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Japan Post Bank Share Sale Announced

Buybacks are also planned.

Securities In This Article
Japan Post Bank Co Ltd

We maintain our fair value estimate of JPY 940 for Japan Post Bank 7182 after it and its parent, Japan Post Holdings, announced a public sale in March of some of the Japan Post Bank shares held by Japan Post Holdings, as well as two share buybacks by Japan Post Bank, one on Japan Exchange’s ToSTNet-3 system in early March before the offering and a second one in the market spanning from mid-March until May 12.

Japan Post Holdings’ stake in Japan Post Bank has been 89% since the two companies listed in November 2015, during which time Japan Post Holdings already lowered its stake in Japan Post Bank’s sister company, Japan Post Insurance, from 89% at the time of the IPOs in 2015 to below 50% currently, thereby freeing Japan Post Insurance from some restrictions on its business. However, Japan Post Holdings’ stake in Japan Post Bank has remained at 89% despite Japan Post Holdings’ stated aim to reduce the stake below 50% as soon as possible. This delay, in our view, reflected the larger importance of dividends from Japan Post Bank in delivering cash up to Japan Post Holdings to help maintain the parent’s own dividends to shareholders as well Japan Post Insurance’s greater ability than Japan Post Bank to lift dividend per share.

The author or authors do not own shares in any securities mentioned in this article. Find out about Morningstar’s editorial policies.

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About the Author

Michael Makdad

Senior Equity Analyst
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Michael Makdad is a senior equity analyst for Ibbotson Associates Japan, Inc., a wholly owned subsidiary of Morningstar, Inc. He covers financial and real estate firms. Makdad is a Team Leader for the Japan team.

Before joining Morningstar in 2018, Makdad worked in equity and credit research in Tokyo and Hong Kong since 2005 for Lehman Brothers, Nomura, Moody’s, and Haitong Securities. He worked as a sector analyst and in roles where he supervised the research product content and presentation for other analysts across the Asia region.

Makdad holds bachelor’s and master’s degrees in business administration from Washington University in St. Louis. He also holds the Chartered Financial Analyst® designation.

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