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Podřízený dluhopis EGB Fix-To-Float / 2027


ISIN:
AT0000A1QPC8

Date: 2019/11/14 00:00:00
Bid Ask
100.00 101.77
Difference 0.00% (0.00)

General attributes

Type of bondSubordinated bonds
Bond stylesubordinated
Issuer typefinancial institution
Country of issueAT
Current coupon2.220%
Coupon stylefloating
Coupon payment date2017/07/12
Coupon payment periodsemi annually
Yield to maturity p.a. (before capital gains tax)-
Value date2017/01/12
Maturity2027/01/12
Repayment value100.00
CurrencyCZK
Nominal value10,000
Capital gains tax-
Accrued Interest80.17
Investor tolerance5 (scale 1-7)
Last trading day2027/01/04

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The chart is composed of values which are the arithmetic average values of bid / ask (MID) from previous working day. Performances under 12 month have only little informative value. Information about previous performance does not guarantee future performance.
Source: Česká spořitelna, a. s.
Advantages Details you should be aware of

Why buy the subordinated bond?

  • It reflects the quality of the Erste Group Bank as a strong Central European bank, offering concurrently a higher yield compared to classical bond products.
  • Attractive fixed coupon of 2.4 % p. a. In the first two years.
  • Attractive floating coupon from 2 % p. a. to 5 % p. a. in the following years.
  • Regular half-year disbursement of interest. 
  • The prices of bonds are usually given as the percentage of the nominal value. Purchase price means that the client is selling, selling price means that the client is buying.
  • Issue date: 12 January 2017
  • Currency: (CZK)
  • Nominal value of a single bond: CZK 10,000 
  • Minimum investment: 1 piece
  • Interest disbursement: twice a year
  • Fixed interest (in the first two years): 2.4% p. a.
  • Floating interest from the third year until the maturity date: as per 6M PRIBOR, however at minimum 2% p. a. and at maximum 5% p. a.
  • Brokerage fee: CZK 100 per instruction regardless of the amount of the investment
  • Issuer: Erste Group Bank AG
  • Selling price: according to the current Exchange Rate List of Česká Spořitelna
  • Specific risks associated with the subordinated bond
    If the issuer finds itself in a situation requiring increase of regulatory capital, all measures will need to be taken first to internally create capital in accordance with applicable European legislation. The regulatory authority may order the transformation of subordinated bonds into equity (shares), reduction of their principal, or their full depreciation. If the issuer, in this case Erste Group Bank AG, is liquidated or becomes insolvent, all unsubordinated debt obligations shall firstly be settled (e.g. loans, senior bonds) and only then will investors in subordinated bonds receive their funds. A further risk for subordinated bond holders is the possible limitation of their liquidity. It cannot be ruled out that in future it will not be possible to trade bonds on any market nor sell them before their maturity date. In view of these risks subordinated bonds offer the bonus of a higher yield.

Description

Do you trust the financial strength of the Erste Group Bank and would you like to be part of the success of this renowned Central European financial group? The Podřízený dluhopis EGB Fix-To-Float / 2027 with fixed  as well as floating interest-bearing offers an interesting yield potential.

For its duration this subordinated bond offers its clients two types of yield interest: fixed and floating.  In a short-term period of two years in the current low-interest environment, it offers an above standard fixed interest of 2.4 % p.a. Then in the next eight years until repayment its yield shall be based on the six-month PRIBOR rate while the minimum interest shall be 2% p.a. and the bond will pay out a maximum of 5% p.a.

Podřízený dluhopis EGB Fix-To-Float / 2027 is ideal for anybody who expects an increase of interest rates over a longer period of time.

Payment notes

How the yield is calculated?

  • In the first two years, the fixed interest rate of 2.4% p.a. shall be applied to the bond
  • In the following years, a floating interest rate shall be applied to the bond which shall be determined every half a year on the basis of the current six-month PRIBOR interbank interest rate and shall range from the minimum of 2% p. a. to the maximum of 5% p. a.
  • If the six-month PRIBOR is fixed in the range from 2% to 5%, the investor shall receive an interest in the amount corresponding to this specific value.
  • If the six-month PRIBOR is fixed under 2% (e.g, 1%), the investor shall receive an interest in the amount of 2% p. a.
  • If the six-month PRIBOR is fixed above 5% (e.g. 6.5%), the investor shall receive an interest in the amount of 5% p. a.
  • The interest shall be disbursed on a six-month basis.

Settlement

  • The maturity date of the bond shall be 12 January 2027
  • The disbursement of the yield as well as the nominal value shall be conducted by Česká spořitelna.
  • The bond purchase as well as sale settlement takes 3 business days.

Secondary market

  • Minimum purchased quantity: 1 piece.
  • Administration fee (for purchase or sale) shall be 100 CZK regardless of the amount of investment.
  • The bond may be sold also prior to its maturity date for the price specified by the current exchange rates table.

 Warning: Since 1 August 2013, when granting state aid, the principles applied are those contained in the communication of the Commission on the application of State aid rules to support measures in favour of banks in the context of the financial crisis (2013/C 216/01). According to these principles, before granting any kind of restructuring aid, be it a recapitalising or impaired asset rescue measure, all capital generating measures, including the conversion of junior debt to equity, should be exhausted. For subordinated bond holders these principles mean that they have to contribute to reducing the capital shortfall while their contributions can take the form of either conversion of a bond to a share or a write-down of their principal.


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