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Ottawa, October 22, 1999 Canada Savings Bond and Canada Premium Bond Interest Rates IncreasedRelated document: Secretary of State (International Financial Institutions) Jim Peterson today announced that the interest rates for Canada Savings Bond (CSB) Series 60 and Canada Premium Bond (CPB) Series 9, which are currently on sale, will be increased effective immediately. Those Canadians that may have already purchased CSB Series 60 and CPB Series 9 will also benefit from today's rate increase. CSB Series 60, with an issue date of November 1, 1999 and a 10-year term to maturity, will now carry an interest rate of 4.40 per cent for the first year. CSBs are cashable at any time. CPB Series 9, with an issue date of November 1, 1999 and a 10-year term to maturity, will now carry an interest rate of 5.00 per cent for the first year, 5.40 per cent for the second year and 5.80 per cent for the third year. The annual compound rate of return, based on these guaranteed rates, will be 5.39 per cent for a compound interest bond if held for three years. CPBs are redeemable once a year on the anniversary of the issue date or during the 30 days thereafter without penalty. Outstanding CSB Series 50 (November 1, 1995) and CSB Series 54 (November 1, 1998) will also carry an interest rate of 4.40 per cent for the year beginning November 1, 1999. "Today's rate increases reflect the Government's commitment to ensure that the interest rates on Canada Savings Bonds and Canada Premium Bonds remain competitive relative to other savings and investment products," noted Mr. Peterson. CSB Series 60 and CPB Series 9 are on sale wherever Canadians bank or invest until Monday, November 1, 1999. As in the past, the Minister of Finance reserves the right to terminate sales at any time. A backgrounder providing details of the rate change is attached. ___________________ Canada Investment and Savings BackgrounderCanada Savings Bond Series 60 and Canada Premium Bond Series 9
Those purchasing bonds between October 4 and November 1, 1999 will be able to date their payments November 1, the day Canada Savings Bond (CSB) Series 60 and Canada Premium Bond (CPB) Series 9 bonds start earning interest. Holders of CSB Series 60 will earn $44.00 for each $1,000 held from November 1, 1999 until the end of the first bond year, with an annual rate of return of 4.40 per cent. The interest rate will be increased if market conditions warrant, but bondholders will not earn less than this guaranteed minimum annual rate during the first year of the bond. Holders of compound interest (C-bond) CPB Series 9 will earn $170.89 for each $1,000 bond held from November 1, 1999 until the end of the third bond year, with an annual compound rate of return of 5.39 per cent. The effective annual yield over the three years for a regular interest (R-bond) CPB Series 9 will be 5.38 per cent based on these guaranteed rates. The interest rates posted for years one, two and three are guaranteed over the periods indicated. Once the issue date has passed, however, no changes to these interest rates will be made. CSB rates for the remaining nine years to maturity and CPB rates for the remaining seven years to maturity will be announced at future dates. Outstanding Canada Savings Bonds Series 44 to 59CSBs Series 44 to 59 offer the following posted guaranteed minimum rates for the years indicated.
All CSBs issued up to 1988 (Series 1 to 43 inclusive) have matured and are no longer earning interest. The rates of interest for Series 45 to 59 inclusive for subsequent years to maturity will be announced at future dates. Canada Premium Bonds (formerly known as Canada RRSP Bonds)CPBs Series 1 to 8 will earn the following guaranteed rates of interest for the year beginning on the series issue date.
The rates of interest for Series 2 to 8 inclusive 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 at financial institutions across Canada. For those organizations offering CSBs through the workplace, printed materials providing details of bond values will be sent directly to them. __________________ For further information: Tel: 1 800 575-5151 (toll-free) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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