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In finance, subordinated debt (also known as subordinated loan, subordinated bond, subordinated debenture or junior debt) is debt which ranks after other debts if a company falls into liquidation or bankruptcy. Such debt is referred to as 'subordinate', because the debt providers (the lenders) have subordinate status in relationship to the ...
Perpetual subordinated debt is subordinated debt in the form of a bond with no maturity date for the return of principal. Such a perpetual bond means it never needs to be redeemed by the issuer, and thus pay coupon interest continually until bought back (hence, "perpetual"). Like other subordinated debt, it has claims after senior debt (hence ...
In corporate finance, a debenture is a medium- to long-term debt instrument used by large companies to borrow money, at a fixed rate of interest. The legal term "debenture" originally referred to a document that either creates a debt or acknowledges it, but in some countries the term is now used interchangeably with bond, loan stock or note.
A.M. Best Assigns Debt Rating to The Allstate Corporation's Newly Issued Subordinated Debentures OLDWICK, N.J.--(BUSINESS WIRE)-- A.M. Best Co. has assigned a debt rating of "bbb+" to the 40-year ...
AIG to Redeem 7.70% Junior Subordinated Debentures Due 2047 NEW YORK--(BUSINESS WIRE)-- American International Group, Inc. (NYS: AIG) today announced that it will redeem all of its outstanding 7. ...
Subordination is the process by which a creditor is placed in a lower priority for the collection of its debt from its debtor's assets than the priority the creditor previously had, [1] In common parlance, the debt is said to be subordinated but in reality, it is the right of the creditor to collect the debt that has been reduced in priority.
subordinated (or junior) debt, including debenture bonds which are dependent upon the general credit and financial strength of the company for their security, [14] preferred stock, whose holders are entitled to have their claims met before those of common stockholders, [15] and; equity, which includes common stock and retained earnings. [16]
The higher cost of capital associated with mezzanine financings is the result of it being an unsecured, subordinated (or junior) obligation in a company's capital structure (i.e., in the event of default, the mezzanine financing is only repaid after all senior obligations have been satisfied).