By Sarah N. Lynch
WASHINGTON Feb 22 Investors appear to be
regaining confidence in the public markets based on new data
compiled and analyzed by U.S. securities regulators, Securities
and Exchange Commission Chairman Elisse Walter said on Friday.
"For the first time since the financial crisis, the amount
of money raised in public debt and equity offerings is rising -
up 22 percent last year," Walter told an audience at "The SEC
Speaks," an annual conference held in Washington by the
Practising Law Institute.
"It's important that we embrace a regulatory agenda that is
consistent with continued growth in public offerings," she said.
Policymakers in Washington have been grappling with how to
boost participation in the public markets following the
2007-2009 financial crisis, which wiped out many peoples'
In October 2011, the SEC's Division of Risk, Strategy and
Financial Innovation, or Risk Fin, announced preliminary
findings from an ongoing study which showed that companies were
increasingly relying on private offerings as a way to raise
That spike in private offerings came as public issuances
fell by 11 percent from 2009 to 2010, the division's director
Craig Lewis said at the time.
The latest data unveiled Friday, which is part of the same
study, suggests that public offerings are now back on the rise.
In 2012, the amount of money raised in public offerings was
essentially on par with the amounts raised in the private
market. Collectively, both private and public offerings raised
$2.4 trillion in 2012, up from $2 trillion in 2011, according to
a fact sheet.
In response to the steep decline in initial public offerings
following the crisis, the U.S. Congress last year passed the
2012 Jumpstart Our Business Startups, or JOBS Act.
That law relaxes many securities laws in an effort to help
smaller companies raise capital and eventually go public.
Walter told reporters on the sidelines of Friday's event
that it was too early to know whether the JOBS Act had an impact
on the increase in public investments.
"I think if you want to try to determine the effect of the
JOBS Act, we're going to have to wait a while longer," she
Some of the JOBS Act's provisions went into effect
immediately after the law was passed, including a provision that
allows certain companies to submit initial public offering
documents confidentially until just 21 days before they launch a
road show and start soliciting interest from investors.
SEC officials in the Corporation Finance Division said on
Friday that approximately 150 companies so far have taken
advantage of the new confidentiality provision.
Other provisions in the new law, however, require the SEC to
In April last year, the SEC said companies were already
starting to take advantage of the JOBS Act just a week after
President Barack Obama signed it into law.
"Obviously if more capital-raising is going on, that is a
sign of increasing investor confidence," Walter told reporters.
"It's a good trend line in terms of what investors are feeling."
Officials from Risk Fin plan to give a more detailed
presentation on the study during the second day of "The SEC
Speaks" conference on Saturday.
However, Scott Bauguess, an assistant director within Risk
Fin, gave reporters a few additional details on Friday .
Of all the public offerings studied, debt offerings
represented about 75 percent of the total, he said.
Equities were a smaller fraction of public offerings, he
said, and IPOs made up only about 5 or 6 percent of total equity
raised in any particular year.
He said that the full study would be released in the coming