Bullet Maturity
Corporate Credit Analysis glossary · Capital Structure & Debt Mechanics
Definition
A debt instrument where all principal is due at final maturity, with no scheduled amortisation during the life of the instrument.
Bullet Maturity in plain English
Imagine you borrow money from a friend and promise to pay it ALL back in one lump sum on one future date — not a little each month. That's a bullet maturity: you owe interest along the way, but every dollar of the original loan (the 'principal') stays untouched until the very end. This is great for a company's cash flow now, but it stacks a huge single payment on maturity day, so lenders watch closely whether the firm can either have that cash ready or borrow fresh money to pay it off. ('Amortisation' just means paying principal down in chunks over time — a bullet has none of that.)
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