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On 7 January 2002, the National Treasury, with the technical and operational support of the
Brazilian Custody and Settlement Company - CBLC, implemented the Treasury Direct, allowing
individuals to purchase public bonds directly through the Internet. The Program aims at
democratizing investment in federal bonds, stimulating long-term savings, and providing
information regarding the management and structure of the Brazilian federal public debt.
This initiative is first of its kind in Latin America.
Purchase and Sale of Bonds
The minimum limit per investor is of 0.2 bond (approximately R$ 200.00) and the maximum is
R$ 400,000.00 per month. There are no limits to public bond holdings; in other words, investors
may purchase the R$ 400,000 limit every month. Those months the interest is paid and the bonds
are purchased through the Treasury Direct, the value redeemed or paid in interest is added to
the monthly limit of R$ 400,000.00.
In order to provide liquidity to the bonds purchased through the Treasury Direct system, the
National Treasury performs weekly repurchases, held between 9 am on Wednesday and 5 pm on
Thursday. There is no time limit regarding the resale of bonds back to the Treasury Direct, nor
is there a limit to the repurchase value. The bonds are repurchased at the market price quoted
on the date of the transaction.
Bonds Available for Purchase
The following bonds may be purchased via Internet:
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LTN National Treasury Bills: bonds which yields are determined (fixed rate) upon purchase. Form of payment: upon maturity; |
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LFT Treasury Financial Bills: bonds which daily yields are linked to the economys basic interest rate (average rate of daily operations with public bonds registered in the SELIC system, or simply, the SELIC rate) Form of payment: upon maturity; |
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NTN-B National Treasury Notes B series: bonds which yields are linked to the variation of the Consumer Price Index - IPCA, along with the interest defined upon purchase. Form of payment: every six months (interest) and upon maturity (principal); |
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NTN-C National Treasury Notes C series: bonds which yields are linked to variation of the General Price Index - IGP-M, along with the interest defined upon purchase. Form of payment: every six months (interest) and upon maturity (principal); and |
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NTN-F National Treasury Notes F series: bonds with fixed rate yields, along with interest defined upon purchase. Form of payment: every six months (interest) and upon maturity (principal). |
Payment
The purchase of bonds through the Treasury Direct system must be paid for with resources made
available in the account of the Custody Agent. Upon confirmation of the bond purchase, the
Treasury Direct system will determine the deadline the investor must make the funds available
in the account of the Custody Agent. The investor shall then contact his or her Custody Agent
to obtain the information of the account in which the funds must be deposited. There is no
change for those investors who are registered by banks that are part of the Treasury Direct
system.
As of October 1st 2004, payments are no longer made through banks; funds must be deposited at
the Custody Agents. This change went into effect with the setting up of the Investment Account,
which allows investors to manage their financial applications, including the Treasury Direct,
without having to pay the CPMF (transaction tax). With this instrument, all financial
applications must take place through the Investment Account. This new type of account went into
effect on October 30 2004 for new investments, and will go into effect on October 1 2006 for
the stock existing on 30 September 2004. The CPMF will only be levied when funds are debited
from the current account of the investor and credited in the Investment Account.
Operating Hours
The purchase and sale of bond through the Treasury Direct system may be made 20 hours a day on
working days and 24 hours a day on weekends and holidays. Between 5 and 9 am on working days,
activity on the Treasury Direct is suspended for system updating and maintenance. Balance and
limit statements may be issued 24 a day. However, the National Treasury may suspend the
activities of the Treasury Direct at any time, as deemed necessary.
Public and Restricted Access
The public bond sale portal has two types of access: public and restricted. The general public
may access information regarding registration, sales, purchases, public debt indicators,
legislation, system security, as well as other types of information. Access is restricted once
the username and password have been entered, allowing the investor to perform purchase and sale
operations, as well as monitor account activity.
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