Sber has issued its first zero-coupon bonds, a debt instrument implying no coupon payments, on September 3, 2021. The bonds will reach maturity in 3.5 years and will be redeemed on February 28, 2025. Early redemption is possible. The face value of one bond is RUB 1,000.

Interest in the stock market is climbing in Russia, and Sber strives to give clients as many opportunities to make reliable investments in the Russian market as possible. Major Russian issuers rarely issue zero-coupon bonds, which makes them more interesting to investors, including retail ones. Sber's zero-coupon bonds are low-risk ones. Representing the issuer's senior debt, they have an AAA rating assigned by ACRA[1] and are great for conservative investors seeking to make long-term investments. The structure of zero-coupon bonds is clear even to those who do not have much investment experience, and they are available to unaccredited investors[2]. When holding a bond for more than three years, an investor can receive an investment tax deduction for income of up to RUB 3 mn a year, according to the Tax Code.

Alexander Zozulya

Senior Managing Director, Global Markets, Sberbank

Zero-coupon bonds usually trade below their face value; upon redemption, the owner of the bond is paid the face value in full. This difference is essentially the income investors receive. Also, these bonds don't need to be held until maturity and can be sold on the market before maturing if there is demand for them. In this case, however, your investment income may be smaller than expected.

Sber customers can buy the zero-coupon bonds to their brokerage account.

[1] Credit rating agency ACRA: https://www.acra-ratings.ru/.

[2] If the bonds meet the rating levels established by the Bank of Russia (Article 8, paragraph b) 192-FZ): the credit rating of bonds or the issuer of bonds or the person who provided security for bonds is not below the level set by the Board of Directors of the Bank of Russia

(https://www.cbr.ru/about_br/dir/rsd_2021-07-23_3/).

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Sberbank of Russia published this content on 10 September 2021 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 10 September 2021 12:21:02 UTC.