Columbia Encyclopedia entry: debenture
Debenturedəbĕn'chər, document acknowledging indebtedness. In Great Britain a debenture is practically the same as a bond, and debenture stock is similar to preferred stock. In the United States the term is usually employed for a corporation certificate without special security, such as a mortgage, to back it up. Debentures are generally issued by service corporations that have few mortgageable assets, or by blue-chip companies that are stable enough to invite unsecured loans. In a typical debenture, the corporation promises to repay the principal either periodically or on a specified date, and with regular interest. The term is also used for a document by which a government is bound to pay a creditor money due after some condition has been fulfilled.
The Columbia Encyclopedia. Copyright © 2001-09 Columbia University Press. All rights reserved.
Wikipedia search results for: Debenture
From Wikipedia, the free encyclopedia
In law, a debenture is a document that either creates a debt or acknowledges it.
The term is used in corporate finance for a medium to long-term debt instrument used by large companies to borrow money. In some countries the term is used interchangeably with bond, loan stock or note.
Debentures are generally freely transferable by the debenture holder. Debenture holders have no voting rights and the interest paid to them is a charge against profit in the company's financial statements.
In the United States, debenture refers specifically to an unsecured corporate bond; i.e., a bond that does not have a certain line of income or...more »
