Japan Post Bank to launch private equity division

The division, which will come into operation on December 1, will be led by Tokihiko Shimizu, who in a previous capacity was instrumental in the Government Pension Investment Fund's (GPIF) push to diversify its assets and enter the alternatives space.

Shimizu was director general of GPIF's research department for seven years, departing in January to return to the Ministry of Health, Labor & Welfare as director and head of research. He joined Japan Post Bank in October.

The announcement comes in the wake of Japan Post Bank's listing earlier this month alongside its parent and Japan Post Insurance. There has been some speculation that Japan Post Bank, which has $1.7 trillion in assets, might shift part of its portfolio away from government bonds and other asset classes.

Masatsugu Nagato, the bank's president, said ahead of the listing that infrastructure, private equity and overseas real estate trusts would be considered as part of a more aggressive investment strategy, The Wall Street Journal reported. The medium-term goal is to increase holdings of foreign bonds and stocks.

GPIF's reorganization of its JPY129 trillion ($1.1 trillion) portfolio will see a movement from domestic bonds towards domestic and foreign equities as well as alternative assets. The target allocation for equities is now 50% - up from 24% - while alternatives are expected to account for up to 5%.

In 2014, GPIF formed a partnership with Development Bank of Japan (DBJ) and Ontario Municipal Employees Retirement System (OMERS) to jointly invest in infrastructure assets. Later the same year it appointed Hiro Mizuno, formerly of Coller Capital, as CIO.

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