Japan became the largest holder of US Treasury securities at the end of February for the first time since August 2008, narrowly surpassing China, which is scaling back US bonds in its portfolio, the US government said Wednesday.

The latest Treasury International Capital data showed that the margin between the two countries was small with Japan's holdings of US Treasury debt at $1.2244 trillion against China's $1.2237 trillion, but the month-on-month decline in China's holdings of US bonds exceeded that for Japan, according to Japan's (Kyodo) News Agency.

China's holdings of US bonds in February fell $15.4 billion from a month earlier while the figure for Japan dropped $14.2 billion.