Japan Post Bank Co. Ltd. plans to set up a US$1.5 billion in-house hedge fund in October, a move seen by analysts as a sign that the bank is embracing a more aggressive investment approach, the Financial Times reported May 15, citing sources familiar with the plan.
The new hedge fund will initially be managed by a team of six people, sources said. Among those managing the fund are new recruits from Goldman Sachs, Barclays and Fidelity, who have been quietly hired over the past months, the report said.
Analysts mostly see Japan Post Bank as a passive investor in externally managed funds. However, Japan's negative interest rate and a declining population have put pressure on the bank's profit margins.
The decision to establish an in-house hedge fund will allow the bank to actively hold and potentially short-sell individual stocks, and is in line with its plan to aggressively branch out into new business lines and diversify its investment portfolio as the Japanese government sells down its 56% stake in the bank's parent, Japan Post Holdings Co. Ltd..
