Z bond

(redirected from Accrued Bond)

Z bond

A bond on which interest accrues but is not currently paid to the investor but rather is added to the principal balance of the Z bond and becoming payable upon satisfaction of all prior bond classes.

Z Bond

A bond on which interest accrues but is not paid to the bondholder until maturity. That is, the interest is added back into the principal and further interest is calculated over the new, larger principal. A Z bond is also called an accrual bond. See also: Accretion, Balloon Mortgage.
References in periodicals archive ?
Does the county issue bonds with nearly $1 million issuing costs plus millions more of accrued bond interest over the 15 year repayment term or use the $45 million already set aside in the current budget?
With its combination of payroll taxes, bonds and accrued bond interest, the system is currently operating at a surplus, albeit in the face of liabilities.
3 Multiply line (1) times line (2) to compute accrued bond value at YTM (effective interest rate) including accrued coupon interest 4 Multiply $100,000 times 0.02625/2 times 106/184 to compute accrued coupon interest up to settlement date from 8/15/2013.