Daiwa Securities Group is set to introduce real estate investment loans of 300 million yen ($2 million) or more from October, marking its return to retail lending as part of a strategy to enhance its wealth management services. By facilitating financing through Daiwa Next Bank, the group aims to streamline the investment process and retain more of the business in-house.
Daiwa Next Bank, which initially focused on small unsecured loans upon its 2011 launch, ceased new lending applications in 2015 to prioritize deposits and asset-based lending. The bank’s re-entry into retail lending aims to achieve a loan balance in the tens of billions of yen within three to five years.
The move aligns with Daiwa Securities’ broader strategy to position wealth management as a cornerstone of its business, targeting an increase in pretax profit contribution from 35% to 45% of the group’s total by fiscal 2030. The company plans to capitalize on both fee income and interest from the new lending operations, as articulated by CEO Akihiko Ogino.
The real estate loan market is on an upswing, driven by rising property prices and increased borrowing. As of March, the balance of real estate loans to retail investors reached 28 trillion yen, a three-year high. Amidst this competitive landscape, Daiwa’s competitors, including Rakuten Bank, Orix Bank, and Sony Bank, are also enhancing their focus on property investment lending.
