At the start of this week, the Finance Ministry launched the ‘Fidelis Centenar’ government bond issuance for natural persons. The bonds will fall due in 2018, at the anniversary of 100 years since the Great Union. The issuance has a total value of RON 100 M, and a government bond will have the price of RON 100. The bonds can be bought on July 11-29, at an annual interest rate of 2.15 percent. The interest and capital earnings obtained from owning and trading the government bonds will represent tax-free income.
All resident and non-resident natural persons who are 18+ years old can become investors. Those interested can buy a maximum of 1,000 government bonds. The bonds can be bought, without bank fees, from BCR, BRD, Raiffeisen Bank and Banca Transilvania. In the subscription process, buyers can choose between opening a bank account, offering the data of their personal bank accounts or can use cash for the purchase.
After the subscription period ends, the Finance Ministry will establish the sum that will be contracted. The sum could be higher, equal to or lower than the RON 100 M initially announced, depending on the volume of subscribed government bonds.
The government bonds can be subsequently traded on the Bucharest Stock Exchange (BVB). The owners of the government bonds can trade them at prices transparently quoted on the BVB. The prices of the government bonds can fluctuate on the stock exchange depending on market conditions, and their value could be higher, equal to or lower than the nominal RON 100.
When they fall due, an anniversary raffle with 100 prizes each worth RON 1,000 will be organised. An investor can win a single prize, regardless of the number of bonds owned.
This issuance is part of Finance Ministry initiatives meant to enhance the population’s degree of financial education and to diversify the offer of savings instruments for natural persons.