Listen to a Business English Dialogue About Prior lien bond
Penelope: Hi Eugene, have you ever heard of a “prior lien bond” in finance?
Eugene: Hi Penelope, yes, it’s a type of bond that has a first claim on specific assets of the issuer before other bonds or debts, providing greater security for investors.
Penelope: Oh, I see. So, it’s like having priority access to certain assets if the issuer defaults on their obligations?
Eugene: Exactly, Penelope. Prior lien bonds offer investors a higher level of security compared to other bonds because they have a first right to the specified assets in case of default.