Meiji Yasuda Life Insurance: Core credit themes intact through June

研报英文原文证据摘录

J P M O R G A N

Asia Pacific Credit Research

11 August 2026

Overweight

Meiji Yasuda Life Insurance

MYLIFE

Core credit themes intact through June

Core credit themes remained intact for Japan’s Meiji Yasuda Life Insurance (bond

ticker: MYLIFE) through the June quarter. The economic solvency ratio remained

steady and above most peers at 209%, and ¥7tn (US$346bn) of unrealized gains

on equities provides financial flexibility. We think the bonds look cheap and

reiterate an Overweight.

Financial soundness remained solid, with the solvency ratio above most

peers. The consolidated economic value-based solvency ratio (ESR) ticked

slightly higher to 209% from 208% at end-March, comfortably within

management’s target range of 200–220%.

The company has the flexibility to manage the JGB yield volatility.

Unrealized gains on domestic stocks increased 14% from end-March to ¥7tn,

while unrealized losses on domestic bonds rose 5% from end-March to ¥2.3tn,

bringing the unrealized equity gains to 3.1x unrealized bond losses. Such

financial flexibility may increasingly come into focus as industry data show an

uptick in policy surrenders, although this detail is not disclosed at the company

level. According to a Bloomberg report in July (see here), management

indicated that the net purchases of super-long-term bonds for FY26 could reach

¥1tn if interest rates remain elevated, compared with its April expectation of

several hundred billion yen, when it saw limited room for further rises in yields.

Profitability remained under pressure due to portfolio rebalancing. Pretax profit declined 14% q/q to ¥17bn in 1Q FY26 (financial year ending 31

March 2027), as the company reported an ordinary loss of ¥197bn, versus

¥39bn of ordinary profit in 4Q FY25, while extraordinary gains from the

reversal of a reserve for price fluctuations (¥216bn) offset the loss. Ordinary

income declined 15% q/q, due to a 42% q/q decline in investment income to

¥573bn, while insurance premium and reinsurance income grew 9% q/q to

¥1,161bn. The sharp decline in investment income was mainly caused by lower

gains on sales of securities of ¥82bn, versus ¥425bn in 4Q FY25, amid

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