In financial terms, a call premium is either the amount paid by the buyer of a call option above the stock's or index’s current market price, or the additional amount over par that an issuer of bonds or preferred stock pays to redeem the security early.
Fixed-rate bonds wherein the issuer holds the right, but not the obligation, to redeem the bond at par value or at a premium during its lifetime. Callable bonds often include a grace period where the issuer cannot call the bond, with conversion possible later if specific conditions are met.
A fiscal agent typically refers to a bank or trust company that manages various financial transactions and responsibilities, such as disbursing funds for dividend payments, redeeming bonds and coupons, handling bond-related taxes, and paying rents.
The redemption premium, also known as a call premium, is the amount over the par value that a bond issuer must pay an investor if the security is redeemed early.
Yield to Call (YTC) refers to the yield on a bond or other fixed-income security assuming that the bond will be redeemed by the issuer at the first call date specified in the indenture agreement. YTC is particularly important for callable bonds, as it helps investors gauge the potential return if the bond is called before maturity.
