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Market Data Network

Dictionary

Sinkable Bond

From the Collaborative Bond and Money Market Data Portal

 

A sinkable bond is a type of debt security that requires the issuer to repay a fixed amount of principal every year until maturity or after a specified date.

The payments are backed by funds, usually cash, set aside by the borrower. These are recognised as safe assets as the set payment schedule helps maintain financial stability.

In this format, the issuer can reduce the cost of debt capital by regularly redeeming part of the principal amount in the open market with the funds set aside.

A Sinkable Bond differs from an Amortised Bond in that the Sinkable Bond uses an arranged fund to cover the principal repayments, whereas an Amortised Bond does not.

In the Collaborative Bond and Money Market Data Model the term Sinkable appears within the field Callable.

For information on the current size of the Sinkable Bond Market, please use CMDportal's Data Sheet Tool.
For information on Sinkable Bond issues, please use CMDportal's Instrument Search Tool.
For information on the composition of the Sinkable Bond Market, please CMDportal's Issuer Search Tool.
For information on active dealers in the Sinkable Bond Market, please use CMDportal's Dealer Search Tool.