Who is the debenture holder of a company?
Individuals who pay the company to purchase debentures are called debenture holders. Unlike shareholders, debenture holders only lend loans to the company for a specified period.
What is debenture holders?
Meaning of debenture holder in English
a person or company that has lent money to another person or company by using a debenture: Payment of interest is made to the debenture holder at a specified rate and at clearly defined intervals.
Who is debenture holder answer in one sentence?
Debenture holder is a person who subscribes to the debentures of a company.
Is a debenture holder is an owner of the company?
(1) Debenture is a loan taken by company for medium to long period. Debenture holder therefore is the creditor of the company. … Hence Debenture holders are not the owners of the company.
What are the risks of debentures?
Debentures also carry interest rate risk. 4 In this risk scenario, investors hold fixed-rate debts during times of rising market interest rates. These investors may find their debt returning less than what is available from other investments paying the current, higher, market rate.
What is debenture example?
What is a Debenture? A debenture is a bond issued with no collateral. Instead, investors rely upon the general creditworthiness and reputation of the issuing entity to obtain a return of their investment plus interest income. … Examples of debentures are Treasury bonds and Treasury bills.
What is a debenture in simple terms?
Share. A debenture is a marketable security (a type of investment) issued by a business or other organization to raise money for long-term activities and growth. It is a form of debt capital so it is accounted for as debt on the balance sheet of the issuing company.