Escrowed To Maturity

DEFINITION of 'Escrowed To Maturity'

The condition of a bond that has been repaid in advance by means of an escrow account, which holds the funds needed to pay the periodic coupon payments and the principal.

BREAKING DOWN 'Escrowed To Maturity'

The escrowed funds set aside for a company's debt obligations are usually invested in short-term debt securities - usually low-risk government bills - in order to protect the funds from inflationary depreciation.

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