Definition: Debt buyback

Category: External debt - IMF

The repurchase by a debtor of its own debt, usually at a substantial discount. The debtor’s obligations are reduced while the creditor receives a once-and-for- all payment. Although in apparent contravention of standard commercial bank loan agreements, some debtors have bought back their own debt on the secondary market. http://ec.europa.eu/eurostat/ramon/statmanuals/files/external_debt_guide_2003_EN.pdf#page=255