Table: Many Japanese insurers look to yen bonds, some cautious on foreign bonds in FY2021/22

Japan Post Insurance

26/04/2021 07:06

* adds Asahi Life to a version sent on Friday

    TOKYO, April 23 (Reuters) - Many Japanese life insurers, major investors in global bonds,
plan to increase their m holdings of yen bonds as their yields have recovered from lows while
some of them are more cautious about foreign bonds, their comments from Reuters interview and at
press conferences showed. 
    Following is a summary of the investment plans of Japan's major life insurance companies for
the year through March 2022, based on interviews with Reuters and news conferences this month.
For more stories, see  JP/INS .

FOREIGN BONDS
----------------------------------------------------------------------------------------
Nippon Life    to reduce foreign bonds without FX hedge, to raise FX-hedged holdings a tad
Dai-ichi       stance on foreign bonds will depend on currency, interest rate levels
Meiji Yasuda   to reduce holdings of FX-hedged sovereign bonds, increase those without hedge
Sumitomo       to add foreign bonds without FX hedge and reduce those with hedge
Japan Post     to keep holdings steady; cautious about investment without FX hedge
Fukoku         to raise holdings of foreign bonds by 70 bln yen, mostly in corporate bonds
Taiju          to reduce holdings of FX-hedged foreign bonds, to add unhedged ones
Taiyo          to keep holdings flat, limit U.S. Treasuries and buying mortgages, corp bonds
Daido          to reduce holdings due to inflation worries, after cut of 90 bln yen in FY2020/21
Asahi          to increase holdings by 20 bln yen, have reduced FX hedge in FY2020/21

JAPAN BONDS
---------------------------------------------------------------
Nippon Life    to increase yen bonds, incl fully yen-swapped foreign debt using currency swaps
Dai-ichi       to increase yen bond holdings 
Meiji Yasuda   to increase holdings when yields have risen
Sumitomo       to increase domestic bonds 
Japan Post     expects yen bond holdings to fall; but sees market's steadiness attractive 
Fukoku         to reduce holdings of JGBs by 40 bln yen while increase corp bonds by 30 bln yen 
Taiju          to trim holdings overall but to increase corporate bonds 
Taiyo          to increase holdings steady, considers 0.5% in 20-year yield attractive 
Daido          to increase holdings of superlong bonds, after 160 bln yen boost in FY2020/21 
Asahi          to reduce holdings by 10 bln yen 

JAPAN STOCKS
---------------------------------------------------------------
Nippon Life    to trim Japanese stock holdings
Dai-ichi       to cut back domestic stock holdings in order to reduce risks
Meiji Yasuda   to cut equity holdings a little
Sumitomo       to increase holdings; looks to buy on dip
Japan Post     to keep holdings flat, but will buy on dips
Fukoku         to keep overall holdings steady and shift to high dividend stocks 
Taiju          to keep holdings steady
Taiyo          to keep holdings steady but may buy on dip 
Daido          to buy on dips after increase of 45 bln yen in FY2020/21
Asahi          to increase holding by 15 bln yen, including stock of a subsidiary

FOREIGN SHARES, ALTERNATIVE INVESTMENTS
---------------------------------------------------------------
Nippon Life    to increase foreign stocks slightly
Dai-ichi       to increase properties, buy-out & infrastructure funds
Meiji Yasuda   to moderately increase domestic property assets
Sumitomo       to add int'l shares, properties and private equity funds
Japan Post     to keep foreign stock holdings flat; to add alternative assets such as properties
Fukoku         to increase holdings of foreign stocks, infrastructure funds by 70 bln yen
Taiju          to raise investments in ESG funds, other new areas
Taiyo          to increase holdings by 20 bln yen, mainly in private equity
Daido          n/a
Asahi          to keep holdings of foreign stocks steady

EXPECTED MARKET RANGES
---------------------------------------------------------------
    (previous forecasts in brackets)
                 USD/JPY      EUR/JPY       NIKKEI         JGB 10-yr      US 10-yr
Nippon Life     97 - 117   112 - 138   21,000 - 31,000  -0.25 to 0.25%   0.7 - 2.4%
              (100 - 120   110 - 130   17,000 - 25,000   -0.2 to 0.2%    0.3 - 1.7%)
Dai-ichi       100 - 115   120 - 140   28,000 - 36,000  -0.25 to 0.25%  1.25 - 2.25%   
              (100 - 110   115 - 135   20,000 - 27,000   -0.2 to 0.2%    0.0 - 1.5%)
Meiji Yasuda   106 - 115   126 - 136   26,500 - 32,000   -0.2 to 0.2%    1.6 - 2.15%
              (101 - 110   116 - 131   19,500 - 26,000  -0.15 to 0.15%   0.5 - 1.3%)
Sumitomo       102 - 117   115 - 145   25,500 - 33,500   -0.1 to 0.25%   1.3 - 2.3%
              (100 - 112   115 - 135   20,000 - 27,500   -0.2 to 0.2%    0.4 - 1.3%)
Japan Post     105 - 117   125 - 140   27,000 - 33,000      0 to 0.25%   1.25 - 2.25% 
              (100 - 110   110 - 130   19,000 - 25,000   -0.2 to 0.2%    0.5 - 1.2%)
Fukoku         100 - 115   115 - 135   22,000 - 33,000   -0.2 to 0.3%    1.2 - 2.0%
              ( 95 - 115   105 - 130   18,000 - 24,000   -0.3 to 0.2%    0.3 - 1.5%)
Taiju          105 - 115   124 - 136   29,000 - 35,000  -0.25 to 0.25%   1.5 - 2.3%
              (101 - 111   120 - 132   20,000 - 26,000   -0.1 to 0.1%    0.6 - 1.4%
Taiyo          100 - 115   120 - 135   25,000 - 36,000  -0.25 to 0.25%   1.0 - 2.5%
              (100 - 110   120 - 130   19,000 - 25,000   -0.1 to 0.1%    0.3 - 1.3%
Daido          104 - 118   124 - 140   25,000 - 34,000    0.0 to 0.25%   1.3 - 2.5%
              (100 - 110   119 - 130   21,500 - 25,000   -0.2 to 0.2%    0.5 - 1.1%
Asahi          105 - 115   126 - 138   25,000 - 33,000    0.0 to 0.2%    1.2 - 2.2%
              (103 - 108   120 - 127   22,000 - 25,000   -0.1 to 0.1%    0.5 - 1.0%

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Japanese insurers' foreign bond buying    http://tmsnrt.rs/2oZOJ7E
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 (Reporting by Hideyuki Sano, Tomo Uetake, Daiki Iga, Hiroko Hamada, Mariko Sakaguchi and Mayu
Sakoda)
 ((hideyuki.sano@thomsonreuters.com; +81 3 4563 2768
))