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Japan says GPIF to sell 27% fewer assets in 2013/14

Japan’s Government Pension Investment Fund is the world’s biggest with a $1.2 trillion portfolio

Gulf News

Tokyo: Japan’s Government Pension Investment Fund (GPIF), the world’s biggest public pension fund with a $1.2 trillion portfolio of mostly Japanese government bonds, plans to sell 26.6 per cent fewer assets to pay pensions in 2013/14 than in this fiscal year.

GPIF Chairman Takahiro Mitani told Reuters in an interview on Monday that the fund, which controls assets worth more than the Mexican economy, will review its long-term investment target and portfolio allocation model around April.

The review should include a discussion of the investment strategy towards Japanese government bonds, which form two-thirds of GPIF’s portfolio, Mitani said, as yields on 10-year JGBs were languishing at around 0.8 per cent.

The fund plans to raise about 4.7 trillion yen for pension payouts for the next financial year starting in April, down from the planned 6.4 trillion yen during the current year, he said.

The former Bank of Japan executive also said that he did not think Japan’s equity market was overheating, despite a near 30 per cent climb since mid-November, and that foreign investors’ perceptions of the Japanese market had improved since Prime Minister Shinzo Abe took power in December.

“Regarding the question on whether or not Japanese shares are near their top, I would say I don’t think so,” Mitani said.