Borrowing Cheap with Zero Coupon Bonds: Three Caselets

Borrowing Cheap with Zero Coupon Bonds: Three Caselets
Case Code: FINC181
Case Length: 8 Pages
Period: 2019-2021
Pub Date: 2021
Teaching Note: Available
Price: Rs.200
Organization: Government of Ghana
Industry: Government
Countries: Ghana
Borrowing Cheap with Zero Coupon Bonds: Three Caselets
Abstract Case Intro 1 Case Intro 2 Excerpts


This case is a collection of three caselets on Zero Coupon Bonds (ZCBs). The first caselet discusses Ghana’s first-ever zero coupon bond issued by the Government of Ghana (GoG). GoG planned to use this money to support its annual 2021 budget and for liability management. The second caselet discusses the ZCBs issued by Apple Inc. (Apple). With the help of the ZCBs, Apple was able to borrow from the European market at the lowest cost ever. The third caselet discusses how the Government of India (GoI) used ZCBs to infuse capital into the Public Sector Banks (PSBs) without its fiscal deficit being impacted.


The case is structured to achieve the following teaching objectives:

  • To understand zero coupon bonds and how various governments and corporations around the world use them to their benefit.
  • To discuss how a zero coupon bond is different from other regular bonds and what its advantages and disadvantages are
  • To introduce the mechanism of estimating yield to maturity for zero coupon bonds.



Zero Coupon Bonds; ZCB; YTM; Yield to Maturity; Bonds; Government of India; Punjab and Sind Bank; Held-to-Maturity; Apple Inc.; Government of Ghana; Sovereign Bonds

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