State of Israel Bonds - Securities

Securities

Initially, Israel Bonds offered one security. As the program became increasingly successful, multiple investment options were made available. The following bonds are currently offered:

• Jubilee Issue Bonds – fixed rate 2, 3, 5 and 10-year bonds; $25,000 minimum investment and increments of $5,000. Interest is paid semi-annually on May 1 and November 1.
• Maccabee Issue Bonds – fixed rate 2, 3 and 5-year bonds; $5,000 minimum investment and increments of $500 . Interest is paid semi-annually on May 1 and November 1.
• Sabra Savings Bonds – fixed rate 3-year bonds; $1,000 minimum investment and increments of $100. Interest paid upon maturity.
• Mazel Tov Bonds – fixed rate 5-year bonds; $100 minimum investment and increments of $10, limited to $2500 per day for each purchaser and holder. Interest paid upon maturity.
• eMitzvah Bonds - fixed rate 5-year bonds; $36 minimum investment and increments of $18. Maximum allowable amount purchased by one person in a transaction, registered in the name of one holder, is $90. Interest paid upon maturity. May only be purchased online.
• Floating Rate LIBOR Bonds – variable rate 2, 3 and 5-year bonds; $5,000 minimum investment and increments of $500; interest paid semi-annually on June 1 and December 1.

Rates change two times per month on most Israel bonds. Interest for fixed rate bonds is based on prevailing Treasury bond rates, plus a spread. Rates for floating rate bonds are equal to the 6-month LIBOR rate in effect on the initial determination date, plus or minus a spread that remains fixed until maturity.

According to Israel's Finance Ministry, "Israel has never defaulted in the payment of principal or interest on any of its internal or external indebtedness." According to the Congressional Research Service of the Library of Congress, as of 2002, approximately $40 billion in loans to Israel by the United States Government have waived by the United States Government, rather than repaid by Israel.

Capital is raised through the following four organizations: Development Corporation for Israel (US), Israel Bonds International (Europe and Latin America), Development Company for Israel (UK) Ltd., and Canada-Israel Securities Limited.

Computershare acts as fiscal agent for the bonds. Historically the bonds have not generally been freely transferable. Israel expects to continue to issue the bonds in the future. Redemption of Israel bonds requires a new W-9 form to be submitted with the bond, and redemption checks often take over a month to be issued.