System of charge of coupon compensation for State Savings Bonds of Kazakhstan was changed
/IRBIS, Oct.05, 99/ - Since the third quarter the Ministry of Finance of
Kazakhstan has changed order of the quarter compensation charge for the
state savings bonds (SSB) holders. As far as it is known to the IRBIS agency
the new rules are not authorized yet by emitter.
SSB are tenge denominated coupon liabilities with the "floating" rate of
quarter compensation. A nominal value is 1,000 tenge. These securities are
oriented to attraction of money of the Kazakhstan population, earlier they
were issued by the Ministry of Finance at the end of each quarter. However
recently this practice was stopped.
The coupon rate of unredeemed SSB was determined for each next quarter
of circulation through the yield of the MEKKAM-3 issue. But than MEKAVM
were introduced on the market while MEKKAM placement was canceled.
Now there are two SSB issues in circulation: of tenth issue (10/98,
KZ4CL2312997, 150 million tenges) and eleventh issue (11/98,
KZ4CL2303A09, 170 million tenges).
Recently the Ministry of Finance determined the SSB quarter compensation
charge system. Henceforth placement parameters of MEIKAM-3 - indexed
liabilities of the Ministry of Finance will be used as a basis. The yield rate
which will be determined at these securities auction placement will be
established for the nearest quarter as SSB yield. Except this the holders will
receive additional payment for inflation, which will be calculated from the real
consumer price index (CPI) for three last complete months of SSB
To illustrate the coupon charge mechanism let's take as example the
September 23 service of the circulated issues (at that Agency has not
information concerning reception of money by the investors).
For a basis the results of MEIKAM-3 (29.06.99, KZ31L3009995) first issue
placement were taken. The fixed yield rate - 10.0 % annual. The inflation
was taken into account for June (CPI - 104.8), July (106.0) and August
(105.6) and has made 5.635%. Thus, compensation for one SSB of 1,000
tenge nominal, have made: under the fixed rate - 25.00 tenge, for inflation -
56.35 tenge, total - 81.35 tenge. An effective yield for actual term of
circulation (June 24, 99 - Sep.23, 99) - 32.54% p.a.
As an employee of the Ministry of Finance has informed KASE, in connection
with fourth issue of MEIKAM-3 (Sep.29, 99, KZ31L3112997) cancellation the
rate of SSB-10 and SSB-11 coupon compensation will be established on the
base of the previous MEIKAM-3 (Aud.27, 99, KZ31L3011991) auction at the
rate of 9.75% p.a. plus additional payment for September, October and
The IRBIS agency also knows, that now the Ministry of Finance considers an
opportunity of issue of the 2,000 registered devaluation indexed SSB - as
the paper bonds for the population.