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Redeemable Bond

Redeemable Bond Definition

Redeemable Bond is a bond that can be redeemed prior to its maturity date. Its price is slightly above the par value for the bond. The earlier the bond is called, the higher price increase is foreseen. The issuer calls a bond if he has to pay a higher coupon than the current market interest rates. After that he can refund the capital by reissuing the bonds at a lower interest rate.  The conditions under which the bond can be redeemed are specified in the terms and conditions of the bond issue.

RELATED TERMS
Redeemable Shares
RELATED CATEGORIES
Bonds







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