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Eurobonds of other governments

Eurobonds of other governments

Debt securities with various maturity and return in a foreign currency

  • You can invest for a short, medium or long term
  • You have the opportunity to invest in a foreign currency

These debt securities issued by governments of different countries and offered on foreign markets can be both more profitable (more risky) and yield similar or lower return than debt securities issued by the Government of the Republic of Lithuania. The return on investment (risk) depends on the country's credit rating.

To borrow money abroad for a short, medium or long term, governments of different countries issue eurobonds and offer them on foreign markets. The normal maturity of these eurobonds is between several years to several decades.

When eurobonds are issued, the annual interest rate and interest payment dates are set. Interest is paid in periodic coupon payments — usually once or twice per year.

On the set redemption date the face value of eurobonds (for instance, EUR or USD 1,000 per eurobond) is repaid to their holders and the last coupon is paid out.

 

For more information about eurobonds issued by governments of foreign states, investment risks, terms and rates of securities operations call our line +370 5 268 2822 or visit a SEB bank unit of your choice.


We recommend that before you sign any financial service agreement you read the service terms carefully and consult the staff of the bank if you need to.

You can sell eurobonds of the governments of foreign states without waiting for the set redemption date, but in such case their price depends on market conditions, which means investors may receive a lower return on investment than on their redemption date or even incur losses.

Please note that return on investments in eurobonds of other states may fluctuate due to inflation and changes to interest rates or other circumstances not dependent on the will or actions of the bank.

This content cannot be construed as personal recommendation or order to invest and may not constitute any basis or part of any subsequent transaction. Before you decide to invest in eurobonds issued by governments of other states you should review all risk factors related to these securities and either yourself or with help from consultants consider whether such risks are acceptable to you.

For more information about the risk factors please refer to the publication "Description of risks related to financial instruments" (PDF, 150 KB). Alternatively, you can call us on the 24/7 private customer line +370 5 268 2800 or business customer line +370 5 268 2822 or visit any SEB bank unit.

Please note that the above-listed services are not aimed at investors that belong to a different jurisdiction than the SEB units offering these services whereas providing of investment opportunities, permission to invest and investing in locations belonging to specific jurisdictions, including the United States of America, Canada, Japan and Australia, may be illegal. SEB Bank cannot offer investment advice, advertise investments and offer or urge to invest in locations where this may be illegal. If you live or are reading the information posted on this website in a location which does not belong to the same jurisdiction as the SEB bank unit that provides this information, you are responsible for compliance with the laws and regulations that may apply to you. For more information please contact your account manager at SEB Bank or any SEB bank unit.

 

Credit risk

Eurobonds of governments of other countries relate to credit risk, i.e. the risk that the government that issues these securities may default on its obligation to settle accounts with investors by the set deadlines and on defined terms.

Market risk

The price for eurobonds sold on the secondary market may be either higher or lower than their purchase price, so investors who sell eurobonds prior to redemption date may receive lower return on investment than on the set redemption date or even incur losses. The price for eurobonds on the secondary market depends on changes to interest rates, the term to the redemption date, supply and demand of eurobonds on the market and other factors.

Interest risk

Changes to the interest rates on the market may alter the value of investments in these debt securities. As interest rates on the market increase, the value of investment in debt securities decreases. Investors investing in long-term debt securities take a higher risk than when they invest in short-term debt securities.

Reinvestment risk

As market interest rates decline, it may be impossible to reinvest the interest (coupon) earned periodically from fixed return securities (eurobonds) in financial instruments that yield at least the same rate of return. For this reason there is a risk to receive a lower return on investment in these securities.

Currency risk

When you invest in eurobonds of foreign governments in a foreign currency, you take the risk that the actual value of these securities may decrease due to changes in exchange rates.

Tax risk

When you invest in eurobonds of foreign governments, you take the risk that any income received from investing or trading in these eurobonds may be taxed not only in your home country, but also in the country of the issuer of these eurobonds. AB SEB bankas is not responsible for taxation of income paid out for the owned and/or sold eurobonds (coupons, etc.) and does not offer any withholding tax recovery service to customers.

Description of risks related to financial instruments (PDF, 150 KB, in Lithuanian)

For more information about eurobonds issued by governments of foreign states, investment risks, terms and rates of securities operations call our line +370 5 268 2822 or visit a SEB bank unit of your choice.


We recommend that before you sign any financial service agreement you read the service terms carefully and consult the staff of the bank if you need to.

You can sell eurobonds of the governments of foreign states without waiting for the set redemption date, but in such case their price depends on market conditions, which means investors may receive a lower return on investment than on their redemption date or even incur losses.

Please note that return on investments in eurobonds of other states may fluctuate due to inflation and changes to interest rates or other circumstances not dependent on the will or actions of the bank.

This content cannot be construed as personal recommendation or order to invest and may not constitute any basis or part of any subsequent transaction. Before you decide to invest in eurobonds issued by governments of other states you should review all risk factors related to these securities and either yourself or with help from consultants consider whether such risks are acceptable to you.

For more information about the risk factors please refer to the publication "Description of risks related to financial instruments" (PDF, 150 KB). Alternatively, you can call us on the 24/7 private customer line +370 5 268 2800 or business customer line +370 5 268 2822 or visit any SEB bank unit.

Please note that the above-listed services are not aimed at investors that belong to a different jurisdiction than the SEB units offering these services whereas providing of investment opportunities, permission to invest and investing in locations belonging to specific jurisdictions, including the United States of America, Canada, Japan and Australia, may be illegal. SEB Bank cannot offer investment advice, advertise investments and offer or urge to invest in locations where this may be illegal. If you live or are reading the information posted on this website in a location which does not belong to the same jurisdiction as the SEB bank unit that provides this information, you are responsible for compliance with the laws and regulations that may apply to you. For more information please contact your account manager at SEB Bank or any SEB bank unit.

For more information about eurobonds issued by governments of foreign states, investment risks, terms and rates of securities operations call our line +370 5 268 2822 or visit a SEB bank unit of your choice.


We recommend that before you sign any financial service agreement you read the service terms carefully and consult the staff of the bank if you need to.

You can sell eurobonds of the governments of foreign states without waiting for the set redemption date, but in such case their price depends on market conditions, which means investors may receive a lower return on investment than on their redemption date or even incur losses.

Please note that return on investments in eurobonds of other states may fluctuate due to inflation and changes to interest rates or other circumstances not dependent on the will or actions of the bank.

This content cannot be construed as personal recommendation or order to invest and may not constitute any basis or part of any subsequent transaction. Before you decide to invest in eurobonds issued by governments of other states you should review all risk factors related to these securities and either yourself or with help from consultants consider whether such risks are acceptable to you.

For more information about the risk factors please refer to the publication "Description of risks related to financial instruments" (PDF, 150 KB). Alternatively, you can call us on the 24/7 private customer line +370 5 268 2800 or business customer line +370 5 268 2822 or visit any SEB bank unit.

Please note that the above-listed services are not aimed at investors that belong to a different jurisdiction than the SEB units offering these services whereas providing of investment opportunities, permission to invest and investing in locations belonging to specific jurisdictions, including the United States of America, Canada, Japan and Australia, may be illegal. SEB Bank cannot offer investment advice, advertise investments and offer or urge to invest in locations where this may be illegal. If you live or are reading the information posted on this website in a location which does not belong to the same jurisdiction as the SEB bank unit that provides this information, you are responsible for compliance with the laws and regulations that may apply to you. For more information please contact your account manager at SEB Bank or any SEB bank unit.

Banks trade eurobonds of foreign governments on the secondary market. To buy or sell eurobonds on the secondary market, you can file the required order by visiting a SEB bank unit of your choice.

When you sell eurobonds on the secondary market prior to the set redemption date, accrued interest is included in the secondary market price of bonds sold.

 

When you buy eurobonds of foreign governments, custody fees apply.

Fees of securities transactions (150 KB)

Please note that due to different legal regulation and securities accounting standards in each country additional taxation may apply in the state where eurobonds are issued.

For more information about eurobonds issued by governments of foreign states, investment risks, terms and rates of securities operations call our line +370 5 268 2822 or visit a SEB bank unit of your choice.


We recommend that before you sign any financial service agreement you read the service terms carefully and consult the staff of the bank if you need to.

You can sell eurobonds of the governments of foreign states without waiting for the set redemption date, but in such case their price depends on market conditions, which means investors may receive a lower return on investment than on their redemption date or even incur losses.

Please note that return on investments in eurobonds of other states may fluctuate due to inflation and changes to interest rates or other circumstances not dependent on the will or actions of the bank.

This content cannot be construed as personal recommendation or order to invest and may not constitute any basis or part of any subsequent transaction. Before you decide to invest in eurobonds issued by governments of other states you should review all risk factors related to these securities and either yourself or with help from consultants consider whether such risks are acceptable to you.

For more information about the risk factors please refer to the publication "Description of risks related to financial instruments" (PDF, 150 KB). Alternatively, you can call us on the 24/7 private customer line +370 5 268 2800 or business customer line +370 5 268 2822 or visit any SEB bank unit.

Please note that the above-listed services are not aimed at investors that belong to a different jurisdiction than the SEB units offering these services whereas providing of investment opportunities, permission to invest and investing in locations belonging to specific jurisdictions, including the United States of America, Canada, Japan and Australia, may be illegal. SEB Bank cannot offer investment advice, advertise investments and offer or urge to invest in locations where this may be illegal. If you live or are reading the information posted on this website in a location which does not belong to the same jurisdiction as the SEB bank unit that provides this information, you are responsible for compliance with the laws and regulations that may apply to you. For more information please contact your account manager at SEB Bank or any SEB bank unit.

 

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