REPEAT:MNI: BOJ Net H1 FY18 Profit Up; Foreign Hldgs Up On Yen

Repeats Story Initially Transmitted at 07:38 GMT Nov 28/02:38 EST Nov 28

     TOKYO (MNI) - The Bank of Japan said Wednesday that it posted a net profit

of Y827.9 billion in the first half of fiscal year 2018, improving from a net

profit of Y550.2 billion a year earlier, as the weaker yen pushed up the value

of its foreign currency assets.

     The net gain came mainly from profits on foreign-exchange transactions, the

BOJ said, which totalled Y409.6 billion in the six-month period, due to the

depreciation of the yen, up from a profit of Y128.8 billion in the same period

last year.

     The dollar stood at Y113.69 and the euro at Y131.98 at the end of

September, compared with Y112.49 and Y132.89 at the end of September 2017.

     Interest payments on government bond holdings totalled Y646.1 billion in

the April-September period, up from Y597.2 billion a year earlier.

     The BOJ also posted a pre-tax profit of Y1.046 trillion for the first half

of this fiscal year, compared with a profit of Y668.5 billion in the 96 months

to September 2017.

     The central bank is putting roughly half of its interest income on Japanese

government securities into reserves as a provision against losses it will face

when it eventually ends its large-scale monetary easing.

     The BOJ transferred Y222.9 billion to a provision for possible losses on

bond transactions, down from the transfer of Y227.9 billion a year before.

     --BOND BUYING

     Assets held by the BOJ at the end of September totalled Y545.7 trillion, up

Y32.2 trillion, or 6.3%, from Y513.4 trillion a year before.

     The rise in assets was due to further outright Japanese government bond

purchases. The monthly pace of JGB buying by the BOJ fluctuates under the yield

curve control policy framework, but the balance of its JGB holdings has been

steadily increasing every year since the start of aggressive easing in April

2013.

     The BOJ's capital adequacy ratio at the end of September was 8.30%, up from

8.12% at the end of September 2017.

     That ratio is at the low end of the BOJ's desired range for its own

capital, which is two percentage points above or below 10%.

     The outstanding balance of long-term JGBs held by the BOJ at the end of

September totalled Y447.4 trillion, up from Y404.2 trillion a year earlier.

--MNI Tokyo Bureau; tel: +81 90-2175-0040; email: hiroshi.inoue@marketnews.com

--MNI London Bureau; tel: +44 203-586-2225; email: les.commons@marketnews.com