prerefunded bond

prerefunded bond definition - business

prerefunded bond

A bond secured by an escrow fund of U.S. government obligations that is sufficient to pay off the entire issue of refunded bonds at maturity. The rating of the refunded bond generally assumes the rating of the government obligations (highest rating) at the time the fund is established. See also arbitrage bond.

The American Heritage® Dictionary of Business Terms Copyright © 2009 by Houghton Mifflin Harcourt Publishing Company. Published by Houghton Mifflin Harcourt Publishing Company. All rights reserved.

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