DEPARTMENT OF FINANCE PRESS STATEMENT NO. 1 OF 1996: REDEMPTION OF INDEFINITE PERIOD SAVINGS BONDS, 5 JANUARY 1996
The Ministerof Finance has announced that indefinite period savings bonds are to be phased out during 1996. A notice to this effect appeared in the Government Gazette of 5 January 1996.
Over the past few years, the issuing of bonds has made a small contribution towards financing the total borrowing requirement of the Government. However, the administration of such investment instruments is much more expensive than, for example, stocks. Government has also been trying to limit its interest burden, and has therefore not been able to offer competitive interest rates on these bonds. As a result, bonds have roused little interest in recent years, as individual investors have been able to earn higher rates of interest through commercial savings institutions. It has now become uneconomical for the State to continue financing by means of this instrument.
Phasing out savings bonds will involve the following:
1) Suspending the sale of Indefinite Period National Defence Bonds and Indefinite Period Exchequer Bonds, as from 1 February 1996;
2) The redemption of the respective bonds on the following redemption dates, after which dates no further interest will accrue;
Indefinite Period National Defence Bonds: 15 July 1996 Indefinite Period Senior Citizen Savings Bonds: 15 July 1996 Indefinite Period Exchequer Bonds: 31 August 1996
All holders of the above-mentioned bonds are therefore requested to return their bond certificates to the Department of Finance, as soon as possible, but not later than one month period to the redemption date of the respective bonds. Certificates, together with complete repayment instructions must be dispatched, by registered mail, to the following address:
Deputy Director-General: Financial Planning (Bonds Division) Department of Finance Private Bag X115 0001 PRETORIA
Bond certificates may be handed in at the following street address of the Bonds Division during office hours:
Mrs N v.d. Merwe Room 101, Abattoir House c/o Hamilton Street and Edmund Street Arcadia, Pretoria
NB: These bonds must be clearly distinguished from Bonus Conversion Bonds (previously National Defence Bonus Bonds) and the Bop Bonds of the former Republic of Bophuthatswana. Holders of Bonus Conversion Bonds may still surrender their certificates for redemption at South African Post Offices which conduct money order business. Bop bonds must be forwarded to the Department of Finance, North West Province, P.O. Box 5555, Mmabatho, by registered mail.
Enquiries: Mrs N van der Merwe, tel (012) 323-1703 ext. 260.
Issued by: Ministry of Finance