SECURITY INVESTMENTS

Also known as bank bills, these investments offer competitive rates that are fixed until maturity.

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About security investments

Overview

Also known as ‘negotiable certificates of deposit’ or ‘bills of exchange’ accepted or endorsed by Australian banks
Considered to be ‘discount securities’ because they are sold at a discount to their face value
Difference between the purchase price (amount invested) and the face value (amount at maturity) represents the interest earned
Provides flexibility, competitive returns and the ability to manage interest rate risk
Minimum investment amount of $100,000
Terms from 30 to 185 days
No account-keeping fees (where applicable, standard government fees apply)
The face value of the investment is paid on maturity

Benefits

Competitive returns – receive rates available in the short-term money market
Consistent returns – once purchased, interest rate is fixed until maturity
Flexibility – a fixed interest rate facility can extend the guaranteed rate for up to two years, with interest paid quarterly (forward sale) or at maturity (compound forward sale)
Security – the accepting or endorsing bank has an ‘obligation to pay’ upon maturity. We will hold the securities for safe custody free of charge
Manage risk – enhance returns and manage risk by attaching Flexi Bill Solutions to your investment

Fixed rate security investments

Suitable if you want to invest for a longer term than is generally available in the securities or bank bill market
Minimum investment amount of $100,000
Choice of two types of fixed rate investments – forward sales and compound forward sales (see below)

Forward sales

Security investments rolled over quarterly at the same interest rate negotiated on the initial investment date
Interest is paid on each rollover
Terms from four months to five years

Compound forward sales

Similar to forward sales, but interest is paid at maturity
Terms from four months to two years

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Important information

This advice has been prepared without considering your objectives, financial situation or needs. Before acting on this advice, please consider its appropriateness to your circumstances.

Commonwealth Bank of Australia issues all products mentioned on this webpage. View our Financial Services Guide (PDF 59kb). View Product Disclosure Statements (PDSs) for Security Investments - Negotiable Certificates of Deposit (issued by the Commonwealth Bank of Australia) (PDF 134kb) and consider them before making any decision about these products. If you have a complaint, call the Bank’s dispute resolution team on 13 2221.