Mizuho Financial Group Inc. announced another round of losses Wednesday on its foreign-bond holdings as part of a surprise writedown that will severely curtail full-year profit, as Japanese banks' quest to secure yield by investing overseas continues to create turbulence.
Mizuho slashed its net income forecast by 86 percent after booking ¥680 billion ($6.1 billion) of charges tied to business restructuring and securities losses. CEO Tatsufumi Sakai said he will forfeit his performance-related pay to take responsibility for the writedown.
The charge underscores the challenges faced by banks in Japan as rock-bottom interest rates at home prompt them to look abroad for returns. It also reflects Mizuho's plans announced in November 2017 to eliminate branches and jobs over a decade, in a bid to counter headwinds including financial technology disruption and tepid credit demand from a shrinking population.