Refunded Bond

外汇网2021-06-19 14:09:29 49

Bonds that have their principle cash amount already held aside by the original issuer of the debt. A subset of the municipal and corporate bond classes, the funds required to pay off refunded bonds are held in escrow until the maturity date, usually by purchasing Treasury or agency paper.

Also known as "prefunded bonds".

|||Refunded bonds will typically be 'AAA' rated due to the cash backing and, as such, will offer little pmium to equivalent-term Treasuries. The date of refunding will usually be the first callable date of the bonds.

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