What is a century bond?

"Century bond" is a bond with a maturity of one hundred years. Although "century loan" would be an appropriate Dutch translation, the term is still rarely used. Despite their name, some 100-year bonds are redeemable early, meaning they can be repaid before the full term of a century has elapsed.

A well-known example is the bond issued by Disney in 1993, which was supposed to mature in 2093 but can be repaid as early as 2023.

Century bonds offer investors the opportunity to invest for the extremely long term, but it is important to note that the issuer often has the flexibility to repay the loan sooner.

Version:
26/9/24