'Pibs' - tempting fare for yield-hungry investors

Permanent interest-bearing shares pay a fixed, often generous rate of income. Phil Oakley explains how they work, and tips four 'Pibs' to consider buying.

In the current low-interest-rate environment, many yield-seeking private investors have been willing to take extra risks for more income by buying permanent interest-bearing shares (Pibs). New EU regulations mean that these might become scarcer from next year. So what should investors do?

What are Pibs?

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Skipton6.875% 2017On 13/4/2017 @ 100p93p7.40%9.40%11.42%
Yorkshire13.5% 2025Matures 1/4/2025 at 100p150p9%7%13.70%
Coventry12.13%No180p6.74%N/A22.50%
Leeds13.38%No168p7.96%N/A14.20%

Phil spent 13 years as an investment analyst for both stockbroking and fund management companies.

 

After graduating with a MSc in International Banking, Economics & Finance from Liverpool Business School in 1996, Phil went to work for BWD Rensburg, a Liverpool based investment manager. In 2001, he joined ABN AMRO as a transport analyst. After a brief spell as a food retail analyst, he spent five years with ABN's very successful UK Smaller Companies team where he covered engineering, transport and support services stocks.

 

In 2007, Phil joined Halbis Capital Management as a European equities analyst. He began writing for MoneyWeek in 2010.