Annual lists 2004 2003 2002 2001 2000 1999 1998 1997 1996 1995

Ottawa, October 1, 2002
2002-080

Rates Announced for Canada Premium Bond Series 27 and Canada Savings Bond Series 78

Related document:

• Backgrounder.

John Manley, Deputy Prime Minister and Minister of Finance, announced today interest rates for the November 1 bond issues of Canada Premium Bond (CPB) Series 27 and Canada Savings Bond (CSB) Series 78, which are on sale from today until November 1, 2002, inclusive.

CPB Series 27, with an issue date of November 1, 2002, and a 10-year term to maturity, will carry an interest rate of 2.50 per cent for the first year, rising to 6.00 per cent for the fifth year. The annual compound rate of return, based on these guaranteed rates, will be 4.06 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 9 (November 1, 1999) will carry the same rates as those announced for CPB Series 27 for the bond years beginning November 1, 2002, and ending October 31, 2007.

CSB Series 78, with an issue date of November 1, 2002, and a 10-year term to maturity, will carry an interest rate of 2.00 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) and CSB Series 72 (November 1, 2001) will carry the same rate as that announced for CSB Series 78 for the bond year November 1, 2002 to October 31, 2003.

CSB Series 45 (November 1, 1990) matures on November 1, 2002, and following that date will no longer earn interest.

CPB Series 27 and CSB Series 78, 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. The next series of CPBs and CSBs are expected to be available November 2, 2002.

The Minister also announced today that the Department of Finance, together with Canada Investment and Savings, the special operating agency responsible for the Retail Debt Program, has implemented a new Internet-based delivery service to provide notification of future interest rates for subsequent bond series.

The Department will no longer issue news releases to announce interest rates following the start of the traditional fall campaign. Instead, effective immediately, persons interested in receiving information about Canada Premium Bond and Canada Savings Bond interest rates may subscribe to an automatic e-mail notification service at www.csb.gc.ca. Those who already subscribe to the New Canada Savings Bonds 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.

___________________
For further information:

If you would like to receive automatic e-mail notification of all news releases, please visit the Department of Finance Canada Web site at http://www.fin.gc.ca/scripts/register_e.asp

Backgrounder

Canada Premium Bond Series 27 and Canada Savings Bond Series 78

Those purchasing bonds between October 1, 2002, and November 1, 2002, will be able to date their payment November 1, 2002, the day Canada Premium Bond (CPB) Series 27 and Canada Savings Bond (CSB) Series 78 start earning interest.

Holders of compound interest (C-bond) CPB Series 27 will earn $220.31 for each $1,000 bond held from November 1, 2002, until the end of the fifth bond year, with an annual compound rate of return of 4.06 per cent. The effective annual yield over the five years for a regular interest (R-bond) CPB Series 27 will be 4.00 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) CSB Series 78 will earn $20.00 for each $1,000 bond held from November 1, 2002, until the end of the first bond year, with an annual compound rate of return of 2.00 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.

CPB Series 27 rates for the remaining five years to maturity and CSB Series 78 rates for the remaining nine 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 Premium Bonds (Series 1 and Series 2 formerly known as Canada RRSP Bonds)

CPBs Series 1 to 26 will earn the following guaranteed rates of interest for the years indicated.

The rates of interest for Series 2 to 26 for subsequent years to maturity will be announced at future dates.

Outstanding Canada Savings Bonds

CSBs Series 46 to 77 will earn the following posted minimum guaranteed rates for the years indicated.

All CSBs issued up to 1989 (Series 1 to 44) have matured and are no longer earning interest. CSB Series 45 (November 1, 1990) matures on November 1, 2002, and following that date will no longer earn interest.

The rates of interest for CSB Series 47 to 77 for subsequent years to maturity will be announced at future dates.

Additional information on the terms and conditions of New Canada Savings Bonds is available on our Web site or at financial institutions across Canada.

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