Face Value

Face value means the amount a bond issuer agrees to repay at maturity. In simple terms, face value is the amount printed on the bond that will be paid back at the end. Face value is important because coupon payments are often calculated using it, and it is the principal amount returned when the bond matures. Many bonds have a face value of $1,000. For example, if a bond has a face value of $1,000, the issuer is expected to repay $1,000 at maturity. Face value is not always the same as market price. A bond can trade above or below face value before maturity.