Glossary of Municipal Securities Terms

PAYING AGENT

The entity responsible for transmitting payments of interest and principal from an issuer of municipal securities to the bondholders. The paying agent is usually a corporate trust department of a bank or trust company, but may be the treasurer or some other officer of the issuer or another governmental entity (e.g., a county treasurer acting for a school district or municipality within the county). The paying agent may also provide other services for the issuer such as reconciliation of the securities and interest paid, destruction of paid securities, and similar services. The trustee under a bond contract usually also acts as paying agent. See: TRUSTEE.

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