Paying Agent

The institution, often appointed in an Indenture or a paying agency agreement, responsible for making payments of Interest and Principal to bondholders.  The Paying Agent is usually a bank or trust company but may be the treasurer or some other officer of the Issuer.  Frequently the same entity serves also as the Registrar. Typically, the Trustee is also the Registrar and Paying Agent.

Life’s a Party

Learn more about the various parties involved in a municipal securities transaction and their roles.

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The person or entity responsible for maintaining records on behalf of the issuer for the purpose of recording the names of the owners of registered bonds.


A commercial bank or trust company with trust powers which acts in a fiduciary capacity for and on behalf of the bondholders by entering into an indenture with the issuer of the bonds.

Indenture or Trust Indenture/Agreement

A contract between an issuer and a trustee under which the issuer issues bonds and specifies their maturities, interest rates, redemption provisions, form, exchange provisions, security and other terms.

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Volume Cap

A requirement contained in Section 146 of the Code that private activity bonds (PAB) (with certain exceptions) issued as tax-exempt bonds obtain an allocation of volume cap from the state in which the project is located prior to the issuance of the bonds.