easy · Debt Capital Markets
What is an 'Original Issue Discount' (OID) in the context of syndicating a bridge or Term Loan B?
- Selling the debt to investors at a price below par (e.g., 98.00) to increase their effective yield without changing the nominal coupon.
- The difference between the high-yield spread and the investment-grade spread.
- A discount given to the issuer if they repay the loan before the first anniversary.
- A fee paid by the bank to the issuer for the right to underwrite the deal.
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