Known Conditions for ‘People’s Treasury Bills’, Earnings Higher than People’s Bonds

The conditions under which the Ministry of Finance will issue the long-awaited treasury bills intended for citizens are officially known. According to the presentation, the annual yield rate is set at 3.75 percent, while for the people’s bond, it is established at an annual yield of 3.65 percent. The state aims to raise 440 million euros, and the minimum amount that can be subscribed is 1,000 euros.

According to the plan, the ‘treasury bill’ will be issued on November 23, and it matures on November 21, 2024. The offering period is divided into two parts. In the first round, which will last from November 13 to November 20 at 11 a.m., citizens have the right to subscribe. It should be noted that, in addition to Croatian citizens, foreigners residing in Croatia also have the right to subscribe. Interested investors will be able to subscribe to treasury bills in the first round through a network of 170 branches of the Financial Agency (FINA).

The documents required for subscription include a personal identification card or passport, and other necessary information will include the OIB, the account number in a commercial bank (IBAN) for the payment of funds upon maturity, the desired quantity of treasury bills, and the account number in SKDD (if they have an open account and know this information). In case the subscription is made on behalf of another individual, a certified power of attorney must be attached along with the mentioned documents. Foreigners need to bring a valid personal identification card or passport from their home country or a foreign residence permit and a certificate of residency.

The price of one treasury bill in the first round of subscription is 963.95 euros. Upon entering the data, the investor will receive a Confirmation of Receipt of Offer for signature. However, for final subscription, a payment must be made, and there are two options for this: at the FINA counter without a payment transaction fee for amounts up to 10,000 euros (above that according to FINA’s conditions), at the bank counter, or via online banking. Upon maturity on November 21 of the following year, the investor will receive an amount consisting of the subscribed quantity of treasury bills multiplied by 1,000 euros. The Ministry emphasizes that with the amendments to the Income Tax Act, which will apply from January 1, 2024, investments in treasury bills will not be taxed with income tax.

The second round is intended for registered users of the Bloomberg Auction System (BAS) through which the sale of treasury bills is usually conducted. In other words, the second round is intended for institutional investors, primarily banks, which are also the largest buyers of these short-term government debt securities. The subscription period in the second round will last on November 21 from 9 to 11 a.m.