Forming a Small Business Investment Company: Threshold Considerations
Author: Michael B. Staebler.
Source: Volume 26, Number 04, March/April 2013 , pp.5-16(12)
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Abstract:
When changes in the banking laws a decade ago permitted banks directly to own more than 5 percent of the voting securities of businesses that were not related to banking, many banks that had previously formed Small Business Investment Companies (SBICs) surrendered their licenses. A number of banks are now again considering the formation of SBICs, because the Dodd-Frank Act permits bank investment in SBICs. Although SBICs provide a number of advantages, threshold issues deserve careful consideration.Keywords: Start-Up America Initiative, leverage, Regulatory Capital, Debenture SBICs
Affiliations:
1: Pepper Hamilton LLP.