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Glite Dictionary
letter bond

letter bond

9.9
A loan not registered with the government and sold only to certain buyers
  • noun
  • Specialized
translation icon : bono no registrado
  • Only qualified buyers were allowed to purchase the letter bond under private placement rules.

Examples

  • The company raised cash by issuing several letter bonds to a select group of investors.

  • He purchased a letter bond from a private investor.

  • Because it was a letter bond, it could not be freely traded on the open market.

  • Many investors prefer letter bonds for their unique benefits.

  • Only qualified buyers were allowed to purchase the letter bond under private placement rules.

  • Because it was a letter bond, it could not be freely traded on the open market.

  • The company raised cash by issuing several letter bonds to a select group of investors.

Synonyms

bond
vsletter bond
  • Specialized
564 4.4

A certificate promising to repay borrowed money with interest

is unregistered and therefore cannot be sold to the general public
letter security
vsletter bond
  • Specialized
9.4

A stock or bond not registered with the government that cannot be sold in public markets

is specific to an unregistered debt certificate and cannot be sold publicly

Surface Forms

letter bond singular
letter bonds plural

Morphology

letter + bond

The specialized financial sense 'an unregistered bond not sellable to the general public' cannot be derived from the ordinary meanings of 'letter' (a written message/character) and 'bond' (debt instrument). 'Letter' does not transparently signal regulatory or registration status, and this is technical jargon unfamiliar to a B1 learner, so the overall meaning is unpredictable without prior exposure.

Etymology

Letter bond may come from an old practice of attaching a written letter to the bond that said who could buy it. That attached letter kept the sale private, so the term came to mean a bond 'not sold to the public'.