Bonds (17) Nominal value

The common terms used in association with bonds(1)

The following terms are associated with bonds and we need to understand what they mean in order to understand bonds.


Nominal value

The nominal value of a bond is the par or face value also

referred to as the principal value of the bond.

This is the amount the issuer of the bond has agreed to pay the bondholder at the maturity date.

In view of this, the principal is also called the redemption or maturity value