Fixed/Floating interest rates

Rates on bonds can be fixed (set at the time of issue) or floating. If they are floating then they will be set as a constant margin to a variable benchmark such as the 90-day bank bill rate expressed, for example, BBSW +125%. The coupon rate is set by the issuer and is based on a number of factors such as prevailing market interest rates and the entity’s credit rating.

« Back to Glossary Index
0 replies

Leave a Reply

Want to join the discussion?
Feel free to contribute!

Leave a Reply

Your email address will not be published. Required fields are marked *