How debt securities is different from term loan, Financial Management

Assignment Help:

How Debt securities is different from term loan

Debt securities are different from term loans provided by financial institutions and banks to the company. Term loans are long term debt contracts under that a borrower agrees to make a series of interest and principal payments on specific dates to the lender. Whereas this is true for debt securities also, term loans differ in one significant aspect that they are usually sold to one (or few) lenders particularly financial institutions and banks, whereas debt securities (Terms 'debentures' and 'bonds' would be used interchangeably for debt securities) are normally offered to the public.  Another vital difference is that principal repayments in term loans are made along with interest payments however in debt securities it is generally a lump sum payment at the end of period (or a series of payments).

 


Related Discussions:- How debt securities is different from term loan

What is certified financial planner, Q. What is Certified Financial Planner...

Q. What is Certified Financial Planner? Certified Financial Planner (CFP) - Individuals who are trained to develop and implement financial plans for businesses, individuals and

Question, What can a financial institution often do for a deficit economic ...

What can a financial institution often do for a deficit economic unit (DEU)that it would have difficulty doing for itself if the DEU were to deal directly with an SEU?

Segment margin, Segment Margin This is the amount in which a business s...

Segment Margin This is the amount in which a business segment in a company contributes toward the common or indirect cost of the company. Therefore, it represents that segment'

What do you signify by organisation of finance function, Q. What do you sig...

Q. What do you signify by Organisation of Finance Function? Describe the functions of Financial Manager. Ans. Organisation of Finance Function: - Organization of finance functi

Full valuation approach, When a manager measures the interest ...

When a manager measures the interest rate exposure, he would be interested in analyzing the exposure to a set of changing interest rate. The process of r

Poultry broilers, discuss the applicability of operating cycle in poultry (...

discuss the applicability of operating cycle in poultry (consider broilers)

Define measures that propose to prevent the recurrence, In an integrated wo...

In an integrated world financial market, a financial crisis in a country can be rapidly transmitted to other countries, causing a global crisis. What kind of measures would you pro

Types of floating-rate securities, Floating rate securities can be br...

Floating rate securities can be broadly divided into following two parts: Floating-rate securities that have constant quoted margin. Floating-rate sec

Rannacher smoothing, Explain what is meant by a positive coefficient discre...

Explain what is meant by a positive coefficient discretization in the context of valuing options using numerical PDE methods. What is the main benefit of using a positive coefficie

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd