Structured Thoughts: News For The Financial Services Community, Volume 7, Issue 7

Financing Subsidiaries and SEC Registration

As readers of this publication know, in order to address the expected new U.S. regulatory capital requirements, a number of U.S. bank holding companies have been creating new finance company subsidiaries. This article discusses a variety of SEC rules and regulations that simplify the registration process for using these entities, as well as certain limitations.

Using the Parent Company's Registration Statement. Under General Instruction I.C of SEC Form S-3, a wholly owned subsidiary of an S-3 eligible company can utilize the parent company's short form shelf registration statement for primary offerings of investment grade securities. This provision enables these subsidiaries to take advantage of the parent company's reporting status for purposes of effecting a shelf registration. This will be the case whether or not the parent corporation is a "WKSI" or a "non-WKSI" (including a WKSI that has become an "ineligible