Public Debt Instruments

Public Debt Instruments

Government Debt Securities (GDS)

Government debt securities are borrowing instruments issued by the Turkish Treasury in the domestic market. The government is indebted, and pays back the holders of Government Debt Securities the borrowed amount on coupon payment days and at the end of maturity. During their maturity term, government debt securities may be traded by real and legal persons in secondary markets.

Government debt securities are classified on the basis of their maturity term, issue method, the currency in which they are denominated, interest payment method, and whether they carry coupons or not.

According to their maturities:

-          Government debt securities with maturity terms of 1 year and more are called “Government Bonds”, and

-          Government debt securities with maturity terms of less than 1 year are called “Treasury Bills”.

Central Bank of the Republic of Turkey (CBRT) Liquidity Bills

Liquidity bills are used as monetary policy tools issued by the Central Bank of the Republic of Turkey for managing the market liquidity and contributing to the efficiency of open market trading. Liquidity bills are discounted securities, which are issued by the Central Bank of the Republic of Turkey on its own name and account with maturities less than 91 days.

Revenue Sharing Certificates

Revenue sharing certificates are those securities entitling their real/legal person holders to the revenues of publicly held infrastructure facilities such as transportation, communication and energy, such as bridges, dams, electricity generators, highways, railroads, telecommunication systems, civil seaports and airports, etc. Revenue sharing certificate holders have no ownership or operation rights on such facilities. Revenue sharing certificates are, by nature, bonds with varying interest.

Revenue Indexed Bonds

Turkish Treasury realized its first issue of revenue indexed bonds on January 28, 2009 in order to encourage domestic saving, diversify Government Debt Securities and widen the investor base. The yield of these instruments are indexed to the revenues of the state owned enterprises including Turkish Petroleum Corporation (Türkiye Petrolleri Anonim Ortaklığı-TPAO), State Procurement Office (Devlet Malzeme Ofisi -DMO), General Directorate of State Airports Authority (Devlet Hava Meydanları İşletmeleri-DHMİ) and General Directorate of Coast Safety (Kıyı Emniyeti Genel Müdürlüğü- KIYEM), which are transferred to the state’s budget. The yields of the revenue indexed bonds are related to the state’s income and coupon payments are guaranteed within a minimum and maximum range.