Deep-discounted bonds
Deep-discounted bonds are bonds issued below the nominal value, bearing interest at a rate below the market rate.
Deep-discounted bonds shall be defined as those whose nominal coupon is less than 50 % of the corresponding yield to maturity (calculated on the basis of the issue price).
For these deep-discounted bonds, the difference between the issue price and the nominal value is to be regarded as interest, and this interest is to be accounted for at the time of redemption of the bond. This is consistent with the decision taken over the treatment of zero-coupon bonds.
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