TOKYO (Reuters) - Japan’s Government Pension Investment Fund (GPIF), the world’s largest pension fund, on Friday reported a record quarterly loss of 17.71 trillion yen ($164.74 billion) in January-March after global stock markets plunged during the COVID-19 pandemic.
GPIF posted a negative return of 10.71% on its overall assets during the three months, compared with a 4.61% gain in the previous quarter, it said in a statement.
The mammoth-size fund, which managed 150.6 trillion yen of assets by end-March, is closely watched by global financial markets.
The quarterly loss, the biggest since GPIF started managing its assets on the market in 2001, poses a potential challenge to the new president Masataka Miyazono who took the helm in April as market uncertainity looms.
The GPIF in April raised its allocation target for foreign bonds to 25% from 15% and lowered domestic bonds allocation to 25% from 35%. Its portfolio is evenly split at 25% each across domestic and foreign stocks and domestic and foreign bonds.
The fund had 23.87% of its portfolio in Japanese bonds as of end-March, compared with 36.15% in September 2016 when the Bank of Japan launched its policy of pinning 10-year government bond yields around 0%. Its foreign bond holdings accounted for 23.42% of its portfolio.
The fund allocated 22.87% to domestic stocks and 23.9% to foreign stocks.
Reporting by Takashi Umekawa, Editing by Chang-Ran Kim and Sherry Jacob-Phillips