Nao Sano

The move shows the fund’s need to increase its expertise in order to deal with volatility in the nation’s debt market.

Daiichi Life Group has been approaching dozens of companies that have never issued bonds or only rarely done so, proposing that it will become a core buyer if they tap the market.

Japan’s four largest life insurers reported that their combined unrealized losses on domestic bonds increased 7% in the three months through June, showing the risks to the industry from soaring interest rates.

Meiji Yasuda Life Insurance Co. is examining an industrywide increase in policy cancellations as rising interest rates prompt customers to shift into other financial products, said its Deputy President Atsushi Nakamura.

Meiji Yasuda Life Insurance Co is examining an industrywide increase in policy cancellations as rising interest rates prompt customers to shift into other financial products.

Japanese bond yields have climbed so sharply that analysts say Government Pension Investment Fund may be justified in eventually raising its domestic debt allocation target from 25% to seek higher returns.

Government Pension Investment Fund’s recent announcement that its management team took the unusual step of meeting in August is fueling speculation that Japan’s biggest retirement fund may boost its allocation target for domestic bonds.

Japanese health minister Kenichiro Ueno, who oversees the Government Pension Investment Fund, said the GPIF is still considering whether a review of its asset allocation is needed.

With the fund overseeing about ¥318 trillion in assets, a 1 percentage-point change in allocations translates to more than ¥3 trillion in fund flows.

Japan’s financial regulator is closely monitoring whether banks are properly managing the risks of rising interest rates on all facets of their businesses, including bond holdings, corporate lending and super-long mortgages.