Announcement of currency conversion of financial instruments

In connection with the Law on the Introduction of the euro in the Republic in Bulgaria (the Law) published in the Official Gazette Nr.70 form August 20th, 2024 and starting from the date of introduction of the euro as official means of payment in the Republic of Bulgaria, the value of all financial instruments denominated in BGN and owned by clients of INVESTBANK (the Bank) will be automatically be converted in EUR according to the general principles and rules postulated in the Law.

In accordance with the general principles and rules for currency conversion and rounding postulated in the Law, the conversion form BGN to EUR will be done by dividing the numerical value in BGN by the official exchange rate expressed with six digits and five decimal places.

The resulting amount in EUR shall be rounded to the second decimal place in respect with the following mathematical rule:

-          If the number on the third decimal place is less than 5, the number on the second decimal place does not change;

-          If the number on the third decimal place is equal to or bigger than 5, the number on the second decimal place shall increase buy one.

The value of the financial instruments shall be converted from BGN to EUR according to the general principles postulated in the Law as follows:

The market operator and/or the respective investment intermediary that operates and/or manages a trading venue shall convert the market value of the financial instruments admitted to trading on the trading venue according to the general principles and rules of the Law unless other legal act of the European Union provides for special rounding rules for a specific financial instrument.

The Central Depository shall automatically convert the notional value of all dematerialized financial instruments registered with the Central Securities Register (CSR) according to the general principles and rules of the Law.

All transactions with dematerialized financial instruments shall be suspended within 3 (three) working days prior the date of introduction of the euro in the Republic of Bulgaria. All transactions shall resume on the next day after the date of introduction of the euro in the Republic of Bulgaria. All payment and settlement systems shall facilitate the transactions in euro staring from that day.

1)      Shares

The currency conversion of the par value of shares and shareholders` equity shall be without affecting not the rights of the shareholders neither their equity participation.

The par value of a share shall be converted form BGN in EUR according to the general principles and rules of the Law.

The total number of shares owned by clients shall not change after the par value conversion.

2)      Debt securities other than Government debt securities

The total par value of any debt issue shall be converted from BGN to EUR according to the general principles and rules of the Law.

The par value of a single par amount shall be calculated by diving the total EUR par value of the bond issue by the number of the par amounts.

The currency conversion shall not changes the rights and the obligations of the issuer and the bondholders.

3)      Government debt securities (bonds)

The par value of all Government debt issues shall be converted at once from BGN to EUR according to the general principles and rules of the Law.

The currency conversion of the par value of any government debt issue held by any individual client shall be carried out by the Bulgarian National Bank (BNB).

The BGN value on the previously issued bond certificates shall be considered in EUR according to the general principles and rules of the Law. The bond certificates shall be valid until the full repayment of the bonds to the bondholders for any specific government debt security.

The market value in EUR of the government securities issued in BGN shall be determined on the basis of the converted nominal value of those securities and shall be calculated in relation to 100 (par value) with 2 (two) decimal places.

4)      Collective investment schemes, national investment funds and alternative investment funds

The total Net Asset Value (NAV) of the collective investment scheme shall be calculated on the first working day following the introduction of the euro in the Republic of Bulgaria by converting the NAV in BGN as per the previous working day and according to the general principles and rules of the Law. The NAV of 1 unit in EUR shall be determined by dividing the total NAV by the number of units and by rounding the resulting value to the fourth decimal place as follows:

-          If the number on the fifth decimal place is less than 5, the number on the fourth decimal place does not change;

-          If the number on the fifth decimal place is equal to or bigger than 5, the number on the fourth decimal place shall increase buy one.

The issue and redemption prices of 1 unit in EUR shall be rounded according to the above mentioned rules, sentence 2.

The above general principles and rules shall be applied accordingly to the national investment funds and the alternative investment funds.

Additional information shall follow for other products and services provided by the Bank.

INVESTBANK