Daily Point 2293 - Non-Participating Preference Shares

 

The Banking Tutor 

Daily Point 2293 

Non-Participating Preference Shares 

Non-participating preference shares give shareholders a fixed dividend and priority in liquidation, but they do not allow holders to share in the company's surplus profits or assets beyond the agreed-upon fixed amount. These shares act as a hybrid between debt and equity, offering downside protection and stable income but limiting the potential for upside gains compared to common stock or participating preference shares.

Sekhar Pariti

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