Strip bond package security descriptions
NOTE: The comments regarding strip bond package security descriptions apply only to Canada, as no other countries offer this service.
Generally, the Canadian depository (CDS) uses 30 character descriptions for securities. Investment dealers, banks, and trust companies may use different descriptions of different lengths and standards. For example, one Canadian dealer marketed bond-type packages as "RSBs" ("Retirement Savings Bonds").
Standards are shown here for the different types of strip bond package securities supported by CDS. In developing these standards, CDS tried to include the maximum amount of information possible within the 30 characters. Occasionally, CDS drops spaces within the description to disclose more information, rather than dropping information from the description.
Where the full information cannot be disclosed in the security description, CDS adds two characters (the 7th and 8th from the CUSIP security number for the package) after the maturity date. For these issues, full information is only available by checking CDS documentation distributed to its participants at the time the packages were first created.
Select from the following list of sample descriptions to see the explanation of the format.
| Sample description | Package type | Package composition | Number of rates |
| CDA PKG 10.5%S 060106 060112 | Bonds | Standard | 1 |
| OCRM DR 7% 101502 9.785% S 041512 | Bond | Standard | 2 (dual rate) |
| CDA MPK 10.25%S 120102 060121 | Bond | Standard | 2 or more |
| ON H CP 8.5% S 051403 13.25% 2010 | Bond | Standard | 1 |
| ON H MCP 8.5% S 051403 13.25% 2010 | Bond | Standard | 1 |
| CDA IP 9.5% A 091504 0315 | Bond | Interest-only | 1 |
| ONT MIP 8% 18% S 060298 060218BN | Bond | Interest-only | 2 or more |
| ONT RP 10% A 091815 091825 | Bond | Residual-only | 1 |
| ONT MRP 12% A 091818 091822 | Bond | Residual-only | 2 or more |
| CDA ANN PKG A 060102 060122 | Annuity | Interest-only | 1 |
Standard formats used for strip bond package security descriptions
Bond-type packages
Packages with regular interest-like payments until maturity plus a lump-sum payment at maturity
[Issuer name abbreviation] [Package type] [Interest rate] [Payment frequency] [First payment date] [Maturity date] [Special characteristics indicator]
Dual-rate packages
[Issuer name abbreviation]DR [Interest rate for first period] [End date for first interest rate] [Interest rate for second period] [Payment frequency] [Maturity date] [Special characteristics indicator]
Callable-residual packages
[Issuer name abbreviation][Package type] [Interest rate] [Payment frequency] [First payment date] [Maturity date] [Special characteristics indicator]
| Information | Examples | Comments |
| Issuer name abbreviation | CDA, ONT, ON H (Ontario Hydro), QUE, BC, ALTA, HY Q (Hydro Quebec), MAN, etc. | Abbreviations are usually 2 to 4 characters. |
| Package type | PKG, IP, RP, CP, DR, MPK, MIP, MRP, MCP | For PKG, DR, CP, MCP, and MPK packages, periodic payments are from interest strip bonds and the lump sum payment at maturity is from a principal payment on the underlying bond(s). For IP and MIP packages, all payments are from interest payments on the underlying bond(s). For RP and MRP packages, all payments are from principal payments on the underlying bond(s). MPK, MIP, MRP, and MCP package all have multiple interest rates. DR packages have two rates. The other package types have only one rate during the applicable period. |
| Interest rate | 10.125% | Interest rate is specified only for bond-type packages. For dual-rate packages, both rates are shown. For multiple rate packages (MPK, MIP, MRP, or MCP), only the rate for the final period is shown. For annuity-type packages, CDS calculates each payment using a rate of 100% per annum, divided by the number of payments per year. |
| Payment frequency | M, B, Q, S, or A | Monthly, Bi-monthly, Quarterly, Semi-annually, or Annually |
| First payment date | 091506 | Date on which the first payment will be made for the package, in MMDDYY format |
| Maturity date | 100115 | Date on which the final payment(s) will be made for the package. For bond-type packages, both an interest payment and a maturity payment will be made. For annuity-type packages, only the final periodic payment will be made. |
| Special characteristics indicator | AE; A2; 3B | Optional. Indicates that the strip bonds in the package have special features or if there are multiple rates; the characters shown are the 7th and 8th in the package CUSIP number (a security identification number used within the financial community). |
Annuity-type packages
Packages with regular annuity-like payments until maturity, but no lump-sum payment at maturity
[Issuer name abbreviation] [Package type] [Payment frequency] [First payment date] [Maturity date] [Special characteristics indicator]
| Information | Examples | Comments |
| Issuer name abbreviation | CDA, ONT, ON H (Ontario Hydro), QUE, BC, ALTA, HY Q (Hydro Quebec), MAN, etc. | Abbreviations are usually 2 to 4 characters. |
| Package type | ANN PKG | For annuity-type packages, the periodic payments equal the face value divided by the number of payments per year (i.e., 100% of the face value is paid out each year from the first payment date to the maturity date, inclusive). |
| Payment frequency | M, B, Q, S, or A | Monthly, Bi-monthly, Quarterly, Semi-annually, or Annually |
| First payment date | 091506 | Date on which the first payment will be made for the package, in MMDDYY format |
| Maturity date | 100115 | Date on which the final payment(s) will be made for the package. For bond-type packages, both an interest payment and a maturity payment will be made. For annuity-type packages, only the final periodic payment will be made. |
| Special characteristics indicator | AE; A2; 3B | Optional. Indicates that the strip bonds in the package have special features or if there are multiple rates; the characters shown are the 7th and 8th in the package CUSIP number (a security identification number used within the financial community). |
See also Strip bond description standards and Canadian issuer name abbreviations.
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