7.16.2005

Q&A: List some duties of the trustee appointed...

...when bonds are issued?

  • Make sure terms of the indenture are obeyed
  • Manage the sinking fund
  • Monitor the protective covenants for the bondholders
  • Represent the bondholders in default

Bonus Points

  • A bond indenture is made out to a third-party trustee as bondholders may have difficulty in ascertaining whether the issuer has been fulfilling its obligations.

Category: C++ Quant > Debt

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