Japanese mega banks continue to cut JGB exposure and remaining holdings have an increasingly shorter duration. They have also slashed equity positions: the value of which has held firm due to rising prices.
However, increased holdings of foreign bonds, especially US Treasuries, has made the Balance Sheets and P&L of the mega banks that more sensitive to global monetary tightening.
There is some risk (and reward) associated with the
growing foreign loan portfolio.
SMFG is less sensitive to a rise in foreign bond yields.
Dollar Borrowing has risen sharply. Funding mismatch: US assets (>US$3.5 trillion) exceed US Liabilities by some US$1 trillion.