Japan Post Holdings Co. will shift more of its $2.6 trillion investment portfolio to riskier assets to boost profitability as negative interest rates shrink income from government bonds.
The newly privatized postal and financial giant, which has about ¥205.5 trillion ($1.9 trillion) managed by its banking unit and ¥82.7 trillion at its insurer, will buy assets such as overseas real estate investment trusts and infrastructure funds and has begun investing in private equity, said President Masatsugu Nagato.
Japan Post has already been diversifying its portfolio away from government bonds, which now make up about 40 percent of its banking unit's portfolio, to reduce its reliance on the securities for returns. Yields on about 70 percent of the nation's sovereign debt are now below zero following the central bank's January decision to introduce negative interest rates to spur lending and inflation.