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.
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.