Definition: Debt defeasance

SNA

Debt defeasance allows a debtor (whose debts are generally in the form of debt securities and loans) to remove certain liabilities from the balance sheet by pairing irrevocably assets of equal value to the liabilities (SNA 2008, § 12.42 and 22.122).

Debt defeasance allows a debtor (whose debts are in the form generally of securities other than shares and loans) to remove certain liabilities from the balance sheet by pairing irrevocably assets of equal value to the liabilities (SNA 1993, § 11.24).