First of all, we would like to express our deepest condolences to those who have lost loved ones to the COVID-19 illness. We also extend our sympathies to the many others and their families adversely affected by the virus.
MUFG will continue to support our customers and society through financial services. We see this ongoing endeavor as our social mission. We believe that whatever we do must be consistent with the pursuit of this mission.
Here I will explain MUFG’s fiscal 2019 operating results and future initiatives.
Fiscal 2019 Performance Results
For the fiscal year ended March 31, 2020, gross profits grew 260.5 billion yen year-on-year to 3,986.3 billion yen. This was due mainly to an increase in net profits associated with the global markets business. Revenue growth also reflected the consolidation of Bank Danamon Indonesia and Australia-based asset manager First Sentier Investors. At the same time, general and administrative expenses rose by 154.7 billion yen, due primarily to growing expenses in overseas operations and higher regulatory costs. As a result, net operating profits totaled 1,184.4 billion yen, up 105.8 billion yen year-on-year.
However, profits attributable to owners of the parent fell 344.5 billion yen year-on-year, to 528.1 billion yen. This was due to the absence of the reversal of allowances for fiscal 2018 credit losses and a rise in credit costs. These costs reflected such factors as the posting of provisions for some credit in light of COVID-19 impacts, and extraordinary losses from the one-time amortization of goodwill related to Bank Danamon and Thailand-based Bank of Ayudhya Public Company Limited (Krungsri).
As of March 31, 2020, MUFG’s capital adequacy ratio remained robust at 11.90% (Common Equity Tier 1 capital ratio).
With regard to fiscal 2019 year-end dividends, we intend to pay 12.5 yen per share, in-line with the amount forecast at the start of the fiscal year, pending shareholder approval. Inclusive of interim dividends, annual dividends are expected to total 25 yen per share, up 3 yen per share from fiscal 2018.
For fiscal 2020, we have announced an annual dividend forecast of 25 yen per share. This is based on certain assumptions,* however. The outlook regarding pandemic containment and the magnitude of its impact on the economy and society as a whole remain unknown.
MUFG’s Response to Address the COVID-19 Pandemic
The COVID-19 crisis has spread internationally, becoming a truly global pandemic. The fallout is affecting the real economy in many ways. Amid these circumstances, MUFG is keenly focused on providing essential services that support livelihoods and help businesses to continue operations, while prioritizing the safety of customers and employees. Concurrently, we are striving to promote internet banking, mobile apps and other services that are accessible any time, anywhere.
Furthermore, we have made donations to the Japanese Red Cross Society and are determined to offer subsidies and assistance to students confronted by difficulties in their pursuit of higher education and livelihood maintenance. Our support also extends to artists struggling amid the crisis. We truly hope that these initiatives will contribute to the normalization of the economy and help our society to regain its former stability, vitality and prosperity as early as possible.
The spread of the virus has further highlighted pre-existing structural changes and challenges in our society, such as the digital shift, the implementation of diverse working styles -- including working from home -- and heightened social contribution awareness. We will therefore respond actively to these trends, and to the expectations of our customers and society.
Lastly, I would like to express my deep respect for our employees, who show such diligence and creativity in helping customers maintain their livelihoods and businesses amid this challenging operating environment. I am proud of our colleagues and am committed to ensuring their health and safety. I believe that fulfilling this commitment constitutes an integral part of top management duties and will eventually help deliver greater benefits to our customers and to the whole of society.
In striving to overcome this unprecedented crisis, we will create a company deserving of the ongoing trust of our customers and society -- no matter the environment -- with every officer and employee doing their utmost. Looking ahead, we ask for your continued support.
President & Group CEO