Profits drop at Shinsei

30 July 2008

Shinsei has reported a surprisingly large decline in first-quarter profit.

In a trading declaration issued today, the Japanese bank said that its net earnings for the three-month period stood at just $100 million.

By way of comparison, this is around one third of the equivalent figure last year.

Nevertheless, Shinsei said that its previous profits forecast of just under $600 million remained the same, despite the disappointing results.

Commenting on the bank's figures to Bloomberg, Nomura analyst Keisuke Moriyama said that he would put a "neutral" reading on Shinsei's shares.

"Profitability at the individual retail business still isn't good," he added.

"Concerns remain regarding the fundamental business as profit from the institutional group slows."

The bank's results were blamed on credit crunch-related asset writedowns, which totalled around $50 million across the three months.

Shares in the bank have dropped by just under seven per cent so far in 2008, in line with the loss in value of other Japanese financials.

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