Bank of Japan Reports Record Stock Gains for Last Financial Year

By Megumi Fujikawa

TOKYO--The Bank of Japan reported record unrealized gains on its stock holdings in the financial year that ended March, reflecting historic rises in Tokyo shares.

The central bank reported unrealized gains of 37.312 trillion yen ($237.39 billion) on its holdings of exchange-traded funds in the year ended March 31, compared with an unrealized profit of Y16.036 trillion in the previous year.

Solid earnings from companies and hopes for better corporate governance have boosted Japanese equities. In February, the benchmark Nikkei Stock Average hit an all-time high, surpassing its 1989 peak.

The central bank also reported unrealized losses of Y9.434 trillion on its holdings of Japanese government bonds as of the end of March, compared with unrealized losses of Y157.1 billion a year ago.

JGB yields have been gradually rising since the bank decided to end negative interest rates in March. Further rises in JGB yields will likely inflate valuation losses on the BOJ's bond holdings. Bond prices fall when yields rise.

The bank in principle holds onto JGBs until maturity. BOJ Gov. Kazuo Ueda has said paper losses on JGBs shouldn't interfere with its policy-making. He has also said that the bank has no immediate plan to sell its stock holdings.

Write to Megumi Fujikawa at [e-mail]

(END) Dow Jones Newswires

05-29-24 0507ET