A callable note that pays a floating rate coupon for its entire tenor. This floating rate note (FRN) allows the issuer to early terminate (premature or early termination) the note at specific point in time over its tenor. The investor will get 100% of notional (full face value of the note). In return for this option given to the issuer, the investor receives an above-market interest rate (higher yields).

For example, a callable FRN could have a 2-year tenor and a 1% +LIBOR coupon where the issuer can early terminate the note after 6 months since issue date, and semiannually thereafter (Bermudan call).