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Japan Post Bank's unrealised losses hit record ¥4.94 trillion

Created at 18 Aug · 3:41 AM1 source↑ Market-relevant
IN SHORT

Unrealised losses on Japan Post Bank's held-to-maturity securities climbed 14.5% in the second quarter to a record ¥4.94 trillion ($31.4 billion), more than double the previous year's figure.

Key Numbers

¥4.94 trillionJapan Post Bank's record unrealised losses
$31.4 billionJapan Post Bank's record unrealised losses
14.5%Quarterly increase in unrealised losses
¥2.26 trillionUnrealised losses a year earlier
June 30End of reporting period

Who's Involved

Japan Post Bank
Suffered record unrealised losses on securities

↳ Why This Matters

The significant increase in unrealised losses on Japan Post Bank's securities highlights potential vulnerabilities in its investment portfolio and could impact its financial stability and future profitability.

Key facts

  • Japan Post Bank's unrealised losses on held-to-maturity securities reached a record ¥4.94 trillion ($31.4 billion) in the three months to June 30.
  • This represents a 14.5% increase from the previous quarter.
  • The losses are more than double the ¥2.26 trillion reported a year earlier.

Japan Post Bank's unrealised losses on its exchange-listed held-to-maturity (HTM) securities surged by 14.5% in the second quarter, reaching a new record of ¥4.94 trillion ($31.4 billion). This figure more than doubles the ¥2.26 trillion reported in the same period last year and is nearly three-and-a-half times the ¥1.43 trillion recorded in June 2024. The markdowns on the HTM book account for nearly a sixth of the face value of these securities.

Frequently asked questions

HTM securities are debt investments that a company has the intent and ability to hold until their maturity date. They are typically accounted for at amortised cost, meaning unrealised gains or losses are not reflected on the balance sheet until the security is sold or matures.

While HTM securities are not marked to market on the balance sheet, large unrealised losses can indicate a significant decline in the value of the bank's investments. This can affect regulatory capital ratios and signal potential future losses if the bank is forced to sell these securities before maturity.

The article states that the unrealised losses account for nearly a sixth of the face value of the HTM securities, but it does not provide the total face value.
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How It Developed

Unrealised losses on Japan Post Bank's HTM securities grew 14.5% in Q2.
Losses reached a record ¥4.94 trillion ($31.4 billion).
This figure is more than double the ¥2.26 trillion reported a year earlier.

Sources

T1
Japan Post’s unrealised losses surge to new record in Q2Risk.net

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