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A Prize Bond is a non-interest bearing security
Security (finance)

A security is a fungible, negotiable instrument representing financial value. Securities are broadly categorized into debt securities , and stock securities; e.g., common stocks....
 issued on behalf of the Minister for Finance
Minister for Finance (Ireland)

The Minister for Finance is the title held by the Republic of Ireland minister responsible for all financial and monetary matters. The office-holder controls the Department of Finance and is considered one of the most important members of the Government of Ireland....
 of the Republic of Ireland
Republic of Ireland

Ireland is an Island country in north-western Europe. The modern Sovereignty state occupies about five-sixths of the island of Ireland, which was partitioned by the British on 3 May 1921....
 by the Prize Bond Company Limited. Funds raised are used to offset government borrowing and are refundable to the bond-owner, on demand. Interest is returned to bond-owners via prizes which are distributed by means of random selection of bonds for the prizes.

is the primary legislation under which the bonds are authorised.






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A Prize Bond is a non-interest bearing security
Security (finance)

A security is a fungible, negotiable instrument representing financial value. Securities are broadly categorized into debt securities , and stock securities; e.g., common stocks....
 issued on behalf of the Minister for Finance
Minister for Finance (Ireland)

The Minister for Finance is the title held by the Republic of Ireland minister responsible for all financial and monetary matters. The office-holder controls the Department of Finance and is considered one of the most important members of the Government of Ireland....
 of the Republic of Ireland
Republic of Ireland

Ireland is an Island country in north-western Europe. The modern Sovereignty state occupies about five-sixths of the island of Ireland, which was partitioned by the British on 3 May 1921....
 by the Prize Bond Company Limited. Funds raised are used to offset government borrowing and are refundable to the bond-owner, on demand. Interest is returned to bond-owners via prizes which are distributed by means of random selection of bonds for the prizes.

Background

The is the primary legislation under which the bonds are authorised. Bonds where first sold in March 1957, with the first draw held in September of that year. Originally the Bank of Ireland
Bank of Ireland

The Bank of Ireland is a commercial bank operation in Ireland, which is one of the 'Big Four ' in both parts of the island.Historically the premier banking organisation in Ireland, today Bank of Ireland is number two to Allied Irish Banks....
, as the government's banker, was the operator of the scheme. When the scheme commenced the biannual draws, in September and March, whereby means of six drums the winning serial number
Serial number

A serial number is a unique number assigned for identification which varies from its successor or predecessor by a fixed discrete integer value....
 was drawn randomly; in 1972 the serial number was increased from six to seven digits for bonds issued after that time. In 1993 regulation was made for the conduct of the draws on a weekly basis using a software-based computer-driven random number generator to determine winning numbers.

Organisation

The Prize Bond Company is a joint venture between the founders An Post
An Post

An Post is the State-owned provider of mail services in Republic of Ireland. An Post provides a universal postal service to all parts of the country as a member of the Universal Postal Union....
 and FEXCO
FEXCO

FEXCO, is a global provider of Merchant, Business, Consumer and International Services. It is a privately owned company, founded and part-owned by Brian McCarthy....
 and is based in Killorglin
Killorglin

Killorglin is a town on the Ring of Kerry, in County Kerry, Ireland. It is located on the river Laune, which boasts a Sport rowing club and a new boathouse....
, County Kerry
County Kerry

County Kerry is a southwestern county in Republic of Ireland. Informally referred to as The Kingdom, it forms part of the provinces of Ireland of Munster....
. The company was created in 1989 with issued share capital between the founders of 50% each and will operate the scheme under its current contract until October 31, 2009. Employees of the Prize Bond Company are seconded from the respective partner, FEXCO is responsible for administration, whilst An Post is responsible for accounting and marketing in addition to conducting the draws.

The National Treasury Management Agency has since its establishment, in 1990, had authority over regulation.

Finance

Originally bonds could be purchased as in units of £5(Punt
Irish pound

The Irish pound or punt ?ireannach was the currency of Republic of Ireland until 2002. Its ISO 4217 code was IEP, and the usual notation was the prefix ?, or IR? where confusion might have arisen with the pound sterling or other pound ....
), with a minimum purchase of £10 been required. Currently a unit is €6.25 and a minimum purchase of €25. Weekly prizes, drawn on Fridays at 12:30 in the GPO
General Post Office (Dublin)

The 'General Post Office' in Dublin is the headquarters of the Irish postal service An Post, and Dublin's principal post office. Sited in the centre of the city's main thoroughfare O'Connell Street, it is one of Ireland's most famous buildings and was the last of the great georgian architecture public buildings to be erected in the...
, Dublin
Dublin

Dublin is both the largest city and capital of Republic of Ireland. It is located near the midpoint of Ireland's east coast, at the mouth of the River Liffey and at the centre of the Dublin Region....
, range from €75 to a jackpot of €20,000, except on the first draw every month when the jackpot is €500,000. The annual prize giveaway is currently 3.0% of the total fund. Winnings are tax free within the Republic of Ireland. Recently there has been some concern that the bonds do not represent value for money for the government, in particular the cost of administration relative to the cost of interest on borrowings.

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