Solidarity bond nets €200m

MORE than €200 million has been invested in the Government’s National Solidarity Bond, with an average of €11m pumped in every week.

The success of the savings scheme, which was launched at the beginning of May, has been instant, with the total invested jumping from €70m in early July to €200m in just two months.

Under the scheme, members of the public can invest anything between €500 and €250,000 and will earn 1% interest each year and bonuses of up to 50% if they leave their money in the scheme for five, seven or 10 years.

The bond is being run by the NTMA and sold via An Post.

More than 9,000 investors have been attracted to date, putting in about €2m per day. That equates to an average investment of €23,000 per person.

The success of the scheme is being put down to the continuing lack of confidence in the banks.

“People are definitely saving more and are taking more care when choosing where to make their deposits. That said, there are initiatives out there which are being marketed better and options which offer better deposit return rates, so the popularity of the bond can’t be attributed to those things but it could be a psychological thing, to some extent.

“They’ve seen so-called safe banks, like Bank of Scotland, leave the country and read the differing opinions over how healthy the credit unions are and they’re basically asking ‘where is my money actually safe?’ and coming to the conclusion that they don’t want all their funds deposited in the banks,” said Frank Conway, director of the Irish Mortgage Corporation.