income bond

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Related to Income Bonds: Convertible bonds

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 ?
A: Guaranteed income bonds are issued by life companies for a set period of between one to 10 years.
But you should consider high-income bonds, distribution bonds, secure income bonds and other investments aimed at providing income such as ISAs.
Speak to an IFA about profits bonds, distribution bonds, income-producing ISAs and high income bonds.
Aaron points out that there are still some investments around that offer the prospect of high yields, such as corporate bonds, guaranteed income bonds and some stockmarket-linked bonds.
AIF you're prepared to take some risk on shares, try high income bonds.
The company's investment portfolio is of high quality and liquidity with 48% invested in highly rated fixed income bonds, and 18.
AHIGH Income Bonds can provide a very attractive income and may also return your original investment.
CHASE de Vere has a new Saver's Guide to the best deals being offered in bank and building society accounts, cash ISAs, TESSAs, National Savings and Guaranteed Income Bonds.
Together, National Savings Pensioners Bonds and Income Bonds attract 90 per cent of all money invested in low-risk monthly income products," said Mr Peter Bareau, chief executive at NS.
Rates on Capital Bonds, FIRST option bonds, Children's Bonus Bonds and Pensioners' Guaranteed Income Bonds have been raised by between 0.