Scheduled retirement provisions

Bullet maturity
· most common, pay entire principle in one lump sum at maturity.

Serial bonds
· bond maturity varies with serial numbers, very common in municipal market, actually made of a series of smaller bond with its own coupon & maturity

Amortizing bond
· principal repaid in installments e.g. mortgage backed/asset-backed securities

Sinking fund provision
· issuer required to retire bond issue according to a schedule, with two methods:
· Cash - issuer deposit required cash annually with the trustee who will retire the applicable proportion of bonds by using random bond selection method;
· Delivery – issuer purchase bond with total par value to be retired in the market and delivery them to trustee.

Accelerated sinking fund provision
· permit issuer to retire more than the annual stipulated sinking fund amount