Nominal value


The nominal value (also referred to as par or face value or nominal amount) of a share states the portion of share capital of a stock corporation that is allocated to the individual share. The total nominal value of all shares issued equals the total nominal share capital. In Germany the minimum nominal value for shares is currently €1,00. There are, however, also no par value shares.

For bonds, the nominal value corresponds to a portion of the total debt. The nominal value represents the amount that the bond issuer, i. e. the debtor, must repay the bondholder or creditor upon maturity. Reverse convertibles also have a norminal value. At maturity, the issuer has the right to either pay the investor 100 percent of the norminal value or to deliver a previously agreed number of shares. The issuer also makes one or more coupon payments on the norminal value to the investor during the term.

 

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