On September 15, 2010, the SBIC Funding Corporation completed pricing on
$562,985,000 in pooling of SBA debentures with a coupon rate of 3.215%. This is
the lowest pricing on SBA-pooled debentures in more than 50 years of the SBA
Program, and follows on the previous all-time low March 2010 issuance of $339
million at 4.108%. Further, this $562.9 million pooling represents the largest
debenture pooling in the history of the SBIC Program.
The pricing of the pool is a critical component to the cost of funds used by
SBIC Funds. Once pooled, the interest rate on the SBA debentures becomes fixed
for a 10-year period. The SBIC Fund is only responsible for a semi-annual
interest-only payment on the SBA debentures until the SBA debentures are repaid.
The SBA debentures must be repaid within 10 years. In addition, there are no
The September 2010 pool included 217 separate issuances to 54 SBIC Funds
located in the United States. Credit Suisse Securities (USA) LLC, J.P. Morgan
Securities LLC, and Goldman, Sachs & Co. served as the underwriters.
The historical pooling information is reflected in our chart (click