日本寿险公司：收益率提升的同业选择

CMBI Credit Commentary Japan Lifers:yield pick-up plays over peers Glenn Ko, CFA高志和(852) 3657 6235glennko@cmbi.com.hk Initiate buy onRESLIF 6.875 Perp andSUMILF 5.875Perp At the time of writing,JP lifershaveoutstanding USD papers totaledUSD27.5bn,representing 45% of the total outstanding USDpapersissued by Asianlifers.Weview JPlifers USD hybrids as high-quality diversification playsin view of these Cyrena Ng, CPA吳蒨瑩(852) 3900 0801cyrenang@cmbi.com.hk The structure of subordinatedcapital papersof JP lifers(except RESLIF 6.875Perp)are more investor-friendly compared to those issued byAustralia, mainlandChina and Singapore, in view of the absence ofprincipal write‑down or equity Yujing Zhang张钰婧(852)3900 0830zhangyujing@cmbi.com.hk We initiate buy onRESLIF 6.875 Perp(first call in May’32) forattractiverisk-adjusted return profile. At 101.3, RESLIF 6.875 Perp is trading at YTC of 6.6%. Itis the highest-yieldingissuein JP lifer universe, reflects its lower credit rating,junior subordinatedranking in capital structure, as well as loss absorption Moreover, we initiate buy onSUMILF 5.875 Perp(first call in Jan’34) for betterrisk-adjusted return profile.At 102.3, SUMILF 5.875 Perp is trading at YTC of5.5%, offers 27bps pickup over NIPLIF 5.95 04/16/54 (first call in Apr’34) withearlier first call date at same issue rating. SUMILF 5.875 Perp also trading6bpsoverDAIL 6.2 Perp (first call in Jan’35)while1 year shorter to first call. CMBI Fixed Incomefis@cmbi.com.hk RESLIF We initiate buy onRESLIF 6.875 Perp(first call in May’32)forattractiverisk-adjusted return profile. At101.3, RESLIF6.875 Perp is trading at YTC of 6.6%. It is the highest-yielding bond in JP lifer universe. We viewthatthe currentvaluationreflects its lower credit rating,deep subordination, andloss absorption features. On RV basis,RESLIF 6.875Perp offers yield-pick up of 96bps over RESLIF 6 ¾ 07/02/35 (first call in Feb’35), aswell as 148bps over itsparent NIPLIF 6.25 09/13/53 (first call in Sep’33)and first callable c1 year earlier. We viewthe spread differential compensates for RESLIF 6.875 Perp’s subordination relative to the dated subordinated RESLIF 6.875 Perpis the only instrumentcontains loss absorption featuresin JP lifer universe, and qualifies as Tier1 Capital ofResolution Life.The distribution of RESLIF 6.875 Perp is non-cumulative, subject to optional cancellationatissuer’sdiscretion and mandatory cancellationifResolution Life fails to meet any enhanced capital requirements(ECR).The perp also carriesdividend stopper clauses. Moreover, the principal is subject to written downifeligible Resolution Life is a global life insurance groupdesignated as an Internationally Active Insurance Group (IAIG) andregulated by the Bermuda Monetary Authority (BMA). Itfocuseson reinsurance and the acquisitionand management As of Jun’25, Resolution Life’s AUM grew to USD94.1bn from USD84.5bn as of Dec’24 driven by onboarding of newtransactions.In 1H25,itreportedrevenueof USD5.9bnand incurred net loss of USD106mn.Despite the net loss, itsBermuda Solvency and Capital Requirement (BSCR)ratioremained robust at212% as of Jun’25,broadlystablefrom the level as of Dec’24 at 215%, andwell above theBMA’sECRof 120%.Moreover, after the issuance of theUSD750mn RESLIF 6 ¾ 07/02/35 (T2) in Jul’25,Resolution Life’s leverage ratio increased to 29% from 25%as of In Oct’25,Nippon Life (Japan’s largest life insurer by revenue and Resolution Life’s largest investor since 2019)completed its 100% acquisition of Resolution Life for USD10.6bn. This transaction is credit positive, anchoringResolution Life to Nippon Life’s strongbalance sheet and generating group-wide synergies.After thecompletion, Fitch upgraded Resolution Life’s rating by two notches to A-from BBB; while Moody’s upgraded RLGH FinanceBermuda’s rating, an intermediate holding and debt issuing entity of Resolution Life, by one notch to Baa2 from Baa1. SUMILF Moreover, we initiate buy onSUMILF 5.875 Perp(first call in Jan’34) for better risk-adjusted return profile. At 102.3,SUMILF 5.875 Perp is trading at YTC of 5.5%, offers 27bps pickup over NIPLIF 5.95 04/16/54 (first call in Apr’34)with earlier first call date at same issue rating. SUMILF 5.875 Perp also trading 6bps over DAIL 6.2 Perp (first call inJan’35) while 1 year shorter to first call. We view the yield pickup of SUMILF 5.875Perp over A-rated hybrid NIPLIFsmore than compensates for SumitomoLife’s comparatively lower solvency ratios and profitability metrics. InSep’25, Sumitomo Life’s solvency ratio at669% Sumitomo Lifeis one of the largest life insurance companies in Japan by today assets as of Sep’25, with businessin life insurance and annuities, property and casualty, as well as asset management and investment. The profitabilitymetrics of SumitomoLife is weaker than its peers. This was partly due to its higher exposure to foreign bonds, That said, we view Sumitomo Life’s FX risk is manageable, with 30% of its assets denominated in foreign