Aflac CFO appeals to Japanese debt investors to cut interest costs

NORTHAMPTON, MA /ACCESSWIRE/November 4, 2022/ By Nina Trentman

Aflac Inc., a Columbus, Georgia-based insurer, generates about 70% of its revenue in Japan. The company, which sells supplemental health insurance to Japanese, and less so to American consumers, recently sold about $1.21 billion of debt in Japan, taking advantage of the country’s lower cost of capital, interest rates country continuing to be in negative territory. CFO Journal spoke with Chief Financial Officer Max Brodén about considerations for the transaction and what Aflac did with the proceeds. Edited excerpts follow.

WSJ: Aflac recently sold approximately $1.21 billion in debt to Japanese investors. What was the reason?

Mr. Brodén: It is quite natural to finance ourselves in yen because we generate a large part of our income and profits [in Japan]. Our Japan operations hold $24.2 billion in investments. And we have $5 billion of futures contracts at the holding company that are long in dollars and short in yen. Thus, these increase in value when the yen weakens and they decrease in value when the yen strengthens. What we’re talking about here are yen-denominated assets, where we then issue our bonds directly to the Japanese market and the principal and coupon are denominated in yen.

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Aflac Incorporated, Friday, November 4, 2022, Image from press release

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Contact information:
Spokesperson: Aflac Incorporated
Email: [email protected]

THE SOURCE: Afla Incorporated

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John A. Bogar