Certificates are securities issued by banks as bonds. Their issuer unconditionally undertakes to buy them back on maturity. They can be acquired on a primary market and then traded on a secondary regulated market.

Certificates entitle you to a fixed or floating principal payment on maturity and the option of regular interest payments.

The main types of certificates are:

Guaranteed
Structured products offering a guarantee on the money invested on maturity. Also, they may bear a fixed or variable yield for the investor for the entire term of the investment or on maturity, in the form of coupon payments or participation in the performance of the underlying asset.

Bonus certificates
Structured products without a guarantee on the money invested, but offering partial conditional protection. They are usually linked to the performance of the underlying asset, and a barrier is usually set.

Discount certificates
Structured products without a guarantee on the money invested. They are traded and quoted with a discount on the market value of the underlying asset, in return for which the investor accepts to participate in the potential profits (capped) from the asset’s performance.

Convertible bonds
Structured products without a guarantee on the money invested. They bear a comparatively high yield in the form of coupons paid regardless of the performance of the underlying asset. If the price of the underlying asset is above a preset barrier, the investor will receive 100% of the money invested on maturity. If the barrier is reached and/or the price of the underlying asset on maturity is lower than a preset strike price, the investor will receive a predetermined number of securities in the underlying asset (number = par value/strike price).

Express certificates 
Structured products without a guarantee on the money invested. Their maturity is generally longer, but if the underlying asset is traded above a certain level on preset assessment dates, the product will be bought back at a higher value. If the underlying asset is quoted under the relevant value, the product’s term will be automatically extended until the next assessment date.

Index certificates
Structured products without a guarantee on the money invested. They allow the investor to participate 1:1 in the performance of a certain index. There are also short index certificates which allow the investor to make a profit when the markets drop.

This is the asset on the basis of which the certificate is structured. Indices, stocks, gold, oil, bonds, etc. can be used as underlying assets.

For some products, there is an upper limit to the returns that can be made from the certificate. This cap should be noted when taking into account the certificate’s maximum buy-back price.

Some products offer a conditional protection mechanism for the par value through a so-called barrier. It is a level  preset on the basis of the initial value of the underlying asset. When that level is reached, the product’s protection mechanism will no longer apply.

The certificates’ main advantages are as follows: high liquidity, lack of management fees, full or conditional guarantee of the principal, option to choose a strategy for any type of market, high degree of protection, option to receive ongoing fixed yields and easy market access with a minimum investment.

Bulgaria operates a Securities Investor Compensation Fund which covers losses resulting from the bankruptcy of an investment firm of up to 90% of the assets held, but no more than BGN 40,000. Only investors classified as non-professional clients are entitled to compensation from the Fund.

In accordance with current statutory provisions, Raiffeisenbank keeps its clients’ securities separate from its own securities. Depending on the type of security, they are held at Central Depositary AD, Bulgarian National Bank or foreign depositaries.

If an issuer becomes bankrupt, bondholders are ranked before shareholders when it comes to satisfying the claims of the creditors.

All fees and commissions are set out in the bank’s tariff, which is available on the Raiffeisenbank (Bulgaria) EAD website.

To trade financial instruments through Raiffeisenbank, you must become a customer of the bank and sign an investment service contract.

Our brokers accept orders for financial instruments both by phone and email. Orders can be placed in selected offices of the bank.