Agency bond


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Related to Agency bond: Eurobond, municipal bond

Agency Bond

A debt obligation owed by an agency of the U.S. Government. While similar to a Treasury security, agency bonds are issued by a particular agency of the federal government, rather than the federal government itself. These agencies include Ginnie Mae, the Federal Farm Credit Bank, and the U.S. Postal Service. With the exceptions of the Postal Service and the Tennessee Valley Authority, all these obligations are guaranteed by the U.S. Government. They offer higher interest rates than Treasury securities. They are less formally called agencies.

Agency bond.

Some federal agencies, including Ginnie Mae (GNMA) and the Tennessee Valley Authority (TVA), raise money by issuing bonds and short-term discount notes for sale to investors.

The money raised by selling these debt securities is typically used to make reduced-cost loans available to specific groups, including home buyers, students, or farmers.

Interest paid on the securities is generally higher than you'd earn on Treasury issues, and the bonds are considered nearly as safe from default. In addition, the interest on some -- but not all -- of these securities is exempt from certain income taxes.

Securities issued by former federal agencies that are now public corporations, including mortgage-buyers Fannie Mae and Freddie Mac, are also sometimes described as agency bonds.

References in periodicals archive ?
We include two smaller groups, one of which contains three rates for long-term government (state and local) and agency bonds. The other relatively small group in our panel includes two series of interest rate changes for new and used car loans.
If FILP agency bonds have been the central financing measure of FILP agencies, it would be inevitable for many FILP agencies to be unable to obtain sufficient funds in the markets.
First, there might be some default risk on the agency bond. With a credit derivative, one would be able to construct a default-free synthetic agency bond.
Reuters has reported that Deutsche Bank AG (NYSE: DB) and Bank of America Corp (NYSE: BAC) have agreed to pay to settle charges that they tried to rig the government agency bond market.
For example, in asking whether there is a liquidity channel that may affect interest rates, we consider the yield spread between a long-term agency bond and a long-term Treasury bond and measure how this yield spread changes over the relevant QE event.
Five commercial banks in the US have been sued for rigging the agency bond market.
Agency bond is a bet every bit as safe as Treasuries, yet slated to pay higher interest.
Fabianna Del Canto, a managing director on Barclays Plc's sovereign, supranational and agency bond syndicate desk, is to move to New York.
With that in mind, it may be best to invest in individual agency bonds as a substitute for Treasuries when you're looking to preserve a certain amount of savings for a specific target, such as college or retirement Ask your broker to price both an agency bond and a comparable Treasury, and factor in the brokerage fees in both cases when comparing yields.
Specifically, under the new rule, if a firm sells or buys a corporate or agency bond to or from a retail customer, and on the same day buys or sells the same security as a principal from another party in an equal or greater amount, the firm will have to disclose on the customer confirmation the firms mark-up or mark-down from the prevailing market price for the security, subject to limited exceptions.
These could include Industrial Development Agency bond financing, state economic development grant financing and power rate reductions.
The Financial Industry Regulatory Authority (FINRA) has fined Citi International, a unit of Citigroup Inc (NYSE: C), for excessive mark-ups and markdowns on corporate and agency bond transactions.