Series 50: Municipal Securities Definition

Municipal Securities Definition

A municipal security is a debt obligation of the state or any political subdivision of the state. The following facts are true of municipal securities:

•The debt instrument may be a long-term bond or short-term note.

•The security may be either a direct obligation issued by the state to pay principal and interest, or it may be issued by a private entity and guaranteed by the state as to principal or interest.

•A political subdivision includes cities and counties.

•An agency is an administrative entity that is