Senior refunding in economics and finance

Hello everyone! Welcome to today's lesson on senior refunding in economics and finance. Have you ever wondered what happens when a company or government wants to refinance its debt? Well, that's where senior refunding comes into play. In simple terms, senior refunding refers to the process of replacing existing debt with new debt that carries a higher priority of payment. This priority ensures that the new debt, often in the form of bonds, takes precedence over the older debt in case of default or bankruptcy. It's a strategic move that can have significant implications for both the debtor and the creditor. Now that we have a basic understanding, let's delve deeper into the world of senior refunding.