Four mechanisms to raise funds in Venezuela’s securities and other-assets markets

Over recent years, strict economic policies and heavy banking regulation have limited the ability of Venezuela’s traditional banking sector to finance the productive sector. The main reason is that banks operate under a 73% legal reserve requirement, which restricts the share of deposits they can lend. Against that backdrop, more companies are turning to the securities market as a route to raise funds.

For context on how banks and capital markets interact in our advisory work, see our Banking & Finance practice.

What the Venezuelan securities market offers

Venezuela’s securities market offers three public-offering mechanisms to raise funds: equity issuance, debt issuance, and asset securitization. Alongside them, the Caracas Stock Exchange operates an additional venue outside the public-offering regime: the market for other assets (the “MOB”), where Exchange Financing Certificates (“CFBs”) are traded. Each mechanism differs in tenor, cost profile, and impact on corporate control.

Equity issuance

The company offers shares to the public through an initial public offering. The Office of the Superintendent of Securities (Superintendencia Nacional de Valores, the “SUNAVAL”) authorizes the issuance and registers it in the National Securities Registry. The issuer must offer the public at least 20% of its capital and undertake to pay, as a cash dividend, at least 25% of net profits. It must also appoint a board of directors with no fewer than three principal members.

This route suits companies seeking permanent capital and willing to share control with new investors. Where governance and shareholder dynamics are central, our Corporate & M&A practice often works alongside capital-markets counsel.

Debt issuance

The company issues debt instruments —bonds, commercial paper, or exchange-traded promissory notes— and places them with investors in exchange for financing with a defined term. Bonds carry medium- to long-term tenor. Commercial paper matures within 15 and 360 days and functions as a working-capital tool. The issuer needs two independent credit ratings and SUNAVAL authorization.

The central advantage is clear: the company raises funds without diluting its ownership structure.

Asset securitization

The company transfers to an authorized securitization vehicle its cash-flow-generating assets —receivables, lease contracts, or commercial flows. The vehicle issues participation certificates backed by those assets and places them with investors. The company turns future cash flows into immediate liquidity without taking on new debt or giving up equity. The issuer needs SUNAVAL authorization.

SUNAVAL also requires the value of the transferred assets to exceed the amount of the certificates issued: an overcollateralization designed to protect investors.

The MOB: an additional path outside the public-offering regime

The Caracas Stock Exchange operates an additional segment, the MOB, in which companies assign to investors the credit rights arising from their invoices and purchase orders through CFBs. The maximum tenor of the assigned invoices and purchase orders is 180 days, which positions the CFB as a working-capital tool. The brokerage only notifies the transaction to SUNAVAL: no prior authorization procedure is required.

Foreign-currency denomination

Issuers of debt, securitization vehicles, and CFB programs may denominate their issuances in Bolivars or in foreign currency. Payment at maturity may be settled in Bolivars at the prevailing exchange rate, or directly in the foreign currency, as agreed. This option directly addresses the problem of Bolivar depreciation: the issuer fixes its obligations in a stable currency, and the investor preserves the purchasing power of its capital.

What to do?

The securities market is not reserved for large corporations. Any company that meets the regulatory requirements and has a solid financial track record can access it. The choice between equity, debt, securitization, and CFBs depends on the financing horizon, the willingness to share control, and the nature of the available assets.

At Ágora Abogados S.C. we advise companies on structuring equity, debt, and securitization issuances, and on the procedures before SUNAVAL and the Caracas Stock Exchange. Our Banking & Finance team supports clients across these structures end to end.

Access to capital does not guarantee growth, but its absence prevents it.