A kiwi bond is a fixed income security offered by the government of New Zealand. The name kiwi is derived from a native bird found in New Zealand much like the Canadian coin called loonie after the loon, a common bird found in Canada.
Kiwi Bonds Explained
The kiwi bonds are available only to New Zealand residents and they cannot be purchased by foreigners even if they are New Zealand citizens. They can be bought only in New Zealand dollars with a minimum investment of NZ$1000 up to a maximum of NZ$500,000.
The interests on the bonds are paid quarterly and the maturities of the bonds range from 6 months to 4 years. The kiwi bonds are considered one of the safest investments for residents since they are fully backed by the New Zealand government and with an AA+ rating they hold the second highest credit rating in the world.
