Private market assets are making up larger shares of portfolios for diversification purposes, and lifers like Dai-ichi Life have ventured deeper into alternatives this year.
Tag : moodys
Many top Japanese life insurers, tempted by historically high yields, are nearing purchases of domestic government bonds, yet others are holding out for even more lucrative opportunities.
High hedging costs and a low yen have led Japanese life insurers to focus on domestic government bonds, although declining yields might also prompt them to seek out alternatives.
With a new regulatory regime in the making, the lifers’ relatively high allocation to domestic equity will incur a higher cost, and selling off can be either boom or bust.
As interest rates have started to move, the larger Japanese life insurers consider either unhedged US investments, or aiming for the eurozone.
Domestic agencies tend to rate domestic firms more favourably than their foreign peers, but the difference is particularly striking in China.
The country insurers' offshore asset allocations will likely remain much lower than the regulatory limit of 15% this year, despite their need to locate higher levels of return.
Moody’s and Fitch Ratings say that emerging market defaults are increasingly likely to hit record highs, with Asia-Pacific corporates looking particularly vulnerable.
Japanese life insurers are well-suited to weather long-term global turbulence as the coronavirus spreads, but certain investment strategies might turn sour, say rating agencies.
Korean securities companies will continue to supply domestic asset owners with new overseas alternative investments, but they are taking increasingly higher risks in the process.
Although new themes are emerging in portfolios, the overall risk approach remains fairly conservative, ratings agencies tell AsianInvestor.
The rating agency is appealing against sanctions imposed by the Hong Kong regulator for a negative report on Chinese companies. If the decision is upheld, price discovery will suffer.
