Collins Stewart Tullett

Frequently asked questions	Preference Shares	Permanent Interest Bearing Shares	Subordinated Bonds - Ex PIBS
Who issued them?	PLCs	Building Societies	Ex Building Societies who have converted to plcs
What yields are currently available ? And what are the main stocks available?	Refer to our latest weekly lists - we will be happy to e-mail them to you - ask Rik Edwards on 020 7523 8888 or e-mail using form	As for prefs	As for prefs
Where are they traded ?	London Stock Exchange	London Stock Exchange	London Stock Exchange
In what form do they pay income?	Dividends - usually twice a year	Interest - twice a year	Interest - twice a year
Do they pay a fixed coupon?	Yes, apart from one or two participating issues	Yes, apart from one or two floating rate issues	Yes
Can the issuer stop payment of income?	Yes - dividends are at the discretion of directors, but the company would not then be able to pay an ordinary dividend	Yes - the board may suspend interest payments if they feel it necessary	No - this would be a default which could lead to administration
Is income cumulative?	Usually yes, although most bank issues are non-cumulative	No	Yes
Where do they rank for income and capital?	After all debt, but before ordinary shares	After all lenders, depositors and share accounts	After all other debt, but before any preference or ordinary shares
Do they pay gross?	No - dividends are paid net, and are deemed to have already suffered the basic rate of Income Tax	Yes	Yes
Can I put them in a PEP or ISA?	Yes	Yes	Yes
Can I reclaim tax credits in a PEP or ISA?	No - reclaimability ended on 5th April 2004	n/a	n/a
How many leading issues are there?	15	12	10
What size can I deal in?	Subject to marketability, any whole number of shares	Round amounts of 1,000, 2,500 or 5,000 depending on the issue	Round amounts of 1,000, 10,000 or 50,000 depending on the issue
Are the shares redeemable?	Generally not, but with some exceptions	No, but some issues are callable at the society's option	No, but some issues are callable at the company's option
Are dealing prices displayed on the screen?	Yes - leaders are typically quoted in 25,000	No - brokers need to phone market-makers to obtain prices	No - brokers need to phone market-makers to obtain prices
Do I have to pay Stamp Duty?	Yes - 0.5% on purchases	No	No - except 1% on First Active 11.75% (an Irish issue)
What would I get in a solvent winding-up?	It depends on the rights of the individual stock	100p	100p
What is normal settlement?	T + 3 , ie three working days - but we can arrange different settlement	As for prefs	As for prefs
How is accrued income settled?	Dealt "dirty" as with equities, ie accrued dividend is included in the price, which falls when the stock is marked ex dividend	Dealt clean of interest as with bonds, ie interest is settled separately at the time of dealing	As for PIBS
How do I work out the income yield?	Divide the coupon by the price, after adjusting the price to allow for net accrued dividend and Stamp Duty	Divide the coupon by the price	Divide the coupon by the price
What if I want to work out a redemption or call yield?	Collins Stewart will be glad to help	Collins Stewart will be glad to help	Collins Stewart will be glad to help
Will I get my money back when I sell?	It depends on the market price - you may get back more or less than you paid.	As for prefs	As for prefs
Can I deal online?	Yes - we supply automated dealing prices to some stockbrokers offering online dealing	No	No
How is the income taxed outside a PEP or ISA?	A basic rate taxpayer can retain the full net dividend, while a higher rate taxpayer only has to pay the difference between basic and higher rate tax - he will currently retain 75% of the net dividend	Interest is paid gross. A basic rate taxpayer will retain 80% of gross interest, while a higher rate taxpayer will retain 60% of gross interest.	As for PIBS
How safe are they?	As safe as the issuing company - no stock from our current leader list has ever failed to pay a dividend	As safe as the issuing society - no stock from our current leader list has ever failed to pay interest	As safe as the issuing company - no stock from our current leader list has ever failed to pay interest
Why should I do my deals with Collins Stewart?	Because Collins Stewart have been experts in prefs and PIBS since we were founded in 1991: because Rik Edwards has many years of experience in fixed interest stocks: and because we have outstanding dealing capabilities.	As for prefs	As for prefs
I'm a fund manager / institutional investor / independent financial advisor - how can I deal?	Phone Rik Edwards on 020 7523 8888 and we will set up your account	As for prefs	As for prefs
I'm a broker with a stock exchange member firm - how can I deal?	Phone Rik Edwards on 020 7523 8888 or STX 67925 to deal	As for prefs	As for prefs
I'm a private individual with a sizeable sum to invest (eg over £25,000) - how can I deal?	Phone our private client general advice and dealing team on 020 7523 4554	As for prefs	As for prefs
I'm a private individual with a smaller sum to invest - how can I deal?	Phone your regular stockbrokers and ask them to contact Rik Edwards on 020 7523 8888	As for prefs	As for prefs

Fixed Interest Sections