The sale of federal loan bonds (OFZ) for households will begin on April 26, the Finance Ministry said in a press release.
"The Finance Ministry of Russia informs that the sale of retail federal loan bonds (OFZ-n) will start at VTB 24 (PJSC) and Sberbank PJSC offices starting April 26, 2017," said the press release.
The OFZ issue will total Rub 15 bln (15,000,000 bonds, with par value of Rub 1,000 apiece).
The coupon rates will be the following: 7.5% on the first coupon, 8% on the second one, 8.5% on the third coupon, 9% on the fourth one, 10% on the fifth and 10.5% on the sixth coupon.
The bonds will be redeemed on April 29, 2020.
The minimum number of bonds for purchase by an individual will be 30 bonds with par value of Rub 30,000, and the maximum number in an issue will be 15,000 with par value of Rub 15 mln. "We had to set the minimum level so that expenses at agent banks do not rise," specified earlier Konstantin Vyshkovsky, head of the Finance Ministry's Department of State Debt and State Financial Assets. The commission fee will be 1.5% if bonds are bought for up to Rub 50,000, 1% when bonds are purchased for Rub 50,000 to Rub 300,000, and 0.5% for bond investment exceeding Rub 300,000. To buy the bonds it will be mandatory for individuals to be a customer of the banks, and it will be necessary to open two accounts at a bank (a money account and the so-called paper account).
The bonds will be issued in the digital form. An individual will have an agreement signed with the bank and an account statement in which the number of bought bonds will be specified.
In March, Deputy Finance Minister Sergey Storchak claimed that retail federal loan bonds would be issued not for the purpose of replenishing the budget, but in order to provide households with a new saving instrument. "This instrument bears no fiscal burden, it aims to give an additional saving tool to individuals who live in the conditions of the fast growing financial market. When preparing a decision on the issue of this instrument we have analyzed expertise of developed countries, France and the US in particular. Both countries use this instrument aggressively – not from the fiscal point of view (to replenish national coffers), but from the point of providing households with those financial instruments that they might use for savings," said Storchak.
He pointed out that this initiative aims at forming the culture of saving and family budget planning. The OFZs bear no risk of default given Russia's reliable financial standing, Storchak emphasized.
