Seniority (financial)

This article needs additional citations for verification. Please help by adding citations to reliable sources. Unsourced material may be challenged and removed. Find sources:  –  ·  ·  · scholar · JSTOR (December 2009) (Learn how and when to remove this template message)

In finance, seniority refers to the order of repayment in the event of a sale or bankruptcy of the issuer. Seniority can refer to either debt or preferred stock. Senior debt must be repaid before subordinated (or junior) debt is repaid.^[1] Each security, either debt or equity, that a company issues has a specific seniority or ranking. Bonds that have the same seniority in a company's capital structure are described as being pari passu. Preferred stock is senior to common stock in a sale when preferred shareholders must receive back their preference, typically their original investment amount, before the common shareholders receive anything.

FpML[]

The seniority of bonds recognised in FpML (Financial products Markup Language) are as follows:

See also[]

• Security interest
• Secured creditor
• Senior debt
• Unsecured creditor
• Preferential creditor

References[]

This finance-related article is a stub. You can help Wikipedia by .

• v
• t