Norinchukin Bank, the Japanese lender that got stung by rising global interest rates, expects its annual loss to exceed a previous ¥1.5 trillion ($9.7 billion) projection as it steps up the disposal of unprofitable foreign bonds.
The company, one of the country’s largest institutional investors, shocked global markets in June when it disclosed plans to sell about ¥10 trillion of U.S. and European sovereign bonds this fiscal year to stem losses from wrong-way bets on rates. It now aims to offload even more than that amount, having disposed of ¥7.5 trillion in the first half.
The steeper expected losses and accelerated asset disposals come as CEO Kazuto Oku said he’s preparing for growing uncertainty, including the possibility of higher U.S. rates under a Donald Trump presidency. Oku didn’t dismiss the potential for losses to reach about ¥2 trillion, when asked during a briefing.
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