Saturday, October 29, 2011

Stock Transfer Agents - Knowing the Role of them

Before few days I met to one of mine best online Finance Adviser Friends and she explained me about “Stock Transfer Agent” role in our Financial Life. We talked in details about this term and told me lots of points about this agent which I want to share with all blog visitors.

They are usually an independent and third-party company that could be introduced to make sure that details and manage the transfer of stock.

Some companies do perform the exact same tasks in-house.

Their role includes three main areas like,

(1) Cancellation and Issuance of Certificates for Stock or Bond Ownership Changes

Let’s I explain you above in sentence in details,

Once in a while the ownership of stocks or bonds for just a certain company might change, either on account of sales, stock dividends, or splits.
Whenever that takes place, the stock transfer agent oversees these changes and monitors the records.

Primarily, stock transfer agents would monitor the main points of folks or businesses that own the stock and as well the way they will be held and as well the way they will be held.

(2) Deal with Lost, Damaged, Stolen, or you cannot misappropriated Stock Certificates

Because stock transfer agents manage all the information of the companies’ stock they are really while in the perfect position that can help the business when any one of the stock certificates are lost, damaged or stolen.

In summary, the transfer agent could confirm the validity of your claim against their unique records and verify the fact that individual or company that claims they lost stock certificates really did own stock inside company.

(3) Represent a Third Party Intermediary to your Company

As soon as the company would need to pay out interest on its stock options, dividends, or distribute everything else to the stock (or bond) owners the stock transfer agent can help you oversee this.

Some transfer agents also perform other similar tasks, like becoming a proxy agent, mailing agent, for example - however, these are very tertiary roles which aren't just like that on the standard role of stock transfer agents.

Do you think you're starting to observe how transfer agents can assist companies in relation to managing their stocks and bonds? Frankly speaking, in primary companies and especially public listed companies the role of a transfer agent is an essential one.

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