Custodial Receipt


DEFINITION of 'Custodial Receipt'

A receipt representing a security held by a custodian or transfer agent. As such, it represents ownership of the security by the depositor. A security in custodial receipt form is usually non-transferable.

BREAKING DOWN 'Custodial Receipt'

In the municipal bond market, custodial receipts refer to securities that represent the right to receive future principal and interest payments on municipal obligations underlying these receipts. In a typical custodial receipt arrangement in this market, an issuer or owner of a municipal obligation deposits it with a custodian in exchange for two or more classes of receipts.

  1. Depositary Receipt

    A negotiable financial instrument issued by a bank to represent ...
  2. Trust Receipt

    Notice of the release merchandise to a buyer from a bank, with ...
  3. Custodial Account

    1. An account created at a bank, brokerage firm or mutual fund ...
  4. American Depositary Receipt - ADR

    A negotiable certificate issued by a U.S. bank representing a ...
  5. Municipal Bond

    A debt security issued by a state, municipality or county to ...
  6. Custodian

    A financial institution that holds customers' securities for ...
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