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StoneCastle Financial Corp. Reports Fourth Quarter 2019 Results

DENVER, Feb. 27, 2020 (GLOBE NEWSWIRE) -- StoneCastle Financial Corp. (BANX) (“StoneCastle Financial” or the “Company”), an investment company registered with the Securities and Exchange Commission (“SEC”), today announced results for the fourth fiscal quarter ended December 31, 2019.   

Fourth Quarter 2019 Investment Highlights:

  • Invested $700,000 in F.N.B.C. of La Grange, Inc., Subordinated Debt, 6.38%, due 1/1/2030 with an effective yield of 9.08%

  • Realized a capital gain of $425,000 from the partial call of $1.8 million of MMCaps Funding I, Ltd, Fixed Rate Senior Notes, 6.34%, due 6/8/2031

  • Realized a capital gain of $366,000 on the sale of Howard Bancorp common stock

A complete listing of investments as of the end of the quarter can be found on the Company’s website at www.stonecastle-financial.com.

The estimated annualized yield generated by the invested portfolio as of December 31, 2019 (excluding cash and cash equivalents) was approximately 9.58%.

Fourth Quarter 2019 Financial Results

Total earnings for the fourth quarter were $3,453,993 or $0.53 per share.  Net investment income was $2,663,178 or $0.41 per share, comprised of $4,114,601 gross income and $1,451,423 of expenses.  For the quarter, net realized capital gains were $790,815 or $0.12 per share.  Net Assets at quarter end were $143,199,234.  The unrealized appreciation of the portfolio decreased by $442,960 or $0.07 per share.  The Company’s Net Asset Value was $21.83 per share, up $0.08 from the prior quarter.  

In the fourth quarter, the Company paid a cash distribution of $0.38 per share.  The distribution was paid on January 3, 2020 to shareholders of record at the close of business on December 23, 2019.   

The Company had $17.7 million outstanding on its $62.0 million credit facility at the quarter end, which represents approximately 11.0% 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 December 31, 2019, the Company had total assets of $164,703,377 consisting of total investments of $162,264,915, cash of $35,328, and other assets of $2,403,134.  Other assets include interest and dividends receivable of $1,784,784 and prepaid assets of $618,350.

During the quarter, the Company purchased $700,000 F.N.B.C. of La Grange, Inc. Subordinated Debt, 6.38%, due 1/1/2030 with an effective yield of 9.08%.   The Company received partial call proceeds of $1,837,622 from MMCaps Funding I, Ltd, Fixed Rate Senior Notes 6.34%, 6/8/2031.  Additionally, the Company also received $1,369,640 from the sale of Howard Bancorp common stock.

Quarterly Conference Call

StoneCastle Financial will host a webcast and conference call on February 27, 2020 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 March 12, 2020. 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 13698624. 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
212-468-5441

  STONECASTLE FINANCIAL CORP.
  Statement of Assets and Liabilities
     
               
        December 31, 2019     September 30, 2019
  Assets          
    Investments in securities, at fair value (cost: $163,178,428 and $167,368,577 respectively)   $ 162,264,915       $ 166,898,025  
    Cash     35,328         118,193  
    Interest and dividends receivable     1,784,784         1,533,447  
    Prepaid assets     618,350         653,468  
    Total assets       164,703,377           169,203,133  
               
  Liabilities          
    Loan payable     17,700,000         25,200,000  
    Dividends payable     2,492,424         -  
    Investment advisory fee payable     726,500         746,924  
    Loan interest payable     38,976         38,541  
    Directors fee payable     20,325         825  
    Accrued expenses payable     525,918         536,219  
    Total liabilities       21,504,143           26,522,509  
  Net Assets   $   143,199,234       $   142,680,624  
               
  Net Assets consist of:          
    Common stock at par ($0.001 per share)   $ 6,559       $ 6,559  
    Paid-in-Capital     144,875,823         143,864,020  
    Total distributable earnings / (loss)     (1,683,148 )       (1,189,955 )
    Net Assets   $   143,199,234       $   142,680,624  
               
  Net Asset Value Per Share:          
  Common Stock Shares Outstanding     6,559,010         6,559,010  
  Net asset value per common share   $   21.83       $   21.75  
  Market price per share   $   22.30       $   22.16  
  Market price premium to net asset value per share     2.15%         1.89%  
               


STONECASTLE FINANCIAL CORP.  
Statement of Operations  
                   
                      For The Three
Months Ended
December 31,
2019
    For The Three
Months Ended
September 30,
2019
  Investment Income                      
    Interest                 $ 3,023,153       $ 3,053,901  
    Dividends                   909,992         774,108  
    Origination fee income                 27,553         13,828  
    Other Income (service fees and due diligence fees)             153,903         119,326  
    Total Investment Income                 4,114,601           3,961,163  
                             
  Expenses                        
    Investment advisory fees               726,500         746,924  
    Interest expense                 263,564         258,348  
    Professional fees                 40,760         66,760  
    Transfer agent, custodian fees and administrator fees             73,159         73,159  
    Directors' fees                 77,879         66,827  
    Bank administration fees               40,457         40,457  
    ABA marketing and licensing fees               37,846         37,845  
    Investor relations fees                 31,204         31,205  
    Delaware franchise tax                 22,943         22,943  
    Insurance expense                 18,148         18,148  
    Valuation fees                 15,153         15,152  
    Printing                   14,671         14,670  
    Due diligence expense                 45,400         -  
    Miscellaneous fees (proxy, rating agency, etc.)             43,739         69,225  
    Total expenses                   1,451,423           1,461,663  
    Net Investment Income               $   2,663,178       $   2,499,500  
                             
  Realized and Unrealized Gain / (Loss) on Investments                  
    Net realized gain on investments             $ 790,815       $ 922,827  
    Net change in unrealized appreciation on investments             (442,960 )       (1,224,760 )
    Net realized and unrealized gain / (loss) on investments               347,855           (301,933 )
    Net Increase in Net Assets Resulting From Operations           $   3,011,033       $   2,197,567  


STONECASTLE FINANCIAL CORP.
Financial Highlights
             
             
            For The Three Months
Ended December 31, 
2019
  Per Share Operating Performance          
  Net Asset Value, beginning of period         $   21.75  
             
  Net investment income(1)         $ 0.41  
  Net realized and unrealized gain / (loss) on investments(1)         $ 0.05  
  Total from investment operations         $   0.46  
             
  Less distributions to shareholders          
  From net investment income         $ (0.38 )
  Total distributions         $   (0.38 )
             
  Net asset value, end of period         $   21.83  
             
  Per share market value, end of period         $   22.30  
             
  Total Investment Return (2)          
  Based on market value           2.35%  
  Based on net asset value           2.08%  
             
  Ratios and Supplemental Data          
  Net assets, end of period (in millions)         $   143.2  
  Ratios (as a percentage to average net assets):          
  Expenses before waivers(3)(4)*           4.03%  
  Expenses after waivers(5)*           4.03%  
  Net investment income(6)*           7.39%  
  Portfolio turnover rate **           2%  
             
  Revolving Credit Agreement          
  Total revolving credit agreement outstanding (000's)         $ 17,700  
  Asset coverage per $1,000 for revolving credit agreement(7)           9,090  



_______________________________________
(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 3.30%. 
(4) Ratio of expenses before waivers to average managed assets equals 3.45%. 
(5) Ratio of expenses after waivers to average managed assets equals 3.45%. 
(6) Ratio of net investment income to average managed assets equals 6.33%. 
(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