callable bond

callable bond
A bond that can be called (redeemed) by the issuer prior to its maturity, on certain call dates, at call prices. On the call dates, the issuer has the right, but not the obligation, to buy back the bonds from the bond holders at the call price. Technically speaking, the bonds are not really bought and held by the issuer, but cancelled immediately or no longer accrue interest at the original coupon rate.
Syn: redeemable bond

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  • Callable bond — is a type of bond 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. [ [http://www.wisegeek.com/what is a callable bond.htm What is a Callable Bond?] ] In… …   Wikipedia

  • callable bond — n. A bond that may be called for payment before it matures. The Essential Law Dictionary. Sphinx Publishing, An imprint of Sourcebooks, Inc. Amy Hackney Blackwell. 2008. callable bond …   Law dictionary

  • callable bond — A bond that the issuer has the right to redeem prior to maturity. Some callable bonds may be redeemed on a single call date while others have multiple call dates. Some callable bonds may be redeemed at par while others can only be redeemed at a… …   Financial and business terms

  • callable bond —   Obbligazione che può essere riacquistata dall emittente in una data antecedente la scadenza pagando all obbligazionista un prezzo prefissato. Viene chiamato callable, in quanto questa possibilità corrisponde, per l emittente, al possesso di un… …   Glossario di economia e finanza

  • Callable Bond — A bond that can be redeemed by the issuer prior to its maturity. Usually a premium is paid to the bond owner when the bond is called. Also known as a redeemable bond . The main cause of a call is a decline in interest rates. If interest rates… …   Investment dictionary

  • callable bond — / kɔ:ləb(ə)l bɒnd/ noun a bond which can be redeemed before it matures …   Dictionary of banking and finance

  • European Callable Bond — A bond that can be redeemed by the issuer at a predetermined date prior to maturity, such as the last coupon date. European callable bonds behave similarly to a vanilla bond after the call date, with a comparable coupon and time to maturity.… …   Investment dictionary

  • Multi-Callable Bond — A bond that allows the issuer to call or redeem it on particular future dates that are specified at the time of issuance. Since the issuer benefits by gaining flexibility with regard to the bond s maturity, the coupon on the bond may be higher… …   Investment dictionary

  • callable — call·able adj: capable of being called; specif: subject to a demand for presentation for payment a callable bond Merriam Webster’s Dictionary of Law. Merriam Webster. 1996. callable …   Law dictionary

  • Bond valuation — is the process of determining the fair price of a bond. As with any security or capital investment, the fair value of a bond is the present value of the stream of cash flows it is expected to generate. Hence, the price or value of a bond is… …   Wikipedia

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