Japan’s Pension Fund Association for Local Government Officials reported an 11.3% gain to ¥21.1 trillion ($176 billion) for its fiscal year ended March 31, amid a steady shift in allocations to higher risk assets from Japanese government bonds.
Information posted on the Tokyo-based pension fund’s website this week showed its allocation to domestic bonds dropping to 50.5% as of March 31, down from 57.3% a year before. Over the same period, the pension fund’s cash weighting slipped to 1.4% from 1.8%.
Among risk assets, allocations rose to 21.6% for domestic equities from 16.1% the year before and to 15.1% for overseas equities from 13.7%. Overseas bonds increased to 11.4% from 11.1%.
For the year, the pension fund reported gains of 30.9% on its domestic equity holdings; 22.7% on its overseas equity investments; 12.8% on its overseas bonds; and 2% on domestic bonds.
The latest data showed the pension fund for the most part making slower progress than Japan’s ¥137 trillion Government Pension Investment Fund, Tokyo, in moving toward the common asset allocation targets adopted over the past year of 35% domestic bonds, 25% each domestic and overseas equities, and 15% overseas bonds.
Over the coming week or so, the GPIF is expected to announce its asset allocation figures as of March 31, but the numbers it released in February for Dec. 31, showed an allocation of 43% domestic bonds, 20% each domestic and international equities, 13% international bonds and 4% cash.
