Business & Finance
Berkshire CEO Greg Abel says rising Japanese bond yields are manageable for trading houses
Berkshire Hathaway plans to maintain its long-term Japanese investments and continue issuing yen-denominated debt despite 30-year high bond yields in Japan.
The short version
- Berkshire Hathaway CEO Greg Abel stated that multi-decade highs in Japanese bond yields do not pose a fundamental problem for major Japanese trading houses.
- Berkshire holds stakes exceeding 10% in five major Japanese trading conglomerates: Itochu, Marubeni, Mitsubishi, Mitsui, and Sumitomo.
- Abel confirmed Berkshire plans to hold these investments for decades and will continue to issue yen debt when appropriate.
- Whether rising yields will eventually pressure borrowing costs or impact future expansion plans remains an ongoing consideration.
Key facts
- Japan's 10-year bond yield reached a 30-year high slightly above 3%, while the U.S. 10-year Treasury yield surpassed 4.8%.[CNBC]
- Greg Abel stated that none of the five major Japanese trading houses in which Berkshire invests raised rising yields as a fundamental challenge.[CNBC]
- Berkshire Hathaway holds stakes of more than 10% in Itochu, Marubeni, Mitsubishi, Mitsui, and Sumitomo after obtaining permission from each firm to exceed the original 10% limit.[CNBC]
- Berkshire intends to keep holding these Japanese trading house investments for decades and expects to continue issuing debt denominated in yen.[CNBC]
What remains uncertain
- The long-term impact on Berkshire's yen debt issuance strategy if Japanese interest rates continue to climb remains unclear.[CNBC]