Callable bond - Definition

Defined as a type of bond (debt security) that allows the issuer of the bond to retain the privilege of redeeming the bond at some point before the bond reaches the date of Maturity. The main cause of a call is a decline in Interest rates. If interest rates have declined since a company first issued the bonds, it will likely want to refinance this debt at a lower Rate of interest. In this case, company will call its current bonds and reissue them at a lower rate of interest.

Terms near "Callable bond"

Callable loan

Callable stock

Called away

Called bond

Cambodia Riel

Cameroon Franc

Canadian Dollar

Cancel

Cancel order

Cancellation of debt