BoJ’s first REIT writedown sparks fear

Japan’s central bank has 33.5 trillion yen (US$316bil) in ETF holdings, which it started buying a decade ago in a policy aimed at lowering the premium investors demand for risk assets on top of the the risk-free rate of government bonds.

TOKYO: The Bank of Japan’s first recorded impairment loss in real estate investment trusts has some market watchers concerned over the possibility of a larger hole from its far more sizable purchases of exchange-traded funds.

In a little-noticed development at the time, the central bank booked a 15.9 billion yen (US$149mil) impairment loss last fiscal year ended March 31 from its J-REIT investments.