introducing group-wide business units and CxO system
- Improving capital, asset, and cost efficiency
- Pursuing our cashless payment strategies
- Retail branch reorganization
- Customer-oriented business conduct
- Enhancing internal-control frameworks
- Valuing diversity and revision of our HR framework
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Chapter 5The Path for Our Future
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Chapter 6Opening a New Chapter in SMBC Group’s History