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Originally Posted by Catalpa  Excuse the ignorance folks put I take it that rate is per annum?
If so do they get it all at the end in one lump sum or at the end of each year the deal is in existence? |
Take for example the €700million 4.5% 2018 bond. The NTMA got that away at an initial yield of 5.082%. That means that the government issued €700million of debt although they will be only actually receiving circa €625million in cash for that €700million in paper. The Exchequer will then pay those bondholders €31.5million every year (€700million x 4.5%) until 2018 when they will buy back the €700million in paper - provided the country does not go belly up in the interim.