Federal Treasury notes ("Schaetze")

Profile

Maturity: 2 years

Income: fixed annual interest payment

Redemption: at par value

Price risk: low

Issuer risk: very low

With a maturity of two years, Federal Treasury notes (Schaetze) have the shortest maturity of any capital market instruments issued by the Federal Government.

Schaetze as a proportion of currently tradeable Government debt

Primary market

After Bunds and Bobls, Schaetze are one of the Federal Government's most important funding tools. As there are four new issues per year, there are eight Schaetze outstanding at any one time.

As in the previous years, four new issues of Schaetze will be carried out in 2019 – in February, May, August and November. After an initial issue with a volume of € 5 bn, the new issue in February reaches a total volume of € 13 bn via two reopenings of € 4 bn each in the two following months. The new issue in May of € 5 bn is followed by reopenings of € 5 bn and € 4 bn and finally reaches € 14 bn in total. The new issue in August of € 5 bn arrives at a final volume of € 13 bn after two reopenings of € 4 bn. The new issue in November of € 5 bn will have just one reopening before year-end, reaching € 9 bn for the time being. In addition, the Schatz initially issued in November 2018 maturing was re-opened for a last time in January 2019 by € 5 bn in order to achieve a final volume of € 12 bn.

This means that in the 2019 issuance calendar € 54 bn (€ 5 bn more than in the previous year) will be raised via Schaetze. Due to the increased annual issuance volume the share of Schaetze in relation to the other issued Government securities (incl. inflation-indexed Government securities) decreases slightly from 27 % (2018) to about 26 %.

Schaetze as a proportion of total issuance volume in 2019

In contrast to the issuance volumes of nominal bonds which already had been fixed within the issuance calendar for the whole year, the issuance amount of the inflation-linked bonds is specified on a daily basis. So in this chart their share increases during the year with each new issuance of an inflation-linked bond (whereby the shares of the nominal bonds decrease slightly).

Secondary market

Schaetze are among the most liquid securities traded on the secondary market for German Government securities. The general tendency on the primary market is to have eight outstanding Schaetze at any one time. At year-end 2018, there was an outstanding volume of € 96 bn corresponding to around 9 % of the total German Government bond volume. This corresponds in relative as well as absolute terms to the numbers of the previous years that vary around € 100 bn and 9 %. At year-end 2018 the tradable volumes of each single securitiy (without the November Schatz thats targeted final volume wasn't achieved yet) amounted to € 12 to 13 bn. Schaetze accounted for around 13 % (€ 595 bn) of the trading volume of German Government securities of the reporting member banks of the Bund Issues Auction Group in 2018. That is almost unchanged versus previous year's € 615 bn.

Currently tradeable Federal Treasury notes

The terms of issue for Federal Treasury notes are available within the security master data after clicking on the corresponding ISIN.