Positive response to government stock issues

Anthony Magri

Mar 13th 2009, 20:58

How much did the banks buy. The interest is comparably high in comparison to what they pay as interest to depositors. This may mean the banks are making huge profits while paying peanuts.Is this regular?Does the European Central Bank or even Malta Central Bank consider this position?

A Cassar

Mar 13th 2009, 20:58

@Leonardo Vince There were other Govt Stocks issues just a few months ago, last August and October if I remember correctly, not to mention other local companies' bonds issued since than. So yes 3567 is a very good number. If one invests in October or January, it wouldnt be so easy for him to invest again in March, if he's not Bill Gates @ A Leone Ganado It is normal that pensioners go for MGS as they tend to invest in a more secure investments than others who prefer to take bigger gains with bigger risks. @ Alfred Camilleri Your simple calculation is correct. However a good part of the amount allocated to financial institutions represent money invested by the public in life assurances and local funds. So it's still public (individual) money that is being used. Every time the Government issues a Stock issue it is always over-subscribed. This shows the confidence people have in Govt finances, not like Iceland. It also shows that people do have money to invest.

J.Borg

Mar 13th 2009, 18:10

were else can one invest his savings......what interest can you get from the banks?

Alfred Camilleri

Mar 13th 2009, 17:20

I consider myself as a person of normal intelligence, definitely not below average. That's why I can tell that the public (individuals) applied for just over 55 million euro worth of stock, while institutions applied for 187 euro worth. (242 - 55). Simple, no?

Joe Vella (Mellieha.)

Mar 13th 2009, 17:07

@ Leonardo Vince Whichever you want to look at it, it only means a vote of confidence in the Government. Gone are the days that when MLP/PL Governments issued bonds and had to go to the overseas markets because the calls were always undersubscribed. If you want to argue that the issue is oversubscribed 3 times over because of institutional investors it only confirms the business community confidence in Malta. During this tough economic times foreign investments kept pouring in. One would not this by watching watching Super 1 or reading l-Orizzont.

albert leone ganado

Mar 13th 2009, 17:01

I suspect that a good number of the general public applications for Government stock
came from pensioners or those close to retiring age.
At the moment many of them see that the only safe way to investin their hard earned earnings
to supplement their pension with some interest revenue is in Government securities.
Perhaps Government should consider an issue stock or bonds for the elderly at attractive rates

leonardo vince

Mar 13th 2009, 16:42

3567 applications should not be considered as something to write home about. It means that less than 3567 individuals (out of circa 280000 in a position to do that) subscribed to the issue.

If you want to treat us as normal rational human beings, even below average intelligence at that, you should give data on value applied by institutions and that by individuals.