Sumitomo Life & Dai-Ichi Life Outline Investment Plans

Japan's Sumitomo Life will look to further increase holdings of longer-end JGBs and unhedged foreign bonds, such as U.S. dollar corporate bonds and Australian government bonds, this fiscal year, the company's chief fund manager said Thursday. The group plans to increase longer-end JGB holdings by several hundred billion yen this fiscal year, building on an increase of JPY640 billion last fiscal year. Fujimura said that the balance of hedged foreign bonds this fiscal year is expected to fall by about JPY100 billion due to the redemption of U.S. Treasuries. He said the company was nervous about further unhedged Treasury purchases as yields are 'still low' and 'we expect hedging costs to rise further." He added that U.S. corporate bonds are more attractive assets than U.S. Treasuries. Sumitomo Life plans to boost unhedged foreign bonds by about JPY100 billion this fiscal year after they increased by JPY960 billion last fiscal year. The plan reflects that the company doesn't expect the yen to appreciate against the U.S. dollar, he said.

• Dai-ichi Life Insurance plans to boost its holding of yen bonds this fiscal year, building on the increased balance through the last fiscal year, the company's lead fund manager said Thursday. As for hedged and unhedged foreign bond investment, the company plans flexible two-way trade as it watches rates and forex developments, Akifumi Kai, general manager of the investment planning department at Dai-ichi Life, told reporters. "We will increase purchases of unhedged foreign bonds," such as agency and corporate bonds, if we don't see the chance of a sharp yen rise, he added.