refunding bond

Refunding Bond

A bond that retires another bond before the first bond matures. A company may issue a refunding bond for a number of reasons, but mainly because of a decline in interest rates, which reduces the cost of funding. Refunding bonds deprive bondholders of the first bond from future coupon payments to which they would otherwise of have been entitled. Most bonds are nonrefundable for at least five or 10 years after issue, but a refunding bond may be issued afterward.

refunding bond

A bond that is issued for the purpose of retiring an outstanding bond. Issuers refund bond issues to reduce financing costs, eliminate covenants, and alter maturities. See also crossover refunding bonds, prerefunding.
References in periodicals archive ?
59,290,000 hospital revenue refunding bonds, series 2005A (Adventist Health System/Sunbelt Obligated Group) 'A+';
The bonds were refunded on November 2, 2006 with proceeds of the State's Board of Governors Florida Atlantic University Dormitory Revenue Refunding Bonds, series 2006B.
These computations were contained in schedules provided to them by UBS Financial Services, underwriter for the refunding bonds.
Grant Thornton verified the mathematical accuracy of future cash receipts and requirements of the trust fund securing the refunded bonds, contained in schedules provided to them by Citigroup, underwriter for the refunding bonds.
AUSTIN, Texas -- Fitch assigns its 'AA+' rating to Harris County, TX' $90 million public improvement refunding bonds (PIBs), series 2006A and $275 million unlimited tax road and refunding bonds (ULT road bonds), series 2006B.
Ypsilanti Community Utilities Authority (MI), $6,800,000 general obligation refunding bonds, series 2006 (insured: Financial Security Assurance Inc.
29, 2006 with proceeds of the State's Board of Education Lottery Revenue Refunding Bonds, Series 2006B and amounts transferred from the sinking funds for the refunded bonds.
Austin Community College District (TX), $23,110,000 general obligation limited tax refunding bonds, series 2006 (insured:, by MBIA.
RE-2J (CO), $3,440,000 general obligation refunding bonds, series 2006 (insured: FSA)
104,500,000 revenue refunding bonds senior series 1999-A-3 at 'AAA';
28,805,000 health facilities revenue refunding bonds, series 2004G;
22 /PRNewswire/ -- Certain maturities of the City of Austin, Texas' Combined Utility Systems revenue bonds Series 1985, 1985A, 1986A, 1986C, 1987, and 1989, and revenue refunding bonds 1985, 1988A, 1990A, and 1990B are rated "AAA" by Fitch.