Tesco Bank Inflation-linked Retail Bond
December 23rd, 2011
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Tesco Bank (tescofinance.com) has issued a new bond aimed at retail investors.
It is a eight-year bond linked to the Retail Price Index (RPI).
It can be bought and sold by investors exclusively through stockbrokers or wealth managers with a minimum purchase of £2,000. It can be held within a stocks and shares ISA or SIPP.
Over the eight-year term, the bonds will pay interest twice a year at a 1% annual gross rate of interest adjusted to take account of changes in the RPI. On maturity, the amount due will be the full value of the bonds plus any overall increase in the RPI. If the RPI has fallen during the term, Tesco Bank has committed to repay the bonds at no less than their full face value.
