Why buy the Podřízený dluhopis EGB VAR / 2029?
- It reflects the quality of the Erste Group Bank as a strong Central European bank.
- The bond has a flexible interest-bearing rate based on the current six-month interbank PRIBOR interest rate, 0.80% is then added to it.
- The yield is paid out regularly in half-year intervals, always at 19 March and 19 September.
- The electronic version of the prospectus and its amendments is published on Erste Group Bank AG website www.erstegroup.com. ERSTE GROUP BANK AG as the issuer and creator of this product elaborated the Notification of Key Information where you will find basic information about this investment product.
- You can get the Notification on creator´s website www.erstegroup.com, on the investment portal of Česká spořitelna www.investicnicentrum.cz and in printed form at Česká spořitelna, a.s. branches.
- The prices of bonds are given as the percentage of the nominal value. Purchase price means the client is selling, selling price means the client is buying.
- The holder of the Premium Bond bears the issuer´s credit risk.
- If you use the portfolio method of investment advice, ask your banker or investment specialist to assess together with you whether this product should become part of your investment portfolio.
- Product risk rate is on a scale from 1 to 7 (from a potentially lower risk and yield of 1 to a potentially higher risk and yield of 7) assuming that you will keep the product for 10 years. The real risk may significantly differ in case you sell the product prematurely.
- Isuer: Erste Group Bank AG
- Date of issue: 19 March 2019
- Maturity date: 19 March 2029
- Coupon level: according to PRIBOR 6M + 0.80% p.a., ACT/360 convention
- Coupon fixed at: 2 working days before the start of the following coupon period
- Coupon pay out: half-year, always at 19 March and 19 September
- Currency: Czech crown (CZK)
- Selling price: 100% on the first two days of sale, then according to the Exchange Rate List
- Distributor´s costs valid at the issue date: 0.4% p.a., you can find the exact wording in the Agreement for Purchase of the bond
- Issuer´s costs valid at the issue date: you can find the exact expression in the Notification of Key Information
- Price for the provision of early redemption: 2% of the transaction volume
- Minimum investment: 1 piece
- Nominal value of a single bond: CZK 10,000
- 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 write-off. 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. mortgage bonds, 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.