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Perpetual Bond
(redirected from Perpetual bonds)

   Also found in: Wikipedia 0.01 sec.
Perpetual bond
Nonredeemable bond with no maturity date that pays regular interest rates indefinitely.

Perpetual Bond
A bond in which the issuer does not repay the principal. Rather, a perpetual bond pays the bondholder a fixed coupon as long as he/she holds it. Prices for perpetual bonds vary widely according to long-term interest rates. When interest rates rise, perpetual bonds fall and vice versa. Perpetual bonds are most common in the United Kingdom, where they were used originally to pay for the military.

perpetual bond
See consol.


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Under Tier I, banks can raise capital as equity and innovative instruments like perpetual non-cumulative preference shares and perpetual bonds.
These include fixed rate bonds, where the interest remains constant throughout the life of the bond; floating rate, where the interest is linked to a stock market index; inflation-linked bonds, and perpetual bonds, which have no maturity date.
Perpetual bonds are non-redeemable, which means they do not have a maturity date but pay interest to the holder forever--truly long term.
 
 
 
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