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U.S. rate rises hit Japanese megabanks' finances hard

Unrealized losses on bonds total $12.5bn for the three top banks

While the giant Japanese banks' overall securities holdings still carry unrealized gains, their capital adequacy is threatened.

TOKYO -- Sharp rises in interest rates of overseas bonds, which represent drops in their price on the flip side, have posed challenges for Japanese megabanks.

Major Japanese banks' investment strategies came into question as they reported a combined total of 1.7 trillion yen ($12.5 billion) in unrealized losses on their foreign bond holdings and suffered losses on their sale as of March.

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