COLLATERALIZED BOND OBLIGATION

collateralized bond obligation: translation

collateralized bond obligation ( CBO)

A multi-tranche security secured by a pool of corporate securities (generally noninvestment-grade corporate bonds) or sovereign debt. Similar to the more familiar CMO, except that in a CBO the tiers or tranches are created with differing levels of credit quality. The CBO structure creates at least one tier of investment-grade bonds, thus providing liquidity to a portfolio of junk bonds. CBOs are a type of CDO.

See collateralized debt obligation ( CDO), special purpose vehicle and waterfall. American Banker Glossary

————

( CBO)

investment-grade bonds backed by a collection of junk bonds with different levels of risk, called tiers, that are determined by the quality of junk bond involved. CBOs backed by highly risky junk bonds receive higher interest rates than other CBOs. Bloomberg Financial Dictionary

сокр. CBO фин. облигация, обеспеченная облигациями* (облигация, обеспеченная пулом других облигаций; сходна с облигацией, обеспеченной пулом закладных, но в отличие от последней, в обеспечении данной облигации представлены бумаги с разным кредитным рейтингом, а не с разными сроками до погашения)