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Banking Certificate of Deposit |
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| | | | | Victoriabank issues Certificates of Deposit that combine the characteristics of a deposit with the possibility to sell it on advantageous conditions. VICTORIABANK issues the following types of certificates of deposit: - registered - in non-materialized form – represent a record in the Bank’s registry regarding the opening of an account, and an excerpt is issued therefrom. The holder of a registered certificate may sell it only through the Bank as it needs to register in the registry the modifications related to the change of the owner.
- bearer – in materialized from – it is printed on a special form that has over 10 protection elements. The bearer certificate may be transferred from one person to another without any restrictions (holder’s name is not indicated on it).
- interest bearing – are sold by the Bank at the price equal to the par value, based on which the interest is calculated and it is paid periodically or on maturity date, at the same time with the par value of the certificate.
- discount – are sold by the Bank at a price lower than the par value, and on maturity date (expiry of period), the buyer is paid the par value of the certificate, the difference representing the interest.
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Characteristics of the Certificate of Deposit
- Financial instrument that helps you to obtain an interest (income) exactly as an usual deposit and, at the same time, offers the holder the possibility, if necessary or as desired, to sell it or pass it to a third party on the secondary market;
- CD are issued only in Lei;
- CD are issued at the following par values:
- 1 000 lei
- 5 000 lei
- 10 000 lei
- 20 000 lei
- 50 000 lei
- 100 000 lei
4. The term of circulation of CD (the term of placing funds on the CD):
- 3 months
- 6 months
- 9 months
- 12 months
5. The frequency of paying the interest associated with Certificates of Deposit (upon client’s choice):
- Quarterly (on March 31, June 30, September 30, December 31);
- With 1 month or 3 months interval from the date of issuance of CD;
- On the maturity date of the issued CD (upon expiry of the circulation term).
Advantages of the Certificate of Deposit:
- It is an investment as secure as a bank deposit. The difference is the fact that the CD has the characteristics not only of a simple deposit, but it is also a security that can be sold at any time. This means that the holder of the Certificate of Deposit may sell it, prior to the expiry of the term, to a third party, thus receiving the deposited money and accrued interest.
- The CD may serve as insurance (mortgage) when obtaining a loan;
- The CD may be donated as a gift;
- There is a possibility to choose the term for money placement, the par value of the certificate and the method of interest payment;
- The persons choosing registered interest-bearing CD benefit from free-of-charge issuance of bank cards VISA Electron or Cirrus Maestro, where the interest could be transferred to, without any payment for annual servicing;
- The individuals’ income from Certificates of Deposit is not subject to taxes;
- It is a secure investment without risks.
Basic conditions of issuance and circulation of Banking Certificates of Deposit of the Commercial Bank "VICTORIABANK” S.A. | | | | | | | | | |
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