that have publicly traded securities typically use transfer agents to keep
track of the individuals and entities that own their stocks and bonds. Most
transfer agents are banks or trust companies, but sometimes a company acts as
its own transfer agent.
Transfer agents perform three main functions:
- Issue and cancel certificates to reflect changes in ownership. For example, when a company declares a stock dividend or stock
split, the transfer agent issues new shares. Transfer agents keep records of
who owns a company’s stocks and bonds and how those stocks and bonds are
held—whether by the owner in certificate form, by the company in book-entry
form, or by the investor’s brokerage firm in street name. They also keep
records of how many shares or bonds each investor owns.
- Act as an intermediary for the company. A
transfer agent may also serve as the company’s paying agent to pay out
interest, cash and stock dividends, or other distributions to stock- and
bondholders. In addition, transfer agents act as proxy agent (sending out
proxy materials), exchange agent (exchanging a company’s stock or bonds in a
merger), tender agent (tendering shares in a tender offer), and mailing agent
(mailing the company’s quarterly, annual, and other reports).
- Handle lost, destroyed, or stolen certificates. Transfer agents help shareholders and bondholders when a stock or bond
certificate has been lost, destroyed, or stolen. If this has happened to you, read our publication entitled Stock Certificates, Lost,
Stolen. Also, if you hold securities in your own name and want to
transfer or sell them, you may need to get your signature
"guaranteed" before a transfer agent will accept the transaction. For
information about transferring your securities, please read "Signature Guarantees:
Preventing the Unauthorized Transfer of Securities"
in our Fast Answers databank.
many cases, you can find out which transfer agent a company uses by visiting
the investor relations section of the company’s website. You also can use the
website of the Securities
Transfer Association, a private trade organization of transfer agents. The STA
provides general information about the functions of transfer agents. Please
note that the STA is not equipped to respond to individual inquiries via the
telephone, mail, or e-mail. Shareholders with any transfer related inquiries would
be best served by speaking to the transfer agent or issuer for the security in
question, or their broker-dealer.