ESCROWED TO MATURITY

Proceeds from a new bond issue are held in escrow to pay off an existing bond issue at its maturation date.

Bonds that have been refunded and are secured by a trust account (usually containing U.S. Government securities) set up to pay directly to the bond trustee the debt service for the remaining lifetime of the bond. The issuer of the bonds is no longer liable for the bond’s repayment. See also Advance Refunding, Defease and Pre-Refunded.