Washington, D.C. 20549







Pursuant to Section 13 OR 15(d) of
The Securities Exchange Act of 1934


Date of Report (Date of earliest event reported) May 13, 2021


StoneCastle Financial Corp.

(Exact Name of Registrant as Specified in Charter)


Delaware   333-189307   90-0934878
(State or other jurisdiction   (Commission   (IRS Employer
of incorporation)   File Number)   Identification No.)


100 Fillmore Street, Suite 325, Denver, Colorado 80206
(Address of principal executive offices) (Zip Code)


Registrant’s telephone number, including area code (303) 398-2929


(Former name or former address, if changed since last report.)


Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):


o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)


o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)


o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))


o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))


Securities registered pursuant to Section 12(b) of the Act:


Title of each class   Trading Symbol(s)   Name of each exchange on which registered
Common   BANX   NASDAQ


Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR §230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR §240.12b-2). Emerging growth company o


If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o



Item 2.02          Results of Operations and Financial Condition.


On May 13, 2021 the registrant issued a press release announcing its financial results for the first quarter ended March 31, 2021. The text of the press release is included as Exhibit 99.1 to this Form 8-K.


The information disclosed under this item 2.02 is being furnished and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 and shall not be deemed incorporated by reference into any filing made under the Securities Act of 1933, except as expressly set forth by specific reference in such filing.


Item 9.01          Financial Statements and Exhibits.


(d) Exhibits:


Exhibit Number   Description
99.1   Press Release, dated May 13, 2021



Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.





Date: May 13, 2021

  By: /s/ Patrick J. Farrell
  Name: Patrick J. Farrell
  Title: Chief Financial Officer



Exhibit Index


Exhibit Number   Description
99.1   Press Release, Dated May 13, 2021

Section 2: EX-99.1 (EX-99.1)


Exhibit 99.1



StoneCastle Financial Corp. Reports First Quarter 2021 Results


DENVER, May 13, 2021– StoneCastle Financial Corp. (Nasdaq: BANX) (“StoneCastle Financial” or the “Company”), an investment company registered with the Securities and Exchange Commission (“SEC”), today announced results for the first fiscal quarter ended March 31, 2021.


First Quarter 2021 Investment Highlights:


  Invested approximately $17.5 million in six investments
  Realized proceeds of $4.7 million from the maturity of one investment
  Realized proceeds from partial paydowns of $4.3 million from six investments


Subsequent to the end of the quarter, the Company invested approximately $8.0 million in two investments and received partial paydowns of $2.6 million.


The estimated annualized yield generated by the invested portfolio as of March 31, 2021 (excluding cash and cash equivalents) was approximately 9.32%.


First Quarter 2021 Financial Results


Net investment income was $2,603,278 or $0.40 per share, comprised of $4,125,528 gross income and $1,522,250 of expenses. Net Assets at quarter end were $142,070,129. The Company’s Net Asset Value was $21.62 per share, up $0.18 from the prior quarter.


In the first quarter, the Company paid a cash distribution of $0.38 per share. The distribution was paid on March 25, 2021 to shareholders of record at the close of business on March 18, 2021.


The Company had $39.0 million outstanding on its $62.0 million credit facility at the quarter end, which represents approximately 21% of total assets. According to regulated investment company rules, the Company may borrow only up to 33.3% of its total assets.


Portfolio and Investment Summary


As of the close of business on March 31, 2021, the Company had total assets of $182,525,474 consisting of total investments of $178,022,813, cash and other assets of $4,502,661.  


During the quarter, the Company invested a total of $17.5 million in six bank-related regulatory capital investments. The Company received total proceeds of $9.0 million, consisting of a term loan maturity of $4.7 million, and $4.3 million in partial paydowns from six investments.


Quarterly Conference Call


StoneCastle Financial will host a webcast and conference call on May 13, 2021 at 5:00 pm Eastern time.


The conference call can be accessed by dialing 1-877-407-9039 for domestic callers or 1-201-689-8470 for international callers. Participants may also access the call via live webcast by visiting StoneCastle Financial’s investor relations website at www.stonecastle-financial.com. To listen to a live broadcast, go to the website at least 15 minutes prior to the scheduled start time in order to register, download and install any necessary audio software. A replay will be available shortly after the call and be available through midnight (Eastern Time) on May 27, 2021. The replay can be accessed by dialing 1-844-512-2921 for domestic callers or 1-412-317-6671 for international callers. The passcode for the replay is 13718352. The archive of the webcast will be available on the Company’s website for a limited time.


About StoneCastle Financial Corp.


StoneCastle Financial is an SEC registered non-diversified, closed-end management investment company listed on the NASDAQ Global Select Market under the symbol “BANX.” Its investment objective is to provide stockholders with current income and, to a lesser extent, capital appreciation. StoneCastle Financial is managed by StoneCastle-ArrowMark Asset Management, LLC. To learn more, visit www.stonecastle-financial.com.


Disclaimer and Risk Factors:


There is no assurance that StoneCastle Financial will achieve its investment objective. StoneCastle Financial is subject to numerous risks, including investment and market risks, management risk, income and interest rate risks, banking industry risks, preferred stock risk, convertible securities risk, debt securities risk, liquidity risk, valuation risk, leverage risk, non-diversification risk, credit and counterparty risks, market at a discount from net asset value risk and market disruption risk. Shares of closed-end investment companies may trade above (a premium) or below (a discount) their net asset value. Shares of StoneCastle Financial may not be appropriate for all investors. Investors should review and consider carefully StoneCastle Financial’s investment objective, risks, charges and expenses. Past performance does not guarantee future results.


The Annual Report, Semi-Annual Report and other regulatory filings of the Company with the SEC are accessible on the SEC’s website at www.sec.gov and on the Company’s website at www.stonecastle-financial.com.


CONTACT: Investor Contact:


Julie Muraco





Statement of Assets and Liabilities (unaudited)


   March 31, 2021  December 31, 2020
Investments in securities, at fair value (cost: $177,537,308 and $176,919,203 respectively)  $178,022,813   $178,362,337 
Receivable for Investments sold   -    4,860,214 
Interest and dividends receivable   2,335,288    2,111,113 
Foreign cash (cost: $1,300,817 and $1,928,095 respectively)   1,302,222    1,920,752 
Cash   63,110    358,061 
Unrealized appreciation on forward currency exchange contracts   204,752    135,069 
Prepaid assets   597,289    613,320 
Total assets   182,525,474    188,360,866 
Loan payable   39,000,000    43,000,000 
Dividends payable   -    2,823,128 
Investment advisory fee payable   787,610    832,998 
Payable for securities purchased   -    146,376 
Loan interest payable   35,982    70,457 
Unrealized depreciation on forward currency exchange contracts   -    68,578 
Options written, at value (premiums received $0 and $1,029 respectively)   -    1,625 
Accrued expenses payable   631,753    628,572 
Total liabilities   40,455,345    47,571,734 
Net Assets  $142,070,129   $140,789,132 
Net Assets consist of:          
Common stock at par ($0.001 per share)  $6,572   $6,565 
Paid-in-Capital   145,128,467    144,992,526 
Total distributable earnings / (loss)   (3,064,910)   (4,209,959)
Net Assets  $142,070,129   $140,789,132 
Net Asset Value Per Share:          
Common Stock Shares Outstanding   6,572,212    6,565,413 
Net asset value per common share  $21.62   $21.44 
Market price per share  $19.79   $19.25 
Market price discount to net asset value per share   -8.46%    -10.21% 


Statement of Operations (unaudited)


   For The Three
Months Ended
March 31, 2021
   For The Three
Months Ended
December 31, 2020
Investment Income          
Interest  $3,299,156   $3,274,845 
Dividends   749,851    1,086,960 
Origination fee income   31,977    32,278 
Other Income (service fees and due diligence fees)   44,544    274,538 
Total Investment Income   4,125,528    4,668,621 
Investment advisory fees   787,610    832,999 
Interest expense   295,817    214,920 
Directors’ fees   84,854    77,621 
Transfer agent, custodian fees and administrator fees   71,569    73,159 
Bank administration fees   39,578    40,457 
Professional fees   94,930    202,760 
ABA marketing and licensing fees   32,955    37,287 
Investor relations fees   30,526    31,205 
Delaware franchise tax   22,444    22,943 
Insurance expense   17,753    15,951 
Valuation fees   14,823    15,153 
Printing   7,500    14,670 
Miscellaneous fees (proxy, rating agency, etc.)   21,891    43,095 
Total expenses   1,522,250    1,622,220 
Net Investment Income   2,603,278    3,046,401 
Realized and Unrealized Gain / (Loss) on Investments and Foreign Currency Transactions      
Net realized gain on investments   91,458    311,979 
Net realized gain / (loss) from forward foreign currency contracts   1,675,729    (1,663,224)
Net realized gain from foreign currency translations   134,076    36,751 
Net change in net unrealized appreciation / (depreciation) on investments   (957,630)   5,137,158 
Net change in unrealized appreciation / (depreciation) on written options   596    (620,426)
Net change in unrealized appreciation on forward currency contracts   138,261    222,982 
Net change in unrealized appreciation / (depreciation) on foreign currency translations   (44,538)   10,331 
Net realized and unrealized gain/(loss) on investments, written options, forward foreign currency contracts and foreign currency translations   1,037,952    3,435,551 
Net Increase in Net Assets Resulting From Operations  $3,641,230   $6,481,952 


Financial Highlights (unaudited)


   For The Three
Months Ended
March 31, 2021
Per Share Operating Performance     
Net Asset Value, beginning of period  $21.44 
Net investment income(1)   0.40 
Net realized and unrealized gain / (loss) on investments   0.16 
Total from investment operations   0.56 
Less distributions to shareholders     
From net investment income   (0.38)
Total distributions   (0.38)
Net asset value, end of period  $21.62 
Per share market value, end of period  $19.79 
Total Investment Return (2)     
Based on market value   4.80% 
Based on net asset value   2.79% 
Ratios and Supplemental Data     
Net assets, end of period (in millions)  $142.1 
Ratios (as a percentage to average net assets):     
Expenses before waivers(3)(4)*   4.37% 
Expenses after waivers(5)*   4.37% 
Net investment income(6)*   7.47% 
Portfolio turnover rate**   5% 
Revolving Credit Agreement     
Total revolving credit agreement outstanding (000’s)  $39,000 
Asset coverage per $1,000 for revolving credit agreement(7)   4,643 




(1) Based on the average shares outstanding during quarter.
(2) Reflects reinvestment of distributions at the price obtained under the Dividend Reinvestment Plan. Total return does not include sales load and offering expenses and are not annualized.
(3) Excluding interest expense, the ratio would have been 3.52%.
(4) Ratio of expenses before waivers to average managed assets equals 3.33%.
(5) Ratio of expenses after waivers to average managed assets equals 3.33%.
(6) Ratio of net investment income to average managed assets equals 5.69%.
(7) Calculated by subtracting the Company’s total liabilities (excluding the loan) from the Company’s total assets and dividing the amount by the loan outstanding in 000’s.
* Annualized
** Not-annualized