Agricultural lending institutions are faced with a perpetual task of periodically evaluating personal and financial attributes of their borrowers. This examination is necessary in order to determine the present quality of the loans and to assess the current financial position of each borrower. Moreover, analysis of each borrower's financial performance establishes a basis for extending, limiting or withdrawing the present line of credit and for determining the amount and kind of supervision needed.
Purpose
To analyze and identify the key findings from the April 8, 2020, U.S. Securities and Exchange Commission’s (the “SEC”) recently approved rule amendments (“Adopted Rules”) extended to business development companies (“BDCs”) and registered closed-end funds and an Exemptive Order providing regulatory flexibility to BDCs.
Design/methodology/approach
Discusses the key takeaways and implications from the Adopted Rules and Exemptive Order.
Findings
The Adopted Rules provide BDCs and registered closed-end funds some of the more efficient registration, reporting, offering, and communication requirements currently applicable to operating companies. The Exemptive Order provides BDCs additional flexibility with respect to (1) the issuance and sale of senior securities and (2) the participation in certain joint transactions.
Practical implications
Firms and their representatives should heed the trends in both the substantial restitution FINRA is ordering and the related enforcement issues in the cases FINRA has brought.
Originality/value
Expert analysis and guidance from experienced asset management lawyers.
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