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Immediate release
Ottawa, October 1, 2003
2003-044

Canada Savings Bonds Rates Announced

Related document:

• Backgrounder

John Manley, Deputy Prime Minister and Minister of Finance, announced today interest rates for the November 1 bond issues of Canada Savings Bond (CSB) Series 84, Canada Premium Bond (CPB) Series 34 and Canada Investment Bond (CIB) Series 1, which are on sale from today until November 1, 2003, inclusive.

CSB Series 84, with an issue date of November 1, 2003, and a 10-year term to maturity, will carry an interest rate of 1.75 per cent for the first year. This rate will be increased if market conditions warrant, but bondholders will not earn less than this guaranteed rate during the first year of the bond. CSBs can be cashed at any time.

Outstanding CSB Series 46 (November 1, 1991), CSB Series 47 (November 1, 1992), CSB Series 48 (November 1, 1993), CSB Series 49 (November 1, 1994), CSB Series 50 (November 1, 1995), CSB Series 54 (November 1, 1998), CSB Series 60 (November 1, 1999), CSB Series 66 (November 1, 2000), CSB Series 72 (November 1, 2001) and CSB Series 78 (November 1, 2002) will carry the same rate as that announced for CSB Series 84 for the bond year November 1, 2003, to October 31, 2004.

The maturity date on CSB Series 46 (November 1, 1991) has been extended to November 1, 2013.

CPB Series 34, with an issue date of November 1, 2003, and a 10-year term to maturity, will carry an interest rate of 2.45 per cent for the first year, rising to 5.00 per cent for the fifth year. The annual compound rate of return, based on these guaranteed rates, will be 3.34 per cent if held for the five years. The interest rates posted for years one through five are guaranteed and will be increased up until the issue date if market conditions warrant. Once the issue date has passed, no changes to the posted interest rates will be made. CPBs are redeemable once a year on the anniversary of the issue date and during the 30 days thereafter.

Outstanding CPB Series 15 (November 1, 2000) will carry the same rates as those announced for CPB Series 34 for the bond years beginning November 1, 2003, and ending October 31, 2008.

CIB Series 1, with an issue date of November 1, 2003, and a three-year term to maturity, will carry a guaranteed interest rate of 3.00 per cent for each year of the term. CIBs are non-redeemable prior to maturity but are transferable subject to the terms and conditions of the bond. CIBs are available through authorized investment dealers only.

CSB Series 84 and CPB Series 34, together with their no-fee retirement savings plan option, are available for direct purchase online at www.csb.gc.ca, by phone Monday to Friday between 8 a.m. and 8 p.m. Eastern Time at 1 888 773-9999, or wherever Canadians bank or invest. Non-certificated CSB Series 84, CPB Series 34 and CIB Series 1 are available from authorized investment dealers. The next series of CSBs, CPBs and CIBs are expected to be available November 2, 2003.

Persons interested in receiving immediate notification of future interest rates for subsequent CSB and CPB issues may subscribe to an automatic e-mail notification service at www.csb.gc.ca. Those who already subscribe to the CSB e-newsletter service are not required to re-register to receive these automatic notifications.

As in the past, the Minister of Finance reserves the right to terminate sales at any time.

A backgrounder is attached.

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For further information:

Canada Investment and Savings Media Relations 
(613) 992-9033

Backgrounder 

Those purchasing bonds between October 1, 2003, and November 1, 2003, will be able to date their payment November 1, 2003, the day Canada Savings Bond (CSB) Series 84, Canada Premium Bond (CPB) Series 34 and Canada Investment Bond (CIB) Series 1 start earning interest.

Holders of compound interest (C-bond) CSB Series 84 will earn $17.50 for each $1,000 bond held from November 1, 2003, until the end of the first bond year, with an annual compound rate of return of 1.75 per cent. This interest rate will be increased if market conditions warrant, but bondholders will not earn less than this guaranteed annual rate during the first year of the bond.

Holders of compound interest (C-bond) CPB Series 34 will earn $178.89 for each $1,000 bond held from November 1, 2003, until the end of the fifth bond year, with an annual compound rate of return of 3.34 per cent. The effective annual yield over the five years for a regular interest (R-bond) CPB Series 34 will be 3.31 per cent based on these guaranteed rates. The interest rates posted for years one through five are guaranteed for the periods indicated and will be increased up until the issue date if market conditions warrant. Once the issue date has passed, however, these interest rates will not be changed.

Holders of compound interest (C-bond) CIB Series 1 will earn $92.73 for each $1,000 bond held from November 1, 2003, until maturity on November 1, 2006. The interest rates posted are guaranteed for the term of the bond.

CSB Series 84 rates for the remaining nine years to maturity and CPB Series 34 rates for the remaining five years to maturity will be announced at future dates.

As in the past, the Minister of Finance reserves the right to terminate sales at any time.

Outstanding Canada Savings Bonds

CSBs Series 46 to 83 will earn the following posted minimum guaranteed rates for the years indicated.

All CSBs issued up to 1990 (Series 1 to 45) have matured and are no longer earning interest. The maturity date on CSB Series 46 (November 1, 1991) has been extended to November 1, 2013 and will continue to earn interest at the rate indicated in the above chart for the bond year beginning November 1, 2003, and ending October 31, 2004.

The rates of interest for CSB Series 46 and 48 to 84 for subsequent years to maturity will be announced at future dates.

Outstanding Canada Premium Bonds 

CPBs Series 1 to 33 will earn the following guaranteed rates of interest for the years indicated.

The rates of interest for Series 2 to 34 for subsequent years to maturity will be announced at future dates.

Additional information on the terms and conditions of CSBs and CPBs is available on our Web site at www.csb.gc.ca or at financial institutions across Canada. Information on the terms and conditions of CIBs is available on our Web site at www.csb.gc.ca/eng/bonds_cib.asp.

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For further information:

Tel: 1 800 575-5151 (toll-free)
TTY: 1 800 354-2222 (toll-free)
Fax: (613) 782-7716
E-mail address: csb@csb.gc.ca
Web site: www.csb.gc.ca