1. Issue price for first tranche of sovereign gold bonds fixed at Rs 2,684/gm

Issue price for first tranche of sovereign gold bonds fixed at Rs 2,684/gm

The Reserve Bank of India on Tuesday announced the issue price of the first tranche of sovereign gold bond at Rs 2,684 per gram of gold. Investors can apply for these bonds in receiving offices from November 5-20.

By: | Mumbai | Published: November 4, 2015 12:12 AM

The Reserve Bank of India on Tuesday announced the issue price of the first tranche of sovereign gold bond at Rs 2,684 per gram of gold. Investors can apply for these bonds in receiving offices from November 5-20.

“The rate has been fixed on the basis of simple average of closing price for gold of 999 purity of the previous week (October 26-30, 2015) published by the India Bullion and Jewellers Association,” RBI said.

Gold bonds will bear interest at 2.75% per annum on the amount of initial investment and the interest will be paid in half-yearly rests. The last interest is payable on maturity along with the principal.

Scheduled commercial banks (excluding RRBs) and designated post offices are authorised to receive applications for gold bonds either directly or through agents. The minimum investment in these bonds would be two grams with a maximum subscription of 500 grams per person per fiscal year. In case of joint holding, the limit applies to the first applicant.

Gold bonds are repayable on the expiration of eight years from the date of issue and premature redemption is allowed from fifth year of the date of issue on the interest payment dates. These bonds can also be used as collateral for loans. The interest on gold bonds is taxable and capital gains tax treatment is the same as that for physical gold.

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