floating-rate note

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Related to Variable Rate Bond: Frn, Floating Rate Securities

Floating-rate note (FRN)

Copyright © 2012, Campbell R. Harvey. All Rights Reserved.

Floating-Rate Note

A bond with a variable interest rate. These bonds typically have coupons renewable every three months and pay according to a set calculation. For example, a note may have an interest rate of "EURIBOR + 1%" and pay whatever the EURIBOR rate happens to be at the time plus 1%. Some FRNs have maximum and minimum interest rates, known as capped FRNs and floored FRNs, respectively. An FRN with both a maximum and a minimum interest rate is called a collared FRN. In the United States, government sponsored enterprises issue most FRNs while banks do the same in Europe. See also: Adjustable-rate mortgage.
Farlex Financial Dictionary. © 2012 Farlex, Inc. All Rights Reserved

floating-rate note

An unsecured debt issue with an interest rate that is reset at specified intervals (usually every six months) according to a predetermined formula. Floating-rate notes usually can be redeemed at face value on certain dates at the holder's option. Floating-rate notes pay short-term interest and generally sell in the secondary market at nearly par value. Floating-rate notes are indicated in bond transaction tables in newspapers by the symbol t. Also called floater, variable-rate note. See also convertible floating-rate note, droplock bond, variable-rate demand obligation, yield curve note.
Wall Street Words: An A to Z Guide to Investment Terms for Today's Investor by David L. Scott. Copyright © 2003 by Houghton Mifflin Company. Published by Houghton Mifflin Company. All rights reserved. All rights reserved.
References in periodicals archive ?
A variable rate bond is a coupon-paying bond where the coupon interest rate is tied to a common market rate.
We introduced a bill that passed both houses and we expect the Governor to sign that would permit HFA and HDC to place tax-exempt bonds for 80/20 housing directly with a financial institutions, instead of having these short-term variable rate bonds sold weekly in the bond market with a requirement to have credit enhancement from Fannie Mae or Freddie Mac.
Harvard and Princeton universities have sold bonds to replace variable rate bonds that investors no longer wanted and because of their drops in endowments, according to Bloomberg BusinessWeek.
The bank is to provide a letter of credit worth up to USD100m to cover variable rate bonds the county is selling as part of about USD448.4m in new and refunding bonds to finance the USD644m new Marlins ballpark stadium.
The bonds would be fixed at six percent interest, although the board did give permission to issue variable rate bonds if market conditions improved.
The authority benefited by financing $800 million in bond swap options in exchange for $35 million in payments several years ago, which was leveraged on the difference between variable rate bonds and fixed municipal rate bonds.
* Variable rate bonds with a current estimated interest rate of 1.03 percent
She has also invested pounds 7,000 in a second maxi-Isa, bought some variable rate bonds with Sun Life and opened an offshore account in Guernsey with Rothschild Asset Management.
New York: Fitch Ratings has assigned a 'AA-' rating to bank bonds associated with approximately $230 million of series 2018C-F variable rate bonds expected to be issued by the Iowa Finance Authority on behalf of UnityPoint Health (UPH).

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