Municipal bonds (muni bonds) are debt securities issued by state and local governments, or their authorized agencies, to borrow or raise money for public purposes such as building schools, highways, or hospitals.
What are the two types of municipal bonds?
Municipal bonds are debt instruments that local, county, and state governments issue to secure financing for civic improvements, including the construction of highways, bridges, or schools. Types of municipal bonds include general obligation and revenue bonds.
What is a bank qualified municipal bond?
Description of Bank Qualified Bonds Banks, like other investors, purchase municipal bonds in order to obtain the benefit of earning interest that is exempt from Federal income taxation. Historically, commercial banks were the major purchasers of tax-exempt bonds.
What does it mean to be bond qualified?
Qualified bond means any unsecured investment grade debt securities issued by the Parent (or a wholly-owned subsidiary of the Parent) prior to the Closing (x) that is (i) either (a) guaranteed by the Company at issuance (in which case, such bond will be automatically assumed by the Company upon the termination of this
Why do rich people buy municipal bonds?
High-net-worth individuals may invest in muni bonds because they provide steady income and tax benefits. For the ultra-wealthy, municipal bonds arent just about earning interest. Theyre a way to lock in tax-free income, cover essential expenses, and free up the rest of their portfolio for higher-growth investments.
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