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) August 4, 2022


ArrowMark 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 August 4, 2022, the registrant issued a press release announcing its financial results for the second quarter ended June 30, 2022. 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 August 4, 2022



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: August 4, 2022


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



Exhibit Index


Exhibit Number Description
99.1 Press Release, Dated August 4, 2022

Exhibit 99.1


ArrowMark Financial Corp. Reports Second Quarter 2022 Results


DENVER, August 4, 2022– ArrowMark Financial Corp. (Nasdaq: BANX) (“ArrowMark Financial” or the “Company”), an investment company registered with the Securities and Exchange Commission (“SEC”), today announced results for the second fiscal quarter ended June 30, 2022.


Second Quarter 2022 Investment Highlights:


·Invested approximately $23.8 million in four investments
·Realized proceeds of approximately $4.6 million from the sale of one investment
·Realized proceeds of approximately $6.3 million from the full call of one investment
·Realized proceeds from partial paydowns of $3.9 million from seven investments


A complete listing of investments as of the end of the quarter can be found on the Company’s website at ir.arrowmarkfinancialcorp.com, under SEC filings.


The estimated annualized yield generated by the invested portfolio as of June 30, 2022 (excluding cash and cash equivalents) was approximately 10.11%, up 58 basis points from 9.53% in the prior quarter.


Second Quarter 2022 Financial Results


Net investment income was $3.0 million or $0.43 per share, comprised of $5.0 million in gross income and $2.0 million of expenses. The Company also reported a net realized and unrealized loss on investments of ($0.54) per share. Net Assets at quarter end were $148.7 million. The Company’s Net Asset Value was $20.94 per share, down ($0.50) from the prior quarter.


In the second quarter, the Company paid a regular cash distribution of $0.39 per share which was paid on June 29, 2022, to shareholders of record at the close of business on June 22, 2022.


The Company had $51.5 million outstanding on its $70.0 million credit facility at the quarter end, which represents approximately 26% 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


During the quarter, the Company invested a total of $23.8 million in four bank-related regulatory relief capital investments. The Company received total proceeds of approximately $14.8 million, including $4.6 million from the sale of one investment, $6.3 million from one full call, and $3.9 million from partial paydowns from seven investments.


Quarterly Conference Call


ArrowMark Financial will host a webcast and conference call on August 4, 2022, at 5:00 pm Eastern time. The call will include a presentation hosted by Chairman & CEO, Sanjai Bhonsle and Patrick J. Farrell, Chief Financial Officer. There will be no open Q&A session. All questions can be immediately addressed by calling ArrowMark Financial’s Investor Relations at 212-468-5441 or emailing jmuraco@arrowmarkpartners.com to schedule a meeting with the management.


The conference call can be accessed by dialing 1-877-344-8082 for domestic callers or 1-213-992-4618 for international callers. Participants may also access the call via live webcast by visiting ArrowMark Financial’s investor relations website at ir.arrowmarkfinancialcorp.com. To listen to a live broadcast, go to the website at least 15 minutes prior to the scheduled start time 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 August 18, 2022. 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 151134. The archive of the webcast will be available on the Company’s website for a limited time.


About ArrowMark Financial Corp.


ArrowMark 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. ArrowMark Financial is managed by ArrowMark Asset Management, LLC. The Company’s website can be found at ir.arrowmarkfinancialcorp.com.


Disclaimer and Risk Factors:


There is no assurance that ArrowMark Financial will achieve its investment objective. ArrowMark 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 ArrowMark Financial may not be appropriate for all investors. Investors should review and consider carefully ArrowMark 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 ir.arrowmarkfinancialcorp.com.


CONTACT: Investor Contact:


Julie Muraco





Statement of Assets and Liabilities (unaudited)


   June 30, 2022  March 31, 2022
Investments in securities, at fair value cost: $207,554,612 and $203,836,019 respectively)  $197,055,807   $200,051,448 
Interest and dividends receivable   2,894,419    2,817,851 
Foreign cash (cost: $22,337 and $1,340,388 respectively)   22,443    1,345,044 
Cash   127,284    6,072,891 
Prepaid assets   1,535,171    712,608 
Total assets   201,635,124    210,999,842 
Loan payable   51,500,000    57,000,000 
Investment advisory fee payable   877,992    907,401 
Loan interest payable   33,990    12,709 
Unrealized depreciation on forward currency exchange contracts   399,809    713,215 
Accrued expenses payable   162,644    121,367 
Total liabilities   52,974,435    58,754,692 
Net Assets  $148,660,689   $152,245,150 
Net Assets consist of:          
Common stock at par ($0.001 per share)  $7,101   $7,099 
Paid-in-Capital   156,696,147    156,666,283 
Total distributable earnings / (loss)   (8,042,559)   (4,428,232)
Net Assets  $148,660,689   $152,245,150 
Net Asset Value Per Share:          
Common Stock Shares Outstanding   7,101,054    7,099,387 
Net asset value per common share  $20.94   $21.44 
Market price per share  $19.20   $21.51 
Market price premium/(discount) to net asset value per share   -8.31%   0.33% 


Statement of Operations (unaudited)


   For The Three
Months Ended 
June 30, 2022
  For The Three
Months Ended
March 31, 2022
Investment Income          
Interest  $4,713,141   $4,385,002 
Dividends   259,077    220,435 
Origination fee income   32,127    31,977 
Other income (service fees and due diligence fees)   32,238    38,768 
Total Investment Income   5,036,583    4,676,182 
Investment advisory fees   877,992    907,401 
Interest expense   486,112    341,361 
Directors’ fees   125,152    102,444 
Transfer agent, custodian fees and administrator fees   82,364    71,569 
Bank administration fees   51,772    39,578 
Professional fees   148,450    77,590 
Investor relations fees   29,080    30,526 
Insurance expense   17,951    17,753 
Valuation fees   69,988    14,823 
Miscellaneous fees (proxy, rating agency, etc.)   89,309    88,423 
Total expenses   1,978,170    1,691,468 
Net Investment Income   3,058,413    2,984,714 
Realized and Unrealized Gain / (Loss) on Investments and Foreign Currency Transactions          
Net realized gain / (loss) on investments   (808,687)   224,979 
Net realized gain from forward foreign currency contracts   3,540,799    2,201,190 
Net realized gain / (loss) from foreign currency translations   (226,172)   (107,593)
Net change in net unrealized appreciation / (depreciation) on investments   (6,714,234)   (4,188,412)
Net change in unrealized appreciation / (depreciation) on forward currency contracts   313,406    (114,116)
Net change in unrealized appreciation / (depreciation) on foreign currency translations   (9,092)   (9,292)
Net realized and unrealized gain/(loss) on investments, forward foreign currency contracts and foreign currency translations   (3,903,980)   (1,993,244)
Net Increase/(Decrease) in Net Assets Resulting From Operations  $(845,567)  $991,470 


Financial Highlights (unaudited)


   For The Three
Months Ended
June 30, 2022
Per Share Operating Performance     
Net Asset Value, beginning of period  $21.44 
Net investment income(1)   0.43 
Net realized and unrealized gain (loss) on investments   (0.54)
Total from investment operations   (0.11)
Less distributions to shareholders     
From net investment income   (0.39)
Total distributions   (0.39)
Net asset value, end of period  $20.94 
Per share market value, end of period  $19.20 
Total Investment Return (2)     
Based on market value   -8.80% 
Based on net asset value   -0.21% 
Ratios and Supplemental Data     
Net assets, end of period (in millions)  $148.7 
Ratios (as a percentage to average net assets):     
Expenses before waivers(3)(4)*   5.25%
Expenses after waivers(5)*   5.25% 
Net investment income(6)*   8.12% 
Portfolio turnover rate **   12% 
Revolving Credit Agreement     
Total revolving credit agreement outstanding (000’s)  $51,500 
Asset coverage per $1,000 for revolving credit agreement(7)   3,887 



(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 3.96%.
(4) Ratio of expenses before waivers to average managed assets equals 3.85%.
(5) Ratio of expenses after waivers to average managed assets equals 3.85%.
(6) Ratio of net investment income to average managed assets equals 5.95%.
(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