Japan’s push to steer more national pension assets into domestic markets risks
redirecting billions into Japan and trimming fee revenue for foreign managers.
Finance Minister Katayama said last Friday the government aims to substantially
raise the national pension fund’s allocation to domestic assets, prompting
investor bets that billions of dollars could flow into Japanese markets. The
Government Pension Investment Fund (GPIF) manages $1.8 trillion; roughly $93
billion of overseas exposure is almost entirely run by foreign managers. As of
the fiscal year to March 2025, GPIF relies on 35 external managers for overseas
mandates; those firms collectively earned about JPY21bn (~$130m) in fees, and
some global managers could face losses of tens of millions of dollars in
management fees. Broadridge Asia-Pacific head of growth solutions Yoon Ng says
passive foreign managers may come under pressure while domestically strong
active managers stand to benefit.
