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A slightly higher coupon at the beginning, a little lower at the end but with a more generous loyalty bonus. The fourth BTp Valore, which will be on offer from Monday, has revealed its characteristics with the minimum guaranteed rates communicated by the Treasury and confirms itself to be very similar to its more immediate predecessor, offered two months ago.
The step up mechanism
The duration is the same, six years, the yield calendar is similar, with the step up mechanism which raises the coupon halfway through the period: for the first three years the gross annual yield will be 3.35%, compared to 3.25% in the latest edition, and will rise in the second three-year period to 3.90%, a decimal point below the 4% offered by the BTp at the end of February. Completing the picture is the 0.8% premium reserved for those who join in the next week and keep the security in their portfolio until maturity.
The numbers of the new BTp Valore reflect, as always, the overall picture of bond yields, which after the drop in mid-March have returned very close to the levels of two months ago; the combination of annual coupons and loyalty bonus then creates a small premium compared to ordinary securities of similar duration.
Guaranteed minimum rates
The rates communicated by the Treasury, it must be remembered, are the guaranteed minimums, and can therefore only be revised upwards at the end of the issue next week in the event of important news on the markets. The coupon, as per the tradition of the BTp Valore, will be quarterly, thus intensifying the semi-annual rhythm typical of other government bonds. The minimum investment is one thousand euros, there is no maximum limit: the regulation always provides for the theoretical possibility of early closure, which however does not jeopardize applications that arrive on time and are destined for complete satisfaction.
The tax advantages
The commission-free purchase, the preferential taxation of 12.5% and the exemption from inheritance tax are the key features that determine the tax convenience of the BTp. Furthermore, up to 50 thousand euros, government bonds will be excluded from the calculation of the ISEE, probably from next year in light of the implementing decree which still has to be passed to make the innovation foreseen by the latest budget law operational.