Early redemption
Return of the principal before the stated date — by the issuer's decision, at the holders' demand, or because of circumstances described in the documentation.
How to read the number
For the issuer it is a way out of debt that has become expensive; for the holder it is a forced end to a deal they intended to keep longer.
When the metric lies
The issuer uses the right when it suits the issuer, that is when rates have fallen. The money comes back at the very moment a comparable yield is hardest to find.
Also known as: prepayment of principal, early call