Serial Bond With Balloon


DEFINITION of 'Serial Bond With Balloon'

A combination of a serial bond issue and a term bond issue. Essentially, the serial bond with balloon has bonds that mature at different intervals throughout the issue's life, and then a large percentage of the bonds (the term bonds) mature in the last year of the issue's term. Alternatively, the bulk of the bonds may mature at the first maturity date with the rest of the bonds gradually maturing over the remainder of the issue's life.

BREAKING DOWN 'Serial Bond With Balloon'

All the bonds in a term issue have the same maturity date. All the bonds in a serial bond issue mature in intervals. The combination of the two creates an issue that matures at regular intervals with a large portion of the bonds maturing at the same time in the first or last interval, creating the 'balloon'.

  1. Bond

    A debt investment in which an investor loans money to an entity ...
  2. Debt

    An amount of money borrowed by one party from another. Many corporations/individuals ...
  3. Term Bond

    Bonds from the same issue that share the same maturity dates. ...
  4. Balloon Maturity

    1. A repayment schedule for a bond issue where a large number ...
  5. Serial Bond

    A bond issue in which a portion of the outstanding bonds matures ...
  6. Maturity

    The period of time for which a financial instrument remains outstanding. ...
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