Among all fast-growth companies surveyed, the biggest and fastest-growing have secured new loans and have significant plans for new investment. Further, many new borrowers are planning to explore alternative financing in the coming months. And, in what may be a prelude to new spending initiatives, nearly one in five fast-growth companies have increased their credit availability by an average of 37 percent.

Despite more-attractive interest rates, only 19 percent of fast growth CEOs reported new loans in the second quarter, down from 21 percent a quarter earlier. Twenty-five percent of product sector companies were new borrowers, compared to only 14 percent in the service sector. Rates averaged 4.81 percent -- 72 basis points below a year ago, and 15 points below the prior quarter.

Recipients of new loans are considerably larger than non-borrowers, with 37 percent greater annual revenues. They are also much faster-growing. Over the next 12 months they are expecting revenue growth of 20.0 percent, versus 13.4 percent, respectively -- a 49 percent edge -- despite their significant size differential.

New borrowers are expansion driven, planning major new capital investments at a 27 percent higher rate than non-borrowers. And, compared to those on financing's sidelines, considerably more have increased their 2003 budgets for new product development, information technology, and research & development.

"The largest and most dynamic 'Trendsetter' companies may be seen as lining up their financing in preparation for major expansion when the economy turns," said Tracy Lefteroff, PricewaterhouseCoopers' global managing partner for private equity and venture capital. "These companies' growth plans are extensive, and near-ready for launch."

More new borrowers will also be exploring other financing options over the next 12 months -- 33 percent, up from 24 percent in the prior quarter. In sharp contrast, only half as many non-borrowers (16 percent) expect to go this route. Also, 25 percent of new borrowers are planning a restructuring of debt over the next 12 months, versus only ten percent of non-borrowers.

"New borrowers are motivated, and perhaps more conscious of the need to tie their various planned initiatives to specific funding sources," noted Lefteroff. "Their sense of urgency is prompting them to leave no option unexplored."

Eighteen percent of "Trendsetter" companies upped their credit availability over the past quarter—by a whopping 37 percent, on average. Only five percent decreased their credit, and 77 percent stayed about the same.

Fewer than half of those increasing their credit obtained a new bank loan this past quarter (seven percent), whereas most (11 percent) generated their credit increase apart from a new loan.

"This jump in new credit also hints at plans for significant new investments," said Lefteroff. "It may signify added flexibility for those who just obtained a new loan, enabling them to quickly respond to changes in their markets. But for non-borrowers, the rationale for a credit increase may be entirely different. Many of these companies may have simply outgrown, or may need to update their capital equipment. And, in an environment that some may perceive as deflationary, many must look for ways to continue to boost productivity by investing in state-of-the-art equipment and information technology. In either case -- whether for flexible expansion or an operational upgrade -- there are favorable implications for the economy."