Recovery amount

From Wikipedia, the free encyclopedia

This article does not cite any references or sources. (April 2008) Please help improve this article by adding citations to reliable sources. Unverifiable material may be challenged and removed.

This article is orphaned as few or no other articles link to it. Please help introduce links in articles on related topics. (November 2006)

When a bond or other financial derivative defaults, the recovery amount is the amount that the underlying company can afford to pay. This is usually a result of a liquidation of the company's assets and generally results in a lower amount than the par value.