Repudiation

Repudiation
Disputing the validity of a contract and refusing to honor its terms. In investing, repudiation is most relevant in fixed income securities, particularly sovereign debt. Fixed income instruments are fundamentally contracts where the borrower lends a certain amount of principal in return for payments of interest and principal on a preset schedule. Repudiation occurs if the borrower refuses to honor this contract and stops making the agreed upon payments.

With fixed income instruments it is always possible that the borrower may default, dispute the validity of the contract or otherwise refuse to pay. If the borrower does repudiate the contract, the corresponding investors may lose their entire investment unless they are able to take recourse against the borrower. In the case of sovereign debt, however, there is often not any method of recourse against the borrowing nation.


Investment dictionary. . 2012.

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  • répudiation — [ repydjasjɔ̃ ] n. f. • 1342; lat. repudiatio 1 ♦ Action de répudier (qqn). 2 ♦ Fig. Action de rejeter (un sentiment, une opinion, etc.); son résultat. ⇒ 2. rejet. « Sa conduite dans cette occasion parut la répudiation de ses principes » (… …   Encyclopédie Universelle

  • repudiation — re·pu·di·a·tion /ri ˌpyü dē ā shən/ n: the rejection or renunciation of a duty or obligation (as under a contract); esp: anticipatory repudiation ◇ A party aggrieved by a repudiation may consider a repudiated contract to have been breached and… …   Law dictionary

  • Repudiation — Re*pu di*a tion ( [hand] sh?n), n. [Cf.F. r[ e]pudiation, L. repudiatio.] The act of repudiating, or the state of being repuddiated; as, the repudiation of a doctrine, a wife, a debt, etc. [1913 Webster] …   The Collaborative International Dictionary of English

  • Repudiation — Re*pu di*a tion, n. One who favors repudiation, especially of a public debt. [1913 Webster] …   The Collaborative International Dictionary of English

  • repudiation — Repudiation. s. f. v. Action de repudier. La repudiation a esté long temps en usage dans l ancienne Rome …   Dictionnaire de l'Académie française

  • Repudiation — (v. lat.), 1) Verschmähung, Ausschlagung, Zurückweisung; 2) Verstoßung; 3) die Erklärung einiger nordamerikanischer Staaten, weder die Staatsschulden noch Zinsen bezahlen zu wollen …   Pierer's Universal-Lexikon

  • Repudĭation — (Repudium, lat.), »Verwerfung«, Auflösung einer Verbindung (z. B. einer Ehe); Ablehnung, Ausschlagung, namentlich eines Vermächtnisses. In Nordamerika versteht man unter R. die Weigerung eines Staates, eine von ihm kontrahierte Schuld zu bezahlen …   Meyers Großes Konversations-Lexikon

  • Repudiation — Repudiatiōn, Repudĭum (lat.), Abweisung, Ausschlagen, z. B. eines Vermächtnisses; in den Ver. Staaten von Amerika (in Virginia Readjustment genannt), die Nichtzahlung einer gültig kontrahierten Schuld samt Zinsen seitens eines Staates oder einer… …   Kleines Konversations-Lexikon

  • repudiation — 1540s, “divorce” (of a woman by a man), from L. repudiationem, noun of action from repudiare (see REPUDIATE (Cf. repudiate)). Meaning “action of disowning” is from 1840s …   Etymology dictionary

  • répudiation — (ré pu di a sion ; en vers, de six syllabes) s. f. 1°   Action de répudier. Répudiation de succession. 2°   Action de renvoyer légalement une épouse. •   Selon le témoignage de ce grave auteur [Castelnau], la répudiation [de Catherine d Aragon… …   Dictionnaire de la Langue Française d'Émile Littré

  • repudiation — A rejection, disclaimer, or renunciation of a contract before performance is due that does not operate as an anticipatory breach unless the promisee elects to treat the rejection as a breach and brings a suit for damages. The rejection or refusal …   Black's law dictionary

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