Japan Post Insurance plans to sell holdings of lower-yielding government bonds and replace them with higher-yielding debt on expectations for further interest-rate hikes, according to its chief executive officer.
The life insurer expects the Bank of Japan to raise interest rates again as soon as April. It’s one of the nation’s biggest insurers and held ?50.35 trillion ($320 billion) in securities at the end of last year. As Japanese bond yields jumped in the final quarter of last year, the firm’s valuation losses on domestic notes widened about 30% in the three months to ?4.39 trillion.
“It’s important to make adjustments in light of rising interest rates, to legitimately benefit from the rate hikes,” said CEO and President Kunio Tanigaki in an interview on Friday. Market interest rates “will continue to rise in the near future,” he said.
With your current subscription plan you can comment on stories. However, before writing your first comment, please create a display name in the Profile section of your subscriber account page.