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UPDATE 1-Meiji Yasuda to cut unhedged foreign bonds in H2

Published 10/16/2009, 02:52 AM
Updated 10/16/2009, 02:54 AM

* Meiji Yasuda to cut $330 mln of unhedged foreign bonds

* To reduce exposure to currency risks

* Plans to invest in emerging Asian economies in H2

By Satomi Noguchi

TOKYO, Oct 16 (Reuters) - Japan's Meiji Yasuda Life Insurance Co said on Friday it plans to cut its unhedged foreign bond holdings by around $330 million in the second half of the financial year ending in March 2010 on concerns about persisting currency risk.

Japan's top nine insurers held around $1.6 trillion in assets as of March 2009 -- about the size of Brazil's economy -- and investors closely watch their plans because their investments can affect financial markets.

Meiji Yasuda, the nation's third-largest life insurer by assets, said it would shed a net 30 billion yen in unhedged foreign bonds in the October-March second half, after cutting 240 billion yen of them in the fist half.

"In order to reduce our exposure to currency risk, we plan to cut holdings of unhedged foreign bonds, and shift a portion of those funds to hedged foreign bonds," said Meiji Yasuda's deputy president, Yasuharu Takamatsu, at a news conference.

The company expects the dollar to trade between 83 yen and 98 yen and the euro at 120-145 yen in the October-March second half. In April, it had forecast 90-110 yen for the dollar and 115-150 yen for the euro for the whole fiscal year.

Meiji Yasuda also said that it would boost its investment in emerging markets by 5 billion yen ($55 million) mostly in Asia.

In the first half, it invested about 5 billion yen in emerging Asian countries such as China, India, and Indonesia through investment funds.

The insurer manages 23.9 trillion yen of assets on behalf of policy holders, of which 7 percent was invested in foreign bonds as of the end of September. (Reporting by Satomi Noguchi; Editing by Joseph Radford)

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