Units of Delivery
Bearer bonds must be delivered in denominations of $1,000 or $5,000 par value. The delivery of registered bonds must be in denominations that are multiples of $1,000 par value, up to a maximum of $100,000, but deliveries of notes may be made in denominations specified on the confirmation.
In general, a broker-dealer may not purchase or sell municipal securities in amounts lower than the minimum denomination of the issue.
A broker-dealer may conduct a customer purchase at less than the minimum denomination, however, if that amount constitutes the customer’s entire position in the issue. It may also conduct a customer sale in an amount below the minimum denomination if the customer is liquidating a position at less than the minimum denomination.
Example: Broker-Dealer XYZ has a customer who holds a 20-year transportation revenue bond, in book-entry form, having a par value of $10,000, and a mi