1. third party to a bond indenture. The trustee's function is to make sure the issuer lives up to the numerous provisions in the indenture. A trustee is usually a trust department of a commercial bank. The trustee is paid a fee and acts to protect the interests of the bondholders.
2. third party to a bankruptcy (business) proceeding. The trustee's responsibility is to value and recapitalize the firm if it is to be reorganized.

1. person named to administer a trust for a beneficiary according to the terms established by the donor.
2. financial institution, usually a trust company or the trust department in a commercial bank that holds collateral for the benefit of bondholders. The trustee collects principal and interest payments, invests the cash between payment dates, and disburses funds to pay principal and interest on issued and outstanding bonds.
3. bankruptcy trustee , named by a bankruptcy judge to handle the assets of a debtor in bankruptcy.

one who holds property in trust for another to secure performance of an obligation; the neutral party in a trust deed transaction.

Example: Johnson purchases property and finances it with a deed of trust from a lender. The title company is the trustee, holding legal title to the property pending Johnson's satisfaction of the debt. Should Johnson default on the loan, the trustee may sell the property to satisfy the debt.

1. one who holds legal title to property in trust for the benefit of another person, and who is required to carry out specific duties with regard to the property, or who has been given power affecting the disposition of property for another's benefit.
2. loosely, anyone who acts as a guardian or fiduciary in relationship to another, such as a public officer toward his constituents, a state toward its citizens, or a partner to his copartner.