Negative interest rates force Japan pension fund to adopt riskier investment strategy

Tokyo

NEGATIVE interest rates are forcing a Japanese pension fund to adopt a riskier investment strategy. The National Federation of Mutual Aid Association for Municipal Personnel, with total assets under management of about 11 trillion yen (S$143.1 billion), is considering buying more regional government bonds and state-backed organisations' debt, according to people familiar with the issue.

The Tokyo-based organisation, which manages pensions and provides services for about 1.16 million municipal employees, began on July 1 to recruit managers who will be given more freedom to deviate from the Nomura-BPI index that the fund tracks.