Investor's wiki

Registrar

Registrar

What Is a Registrar?

A registrar is an institution, frequently a bank or trust company, responsible for keeping records of bondholders and shareholders after an issuer offers securities to the public. At the point when an issuer needs to make an interest payment on a bond or a dividend payment to shareholders, the firm alludes to the rundown of registered owners kept up with by the registrar.

How a Registrar Works

One job of the registrar is to ensure the amount of shares outstanding doesn't surpass the number of shares authorized in a firm's corporate charter. A corporation can't issue a greater number of shares of stock than the maximum number of shares that the corporate charter reveals. Outstanding shares are those that shareholders currently hold.

A business might keep on giving shares occasionally over the long run, expanding the number of outstanding shares. The registrar accounts for all issued and outstanding shares, as well as the number of shares owned by every individual shareholder.

Special Considerations

The registrar figures out which shareholders are paid a cash or stock dividend. A cash dividend is a payment of company earnings to every shareholder, and a stock dividend means extra shares are issued to every shareholder.

To pay a dividend, the corporation sets a record date. The registrar confirms the shareholders who own the stock on the record date and the number of shares owned as of that date. Both cash and stock dividends are paid in view of the registrar's rundown of shareholders. The registrar changes this shareholder data in light of current trade transactions.

Types of Registrars

Comprehensively, registrars are recordkeepers. They exist outside of the stock market too. There are registrars for schools and colleges that oversee student records, while legislatures use registrars for companies and businesses. Meanwhile, a registrar can mean a certain teacher in medication or a type of technology —, for example, software in human resources or a domain name registrar.

Mutual funds operate utilizing a transfer agent, which is a company that acts as the registrar and furthermore plays out the duties of a transfer agent. While the registrar keeps records, the transfer agent handles the mutual fund share purchases and reclamations.

Illustration of Registrars

Registrars exist for bonds too. For instance, when an issuer offers a bond to investors, the company works with a underwriter to make a bond indenture. The indenture records all of the appropriate data about the bond, including its face amount, the interest rate, and the maturity date. A bond indenture likewise ensures the bond is a legal obligation of the issuer. A bond might be secured by specific company assets or basically by the issuer's ability to pay.

Just similarly as with stock, the bond registrar tracks the investors who own the bond and investors who ought to receive interest payments. At the point when the bond develops, the registrar's records figure out which investors ought to be repaid the principal amount on the bond issue.

Features

  • Registrars guarantee shares outstanding don't dominate shares authorized.
  • There are different types of registrars that utilized for recordkeeping in different industries, like schools, states, medication, and technology.
  • A registrar is a bank or a comparative company that is responsible for recordkeeping of bondholders and shareholders.