Capital Southwest Announces Receipt of Second SBIC License
Capital Southwest (Nasdaq: CSWC) announced that its subsidiary, Capital Southwest SBIC II, LP, has received a Small Business Investment Company (SBIC) license from the U.S. Small Business Administration. This marks the company's second SBIC license, following its first in April 2021.
The new license enables SBIC II to issue SBA-guaranteed debentures up to $175 million, bringing Capital Southwest's total SBIC program borrowing capacity to $350 million. These debentures feature semi-annual interest payments and ten-year maturity, with interest rates fixed at a spread over ten-year U.S. Treasury Notes.
The company received exemptive relief from the SEC, allowing the exclusion of SBA-guaranteed debentures from senior securities in asset coverage requirements.
Capital Southwest (Nasdaq: CSWC) ha annunciato che la sua controllata, Capital Southwest SBIC II, LP, ha ottenuto una licenza Small Business Investment Company (SBIC) dalla Small Business Administration degli Stati Uniti. Questa rappresenta la seconda licenza SBIC per la società, dopo la prima ottenuta nell'aprile 2021.
La nuova licenza consente a SBIC II di emettere debentures garantite dalla SBA fino a 175 milioni di dollari, portando la capacità totale di indebitamento del programma SBIC di Capital Southwest a 350 milioni di dollari. Queste debentures prevedono pagamenti di interessi semestrali e una scadenza a dieci anni, con tassi di interesse fissati come spread sui titoli del Tesoro USA a dieci anni.
La società ha ottenuto un'esenzione dalla SEC che permette di escludere le debentures garantite dalla SBA dai titoli senior ai fini dei requisiti di copertura patrimoniale.
Capital Southwest (Nasdaq: CSWC) anunció que su subsidiaria, Capital Southwest SBIC II, LP, ha recibido una licencia Small Business Investment Company (SBIC) de la Administración de Pequeñas Empresas de EE. UU. Esta es la segunda licencia SBIC de la compañía, tras la primera obtenida en abril de 2021.
La nueva licencia permite a SBIC II emitir bonos garantizados por la SBA hasta por 175 millones de dólares, aumentando la capacidad total de endeudamiento del programa SBIC de Capital Southwest a 350 millones de dólares. Estos bonos tienen pagos de intereses semestrales y vencimiento a diez años, con tasas de interés fijadas como un margen sobre los bonos del Tesoro de EE. UU. a diez años.
La compañía recibió un alivio exento de la SEC que permite excluir los bonos garantizados por la SBA de los valores senior en los requisitos de cobertura de activos.
Capital Southwest (나스닥: CSWC)는 자회사인 Capital Southwest SBIC II, LP가 미국 중소기업청(SBA)으로부터 소기업 투자 회사(SBIC) 라이선스를 취득했다고 발표했습니다. 이는 2021년 4월 첫 번째 라이선스에 이은 두 번째 SBIC 라이선스입니다.
새 라이선스를 통해 SBIC II는 SBA 보증 채권을 최대 1억 7,500만 달러까지 발행할 수 있게 되었으며, Capital Southwest의 총 SBIC 프로그램 차입 한도는 3억 5,000만 달러로 증가했습니다. 이 채권은 반기 이자 지급과 10년 만기를 특징으로 하며, 이자율은 10년 만기 미국 국채 수익률에 스프레드를 더한 고정 금리입니다.
회사는 SEC로부터 면제 권한을 받아 SBA 보증 채권을 자산 커버리지 요건에서 선순위 증권에서 제외할 수 있게 되었습니다.
Capital Southwest (Nasdaq : CSWC) a annoncé que sa filiale, Capital Southwest SBIC II, LP, a obtenu une licence Small Business Investment Company (SBIC) délivrée par la Small Business Administration des États-Unis. Il s'agit de la deuxième licence SBIC pour la société, après la première obtenue en avril 2021.
Cette nouvelle licence permet à SBIC II d’émettre des obligations garanties par la SBA jusqu’à 175 millions de dollars, portant la capacité totale d’emprunt du programme SBIC de Capital Southwest à 350 millions de dollars. Ces obligations prévoient des paiements d’intérêts semestriels et une échéance de dix ans, avec des taux d’intérêt fixés en marge des bons du Trésor américain à dix ans.
La société a obtenu une dérogation de la SEC lui permettant d’exclure les obligations garanties par la SBA des titres seniors dans les exigences de couverture des actifs.
Capital Southwest (Nasdaq: CSWC) gab bekannt, dass seine Tochtergesellschaft Capital Southwest SBIC II, LP eine Small Business Investment Company (SBIC)-Lizenz von der US Small Business Administration erhalten hat. Dies ist die zweite SBIC-Lizenz des Unternehmens, nach der ersten im April 2021.
Die neue Lizenz ermöglicht es SBIC II, SBA-gesicherte Schuldverschreibungen bis zu 175 Millionen US-Dollar auszugeben, wodurch die gesamte Kreditaufnahmefähigkeit des SBIC-Programms von Capital Southwest auf 350 Millionen US-Dollar steigt. Diese Schuldverschreibungen sehen halbjährliche Zinszahlungen und eine Laufzeit von zehn Jahren vor, mit Zinssätzen, die als Aufschlag auf zehnjährige US-Staatsanleihen festgelegt sind.
Das Unternehmen erhielt von der SEC eine Ausnahmegenehmigung, die es erlaubt, SBA-gesicherte Schuldverschreibungen bei den Vermögensdeckungsanforderungen von Seniorwertpapieren auszuschließen.
- Secured second SBIC license, doubling potential borrowing capacity
- Additional $175 million in potential SBA-guaranteed debentures
- SEC exemptive relief obtained for favorable asset coverage treatment
- Access to favorable government-backed financing terms
- Subject to SBA regulations and oversight limiting investment flexibility
- Investment restrictions on size and nature of portfolio companies
Insights
Capital Southwest secures second SBIC license, doubling potential SBA funding to $350M with favorable terms and regulatory advantages for expanded lending capacity.
Capital Southwest's receipt of a second SBIC license represents a significant funding development that strategically enhances their capital formation capabilities. This new license permits their subsidiary to access up to
SBA debentures offer several compelling advantages compared to traditional funding sources:
- Fixed interest rates set at market-driven spreads over 10-year Treasury notes
- Extended 10-year maturity providing long-term capital stability
- Exclusion from BDC asset coverage requirements due to SEC exemptive relief
The financial impact is substantial considering Capital Southwest's
The exemptive relief from the SEC is particularly valuable as it allows these debentures to be excluded from the company's regulatory leverage calculations. This creates additional flexibility in their capital structure while maintaining regulatory compliance.
While SBIC licenses do come with regulatory oversight regarding investment size and eligibility requirements, Capital Southwest appears well-positioned to navigate these constraints, noting in the announcement that the program has played a "pivotal role" in their lower middle market strategy since receiving their first license in 2021.
DALLAS, April 21, 2025 (GLOBE NEWSWIRE) -- Capital Southwest Corporation (“Capital Southwest”) (Nasdaq: CSWC), an internally managed business development company focused on providing flexible financing solutions to support the acquisition and growth of middle market businesses, today announced its wholly owned subsidiary, Capital Southwest SBIC II, LP (“SBIC II”), has received a license from the U.S. Small Business Administration (“SBA”) to operate as a Small Business Investment Company (“SBIC”).
As an SBIC, SBIC II will be subject to a variety of regulations and oversight by the SBA concerning, among other things, the size and nature of the companies in which it may invest as well as the structure of those investments. The SBIC license will allow SBIC II to obtain leverage by issuing SBA-guaranteed debentures, subject to the issuance of a leverage commitment by the SBA. SBA debentures are loans issued to an SBIC which have interest payable semi-annually and a ten-year maturity. The interest rate is fixed shortly after issuance at a market-driven spread over U.S. Treasury Notes with ten-year maturities. Current SBA regulations permit SBIC II to borrow up to
The SBA program has played a pivotal role within Capital Southwest’s lower middle market investment strategy since receiving its first SBIC license in April 2021. Capital Southwest received exemptive relief from the Securities and Exchange Commission that allows for the exclusion of SBA-guaranteed debentures from the definition of senior securities in the asset coverage requirement applicable to the Company.
About Capital Southwest
Capital Southwest Corporation (Nasdaq: CSWC) is a Dallas, Texas-based, internally managed business development company with approximately
Investor Relations Contact:
Michael S. Sarner, President and Chief Executive Officer
214-884-3829
FAQ
What is the maximum borrowing capacity for Capital Southwest's SBIC II under the new license?
What is Capital Southwest's (CSWC) total SBIC program borrowing capacity after receiving the second license?
When did Capital Southwest receive its first SBIC license?
What are the terms of the SBA debentures available to Capital Southwest SBIC II?
