National savings bonds net extra €100 million

Portuguese national saving bonds have attracted an extra €100 million since February. However, the windfall was at a cost to treasury bonds which have been losing money for 17 months.

 

Portuguese savings bond purchases by the general public (national savings certificates) sold by high street bank branches and post offices climbed to their highest since October 2017. However, Growth Savings Treasury Certificates (CTPC) continued to lose money because of low interest rates.

According to the Bank of Portugal, €117million was invested in CTPC – a product launched in November 2018 by the state, replacing Savings Plus Treasury Bonds. The amount invested in these new bonds is at its highest since introduction, but much less than CTPM (Treasury Certificates Savings Plus) which were suspended from October 2017 after a Council of Ministers Resolution that same month. These offered an average annual rate of 2.25%. The new Growth Savings Certificates pay out 1.38% but are GDP bonus linked.

While Treasury Certificates continue to attract family savings, albeit at a slower uptake than last year, the national pot office savings bonds continue to offer poor returns and are pushing away investors. For 17 months the balance between new subscriptions and cash-ins has been in negative territory with €12 million capital flight in March.

Over a 12-month period, the savings bonds have lost €36 million, while CTPC have attracted €326 million with an overall positive balance of €290 million, an amount nevertheless short of the €794 million invested in the same three months in 2017. In total families have €27,264 million invested in the state.