Definition of Debenture:
A debenture is a type of bond or other debt instrument that is unsecured by collateral. Since debentures have no collateral backing, debentures must rely on the creditworthiness and reputation of the issuer for support. Both corporations and governments frequently issue debentures to raise capital or funds.
A promissory note or a corporate bond which (in the US) is backed generally only by the reputation and integrity of the borrower and (in the UK) by the borrowers specific assets.
When unsecured, it is called a bare debenture or naked debenture; when secured by a charge on a specific property, it is called a mortgage debenture.
Similar to most bonds, debentures may pay periodic interest payments called coupon payments. Like other types of bonds, debentures are documented in an indenture. An indenture is a legal and binding contract between bond issuers and bondholders. The contract specifies features of a debt offering, such as the maturity date, the timing of interest or coupon payments, the method of interest calculation, and other features. Corporations and governments can issue debentures.
Synonyms of Debenture
CD, Fannie Mae, Federal Agency bond, Ginnie Mae, IOU, MO, Series E bond, Series H bond, Acceptance, Acceptance bill, Adjustment bond, Annuity bond, Appreciation bond, Arrangement, Assented bond, Assumed bond, Baby bond, Bank acceptance, Bank check, Bearer bond, Bearer certificate, Bill, Bill of draft, Bill of exchange, Blank check, Bond, Bond anticipation note, Callable bond, Certificate, Certificate of deposit, Certified check, Check, Checkbook, Cheque, Collateral trust bond, Commercial paper, Consolidated annuities, Consolidated stock, Consols, Contract by deed, Contract of record, Contract quasi, Convertible bond, Convertible debenture, Corporate bond, Corporation stock, Coupon bond, Coupon rate, Covenant of indemnity, Current income bond, Current yield, Debenture bond, Deed, Deed of trust, Deed poll, Deep-discount bond, Defense bond, Deferred bond, Definitive bond, Demand bill, Demand draft, Discount bond, Draft, Due bill, Equipment bond, Equipment note, Equipment trust, Equipment trust bond, Equipment trust certificate, Exchequer bill, Extended bond, First mortgage bond, Firsts, Formal contract, General mortgage bond, General obligation bond, Government bond, Group policy, Guaranteed bond, High-grade bond, Implied contract, Income bond, Indent, Indenture, Insurance policy, Interchangeable bond, Interim bond, Joint bond, Letter of credit, Money order, Mortgage bond, Mortgage deed, Municipal bond, Negotiable bond, Negotiable instrument, Nominal rate, Nonnegotiable bond, Note, Note of hand, Optional bond, Paper, Par bond, Parol contract, Participating bond, Perpetual bond, Policy, Postal order, Premium bond, Promissory note, Purchase money bond, Recognizance, Refunding bond, Registered bond, Registered certificate, Revenue bond, Savings bond, Second mortgage bond, Seconds, Secured bond, Sight bill, Sight draft, Small bond, Special contract, Specialty, Specialty contract, State bond, Tax anticipation note, Tax-free bond, Time bill, Time draft, Title deed, Trade acceptance, Treasury bill, Treasury bond, Trust indenture, Trustee mortgage bond, Unsecured bond, Voting bond, Voucher, War bond, Warrant, Yield to maturity
How to use Debenture in a sentence?
- Having no collateral, the young couple was able to obtain a mortgage debenture based on their fine family backgrounds and posh upbringing.
- Debentures are backed only by the creditworthiness and reputation of the issuer.
- A debenture is a type of debt instrument that is not backed by any collateral and usually has a term greater than 10 years.
- I knew I could trust the debenture based on my prior experience with it and the fact that I knew what it was.
- Both corporations and governments frequently issue debentures to raise capital or funds.
- Some debentures can convert to equity shares while others cannot.
- A debenture can be utilized to gain a loan or other type of investment based solely on good faith between two parties, but it is better to always pay in full.
Meaning of Debenture & Debenture Definition