Identification
- Label (rdfs)
- Subordinated Creditor
- Preferred Label
- None
- Alternative Labels
- Junior Creditor, Lower-Priority Creditor, Subordinated Lender
- Identifier
- N/A
Definition and Examples
- Definition
- A Subordinated Creditor holds a claim or loan against a debtor that ranks below other debts in terms of repayment priority, often arising when creditors agree to lesser priority in exchange for potential higher returns. In bankruptcy, these creditors are paid only after senior debts have been settled, making their recovery prospects less certain.