bondholder

noun bond·hold·er \ ˈbänd-ˌhōl-dər \

Updated on: 17 May 2018

Definition of bondholder

: one that holds a government or corporation bond

Recent Examples of bondholder from the Web

Fitch Ratings nonetheless has assured bondholders that debt securitized by tax revenues is still safe.

— the editorial board, WSJ, "Have We Got a Muni Bond for You," 10 May 2018
The report also found that Mount Ida had not met the terms of the bond covenants required by bondholders.

— laura krantz, BostonGlobe.com, "Mount Ida’s struggles included deficit, low graduation rate," 2 May 2018
In the restructuring, cocos were wiped out, alongside junior bondholders and shareholders.

— The Economist, "Coco bonds have not lived up to their promise," 19 Apr. 2018
If a company is liquidated in bankruptcy, the shareholders are entitled to whatever's left after all other stakeholders, including tax collectors, vendors and bondholders, are paid off.

— michael hiltzik, latimes.com, "The gun control issue is destroying the myth that 'shareholder value' is a corporation's only goal," 9 Mar. 2018
Then, during a subsequent expansion, the system pays back these bondholders before paying anything out to shareholders.

— timothy b. lee, Ars Technica, "Basis—the “stable” cryptocurrency with $133 million invested—explained," 25 Apr. 2018
Once completed, the project is expected to bring in annual tax revenues of $23 million to Chula Vista, which will help pay the bondholders.

— gustavo solis, sandiegouniontribune.com, "Chula Vista, Port approve financing for billion-dollar hotel and convention center," 25 Apr. 2018
On the other end of the spectrum is a U.S. Treasury bond – this is commonly considered one of the safer types of bonds because the government has the power to tax you, the taxpayer, to pay the bondholders.

— nathan bachrach, Cincinnati.com, "Are bonds a 'safe' investment? Simply Money answers.," 19 Apr. 2018
Reuters also reported that firms specializing in liquidation also planned to submit a $740 million offer for Bon-Ton in partnership with its bondholders, who have called for Bon-Ton to be liquidated.

— paul gores, Milwaukee Journal Sentinel, "Bon-Ton says store-closing warning was a required notice, not an announcement of shutdown," 6 Apr. 2018

These example sentences are selected automatically from various online news sources to reflect current usage of the word 'bondholder.' Views expressed in the examples do not represent the opinion of Merriam-Webster or its editors. Send us feedback.

First Known Use of bondholder

1823

in the meaning defined above

See Words from the same year

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Financial Definition of BONDHOLDER

bondholder

noun

What It Is

A bondholder is a person who owns a bond issued by a borrower, typically a company or a government.

How It Works

A bond represents a loan agreement between an issuer and an investor, and the terms of the bond obligate the issuer to repay the borrowed amount (the principal) by a specific date. The investor (the bondholder) usually earns a specific amount of interest on a semiannual basis.

Bondholders can buy and sell their bonds on the bond market.

Why It Matters

Being a bondholder is much different that being a shareholder. For one thing, bondholders are lenders; shareholders are owners. Also, bondholders cannot vote and they are not entitled to dividends. But perhaps most important is the fact that bondholders rank senior to shareholders. This means that the bondholders are among the first in line to be repaid in the event the issuer liquidates. Shareholders might receive some proceeds from the liquidation after this point, if there is anything left. This seniority provides an extra level of security for bondholders, and this is one reason corporate bonds are generally considered "safer" investments than stock.

Source: Investing Answers