April 19, 2019 / 8:47 AM / 2 months ago

INTERVIEW-Japan's Taiyo Life to increase foreign bond holdings, eyes euro debt

TOKYO, April 19 (Reuters) - Japan’s Taiyo Life Insurance plans to increase foreign bond holdings in the current financial year through March 2020, a senior executive told Reuters on Friday.

The insurer, a unit of T&D Holdings with about 7.25 trillion yen ($64.8 billion) in assets, said it plans to increase holdings of dollar-denominated debt, known as credit bonds that offer certain spreads above Treasuries, as well as euro-denominated debt.

The insurer plans to increase its foreign bond holdings by about 30 billion yen this financial year, Takahiro Honda, general manager at the investment planning department of Taiyo Life, told Reuters.

“U.S. Treasuries remain unattractive when considering the high hedging costs involved. We are thus planning on investing in credit bonds,” Honda said.

“As for euro bonds, the sovereigns don’t offer very much yield, so we will be looking at instruments such as supranational bonds that are higher yielding.”

Low domestic yields due to the Bank of Japan’s easy monetary policy have prompted Japanese life insurers to increasingly seek better returns abroad.

$1 = 111.9200 yen Editing by Jacqueline Wong

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