what is a foreign currency convertible bond 
a foreign currency convertible bond fccb is a type of convertible bond issued in a currency different than the issuer s domestic currency in other words the money being raised by the issuing company is in the form of foreign currency a convertible bond is a mix between a debt and equity instrument it acts like a bond by making regular coupon and principal payments but these bonds also give the bondholder the option to convert the bond into stock understanding foreign currency convertible bonds fccb a bond is a debt instrument that provides income to investors in the form of regularly scheduled interest payments called coupons at the maturity date of the bond the investors are repaid the full face value of the bond some corporate entities issue a type of bond known as convertible bonds a bondholder with a convertible bond has the option of converting the bond into a specified number of shares of the issuing company convertible bonds have a conversion rate at which the bonds will be converted to equity however if the stock price stays below the conversion price the bond will not be converted thus convertible bonds allow bondholders to participate in the appreciation of the issuer s underlying shares there are various types of convertible bonds one of which is the foreign currency convertible bond a company may choose to issue fccbs in the currency of a country with lower interest rates or a more stable economy than the issuer s home country 