Norinchukin’s credit ratings have been placed on review for downgrade by Moody’s Ratings, which cited the Japanese bank’s impending large losses from sales of foreign bonds.
The unlisted agricultural bank warned last month that it may incur losses of ¥1.5 trillion ($9.3 billion) this fiscal year as it sells U.S. and European sovereign bonds that lost their value after interest rates rose.
Any downgrade by Moody’s may put pressure on Norinchukin’s borrowing costs, which already exceed the returns on much of its foreign bond portfolio. The move comes days after S&P Global Ratings cut its outlook on the bank’s debt to negative, citing earnings risks.