Baby Bond
MATURITY:
19 years
INTEREST:
6,70%

General information

Baby Bonds are government securities with a term of 19 years which can only be purchased to Treasury Start Securities Accounts. They have an annually variable interest rate, and the interest payable is the sum of the basic interest, linked to the change in the consumer price index of the previous year, plus the interest premium. Their face value is HUF 1. For the first series (2032/S), interest payment is due on 2 December each year; for subsequent series, interest payment takes place on 1 February each year.

All payments made to the account, as well as interest credited in the course of the term, are automatically invested in securities with the same serial number, based on a standing order. After the payment of natural persons the Hungarian State provides a state subsidy equal to 10% of the payments but with a maximum amount of HUF 12.000 per year.

From February 13, 2024, the amount that can be paid into the Start account by natural persons cannot exceed HUF 1,200,000 in one calendar year.

Treasury Start Securities Accounts can be opened for all children who have a residence in Hungary, are Hungarian citizens and are Hungarian citizens or a parent of Hungarian nationality living abroad and with a Hungarian identity card, under the age of 18. The account can only be opened if the child does not have Start Account at any other account holder, or if the termination of that account is initiated due to the transfer of the Start Account to the Treasury.

Treasury Start Securities Accounts can already be opened without personal appearance, via Customer Gateway.

Sale and repurchase

The Baby Bonds can be purchased at any time until the child reach the age of 18, and the Hungarian Treasury immediately credits on the  Treausry Start Securities Account the amount of Baby Bonds corresponding to the paid amount. The Hungarian State Treasury automatically invests the paid amount to Baby Bonds with a serial number corresponding to the child’s year of birth.

After reaching the age of 18 until the end of the term, the credited interest is automatically invested in Baby Bonds of the given series.

Given that the Baby Bonds are sold at face value plus accrued interest, the interest advanced by the investor at the time of purchase will be credited on the Client’s Start Securities Account at next interest payment period by the Issuer.

It is possible to open Start Securities Account and purchase Baby Bonds for the foreign Hungarian children born before 1 July 2017 until the age of 18. It is important to know that the savings can be withdrawn at earlier three years after the opening of the Start Securities Account and the family member shall pay an amount of HUF 25.000 as starting amount when opening the account. The state subsidy after the payments and the favourable interest rate provided by the Baby Bonds are also applicable in this case. 

The Issuer repurchases the Baby Bonds in accordance with the law through the Hungarian State Treasury at face value plus accrued interest, e.g. after the child reaches the age of 18 (even before the expiration of the maturity).

Customers of the Baby Bonds

The Baby Bonds can be purchased by any natural persons for the child who have Start Securities Account at the Hungarian State Treasury. Baby Bond series issued in the given year can be purchased for the child born on 1 February of the given year and between 31 January of the next year, until the child reaches the age of 18. The interests realized on the Baby Bonds can be invested to the same series of Baby Bonds until the maturity during the holding of the Start Securities Account. The first series (2032/S) can be purchased for children born until 31 January 2014 and who have Start Securities Account at the Hungarian State Treasury.

For further terms and conditions of each series, please get informed from the Public Offer or the Information Memorandum for that series, which can be reached at in the tab of Current Public Offer.

Online sales, administration*

* To use the online sales services of the State Treasury, an electronic channel contract is required!