Hi, I was a little confused between the differences between muni credit and muni bonds. I understand what a muni bond is but can't seem to understand what muni credits are and how they differ, Any help here will be appreciated. Thanks
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MrParty99, sorry about the lack of response. Maybe one of these topics will help:
I hope those threads give you a bit more insight.
Muni credit: the credit profile (just like a corporation has a credit profile) outlining how stable the issuer is, where they generate revenue from, what their costs are, what their debt service coverage is, etc. Could ALSO BE, a line of credit that a bank provides (similar to a revolver for corporates) as an access to liquidity.
Muni bond: a capital markets instrument that acts as a loan, whereby the issuer pays a certain amount in interest semi-annually (keeping it simple with vanilla debt, no FRNs or VRDBs here) until maturity at which point the investor receives par back along with the last coupon payment.
Thank you so much! This is super helpful!
Follow up question on that:
Thank you
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