True interest cost


Also found in: Acronyms.

True interest cost

For a security such as commercial paper that is sold on a discount basis, true interest cost is the coupon rate required to provide an identical return assuming a coupon-bearing instrument of like maturity that pays interest in arrears.
References in periodicals archive ?
Bank of America Merrill Lynch was the winning underwriter with a 3.22 percent true interest cost bid.
True Interest Cost = underwriter compensation + reoffering yield
Miami-Dade County s aviation revenue bonds earned a true interest cost of 4.92 percent - half a percent lower than estimated in April 2010, which will result in savings of $5 million annually in borrowing costs over 23 years, or $115 million total.
On the consumer-credit front, the Truth in Lending Act of 1968 required the true interest cost of a loan to be stated in simple and transparent terms.
The bond sale consisted of over $30.5 million in tax-exempt bonds and over $8.8 million in taxable bonds, with all "AAA" rated (a Moodys Investors Service rating) bonds possessing a final maturity date of 2038 and a true interest cost of 5.08 percent.
The bid was awarded on the basis of the true interest cost (almost 4.2 percent), which takes into account the purchase price bid and the interest rates for each maturity of bonds.
The bid reflected a true interest cost of 4.183 percent, according to the Highway Department.
Issued in January of 1999, the POBs took advantage of the historically low interest rates and captured a 5.8 percent true interest cost.
The 2017A bonds received eight bids and the bonds were awarded to Bank of America Merrill Lynch with a true interest cost of 4.33 percent.
The bonds include $46.4 million at 3.6 percent all-in true interest cost - which factors in all costs - for projects in the auxiliary system and $10.2 million at nearly 4 percent all-in true interest cost for academic projects.