Masayoshi Son Loses $2.6 Billion as SoftBank Shares Sink on BOJ Rate Hike

Masayoshi Son, the founder of SoftBank Group Corp., saw his fortune decrease by $2.6 billion in just two days as shares of his technology conglomerate plummeted.

The significant drop comes in the wake of an unexpected interest rate hike by the Bank of Japan (BOJ), which has sent shockwaves through the Japanese stock market.

SoftBank Shares Plunge

On Friday, SoftBank shares fell by 8% in Tokyo trading, capping a two-day decline of approximately 14%. This sharp drop in value has erased a substantial portion of the gains Son had accrued earlier in the year.

Despite this setback, Son’s net worth remains approximately $14 billion, still up from the $11.3 billion he started with at the beginning of the year, according to the Bloomberg Billionaires Index.

Impact of BOJ’s Policy Shift

The BOJ’s decision to raise interest rates sooner than anticipated has had a profound effect on Japanese stocks, particularly those in the technology sector. SoftBank, one of the world’s largest tech investors, has been significantly impacted.

The company had enjoyed a 46% increase in its stock price through the end of July, driven by its holdings in companies like chipmaker Arm Holdings Plc.

However, Arm’s shares dropped by 16% on Thursday after the company reaffirmed its annual sales forecast, disappointing investors who had hoped for more optimistic projections.

Economic and Market Repercussions

The broader Japanese market also suffered, experiencing its most significant drop since 2016. Investors reacted to the tighter monetary policy with a selloff, leading to widespread declines across various sectors.

SoftBank’s extensive international operations make it particularly vulnerable to currency fluctuations.

The yen strengthened to a four-month high on Thursday, following the BOJ’s hawkish stance, which added to the pressure on SoftBank’s stock.

Masayoshi Son’s Financial Position

Masayoshi Son, 66, remains the largest shareholder of SoftBank, which is valued at approximately $78 billion.

However, much of his stake is pledged as collateral for loans with various financial institutions. This arrangement heightens the financial risks for Son, especially during periods of market volatility.

SoftBank’s Performance and Future Prospects

SoftBank has been a major player in the technology investment space, with significant stakes in companies that are at the forefront of innovation, such as those involved in artificial intelligence.

The company’s future performance is likely to be closely watched by investors, particularly in light of the recent market turbulence and the BOJ’s policy changes.

Broader Economic Context

The BOJ’s interest rate hike is part of a broader effort to address economic challenges, including inflation and currency stabilization.

The impact of this policy shift on Japanese businesses and the global economy remains to be fully seen.

Analysts and investors are closely monitoring developments, particularly as they relate to major corporations like SoftBank.

The recent decline in SoftBank’s stock price and the resulting loss in Masayoshi Son’s wealth underscore the volatility and uncertainty in today’s financial markets.