Bonus Bond investors who held on will get $1.10 for each $1 bond

Monday, 29 March 2021

50 years after being created Bonus Bonds are to be closed down.

Bonus Bond investors who held on to their bonds will get $1.10 for each of them, ANZ Investment Services says.

ANZ announced the closure of the giant Bonus Bonds trust in August but withdrawals were suspended in October.

Investors who cashed up their Bonus Bonds before withdrawals were stopped got $1 per bond but ANZ said there were sufficient reserves left in the fund to pay $1.10 to redeem each remaining bond.

“ANZIS is confident investors will receive at least $1.10 for each Bonus Bond they hold by the completion of the wind-up,” said Ben Kelleher, for ANZ.

Rylla Leman's Bonus Bond, bought on the first day they became available at the Murupara Post Office, Bay of Plenty, on March 5, 1970.

* Unclaimed Bonus Bonds could end up with the Government

* Days of Bonus Bonds draw to a close

“For example, an investor who held $100 worth of Bonus Bonds when the scheme went into wind-up would receive at least $110 by the time the wind-up is completed.”

The final amount investors would receive at the end of the wind-up was yet to be determined, as it was dependent on the actual costs to wind up the scheme and any investment income earned after October 31, 2020, he said.

The financial statements would be made available to bondholders via email, mail, public notices and posting the results on the Bonus Bonds website and NZ Companies Office Disclose Register.

ANZ said the Financial Markets Conduct Act required that financial statements were produced showing the financial position of the scheme at the time the wind-up began on October 31.

Kelleher said bondholders should expect to get their money back in the second half of 2021.

“We will be contacting customers in due course with what they need to do to get their money,” he said.

“No action is required right now.”

In August, Kelleher said the closure of Bonus Bonds was in the best interests of investors.

“Low interest rates have reduced the investment returns of the scheme, which affects the size of the prize pool,” he said.

“It has now become apparent those trends are likely to continue in the medium term. The official cash rate, currently at a historically low 0.25 per cent, may fall further in early 2021 as the global economy grapples with the impacts of Covid-19,” Kelleher said at the time.

Bonus Bonds was launched by the government in 1970.