Belgians snap up government bonds

The new issue of Belgian government bonds is proving to be a great success. On the first day of issue on Thursday, more bonds were sold than during the whole period that the last issue of government bonds were available for sale earlier this year. Banks report that their customers are showing great interest in the issue.

The Debt Agency also reports being “overwhelmed” with demands for information about the bond.

Belgium issues government bonds four times a year. The last issue in September raised around 80 million euros.

The total sum raised from this year’s first three issues of government bonds came to 300 million. However, this is small beer compared with the 1 billion Euro that has been raised in previous years.

The Prime Minister in Belgium’s caretaker government Yves Leterme (Flemish Christian democrat) has attractively promoted the bonds in an effort to encourage more Belgians to buy the bonds.

The more bonds that are sold, the better it is for the federal exchequer. Money that is lent from savers at a 4% interest is cheaper than money lent on the international financial markets at an interest rate in excess of 5%.

Jean Deboutte of the Debt Agency said on Thursday that the bonds are a very interesting investment. With an interest rate of 4% for those signing up for 5 years, the bonds offer a far higher rate of interest than savings accounts.

Prime Minister Leterme is pleased that the bonds are proving so popular. He wrote on Twitter that “It’s a boost for both the save and the Treasury.”