Sinking fund

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SINKING FUND. A fund arising from particular taxes, imposts, or duties, which is appropriated towards the payment of the interest due on a public loan and for the gradual payment of the principal. See Funding System.

A Law Dictionary, Adapted to the Constitution and Laws of the United States. By John Bouvier. Published 1856.
References in periodicals archive ?
Within three years, six commercial banks made payments totalling N155.45 billion into the sinking fund between 2015 and 2017.
Sinking funds attempt to answer the question of how much capital is required to allow that asset to 'retire' and be replaced.
The authority returns all excess earnings on sinking fund investments to its borrowers, once sinking funds have earned enough to satisfy associated debenture debt service requirements.
But the losses were expected to be defrayed through recoveries from its assets, with additional cover provided by the sinking fund.
Under the straight-line method (or safe vault method) the accumulation of funds in the sinking fund is interest free.
Civil War debt in the late 1870s, the bond issuance associated with the return to the gold standard in 1879, the sinking fund open market purchases of the 1880s, and the deficit funding of the 1890s all provide examples of dramatic changes in the duration or amount of U.S.
We are already concerned about the high service charges, but now we are being asked to pay up to PS900 a year to set up a sinking fund. Why is this necessary when we already pay for insurance?
MARC notes that financial obligations from the increase in borrowings and a recent repayment of MYR 5 million ICPs have reduced DHTI Capital's sinking fund balance to a historic low of about MYR 0.1 million as at end-September 2013.
The sources said the Tata Global Beverages bond does not have a sinking fund to collect accrued interest as debt matures, which would ensure payout at redemption in case of default.
The banks' contributions to Nigeria's bad bank, the Asset Management Corporation of Nigeria (AMCON) sinking fund, was not enough to sustain it, said a research report.
Also on Friday, state-owned Deposit Insurance Agency (DIA) extended a RUB295bn (USD9bn/EUR6.8bn) loan to Bank of Moscow, which was utilised the next day for the purchase of RUB295bn in government bonds, placed by the country's finance ministry with sinking fund provisions for the purpose of the bailout.
The central bank signed an MoU with 24 banks in the country to create the Banking Sector Resolution Cost Sinking Fund.