Cross Calling

Business, Legal & Accounting Glossary

Definition: Cross Calling


Cross Calling


Full Definition of Cross Calling


A method of bond redemption used by issuers that takes prepayments received from lower rate loans to make payments on high-yield bonds. For example, a bank packages two mortgage loans with 5% and 8% rates into high-yield, high-risk mortgage-backed securities (MBS) with coupon rates of 7% and 15%; the bank then uses the interest payments on the 5% loan to pay the 15% coupon principal. This leaves the 7% bondholder relying on the 8% borrower for repayment of the MBS.


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Cross Calling. PayrollHeaven.com. Payroll & Accounting Heaven Ltd.
https://payrollheaven.com/define/cross-calling/ (accessed: March 29, 2024).
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Cross Calling. PayrollHeaven.com. Retrieved March 29, 2024
, from PayrollHeaven.com website: https://payrollheaven.com/define/cross-calling/

Definition Sources


Definitions for Cross Calling are sourced/syndicated and enhanced from:

  • A Dictionary of Economics (Oxford Quick Reference)
  • Oxford Dictionary Of Accounting
  • Oxford Dictionary Of Business & Management

This glossary post was last updated: 20th November, 2021 | 0 Views.