Belgian government to launch two new state bonds

The Belgian Debt Agency will issue two new state notes on Monday 16 September, the first with a maturity of one year and the second with a maturity of 10 years, the institution has announced.

The rate for each of the savings bonds will be announced next Tuesday and the subscription period will run from 5 to 13 September inclusive. Investors will be able to consult their portfolios from 16 September.

This latest launch comes a few days later than a traditional issue. Normally, the subscription period starts at the end of August, but a delay of a few days was chosen in order to coincide with the payments linked to last year's one-year state note, which brought in €22 billion, thanks in particular to the reduced withholding tax.

On 4 September, that sum plus €615 million in interest will be returned to the accounts of about 600,000 Belgian savers.

For the next release, the Debt Agency and banks will be competing for a €22 billion windfall, which will be released in September.

On Monday, ING launched a six to 12-month term account at 3.8% gross in anticipation of the new bonds. These accounts differ from regular savings accounts in a number of ways, according to Nicolas Claeys, coordinator of consumer protection agency Test-Achat’s investment arm.

“With a savings account, you pay in money, it earns interest, and you can withdraw your money at any time,” Claeys said.

“The rates can vary. It's more flexible. With a term account, you lock in the money for a set period. There are banks where you can withdraw the money earlier, but there are often charges that can be quite high.

"When you block money, you need to be sure that you won't need it. On the other hand, the rate is fixed for the entire agreed term. It will not change, even if rates fall during the year."

The Debt Agency generally launches a state bond four times a year, aimed at individual investors. Withholding tax of 30% applies, except for the September 2023 issue when the rate was exceptionally reduced to 15%.

Test-Achats warns people to take care with their investments and be aware of increasingly well-disguised scams.