Trading begins in key BD150m bondS

06/08/2015 08:52 AST

Manama: Investors will be able to buy and sell Government Development Bonds from today following their listing on the Bahrain Bourse (BHB) yesterday.

In a statement, the exchange said the bonds, floated to raise BD150 million, will be traded under the symbol GDEV9.BND.

Having a par value of BD1, 150m bonds were issued by the Central Bank of Bahrain on behalf of the government on July 30 for a period of five years ending July 30, 2020.

Returns on the securities will be paid every six months on January 30 and July 30 every year throughout the period of the issue, with the first coupon payment due on January 30, 2016, and the last coupon payment slated for July 30, 2020. The annual fixed interest rate on the securities is four per cent.

Investors wanting to buy or sell the bonds need to place their orders through registered brokers who will feed them into the trading system, the BHB said. The system will automatically process the orders in accordance with price priority first and time priority later.

Each transaction has to have a minimum value of BD400. Following this listing, the number of bonds and sukuks listed on BHB reached 11 with an approximate total value of $4.861 billion.

Guidelines on trading in debt instruments were issued by BHB on February 1 this year. Types of orders, board lots and the tick size applicable were defined by the guidelines, which also presented the pricing mechanism.

Investors are to receive the full amount of the transaction which includes the bond value plus the coupon which will be automatically calculated by the system.

All transactions will be settled within two business days of the completion of the deal. The bourse is open for trade from Sunday to Thursday, starting at 9.30am and ending at 1pm.

Gulf Daily News