Federal loan bonds with a face value indexed depending on the level of inflation (OFZ-IN). The nominal value of bonds is indexed monthly for the coming month in accordance with the consumer price index for goods and services in the Russian Federation.

General characteristics of OFZ-IN:

• Issuer: Ministry of Finance of the Russian Federation
• General agent for placement, repurchase and exchange of OFZ-IN: Bank of Russia
• Organizers of OFZ-IN placement: CJSC "VTB-Capital", CJSC "Sberbank CIB", Bank GPB (JSC).

1. Secondary market:

   OFZs with an indexed denomination are allowed in the following trading modes:

   • Main trading mode T+ ("glass T+1"),
   • RPS with the Central Committee
   • Negotiated deal mode
   • REPO with the Bank of Russia
   • Interdealer repo
   • REPO with CCP.

   Available trading modes and settlement codes:

   Trading mode	Calculation code	When concluding a deal denomination and NKD values defined:
   Main trading mode T+	Y1	Denomination and NKD - as of date execution of the transaction
   RPS with the Central Committee	Y0-Y2 (Y3-Y7 are not used!)
   RPS	T0, Z0, B0-B30	NKD - on the date of execution of the transaction
   REPO with the Bank of Russia, Interdealer repo	Z0, Rb, S0-S02	Denomination - as of the date of the transaction, NKD - on the date of execution of the 1st part of the transaction
   REPO with CCP	1st part of the repo transaction - T0, Y0, Y1	Denomination and NKD - as of date execution of the 1st part of the transaction

   The Exchange commission is charged on the date of the transaction.

   With OFZ-IN it is allowed to conclude transactions with execution in the following coupon periods (“jumping over the coupon”).
   If PJSC Moscow Exchange does not have par values ​​and/or cash accrual values ​​as of the current date, all settlement codes for such a security will be prohibited. In the absence of a market price and a MIRP price, the latest settlement price is used for trading in repo modes with the Bank of Russia.
   If clearing participants fail to execute transactions with new bonds in regimes with the CCP, a standard procedure for “transferring obligations” is carried out by concluding RPS transactions with the CCP or REPO transactions with the CCP:

   • In this case, the values ​​of the par value and cash income as of the settlement date known to PJSC Moscow Exchange as of the date of the transaction will be used.
   • If there are no values ​​of par value and/or accrual on the date of calculation, for the purpose of “transfer of obligations” the last known value of denomination and the value of accrual calculated on its basis are used.

2. The amount of coupon income will be calculated separately for each payment period based on the par value established on the date of payment of the corresponding coupon income.
   Interest on the 1st coupon is accrued from the calendar day following the start date of OFZ-IN placement until the end date of the 1st coupon period.
   Interest on other coupons is accrued from the calendar day following the end date of the previous coupon period until the end date of the current coupon period (maturity date).
   The NKD is calculated based on the nominal value known by PJSC Moscow Exchange, established on the date of execution of the transaction. Rounding of the tax accrual for these securities is determined according to the issue documents with an accuracy of 1 kopeck (rounding is carried out according to the rules of mathematical rounding. In this case, the rule of mathematical rounding should be understood as a rounding method in which the value of a whole kopeck (whole kopecks) does not change if the first digit after the rounded digit equals from 0 to 4, and changes, increasing by one, if the first digit after the rounded digit is 5-9).

3. Disclosure of information on the website of the Ministry of Finance
   According to the Terms of Issue and Circulation of OFZ-IN, the Ministry of Finance discloses on the website information about the nominal value of OFZ and the index of reduction of the nominal value of OFZ for each calendar date of the billing month no later than 2 business days before its start.
   The amount of coupon income is disclosed by the Ministry of Finance simultaneously with information on the nominal value of OFZ-IN for the corresponding month in which the coupon income will be paid.

   Providing information to NSD
   On the date of acceptance for servicing of the Bond issue of NCO CJSC NSD in the section Notices on securities and events on the organization will publish:

   • information message on acceptance of the Bond issue for servicing;
   • message (CHAN) - “Significant changes in the security” which will reflect the Table of values ​​of the nominal value of the Bonds for the coming month.

   In the future, the CHAN message will be sent to NSD participants with balances as of the date the message was sent and published on the website of the NCO CJSC NSD on a monthly basis after the information is disclosed on the official website of the Ministry of Finance of Russia.

   The value of the daily changing nominal value of the issue will be reflected in the NSD depository accounting system and on the NSD website in the Serviced Securities section and in the NSD DISC in the field “Remaining nominal value to maturity (in nominal currency).”

   In the information services of NPO CJSC NSD, provided under an agreement for the provision of information services, the value of the daily changing nominal value of the issue will also be reflected in the field “Residual nominal value to maturity (in nominal currency)” (maturity_value, MtrtyVal).

   In the NSD file - SIR-NSD (for example, SIR-NSD_Standart_A_v1_0_2015_07_09_01_04_24.zip) for OFZ - IN, the value of the daily changing nominal value of the issue will be reflected in the field "Residual nominal value to maturity (in nominal currency)" (maturity_value). The face_value field will display the initial value of the bond face value.

   In the Exchange file - MOEX securities_micex_state_bonds.zip for OFZ - IN, nothing changes. The "FACEVALUE" field will display the daily changing value of the issue's nominal value. In the ACCINT field - the value of the coupon.

   Broadcasting information in the exchange gateway and terminalMICEXTradeS.E.
   Information on the indexed denomination is transmitted to the gateway and is available in the MICEX Trade SE trading terminal in the “Tools” table, where you need to select OFZ-IN and click on the right mouse button. In the menu that opens, select the item “Denomination and ANK”, which will open a separate window with data on the indexed denomination and AKD.
   An example of such a window with data can now be seen on the test bench for the OFZ 46023 instrument. The “Start date” column contains the date the Ministry of Finance disclosed information about the indexed denomination for the billing month.
   Attention! The example with the OFZ 46023 tool serves only to create a general idea of ​​the composition and structure of the information presented in the “Denomination and Tax Credit” window. The example uses only test data that has nothing to do with real data. The values ​​used as test data may not have any logic or pattern.

   Legal entities 20% 15% 15% Individuals 13% 0% 0% NPF (1) 20% 15% 15% Non-residents Doesn't hold

   (1) the tax is levied at a level of profitability exceeding the refinancing rate of the Bank of Russia

Federal loan bonds (OFZ) is one of the types of securities in Russia, which is issued by the Ministry of Finance. In fact, they have a standard format; their only peculiarity is that the reliability of the papers is ensured by the state itself.

What is the essence of federal loan bonds?

In essence, by buying OFZ, you are lending money to the state for a certain period. With an OFZ, you will receive coupon income (usually every six months) throughout the life of the bond. Upon expiration, you will be returned the original cost of the bond itself.

Types of OFZ

Federal loan bonds are divided into several types according to the type of coupon payment and par value.

According to the type of coupon payments, government bonds are divided into:

• OFZ-PD - with constant coupon income

The coupon value of these securities is constant throughout the entire circulation period of the bond. The coupon payment frequency is once every six months.

• OFZ-FD - with a fixed coupon

The amount of coupon payments may change over time, but is known in advance. For example, the first few years the coupon income may be set at 7% of the face value, and the next few years at 6%.

• OFZ-PK - with variable coupon income

The coupons of such bonds are tied to some floating interest rate, for example RUONIA (the rate on overnight interbank loans of the 28 largest banks) or the official one. The coupon yield is calculated as the RUONIA rate + some interest rate, for example 0.74%. Therefore, for such bonds only the current coupon is known, and each subsequent coupon is calculated based on the average RUONIA value for the last 6 months.

Thus, if rates on the money market rise, then the OFZ-PK coupon yield also rises, rates fall - and the yield also falls.

Based on their face value, government bonds are divided into two types:

• OFZ-AD - with nominal depreciation

For securities of this type, the nominal value is not repaid at one time, but gradually in parts. The depreciation schedule is known in advance. The denomination can be repaid at regular intervals, but there may be breaks. The nominal value can be repaid either in equal or unequal parts.

• OFZ-IN - with nominal indexation

Now on the market you can buy two issues of securities of this type: OFZ 52001-IN with a maturity date of August 16, 2023 and OFZ 51001 with a maturity date of March 31, 2021. These are bonds with a par value indexed to consumer inflation. The coupon yield of OFZ 52001-IN is 2.5% of the par value, OFZ 51001 is 2.25%, the coupon payment period is once every six months.

The denomination is indexed daily. Data on current and future denominations are published on the Ministry of Finance website a month in advance at least 2 working days before the start of the month. There you can also find out the value of the current coupon. Initially, these bonds were issued with a face value of 1000 rubles, now it is equal to 1040.4 rubles. Coupon income and income from indexation are not taxed.

Thus, OFZ 52001-IN gives a 2.5% net return above inflation. This instrument becomes especially profitable in conditions of rising inflation and rising interest rates, when ordinary bonds fall in price.

How is the OFZ rate calculated?

OFZ market rates are either constant or variable. Constant or fixed rates are established for each coupon period of each individual issue. The variable rate is formed taking into account official data characterizing the level of inflation. The OFZ rate depends largely on the key rate.

What is the yield on federal bonds?

The yield on OFZ is formed from two parts:

• The income that the owner of a Russian federal loan bond receives from the coupon;
• Profit from purchasing a coupon at a price lower than its nominal value.

If a bond is purchased at a price higher than the nominal price, without taking into account the coupon income, this leads to a loss, because its repayment is carried out strictly at the nominal value.

In the process of OFZ circulation, coupon profit is accumulated. As the next coupon becomes due, the bond's value increases. An investor who resells a bond before the coupon payment must take into account the accumulated payments on the security. The cost of purchasing bonds is constantly within the par range. The exact price is determined by market conditions, which can be either higher or lower than the cost of the bond.

When working with OFZs, you need to take into account the specifics of taxation of this type of income. Each type of income OFZ is subject to taxes. For example, for the income received from the difference between the purchase and sale of a bond, you will have to pay about 35% . Net coupon income is taxed at 15% of the amount received.

It is extremely important to take these points into account in order for manipulations in the bond market to bring good profits. Any activity in this segment is regulated by law.

What is the advantage of OFZ over other securities?

Investments in bonds are one of the most reliable types. When compared with bank deposits, the level of reliability of OFZs is higher. The reliability of bank deposits directly depends on the bank's rating. There is a direct relationship here: the higher the reliability of the bank, the higher the reliability of the safety of deposits. But there is also a significant disadvantage. A high reliability rating comes at the cost of lower interest rates. If we analyze the offers from the largest Russian banks (Sberbank, VTB and others), we see that their bank deposit rates are the lowest. The difference can be 50-80% than the average for this sector.

The state is the guarantor of the OFZ payment. And accordingly, the state reliability rating. bonds is equal to the credit rating of the state itself. It is responsible for its obligations to state holders. debt.

If the state ceases to be responsible for its obligations, then this happens. But the probability of a default in the country is much lower than the default of any private company.

Higher in reliability are only bonds of foreign issuers. But they usually have lower returns.

Where are they traded and who can buy OFZs?

OFZs are traded on the Moscow Exchange and can be purchased through any broker. Buyers and holders of OFZ can be both Russian and foreign legal entities and individuals. The cost of one bond is 1000 rubles, the yield is in rubles.

The procedure for purchasing OFZs is no more complicated than opening a bank deposit. All you need is to choose a broker, enter into an agreement with him and purchase OFZ. Also, many major banks provide similar services. You can also get advice from them, depending on your goals, which bonds you can buy at the moment.

For a whole month, the Ministry of Finance did not offer government debt to buyers, but against the background of rising oil prices and the strengthening of the ruble, yesterday it still tried to place two issues of 10 billion each with repayment in 2021 and 2024. But the auctions were unsuccessful. Moreover, the one on which OFZs with maturity in 2021 were placed was declared invalid due to the lack of applications at an acceptable price, Vesti reports. Finance".

The head of the ministry, Anton Siluanov, has already commented on the situation: “As we said before, if the conditions do not suit us, we will not enter (the market). Until the market calms down, why do we need expensive borrowings,” Finmarket reports the words of Anton Siluanov. The Ministry of Finance is ready to extend the pause if the market situation does not change, he emphasized.

Such results indicate a lack of demand for risky instruments on the part of investors, explains eToro analyst in Russia and the CIS Mikhail Mashchenko. Market players continue to worry about global economic growth, and in anticipation of the OFZ placement, the nervous situation in the markets was shaken by the Italian government's decision on the budget. However, at the moment, the Europeans managed to reach a consensus, and most likely if the auctions had taken place just a few days later, they would have been less disastrous.

In the current market conditions, no one expected any special success from the Ministry of Finance, but if history repeats itself with the next placement, the pressure on the domestic currency will increase significantly, Mikhail Mashchenko is sure. According to his forecasts, in the current conditions, the Russian currency may well strengthen to 65.50 rubles per dollar with a significant increase in oil prices. In general, the expert is confident that an unsuccessful auction should not have a significant effect on the exchange rate in the long term, because the situation on the oil market and the behavior of the dollar, which is now strengthening against major currencies, has a much greater impact on the ruble.

The head of the analytical department of the FinIst company, Ekaterina Tumanova, gives a completely different explanation for the low demand for Russian debt securities. Most likely, she says, the factor influencing weak demand has not changed in the month without the bond placement. We are talking about sanctions rhetoric.

This partial placement of 20 billion rubles should not be perceived as unsuccessful, Ekaterina Tumanova is sure. This is just a “testing of the situation”, which showed that investors are not yet ready to invest in Russia. This event is unlikely to have any impact on the ruble exchange rate, because for the OFZ placement procedure, the total amount of 20 billion is a small denomination.

Anton Siluanov has already announced that the borrowing program will be reduced. I believe, the analyst says, the Ministry of Finance is already thinking about where to borrow from. After all, the OFZ market is not the only source of income. As an alternative to the standard placement of OFZs, they can offer our Russian companies to acquire debt securities on a voluntary-compulsory basis, she believes.

There is a small amount for investment - around 300 thousand rubles. Every month I can replenish this amount by about 20 thousand. The investment period is 5-6 years. I am considering OFZ as one of the options.

I heard that if relations between the United States and Russia worsen, further sanctions may affect OFZs. So far, the United States has not imposed sanctions against Russia’s national debt, but news about this comes up periodically. If this does happen, what might happen to the bonds purchased?

Andrey, OFZ is one of the most reliable ways to invest money. Even in the event of sanctions against Russian government debt, it is unlikely that anything bad will happen to your investments. I’ll explain why OFZ can be trusted, but first let me remind you what it is.

Evgeny Shepelev

private investor

What is OFZ

We wrote in detail about OFZs in our article, so I’ll tell you briefly.

The government always needs money, and one way to get it is to borrow by issuing federal loan bonds. Investors buy OFZs and receive coupon income (interest) from the Ministry of Finance, and then the face value of the bonds is returned to them.

Types of OFZ

Bonds have different maturity dates and different yields. In addition, they differ in the type of coupons.

With a permanent coupon (OFZ-PD). This is the most popular type of bond. The size of all coupons is known in advance and does not change until redeemed. Example - OFZ 26205.

With a fixed coupon (OFZ-FD). The size of all coupons is also known in advance, but may change. For example, in the first year of circulation the coupon may be 7%, the next year - 8%. Example - OFZ 46011.

With a variable coupon (OFZ-PK). The coupon changes over time and depends on the RUONIA rate - it will not be possible to calculate the yield to maturity in advance. Example - OFZ 29012.

Not all bonds have a constant par value. For OFZ-AD it is amortized - repaid in installments, and for OFZ-IN the nominal value is indexed in accordance with inflation.

Profitability and risks of OFZ

The yield on OFZs is usually at the level or slightly higher than that of bank deposits. For example, OFZ 26214, which will be repaid in May 2020, has an effective yield to maturity of approximately 7.3% per annum. Typically, the longer the time until maturity, the higher the OFZ yield.

You can earn more if - 13% of the amount invested in IIS, but not more than 52,000 R per year.

The solvency of the Ministry of Finance of the Russian Federation now raises no questions among anyone. However, there are fears that the United States will impose sanctions against Russian government debt and this will somehow affect investors holding OFZs.

If you want to receive passive income from bonds, pay attention to the coupon payment dates. For monthly income, you will need to have at least six different OFZs in your portfolio, since the coupon is paid every six months. For example, OFZ 26212 coupons arrive in January and July, OFZ 26215 in February and August, etc.

In summary: pros and cons

Investing money in OFZs through a Russian broker is a completely safe investment option. Even if the United States imposes sanctions against Russian government debt, OFZs will not disappear, coupons for them will be credited to your account, and the nominal value will be repaid on time.

Of the minuses, of course, the profitability is not much higher than on deposits. If your investment horizon is 5-6 years and you have the ability to contribute money regularly, consider also including a small amount of stocks in your investment portfolio or, better yet, stock indices. Over the long term, the return potential of stocks is higher than that of bonds. True, the risks are greater.

If you have a question about personal finance, luxury purchases or family budgeting, write to: [email protected]. We will answer the most interesting questions in the magazine.

Investors do not want to buy our government bonds

Washington's threat to ban the circulation of Russian federal loan bonds (OFZ) has frightened stock exchange players - they are now actively selling this type of securities and reluctantly buying. The auction for the placement of OFZs, held on August 29, brought in only 13 billion rubles, while the Ministry of Finance of the Russian Federation expected to earn 2 billion rubles more from it.

The previous OFZ auction was completely canceled due to new American sanctions. Everything suggests that investors are losing interest in ruble assets. If this trend continues until the end of the year, then investors will finally reorient to exchange-traded instruments in hard currency, which will affect the ruble exchange rate. In this scenario, the dollar exchange rate will reach 75 rubles.

The placement of OFZs, scheduled by the Ministry of Finance for August 29, was supposed to be an important event for the financial market, designed to show how much it has recovered from recent American sanctions and the subsidence of the ruble. Although the amount of bonds offered to the market this time was only 15 billion rubles, as a result, even less securities were sold: 13.2 billion rubles. For comparison: previously, OFZs worth at least 20 billion rubles were put up for auction, and they almost always found buyers.

True, the penultimate placement of OFZs also turned out to be unsuccessful. On August 21, the Ministry of Finance canceled the auction for these bonds, as investors did not want to buy securities whose reputation was damaged due to the threat of Washington sanctions against them. A number of American senators once again proposed banning investors from buying new OFZs. The restrictions were expected to be adopted by the US Congress on August 22. However, this decision was postponed to November - the next sanctions affected only the supply of “dual-use” technologies to Russia, which can be used in military industries.

The domestic foreign exchange market has taken heart - although the value of the dollar has overcome the barrier of 68 rubles, this has become the limit to the growth of the “green” currency. This development of events prompted the Ministry of Finance to make another attempt to enter the market with the next OFZ auction. However, this time the attempt was not particularly effective: initially investors were interested in securities worth 25 billion rubles, but in the end they bought bonds worth almost half that.

According to Finam Group analyst Sergei Drozdov, domestic OFZs continue to remain a risky financial instrument. The semi-annual coupon rate for the entire term of the loan (until December 15, 2021) is 7% per annum. This percentage is considered quite good compared to US Treasury bonds, whose rate is about 3%.

At the same time, in November, Russian OFZs risk suffering from new serious sanctions from the United States. The next restrictions may turn on the red light before transactions with new Russian government bonds on the American market. In this case, in order to place OFZs, the Ministry of Finance of the Russian Federation will have to further increase the rate on securities income. This will increase the sovereign debt, turn our Treasuries into much riskier securities and virtually eliminate investor interest in them.

In fact, this is already happening today. Against the backdrop of new American sanctions, foreign traders are withdrawing their savings from the Russian bond market. In the second quarter, the share of non-residents who invested in OFZs decreased from 35% to 28%.

The main thing that threatens the cooling of investor interest in Russian government securities is the threat of further weakening of the ruble. Now dollar quotes have exceeded 68 rubles. According to experts, “green” has the opportunity to increase in price even more. The US Federal Reserve intends to further increase the interest rate on loans in dollars, which will strengthen the quotes of the American currency on the global financial market.

Both factors - sanctions against Russian OFZs and the increased attractiveness of dollar assets - threaten to lead to a new collapse of Russian banknotes. In its latest review, Bank of America Merrill Lynch lowered its forecast for the Russian currency for the third and fourth quarters of 2018 from 60 to 65 rubles per dollar. “Despite the fact that now the greenback quotes have gone through the roof for 68 rubles, the downgrade of the forecast by a large American financial institution is a very bad signal for the Russian market. Considering the current wary attitude of investors towards ruble assets, in the future, if even stricter sanctions come into force in relation to OFZs, the exchange rate of our currency will continue to decline. By the end of the year, the mark of 75 rubles will be quite achievable for the dollar,” says BCS senior analyst Sergei Suverov.