World-first gold bond gets bank cheap funds
By GCRU Gold News on Saturday, August 23 2014, 00:49 - Permalink
The world’s first gold corporate bond, sold by FirstRand Bank Ltd. last week, will provide cheap funding to the bullion-trading desk of South Africa’s second- largest lender.
The 2 billion-rand ($188 million) bond, redeemable in gold Krugerrand coins that are legal tender in the country, pays investors 50 basis points, or 0.5 percentage point, of interest annually and is redeemable in cash or Krugerrands in 2019. The benchmark interest rate in South Africa, the world’s sixth- biggest producer of the metal, is 5.75 percent.