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Debenture - Meaning, Definition & English Examples

A debenture is a type of long-term loan issued by a company or government, backed by its creditworthiness rather than physical assets. It pays fixed interest and has a set repayment date.

debenture

/dɪˈbɛn.tʃɚ/ /dɪˈbɛn.tʃə/

Definition:

A long-term security issued by a company, paying fixed interest and not secured by physical assets.

Synonyms:

bond, note, certificate, IOU

Part of Speech:

noun

Antonyms:

equity, stock

Common Collocations:

issue debentures, redeem debentures, convertible debenture, secured debenture

Derivatives:

debenture holder, debenture stock

Usage Tips:

Use "debenture" to refer to unsecured corporate bonds; specify if convertible or secured for clarity.

Common Phrases:

debenture issue, convertible debenture, floating-rate debenture

Etymology:

From Latin "debentur," meaning "they are due," referring to debt obligations in medieval commerce.

Examples:

  • 1. The company issued debentures to raise capital for expansion.
  • 2. Investors prefer secured debentures for lower risk compared to unsecured ones.
  • 3. The debenture pays 5% interest annually until maturity.
  • 4. Convertible debentures can be exchanged for company shares after a set period.

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