A Call Provision allows a borrower to retire a bond before it’s maturity date. Strong companies tend to attach these to bond issuances, so that if interest rates fall they can retire the bonds, and re-issue during a more favorable credit environment. Goldman Sachs (NYSE: GS) has announced that they are exercising one such call option. Goldman Sachs Group Inc.is exercising the option on a step-up coupon with maturity of December 10, 2024. The total amount of the redemption is $20 million, and will retire 100 percent of the amount remaining. This will effectively full retire Security ID: 38143UFP1 on December 10, 2010. As interest rates are near historic lows, and capital positions shore up, perhaps we will see more calls exercised in the coming months.
