An period of time between the time a callable bond is issued and the time it can be called by the issuer. A call protection is typically stipulated in a bond indenture or preferred stock. If the issuer needs to retire the issue during a call protection period, a premium over parity (above the par value of a bond or preferred stock) must be paid to bondholders or preferred stockholders.
A discretely callable bond can be called on any coupon payment date after the call protection period ends, while a continuously callable bond may be called at any time after this period ends and up until the maturity date of the bond or preferred stock. Bonds with a call protection are usually referred to as deferred callable bonds.
A call protection period is also known as a cushion.
