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Business, 16.12.2020 18:00 cbkhm

Even though many bonds have deferred sinking funds, the sinking fund has the following effects on bondholders: I) provides extra protection to bondholders as both an early warning system and perhaps some collateral cash; II) provides an option to the firm to buy bonds at the lower of market or face value; III) puts the bondholders at added risk due to potential inability to meet sinking fund payments

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