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Finance

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  • January 2, 2023
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Callable at a Premium

In the context of bonds (specifically bond indentures), this refers to a term providing for a premium to par value in the event that an issuer exercises a call provision– i.e., calls or redeems the issue prematurely (prior to the expiration date). The holder gets a premium to the bond’s face value as compensation for his terminated investment in the respective bond issue.

The call premiums are typically subject to a declining call schedule.


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