It stands for accretion-directed bond; a collateralized mortgage obligation (CMO) whose principal redemption is paid out of payments from an accrual bond or a Z-bond. Accretion-directed bonds constitute bond classes that are formed from the directed interest (cash flows) generated by accrual or Z-bonds (Z-tranches). Additionally, these bonds may receive principal repayments from relevant collateral drawdowns.

Broadly speaking, accretion-directed bonds represent classes that receive principal repayments primarily from the interest that accrues on certain accrual or partial accrual classes.  These classes may also receive principal repayments from principal redeemed on the relevant underlying assets.