Fibank Compensatory instruments
Compensatory instruments are dematerialized, registered payment means which serve to compensate people whose property, buildings or land are expropriated or nationalized. They can be traded on the regulated securities market and OTC as well. Compensatory instruments are compensatory bills and housing compensatory bills under the Law for Indemnification of Owners of Nationalized Properties, and registered compensatory bills under the Ownership and Use of Agricultural Lands Act and the Restitution of Property over Forests and Forestry Lands Act.
With compensatory instruments can be redeemed interests under the Law on Settlement of Uncollectible Credits (ZUNK), to participate in tender procedures for agricultural land from the state land fund or to make payments on privatization transactions through the Bulgarian Stock Exchange.
First Investment Bank offers:
- purchase and sale of compensatory instruments traded on the regulated market (Bulgarian Stock Exchange JSC);
- purchase and sale of compensatory instruments traded on the OTC market;
- participation in privatization procedures and payment by compensatory instruments.
Documents:
- Brokerage contract for financial instruments transactions;
- Financial instrument transaction order;
- Customer categorization document;
- Notification of appropriate service;
- Other documents (you may receive them at the Bank);
- General Terms applicable to contracts with clients of First Investment Bank AD for investment services and activities with financial instruments.
Fees and commissions according to the current Tariff of the Bank are applied.
Signing contracts, giving instructions, orders or requests, and any other legal actions for and on behalf of the client by proxy are allowed only if a notarized power of attorney is presented containing representative powers for carrying out management and/or disposal actions with financial instruments, and a declaration by the proxy that he does not carry out by occupation business transactions with financial instruments.
First Investment Bank AD in pursuance of Art. 10 of the Ordinance on the requirements related to the activities of investment intermediaries and with the objective so the customers, respectively the potential customers can make information-based investment decision, provides a description of the nature and characteristics of the offered and traded by the Bank as an investment intermediary financial instruments and the risks associated with them.
It should be taken into consideration that investment in financial instruments can bring additional risks to investors from unexpected changes in economic and market environment and the investor to take financial and other additional obligations as a result of transactions with financial instruments, including unexpected liabilities, additional to the cost of acquisition of the specific financial instruments.
Investing in financial instruments also bears the risk of losing the entire investment.
Risks related to transactions with compensatory instruments
Investments in compensatory instruments are mainly characterized by market, liquidity and target risk.
Market risk related to investments in compensatory instruments is associated with the possibility of a reduction in the price of the financial instrument.
Liquidity risk related to compensatory instruments is associated with the risk of delay or inability to sell the compensatory financial instruments owned by the investor.
Target risk in compensatory instruments is characterized by the restriction for target use and investment of this type of financial instruments only in specific projects and transactions as a means of payment accepted by the state (repayment of interests on the Law on Settlement of Uncollectible Credits (ZUNK), participation in tenders for agricultural land from the state land fund or payment on privatization transactions through the Bulgarian Stock Exchange - Sofia).