WASHINGTON (Reuters) – Companies are increasingly taking advantage of securities rules that lets them raise capital without having to go through costly registrations, according to a new study by regulators.
The Securities and Exchange Commission study found that these private offerings surpassed debt offerings in 2010 and continued to do so through the first quarter of this year.
The study also found that the spike in private offerings came as public issuances fell by 11 percent from 2009 to 2010.
“To me, it is similar to other types of financial innovations,” SEC Chief Economist Craig Lewis told Reuters on the sidelines of the SEC’s first-ever small business advisory committee meeting.
“Once people understand this is another path for obtaining equity capital, firms will consider it as another choice to make at the time they need capital.”
The agency released the study as part of its review to determine whether it should pursue less restrictive capital-raising
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