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Market Chatter: Sumitomo Life and Dai-ichi Life Shift to Higher-Risk Private Credit Assets for Better Returns

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Japanese insurers Sumitomo Life and Daiichi Life (TYO:8750) are increasing their exposure to private credit as a way to chase better returns, having largely completed their asset rebalancing efforts, Nikkei Asia reported Thursday, citing officials.

According to President Yukinori Takada, Sumitomo Life aims to grow its private credit holdings by 60% from the current 1.6 trillion yen by the end of fiscal 2028, the news daily said.

Daiichi Life also plans to boost its private credit balance this fiscal year after reaching 120 billion yen in December, the publication said.

Naoto Ichimura, general manager of Daiichi Life, said life insurers can assume liquidity risk due to their long-term policy structures, making private credit an attractive asset class if proper manager selection and rigorous risk controls are in place, the report said.

(Market Chatter news is derived from conversations with market professionals globally. This information is believed to be from reliable sources but may include rumor and speculation. Accuracy is not guaranteed.)

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