Feb 08 - GSD on Government Issued Debentures
The GSD opposition has recently been approached by a number of Senior Citizens asking for advice on early repayment of Government issued debentures, not due until 31st December 2013 and 31st December 2015.
The letters dated 20 December 2012 for the 4% 31 December 2013 maturity, and 1 February 2013 for the 5% 31 December 2015 maturity, headed “replacement of debentures” require replies within a very short period of time, namely 14 January 2013 and 15 February 2013 respectively.
The Opposition notes that Government Debenture holders are being given four options in respect of the 5% 31 December 2015 maturity as follows:
1. Replacement with a similar debenture issued by the Gibraltar Savings Bank.
2. Replacement with a new, later maturing, debenture issued by the Gibraltar Savings Bank.
3. Encashment of the existing debenture on 1 March 2013.
4. If no action taken, enforced redemption of the existing debenture by the Government of Gibraltar within 6 months, presumably on 1 August 2013.
The Opposition notes that the prospectus for each of the above debenture issues do allow the Government to redeem but only after giving 6 months notice to the holder.
The letter in respect of the 31 December 2013 debenture does not mention the giving of official notice and thus any holder that has not taken any action is legally entitled to expect the original maturity to be respected by the Government.
GSD Leader Daniel Feetham stated, ‘It is clear to the Opposition that given the undue haste by the Government to urge Government Debenture holders to switch to debentures issued by the Gibraltar Savings Bank that it is engaged in a very crude act of window dressing before the 31 March Government financial year end.’
It is the view of the Opposition that the hasty political action of the Government has caused unnecessary distress to our Senior Citizens, and thus asks the Government to explain to our pensioners what the urgency is.
The Opposition assures our Senior Citizens that it will continue to closely monitor the Gibraltar Savings Bank, which is an institution that has served the community well in the past, to ensure that it is managed on a sound basis and in a prudent manner and will hold the Government and any individuals concerned to account.
