March 2021 SBIC Leverage Pricing Determined
$1,095,675,000 in SBIC debentures priced
Washington, D.C. (March 16, 2021) – The Small Business Investor Alliance (SBIA), the leading association for lower middle market private equity funds and investors, today announced that $1,095,675,000 of Small Business Investment Companies (SBIC) debentures were priced at an interest rate of 1.667%. This price reflects a 5 bps spread from the Ten-Year Treasury rate. This is over 26 bps tighter than the previous tightest recorded spread to the Treasury rate in the history of the SBIC program.
This rate of 1.667% is the new base rate applied to any SBIC leverage drawn between the last pooling in September 2020 and March 1, 2021. This rate does not include the annual, reserving, drawing, or other fees paid to the government. SBIC debentures are non-amortizing, fixed rate notes with no prepayment penalty. The previous pool of debentures priced in September 2020 at 1.034%, in March 2020 at 2.078%, and in September 2019 at 2.283%.
“SBICs continue to provide vital, long-term capital to small businesses as they grow and create jobs,” said SBIA President Brett Palmer. “It is these innovative American small businesses that are driving our recovery and helping rebuild a stronger economy.”
Graph of historical pool size and rates, September 2001-March 2021.
About the Small Business Investor Alliance (SBIA)
The Small Business Investor Alliance (SBIA) is the premier organization of lower middle market private equity funds and investors. SBIA works on behalf of its members as a tireless advocate for policies that promote competitive markets and robust domestic investment for growing small businesses. SBIA has been playing a pivotal role in promoting the growth and vitality of the private equity industry for over 60 years. For more information, visit www.SBIA.org or call (202) 628-5055.
About Small Business Investment Companies
Small Business Investment Companies are highly regulated, venture capital and private equity funds that invest exclusively in domestic small businesses to help them grow and create American jobs. Since its inception, the Small Business Investment Company program has facilitated access to patient capital for tens of thousands of small businesses and has created millions of American jobs.