Changes in defence bonds: continuous distribution, various maturities
From now on, defence bonds are becoming even more attractive and accessible. As of February, individuals, businesses and other organizations can purchase defence bonds at any time and choose from more investment periods.
Two new defence bond issues were launched on Monday. Both are distributed at the same time, between 2 and 16 February, but with different maturities and interest rates.
One issue is with a maturity of one year and will be subject to a 2% annual interest rate (redemption on 17 February 2027). Another issue is with a maturity twice as short – 6 months and will be subject to a 1% 6-month interest rate (redemption on 18 August 2026), respectively.
The other two issues (provisionally planned issues of the same maturity – one year and six months) will start to be distributed immediately after the end of these issues, on 17 February, i.e. there will be no day when there will be no possibility to purchase defence bonds.
“We aim to make defence bonds economically attractive and as easily accessible as possible for individuals and businesses. Continuous distribution of defence bonds and different issue maturities will provide investors with more flexibility and, we hope, will encourage them to contribute to the national defence funding at the same time. We believe that more attractive defence bonds can also be an investment alternative for those leaving the second pillar pension funds", Darius Sadeckas, Vice-Minister of Finance, states.
This is the first step taken by the Ministry of Finance to consistently increase the attractiveness of defence bonds. The Government is currently presented with a draft amendment to the Law on State Debt, which proposes to abolish the ceiling on the interest rate paid on defence bonds. ‘This means that, depending on the cost of borrowing on behalf of the State, those who have purchased defence bonds will also be able to receive higher than 2% interest rates. This will allow longer-maturity issues to be offered,” the Vice-Minister notes.
Following the adoption of the draft law, the interest paid will be more in line with the average interest rate on borrowing on behalf of the State. The draft law is expected to be adopted in the spring session of the Seimas.
Defence bonds are targeted Government savings notes (GSN) to finance defence needs. Since the launch of the defence bond placement in October 2024, during16 issues buyers have purchased the bonds for a total of EUR 238.7 million.
Everyone willing to acquire defence bonds can do so through distributors selected by the Ministry of Finance, namely Swedbank, SEB and Orion Securities. Individuals and legal persons are able to purchase the defence bonds at Swedbank, SEB online bank, Orion Securities online platform, as well as at SEB bank branches. More information about the acquisition of defence bonds can be found at www.gynybosfondas.lt and on the website of the Ministry of Finance.
When the time comes to redeem the defence bonds, nothing will have to be done – the money for the redeemed defence bonds and the interest due will be automatically transferred to the same account from which the payment for the purchased defence bonds was made.
The interest rate on the defence bonds for each issue is set taking into account the average interest rate for borrowing by the Government on behalf of the State of an appropriate maturity, but in any case, it may not exceed 2 %, as decided by the Seimas on 20 June 2024. The interest rate will be set and published together with other terms and conditions of the issue placement of the defence bonds on the website of the Ministry of Finance at least one working day before the commencement of the placement of the defence bonds.
The preliminary schedule for the issue of the defence bonds is updated on a monthly basis and published on the website of the Ministry of Finance.
More information on the defence bonds can be found in the special column “Frequently asked questions” here.
About the Defence Fund:
Please note that the Defence Fund entered into operation on 1 October 2024 with the aim of increasing the national defence funding, foreseeing additional sustainable sources of financing.
The resources of the Defence Fund will be allocated for acquisition of weapons, equipment and ammunition necessary for the development of a division-level military unit capacity, infrastructure necessary for the German brigade in Lithuania, acquisition and development of counter-mobility measures, military mobility and double-purpose (civil and military needs) transport infrastructure projects, strengthening and development of the civil protection foreseen in the Law on Crisis Management and Civil Protection.
Last updated: 12-02-2026
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