Fidelity Sets Japan Bond Funds as Baby Boomers Retire

Fidelity Investments Japan Ltd., trailing Nikko Asset Management Co. and Nomura Asset Management Co., plans to move oversight of its bond funds to Tokyo from Hong Kong to gain customers in the country's retirement market.

``We will be looking to increase the number of asset allocation specialists based here,'' Chief Investment Officer John Ford said in an e-mail. ``We will be accelerating our efforts in Japanese fixed income.''

Fidelity Japan, set up in 1969 by Boston-based Fidelity Investments, the biggest U.S. mutual fund company, oversees 3.7 trillion yen ($32 billion) for clients, behind Citigroup Inc.'s Nikko and Nomura, which have more than four times more money under management.

Japan has 6.9 million people born between 1947 and 1949 who will get about 85 trillion yen of retirement payouts in the next five years, according to estimates from Tokyo-based Nomura Holdings Inc., the nation's biggest brokerage. Nomura estimates about 60 percent of the money, or 51 trillion yen, will be invested in stocks and mutual funds. Thirty percent will be used to pay debt and 10 percent will go to short-term spending.

Retirees account for 25 percent of household savings in Japan, a bigger proportion than in any other country, according to estimates from analysts at New York-based Goldman Sachs Group Inc.

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