MNI BRIEF: BOJ’s JGB Unrealized Loss Rises To JPY32.8 Tlrn

The Bank of Japan posted JPY32.8 trillion in unrealized losses on Japanese government bonds (JGBs) at the end of September, up from JPY28.6 trillion at the end of March, following the rise in JGB yields, according to the BOJ’s half-year earnings report released Wednesday.

The BOJ’s exchange-traded fund (ETF) holdings remained unchanged at JPY37.1 trillion from March, with unrealized profits rising to JPY46.0 trillion from JPY32.9 trillion in the same period.

The central bank recorded a net income of a record JPY1.71 trillion in the first half of fiscal 2025, slightly down from JPY1.84 trillion a year earlier. Total assets held by the BOJ at the end of September stood at JPY695.8 trillion, a 7.6% decline from a year earlier.

The outstanding balance of long-term JGBs held by the BOJ fell to JPY555.1 trillion from JPY583 trillion a year earlier, down 4.8%. The bank’s capital adequacy ratio at the end of September was 11.91%, slightly up from 11.78% at the end of March, remaining at the lower end of the BOJ’s target range of roughly two percentage points above or below 10%.

In September, the BOJ unanimously decided to sell ETFs and J-REITs according to its fundamental disposal principles, which include avoiding destabilising effects on financial markets.