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15 March 2011

The situation in Japan /// The point of view of Natixis Asset Management

written by Equity, Asset Allocation and Structured Products, and Fixed Income Departments at Natixis Asset Management The direct exposure of Natixis Asset Management’s mutual funds to Japanese assets is very marginal (less than 1% of funds under management) and restricted to a limited number of portfolios: a few equity, fixed income and international balanced funds, as well as funds specialized in Japanese equities. In terms of asset allocation, the balanced portfolios had adopted a more prudent exposure to risky assets early in the month, by moving notably from an overweight to a neutral to an underweight position on equities. This desensitization move had been prompted, amongst other things, by soaring commodity prices and their impact on growth. Last Friday, the magnitude of the catastrophe that had begun to hit Japan led the allocation team to decide to neutralize the overweight on Japanese equities within even the equity portion of the international balanced portfolios. Past experience of similar cases effectively demonstrates that the relevant stock markets had difficulties. Since Monday morning, asset allocation has thus remained oriented towards reducing overall equity risk and, more specifically, Japanese equity risk. In terms of fixed income management, no Japanese corporate credit exposure needs to be flagged in the funds with sovereign benchmarks. For their part, the international fixed income portfolios have exposure to Japanese indexes at the neutral minimum in sensitivity relative to their benchmarks. Since Monday morning (14/03), the Yen short positions were closed on fears of a flow of funds being repatriated. Lastly, concerning the funds specialized in Japanese equities, the returns are in line with their benchmarks, given a moderate asset risk concentrated on the stock selection, to the detriment of systemic risk (market exposure and sector allocation close to neutral). Written on 15/03/2011 by Equity, Asset Allocation and Structured Products, and Fixed Income Departments at Natixis Asset Management

Disclaimer This document is destined for professional clients. It may not be used for any purpose other than that for which it was conceived and may not be copied, diffused or communicated to third parties in part or in whole without the prior written authorization of Natixis Asset Management. None of the information contained in this document should be interpreted as having any contractual value. This document is produced purely for the purposes of providing indicative information. It constitutes a presentation conceived and created by Natixis Asset Management from sources that it regards as reliable. Natixis Asset Management will not be held responsible for any decision taken or not taken on the basis of information contained in this document, nor in the use that a third-party may make of it.