How to Get a CUSIP Number for a Security
Understand how to secure a CUSIP number for your financial securities. Navigate the process of obtaining this crucial market identifier.
A CUSIP number is a unique nine-character alphanumeric code that identifies most North American securities, including those issued in the United States and Canada. This standardized identifier is crucial for financial instruments such as stocks, bonds, and mutual funds. Its primary purpose is to ensure clear differentiation among securities, facilitating efficient trading and settlement processes within financial markets. CUSIP numbers help to minimize errors and streamline the tracking of securities.
When a CUSIP Number is Needed
A CUSIP number is necessary for various financial instruments and market activities. Newly issued debt securities, such as corporate, municipal, and government bonds, almost always require a CUSIP for identification. This helps market participants distinguish between different bond issues, including details like maturity dates and interest rates.
New equity securities, including those from initial public offerings (IPOs) and subsequent public offerings, also need a CUSIP number. This ensures each stock issuance has a distinct identity for accurate trading and record-keeping. Beyond stocks and bonds, CUSIPs are used for options, certificates of deposit (CDs), and mutual funds.
The presence of a CUSIP number is essential for securities to be traded on exchanges and to facilitate efficient clearing and settlement. It provides a common identifier that all market participants can use, reducing confusion and errors during trades. Regulatory bodies often require CUSIPs for reporting and oversight, contributing to market transparency and compliance.
Information Required for a CUSIP Application
Before initiating the formal application process, comprehensive information and documentation must be prepared. This includes the issuer’s full legal name, physical address, and contact details for an authorized representative.
The specific type of security, whether equity (common stock, preferred stock) or debt (bond, note), must be clearly specified. For debt securities, detailed characteristics are required, including the principal amount, interest rate (coupon), maturity date, and payment frequency. Any redemption provisions, call features, sinking fund details, or specifics about collateral are also necessary.
For equity securities, the application requires the number of shares being issued, their par value, and the class of stock (e.g., Class A, Class B). Information regarding voting rights and the dividend policy must also be provided.
Offering details are also required, encompassing the expected offering date, names of any underwriters or placement agents, and the jurisdiction of issuance. Supporting legal documentation is paramount, such as a prospectus, offering memorandum, trust indenture, articles of incorporation, or bylaws that describe the security. CUSIP Global Services (CGS) reviews these documents.
Finally, the application requires the name, title, and contact information for the individual responsible for handling the CUSIP application. This ensures CGS has a direct point of contact for questions or additional information.
The CUSIP Application Process
Once all necessary information and documents have been gathered, the formal CUSIP application process can begin. CUSIP numbers are assigned by CUSIP Global Services (CGS), managed on behalf of the American Bankers Association by S&P Global Market Intelligence. Applicants typically initiate the process through CGS’s official online application portal.
The online portal is the primary method for submitting requests, allowing for electronic submission of documents. Applicants input the prepared issuer and issue information into the designated fields.
All required legal documentation, such as the prospectus or offering memorandum, must be uploaded or attached directly to the CUSIP Request Form under the “Offering Documents” section. After completing the form and attaching documents, the request is submitted to CGS for processing.
A fee structure applies for CUSIP assignment, varying based on the type of offering and number of identifiers requested. For a single CUSIP, the assignment fee is around $210. Offerings with multiple maturities or classes may incur an additional $34 per identifier after the first. Expedited services are available for an additional surcharge, typically 50% over regular fees, which can shorten processing time.
Upon successful submission, applicants usually receive a confirmation, often including a reference number for tracking. Standard processing times for CUSIP assignment range from one to two business days, though expedited requests may be processed within one hour. CGS communicates the assigned CUSIP number to the applicant via electronic confirmation, which also includes standardized descriptions of the issuer and issue.