Small Business Investment Companies

In order to encourage small business investment companies (SBICs) to invest in inner cities and rural areas and in businesses that serve such areas, the Small Business Administration (SBA) is introducing a new SBIC investment category called low and moderate income investments (LMI Investments). For each SBIC financing that qualifies as an LMI Investment, SBA is modifying its regulations on control of the small business, ``cost of money'' of the financing, and term of the financing. SBA also will make available a patient form of debenture leverage that may be issued only by SBICs that make LMI Investments.