Trading of securities on stock exchanges
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Erste Group Bonds
Booked bonds with a nominal value of EUR 1,000 that have a public offer
in the Czech Republic and possibly other countries of the Erste Group
Erste Group Bonds
Erste Group bonds are book-entry bonds with a nominal value of 1,000 EUR, which are in public offering in the Czech Republic and any other Erste Group countries. These can be senior bonds or subordinated bonds whose interest yield (coupon) may be fixed, variable, a combination of fixed and variable, or can be structured notes (securities) whose yield depends on the development of selected underlying assets. They are intended for clients who prefer to invest in Euros. The payout of the yield and nominal value of these notes (securities) is guaranteed by their issuer.
The purchase of a bond will enable you to invest money for a period predetermined in the terms and conditions of the note (security). The payout of the bond interest yield and nominal value according to the terms and conditions of the bond is guaranteed by their issuer.
Your advantages
- Thanks to the fixed maturity date, other investments can be planned.
- The current yield to maturity together with the bond selling price is published daily in the bond price list.
- The bonds can be purchased at ČS branches.
- Quick access to funds. You can sell Erste Group bonds through Česká spořitelna for the market price at any time before maturity.
You should know
- The bond selling and purchase price changes every day due to yield changes on the bond market, in case of structured bonds also due to the development of underlying assets.
- A buying and selling order is settled within 2 business days after ordering a trade. If an investor pays the price of the purchased bond, the bond is credited to the investor’s asset account within 2 business days after ordering the trade, and in case of subscription, subscribed bonds are credited on the issue date.
- The price for the procured sale of senior bonds, structured bonds and structured notes, subordinated and other bonds is expressed in percentages of the trade volume. You can find details in the Price List.
- Full information about a note (security) is provided in the Final Terms and Conditions in combination with the Prospectus and all amendments related thereto. An electronic version of the Prospectus is published on the issuer’s website www.erstegroup.com, or on www.investicnicentrum.cz/prospekty.
What else should you know about Erste Group Bonds
The bond yield and nominal value is paid out on a predetermined date according to the issue terms and conditions. The price for which bonds are purchased is also important for the resulting investment yield. What applies to bonds with a fixed coupon is that at the time when the current yields on the bond market are lower than the bond yield interest, bonds are sold for a price higher than their nominal value and vice versa. Therefore, the current yield to maturity calculated on the basis of the current selling price and yields paid out in future could be lower or higher than the bond interest yield.
Income from the holding and selling of foreign bonds and structured notes (ISIN does not start with CZ...) is not subject to final withholding tax, but is subject to individual taxation, and if not exempt from tax (exemption comes into consideration only for income from the sale of a bond or a structured note), the taxpayer is obliged to declare this income in the relevant section of a tax return.
… increasing interest rates?
An increase in interest rates on the market results in a fall in prices of already issued bonds with a fixed coupon. If current interest rates are higher than those at the time that the bond was issued, under otherwise identical terms and conditions the bond is sold for a price lower than its nominal value.
… stable interest rates?
Under otherwise identical terms and conditions, stable interest rates do not affect the bond price.
… falling interest rates?
A fall in interest rates on the market results in an increase in prices of already issued bonds with a fixed coupon. If current interest rates are lower than those at the time that the bond was issued, under otherwise identical terms and conditions the bond is sold for a price higher than its nominal value.
Terms of purchase and sale of bonds and structured notes
Taxation of investment yields
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