income bond


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Related to income bond: convertible bond, junk bond

Income bond

A bond whose payment of interest is contingent on sufficient earnings. These bonds are commonly used during the reorganization of a failed or failing business.

Income Bond

A bond in which the issuer is only responsible for making coupon payments when it has sufficient income to do so. Income bonds are most common in reorganization plans in which the issuer is attempting to maintain operations in bankruptcy. An income bond is useful for the issuer because it provides capital quickly. However, it can be disadvantageous for the bondholder because there is little or no guarantee of repayment. As a result, income bonds are relatively rare securities.

income bond

A long-term debt security in which the issuer is required to pay interest only when interest is earned. This rare security, issued principally as part of a corporate reorganization, offers an investor a relatively weak promise of payment. Some issues require that unpaid interest be accumulated and made up in periods that earnings permit. Also called adjustment bond.
References in periodicals archive ?
The Wizard prices both accrual bonds (Series I, EE, E and savings notes) and current income bonds (Series HH and H).
registered High Income Bond fund, separate accounts, and two Dublin-domiciled UCITS funds available to non-U.
Rowe Price (NASDAQ-GS: TROW) has launched the Global Unconstrained Bond Fund(Investor Class: RPIEX; Advisor Class: PAIEX) and the Global High Income Bond Fund(Investor Class: RPIHX; Advisor Class: PAIHX), building on the firm's well-established fixed income franchise.
The group is also reducing the returns paid on its variable rate savings products, such as its cash mini ISA, easy access savings account and income bonds, by up to 0.
For these people the Guaranteed Income Bond is suddenly the safest port in a storm.
The only investment that gives income with a cast iron capital guarantee is of course National Savings but again rates are pretty unattractive with their Income Bond paying 6 per cent.
NS&I is scrapping Pensioner Guaranteed Income Bonds and Capital Bonds.
A stockmarket income bond is the type of bond which pays a fixed income for a set term (unless you go for a growth option) and repays capital depending on the performance of the stockmarket.
Once you have invested in a Guaranteed Income Bond the in-come level will not change irrespective of what happens to interest rates.
A computer error made two payments on successive days instead of one lump sum when a five-year income bond matured.
Q THREE years ago I took out a High Income Bond that gives me a regular income and has another two years to run.
At the same time, Abbey's latest Guaranteed Income Bond, the ninth, promises guaranteed fixed income of 3.