An Post interest rates forced down and prize bonds raided

irishtimes.com/business/sect … -1.1415165

So, it appears that they don’t want to put the banks at a disadvantage.
No thought paid to the interests of the public/consumers/voters.

Basically, official Ireland want you to spend/give away your hard earned cash and are disincentivising prudence.

the world class brains at the NTMA in action!

independent.ie/irish-news/nu … 15029.html

NTMA also made prize bonds even more pointless than they were before.
This is official Ireland’s new sweepstakes.

Why should AnPost/State offer such high interest rates when the ECB interbank rate is at all time low of 0.5% ?

All the money will now be funnelled into property :slight_smile:

Irish bond yields are 3.5% to 4%
That’s the cost of the government borrowing elsewhere other than off their own citizens.

Forgot that part dipole.

Those are 10 year rates.

3 month rates are approx 0.25%

and they have prizebond principal for pretty much forever because people don’t cash them in.

State savings were substantially reduced as recently as mid-December last. The most recent issue of savings products lasted only 5 months!

So, the state doesn’t set rates, banks simply get their competitor to lower rates XX

Has anyone heard of anyone winning the million with prize bonds?

Heard this reported on the radio today, something along the lines of “more incentives not to save”

Nope, in fact I’m not sure I know anyone who’s ever won a prize (although who knows how many or few of the people I know actually own them)

Have been lucky enough to have won a couple of €75 prizes over the years!

Rather than reduce the amount on one million prizes they should reduce that big prizes to €100k and have 5 winners a month!!!

I guess, unlike regular Lotto players people who win El Gordo in the Prize Bonds
i) are by nature less inclined to pose for the Hedald
ii) don’t have some gasbag newsagent bursting to tell and and sundry how “it couldn’t happen to a nicer person” (due to the persistent nature of the ticket how would they know anyway)

everytime Mrs Slasher goes to the family abode there seems to be a letter from Killorglin with E50 cheque inside

They were very good value given the degree of security involved

Am I wrong in saying that soverign retail products are the only euro-denominated debt intstrument NOT to have been defaulted on in recent years? (bank deposits, senior bank debt, sovereign paper etc all haircut at some point)

So let me get this right. The NAMA bonds that were given to the banks in return for their banjaxed loans were taken to the ECB repo window and used as collateral for borrowings. Then the money thus borrowed was used to buy Irish government bonds because, lets face it, the banks would be mad to lend the money to actual real customers. Now the banks are whinging because the rates they are getting from the government are also available to retail customers via the An Post/NTMA products. And by whinging loud enough, the banks hope to attract deposit customers to rates that are now barely above 2% (which is also now subject to nearly 40% tax in DIRT and PRSI). So customers are expected to accept a net return of typically less than 1.5% from knackered banks, in spite of the very real risk of depositor haircuts the next time the shit hits the fan?! They have to be kidding!

I’ve got a bunch of money on deposit from last year with three banks, from back when rates were good – good enough that a 10% haircut would still be a better deal than putting the money offshore. I’ve got another bunch of money with the NTMA at the pre-December 2012 rates. When all that stuff matures it will not be going anywhere near another Irish institution.

P.S. The reduction in the number of €1m prize bond prizes is actually good news. If you had enough of them to guarantee a properly randomised return, you could effectively use them as another method of tax free saving. But the proportion of prize money going to the bigger prizes (which you were unlikely to win regardless of the number of prize bonds held) acted as a reduction in the effective interest rate.

An Post holds 16% of Irish personal savings - annual report

rte.ie/news/2014/0424/610814-an-post/

An “Piggy” Post.

I wonder how long it will take before Prize Bonds are raided by corrupt politicians, with for example 50% of the fund being “invested” in a nice and friendly Solidarity Bond.

The big increase in ‘deposits’ (technically investments) at the NTMA helps explain why banks have been putting pressure on the NTMA to cut rates.

It is surprising that the NTMA cut rates, several times, significantly, over the last year and yet the amount of money placed with the NTMA soared.

This increase will help lessen the NTMA dependency, slightly, on foreigners for soverign debt purchases.

Perhaps, this increase in money with the NTMA, and the ECB potentially cutting rates further, will cause banks to put pressure on the NTMA to cut rates even further.

€18 billion accounts for 16% of all personal savings.

In other words Irish people have personal savings of €112.5 billion as per NTMA.