Japan Post Bank said on Thursday it will expand investment into long-term government bonds to take advantage of rising yields from the central bank's expected tapering of its huge bond purchases.

The investment appetite by Japan Post Bank, a former state-owned giant with total assets of $1.5 trillion (¥237.6 trillion), may help keep long-term interest rates low, even as the Bank of Japan begins to trim bond purchases under a plan set for release next month.

"We have already begun shifting investment towards government bonds from deposits in light of shifting trend in Japan's interest rates," a public relations official at Japan Post Bank said.