Fee on new National Bonds

National Bonds Corporation (NBC) has introduced a subscription fee on new issued bonds from June 1, but the fee will be charged only if an investor/bondholder does not hold the bonds for three months.

The Shariah-compliant investment company, in a newsletter sent to bondholders, said: “Another change effective 1st of June 2013 is the introduction of subscription fee on new issued bonds, which is waived if bonds complete three months holding period. This fee is paid at the time of redemption and is one per cent (minimum of Dh15) of the value of redeemed bonds, if redeemed within 3 months from date of issuance.”

NBC was not charging any fee for purchase or redemption.

The company also stated it has reduced fees by 50 per cent for instant redemptions done at selected distributors. Distributors were charging Dh30 for redemption. Bondholders cannot redeem only Dh10,000 per day through instant redemption.

“We have reduced fees charged by some of our selected distributors to our customers on their instant redemption requests by 50 per cent. This change will be effective July 1, 2013 and is part of our continuous efforts to simplify the processes for you, making your journey with National Bonds an easier and enjoyable one,” NBC said.

Starting May, the company launched its new reward strategy, a winner every minute, which offers 1,440 daily rewards in Dh50 bonds, totaling Dh26 million in annual prize money to bondholders.

By end-March, the size of the bondholder fund stood at Dh5.05 billion. Customer base grew six per cent in Q1 2013 compared to Q1, 2012. Nearly 200 nationalities are investing in the scheme with 75 per cent being repeat purchasers.

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