HIGH YIELD DEBENTURES

A debenture is defined as a certificate of agreement of loans including an undertaking that the debenture holder will get a fixed return and the principal amount whenever the debenture matures.

A debenture is a debt instrument used by governments and banks and large companies to obtain funds. It is defined as "a debt secured only by the debtor's earning power, not by a lien on any specific asset."

It is similar to a bond except the securitization conditions are different. A debenture is usually unsecured in the sense that there are no liens or pledges on specific assets. It is, however, secured by all properties not otherwise pledged.

The advantage of debentures to the issuer, banks and large corporations, is they leave specific assets burden free, and thereby leave them open for subsequent financing which in turn facilitates growth and earning potential.