A written promise to pay the stated debt with interest rate at specified date.
Bond is a written contractual obligation, usually issued by the borrower, agreeing to pay the amount stated on the document (called maturity value) at a particular date in the future (called maturity date).
Maturity value is usually the sum of:
- principal amount borrowed plus
- interest payable at agreed frequency (monthly, semi-annually, yearly etc) that is usually stated as rate on the document itself (called coupon rate) plus
- any premium agreed between the borrower and lender.