Bonds are long-term debt securities that corporations and government entities issue. Purchasers of bonds receive periodic interest payments, called coupon payments, until maturity, when they receive the bond’s face value and the last coupon payment. Most bonds pay interest semiannually. The Bond Indenture or Loan Contract specifies the features of the bond issue.
The following terms are used to describe bonds.
Par or Face Value
A bond’s par or face value is the amount of money paid to the bondholders at maturity. For most bonds, the amount is INR 1,000. It also generally represents the amount of money borrowed by the bond issuer.
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