Bond coupon rate

Also known as nominal interest rate and the stated interest rate. Bond coupon rate is amount of interest that a Bondholder would receive per year, expressed as percentage of bond face value. In other words it is a rate of interest that an issuer will pay to the bondholder per year

For example if you have bond of $40,000 face value or par value and nominal interest rate is 4% per year, this 4% is also known as coupon rate of a bond

Remember that not all bond have coupon rate there are bonds known as zero coupon bond that do not pay coupon but pay higher amount (greater than their face value) at the maturity date