TOKYO, Nov 12 (Reuters) - Sumitomo Mitsui Financial Group, Japan's No.3 bank by assets, on Friday raised its annual outlook by 59 percent after bond trading gains and lower credit costs lifted first-half earnings.
Japan's major banks, which emerged from the global financial crisis relatively unscathed, are enjoying strong profit growth this year, but their core lending operations remain sluggish as businesses and households remain reluctant to spend.
SMFG said it expects a net profit of 540 billion yen ($6.6 billion) for the year ending in March. That is up from 340 billion yen in an earlier forecast and above an average estimate of 410.3 billion yen in a poll of 13 analysts by Thomson Reuters I/B/E/S.
Last month, SMFG said its first-half net profit had likely topped its annual target, after it saw a jump in profits from trading in Japanese government bonds and a fall in credit costs thanks to fewer bankruptcies.
For the six months ended in September, the bank's net profit more than tripled to 417.5 billion yen.
Shares of SMFG are down around 5 percent so far this year, outperforming an 8 percent drop in the benchmark Nikkei average. (Reporting by Taiga Uranaka; Editing by Lincoln Feast)