UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-Q
QUARTERLY SCHEDULE OF PORTFOLIO HOLDINGS
OF REGISTERED
MANAGEMENT INVESTMENT COMPANY
| Investment Company Act file number | 811-22853 |
| StoneCastle Financial Corp. | ||
| (Exact name of registrant as specified in charter) | ||
| 152 West 57th Street, 35th Floor | ||
| New York, NY 10019 | ||
| (Address of principal executive offices) (Zip code) | ||
| Joshua S. Siegel | ||
| StoneCastle Financial Corp. | ||
| 152 West 57th Street, 35th Floor | ||
| New York, NY 10019 | ||
| (Name and address of agent for service) | ||
Copies of Communications to:
John P. Falco, Esq.
Pepper Hamilton LLP
3000 Two Logan Square / Eighteenth and Arch Streets
Philadelphia, PA 19103-2799
(215) 981-4659
Registrant’s telephone number, including area code: (212) 354-6500
Date of fiscal year end: December 31
Date of reporting period: September 30, 2015
Form N-Q is to be used by management investment companies, other than small business investment companies registered on Form N-5 (§§ 239.24 and 274.5 of this chapter), to file reports with the Commission, not later than 60 days after the close of the first and third fiscal quarters, pursuant to rule 30b1-5 under the Investment Company Act of 1940 (17 CFR 270.30b1-5). The Commission may use the information provided on Form N-Q in its regulatory, disclosure review, inspection, and policymaking roles.
A registrant is required to disclose the information specified by Form N-Q, and the Commission will make this information public. A registrant is not required to respond to the collection of information contained in Form N-Q unless the Form displays a currently valid Office of Management and Budget (“OMB”) control number. Please direct comments concerning the accuracy of the information collection burden estimate and any suggestions for reducing the burden to the Secretary, Securities and Exchange Commission, 100 F Street, NE, Washington, DC 20549. The OMB has reviewed this collection of information under the clearance requirements of 44 U.S.C. § 3507.
Item 1. Schedule of Investments.
The Schedule(s) of Investments is attached herewith.
| StoneCastle
Financial Corp. Schedule of Investments (unaudited) |
| As of September 30, 2015 |
| # of | |||||||||
| Shares/Par | |||||||||
| Company(1) | Investment | Amount ($)(2) | Fair Value | ||||||
| Term Loans – 32.5% | |||||||||
| Banking – 32.5% | |||||||||
| Citizens Bancshares Co. | Senior Term Loan, 8.75%, 12/21/2024 | $ | 13,250,000 | $ | 13,250,000 | ||||
| First Citizens Bancshares, Inc. | Subordinated Term Loan, 8.625%, 6/30/2025 | $ | 10,000,000 | 10,000,000 | |||||
| Linden Bancshares, Inc. | Subordinated Term Loan, 8.75%, 07/31/2025 | $ | 4,000,000 | 4,000,000 | |||||
| Market Street Bancshares, Inc. | Subordinated Term Loan, 6.50%, 8/14/2025 | $ | 7,500,000 | 7,500,000 | |||||
| Sandhills Holding Company, Inc. | Subordinated Term Loan, 8.75%, 7/31/2025 | $ | 8,500,000 | 8,500,000 | |||||
| Victory Bancorp, Inc. | Subordinated Term Loan, 8.50%, 9/22/2025 | $ | 2,500,000 | 2,500,000 | |||||
| Williams Holding Company, Inc. | Subordinated Term Loan, 8.75%, 6/30/2025 | $ | 1,000,000 | 1,000,000 | |||||
| Total Term Loans (Cost $46,750,000) | 46,750,000 | ||||||||
| Debt Securities – 22.5% | |||||||||
| Banking – 22.5% | |||||||||
| Bankwell Financial Group, Inc. | Unsecured Fixed Rate Subordinated Notes, 5.75%, 8/15/2025 | $ | 7,500,000 | 7,509,375 | |||||
| Cornerstone Community Bancorp | Subordinated Debenture, 8.80%, 2/27/2025 | $ | 5,000,000 | 5,000,000 | |||||
| Country Bank Holding Company Inc. | Subordinated Debenture, 8.50%, 5/15/2025 | $ | 6,000,000 | 6,000,000 | |||||
| Freeport Bancshares, Inc. | Subordinated Debenture, 8.875%, 2/17/2025 | $ | 3,150,000 | 3,150,000 | |||||
| MidWest Community Financial Corporation | Subordinated Debenture, 8.50%, 11/24/2024 | $ | 3,500,000 | 3,500,000 | |||||
| MidWest Community Financial Corporation | Subordinated Debenture, 8.50%, 3/3/2025 | $ | 1,500,000 | 1,500,000 | |||||
| MMCapS Funding I, Ltd. / MMCapS Funding I, Inc. | Fixed Rate Mezzanine Notes, 8.04%, 6/8/2031, 144A(3) | $ | 6,512,291 | 5,681,974 | |||||
| Total Debt Securities (Cost $31,706,529) | 32,341,349 | ||||||||
| Trust Preferred Securities – 33.4% | |||||||||
| Banking – 33.4% | |||||||||
| Amboy Capital Trust I | Trust Preferred Security, 9.00%, 7/29/2029, 144A(3) | $ | 15,500,000 | 15,500,000 | |||||
| Capital City TPS LLC Series 2015-1 | Capital City TPS 2015-1 9.74%, Note, 9/30/2030, 144A(3) | $ | 1,920,854 | 1,925,656 | |||||
| Central Trust Company Capital Trust I | Junior Subordinated Debt, 10.25%, 7/25/2031 | $ | 2,500,000 | 2,532,812 | |||||
| Countrywide Capital Trust IV | Trust Preferred Security, 6.75% | 38,562 | 978,318 | ||||||
| Deutsche Bank Contingent Capital Trust V | Trust Preferred Security, 8.05% | 57,444 | 1,609,581 | ||||||
| First Alliance Capital Trust I | Junior Subordinated Debt, 10.25%, 7/25/2031, 144A(3) | $ | 6,500,000 | 6,558,906 | |||||
| 1 | StoneCastle Financial Corp. | | See notes to Financial Statements |
| # of | |||||||||
| Shares/Par | |||||||||
| Company(1) | Investment | Amount ($)(2) | Fair Value | ||||||
| Banking (continued) | |||||||||
| First Citizens TPS LLC Series 2015-1 | First Citizens TPS 2015-1 9.74%, Note, 9/30/2030, 144A(3) | $ | 2,240,997 | $ | 2,246,599 | ||||
| M&T TPS LLC Series 2015-1 | M&T TPS 2015-1 9.74%, Note, 9/30/2030, 144A(3) | $ | 2,561,138 | 2,580,347 | |||||
| Mercantil TPS LLC Series 2015-1 | Mercantil TPS 2015-1 9.74%, Note, 9/30/2030, 144A(3) | $ | 4,802,135 | 4,832,149 | |||||
| Merrill Lynch Preferred Capital Trust III | Trust Preferred Security, Series D, 7.00% | 21,729 | 551,265 | ||||||
| Merrill Lynch Preferred Capital Trust IV | Trust Preferred Security, Series E, 7.12% | 30,263 | 769,285 | ||||||
| Merrill Lynch Preferred Capital Trust V | Trust Preferred Security, Series F, 7.28% | 76,206 | 1,944,015 | ||||||
| Morgan Stanley Capital Trust VIII | Trust Preferred Security, 6.45% | 51,578 | 1,298,218 | ||||||
| National Bank of Indianapolis TPS LLC Series 2015-1 | National Bank Of Indianapolis TPS 2015-1 9.74%, Note, 9/30/2030, 144A(3) | $ | 4,321,922 | 4,343,532 | |||||
| PrivateBancorp Capital Trust IV | Trust Preferred Security, 10.00% | 13,322 | 357,696 | ||||||
| Total Trust Preferred Securities (Cost $48,626,855) | 48,028,379 | ||||||||
| Preferred Stocks – 37.1% | |||||||||
| Banking – 37.1% | |||||||||
| Banc of California Inc. | Depositary Shares, Each Representing a 1/40th Interest in a Share of 7.375% Non-Cumulative Perpetual Preferred Stock, Series D | 40,000 | 1,023,200 | ||||||
| Blue Ridge Bancshares, Inc. | Fixed Rate Cumulative Perpetual Preferred Stock, Series B, 9% | $ | 200,000 | 200,000 | |||||
| BNCCORP, Inc. | Fixed Rate Cumulative Perpetual Preferred Stock, Series A, 9% | $ | 13,750,000 | 13,750,000 | |||||
| Chicago Shore Corporation | Fixed Rate Cumulative Perpetual Preferred Stock, Series A, 9% | $ | 6,400,000 | 6,400,000 | |||||
| Chicago Shore Corporation | Fixed Rate Cumulative Perpetual Preferred Stock, Series B, 9% | $ | 150,000 | 150,000 | |||||
| Citigroup Inc. | Depositary Shares, Each Representing a 1/1,000th Interest in a Share of 7.125% Fixed Rate Non-Cumulative Preferred Stock, Series J | 104,054 | 2,801,134 | ||||||
| Colony Bankcorp, Inc. | Fixed Rate Cumulative Perpetual Preferred Stock, Series A, 9% | $ | 3,661,000 | 3,661,000 | |||||
| Community West Bancshares | Fixed Rate Cumulative Perpetual Preferred Stock, Series A, 9% | $ | 1,481,000 | 1,481,000 | |||||
| Fidelity Financial Corporation | Fixed Rate Cumulative Perpetual Preferred Stock, Series A, 9% | $ | 2,579,000 | 2,579,000 | |||||
| Fidelity Financial Corporation | Fixed Rate Cumulative Perpetual Preferred Stock, Series B, 9% | $ | 210,000 | 210,000 | |||||
| First National Corporation | Fixed Rate Cumulative Perpetual Preferred Stock, Series A, 9% | $ | 1,016,000 | 1,005,840 | |||||
| First Priority Financial Corporation | Fixed Rate Cumulative Perpetual Preferred Stock, Series A, 9% | $ | 709,000 | 709,000 | |||||
| First United Corporation | Fixed Rate Cumulative Perpetual Preferred Stock, Series A, 9% | $ | 9,000,000 | 9,000,000 | |||||
| Katahdin Bankshares Corporation | Floating Rate Non-Cumulative Preferred Stock, Series D, 8.75% | $ | 10,000,000 | 10,000,000 | |||||
| Tennessee Valley Financial Holdings Inc. | Fixed Rate Cumulative Perpetual Preferred Stock, Series A, 9% | $ | 100,000 | 104,050 | |||||
| Tennessee Valley Financial Holdings Inc. | Fixed Rate Cumulative Perpetual Preferred Stock, Series B, 9% | $ | 49,000 | 61,924 | |||||
| See notes to Financial Statements | | StoneCastle Financial Corp. | 2 |
| Company(1) | Investment | #
of Shares/Par Amount ($)(2) | Fair Value | ||||||
| Banking (continued) | |||||||||
| The Queensborough Company | Fixed Rate Cumulative Perpetual Preferred Stock, Series A, 9% | $ | 250,000 | $ | 247,500 | ||||
| Total Preferred Stocks
(Cost $53,694,834) | 53,383,648 | ||||||||
| Convertible Preferred Stocks – 3.6% | |||||||||
| Banking – 3.6% | |||||||||
| Civista Bancshares Inc. | Depositary Shares, Each Representing a 1/40th Interest in a 6.50% Non-Cumulative Redeemable Convertible Perpetual Preferred Share, Series B | 59,001 | 1,958,833 | ||||||
| SB Financial Group Inc. | Depositary Shares, Each Representing a 1/100th Interest in a 6.50% Non-Cumulative Convertible Perpetual Preferred Share, Series A | 250,000 | 3,250,000 | ||||||
| Total Convertible Preferred Stocks (Cost $3,975,025) | 5,208,833 | ||||||||
| Common Stocks – 3.6% | |||||||||
| Banking – 2.0% | |||||||||
| Happy Bancshares, Inc. | Equity Security, Private Placement, 144A(3)(4) | 44,000 | 1,036,200 | ||||||
| Middleburg Financial Corporation | Equity Security | 10,988 | 193,499 | ||||||
| Pioneer Bancshares, Inc. | Equity Security(4) | 83,400 | 1,662,996 | ||||||
| 2,892,695 | |||||||||
| Non-Bank Financial – 1.6% | |||||||||
| Medallion Financial Corporation | Equity Security - Business Development Corporation | $ | 289,371 | 2,193,432 | |||||
| Total Common Stocks (Cost $5,774,358) | 5,086,127 | ||||||||
| Exchange Traded Fund – 2.6% | |||||||||
| Diversified Financial Services – 2.6% | |||||||||
| iShares S&P U.S. Preferred Stock Index Fund | Preferred Stock Exchange Traded Fund | 95,797 | 3,785,897 | ||||||
| Total Exchange Traded Fund (Cost $3,798,602) | 3,785,897 | ||||||||
| Limited Partnership Interest – 0.7% | |||||||||
| Banking – 0.7% | |||||||||
| Priam Capital Fund I, L.P. | Limited partnership(4) | 50,000 | 1,000,000 | ||||||
| Total Limited Partnership Interest (Cost $1,000,000) | 1,000,000 | ||||||||
| Total Long Term Investments (Cost $195,326,203) | 195,584,233 | ||||||||
| 3 | StoneCastle Financial Corp. | | See notes to Financial Statements |
| Company(1) | Investment | # of Shares/Par Amount ($)(2) | Fair Value | ||||||
| Short-Term Investment – 1.3% | |||||||||
| Morgan Stanley Institutional Liquidity Funds - Treasury Portfolio | Institutional Share Class | 1,913,490 | $ | 1,913,490 | |||||
| Total
Short-Term Investment (Cost $1,913,490) | 1,913,490 | ||||||||
| Total
Investments (Cost $197,239,693)(5)(6) † — 137.3% | 197,497,723 | ||||||||
| Other assets and liabilities, net — (37.3)%(7) | (53,689,807 | ) | |||||||
| Total Net Assets — 100.0% | $ | 143,807,916 | |||||||
| (1) | We do not “control” and are not an “affiliate” of any of our investments, each as defined in the Investment Company Act (the “1940 Act”). |
| (2) | $ represents security position traded in par amount. |
| (3) | Security is exempt from registration under Rule 144A of the Securities Act of 1933. |
| (4) | Currently non-income producing security. |
| (5) | Investments are income producing assets unless otherwise noted by footnote (4). |
| (6) | Cost values reflect accretion of original issue discount or market discount, and amortization of premium. |
| (7) | Includes $58.0 million in bank loan from Texas Capital Bank. |
| † | As of September 30, 2015, the cost basis of investment securities owned was substantially identical for both book and tax purposes. Gross unrealized appreciation of investments was $2,163,775 and gross unrealized depreciation was $1,905,745, resulting in net unrealized appreciation of $258,030. |
| See notes to Financial Statements | | StoneCastle Financial Corp. | 4 |
| Notes to Schedule of Investments (unaudited) |
Investment Valuation–The most significant estimates made in the preparation of the financial statements of StoneCastle Financial Corp. (“SCFC” or the “Company”) are the valuation of equity and debt investments and the effective yield calculation with respect to certain debt securities, as well as the related amounts of unrealized appreciation and depreciation of investments recorded. The Company believes that there is no single definitive method for determining fair value in good faith. As a result, determining fair value requires that judgment be applied to the specific facts and circumstances of each portfolio investment while employing a consistently applied valuation process for the types of investments that SCFC makes. The Company is required to specifically fair value each individual investment on a quarterly basis.
The Company complies with ASC 820-10, Fair Value Measurements and Disclosure, which establishes a three-level valuation hierarchy for disclosure of fair value measurements. ASC 820-10 clarified the definition of fair value and requires companies to expand their disclosure about the use of fair value to measure assets and liabilities in interim and annual periods subsequent to initial recognition. ASC 820-10 defines fair value as the price that would be received to sell an asset or paid to transfer a liability (i.e. the “exit price”) in an orderly transaction between market participants at the measurement date. ASC 820-10 also establishes the following three-tier fair value hierarchy:
• Level 1 — Valuations based on unadjusted quoted prices in active markets for identical assets or liabilities that the Company has the ability to access;
• Level 2 — Valuations based on inputs, other than quoted prices included in Level 1, that are observable either directly or indirectly; and
• Level 3 — Valuations based on inputs that are unobservable and significant to the overall fair value measurement.
To the extent securities owned by the Company are actively traded and valuation adjustments are not applied, they are categorized in Level 1 of the fair value hierarchy. Securities traded on inactive markets or valued by reference to similar instruments are generally categorized in Level 2 of the fair value hierarchy.
The availability of valuation techniques and observable inputs can vary from security to security and is affected by a wide variety of factors including the type of security, whether the security is new and not yet established in the marketplace, and other characteristics particular to the transaction. To the extent that valuation is based on models or inputs that are less observable or unobservable in the market, the determination of fair value requires more judgment. Those estimated values do not necessarily represent the amounts that may be ultimately realized due to the occurrence of future circumstances that cannot be reasonably determined. Because of the inherent uncertainty of valuation, those estimated values may be materially higher or lower than the values that would have been used had a ready market for the securities existed. Accordingly, the degree of judgment exercised by SCFC in determining fair value is greatest for securities categorized in Level 3. In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, for disclosure purposes, the level in the fair value hierarchy within which the fair value measurement in its entirety falls is determined based on the lowest level input that is significant to the fair value measurement. The valuation levels are not necessarily an indication of the risk associated with investing in those securities.
Fair value is a market-based measure considered from the perspective of a market participant rather than an entity-specific measure. Therefore, even when market assumptions are not readily available, SCFC’s
| 5 | StoneCastle Financial Corp. | |
own assumptions are set to reflect those that market participants would use in pricing the asset or liability at the measurement date. SCFC uses prices and inputs that are current as of the measurement date, including periods of market dislocation. In periods of market dislocation, the observability of prices and inputs may be reduced for many securities. This condition could cause a security to be reclassified to a lower level within the fair value hierarchy.
SCFC will determine fair value of its assets and liabilities in accordance with valuation procedures adopted by its board of directors. The Company may utilize the services of one or more regionally or nationally recognized independent valuation firms to help it determine the value of each investment for which a market price is not available. SCFC’s board will also review valuations of such investments provided by the Advisor. Securities for which market quotations are readily available shall be valued at “market value.” If a market value cannot be obtained or if SCFC’s Advisor determines that the value of a security as so obtained does not represent a fair value as of the measurement date (due to a significant development subsequent to the time its price is determined or otherwise), fair value shall be determined pursuant to the methodologies established by our Board of Directors. In making these determinations, the Company may engage an independent valuation firm from time to time to assist in determining the fair value of our investments. The methods for valuing these investments may include fundamental analysis, discounts from market prices of similar securities, purchase price of securities, subsequent private transactions in the security or related securities, or discounts applied to the nature and duration of restrictions on the disposition of the securities, as well as a combination of these and other factors. |
|
| The Company’s assets measured at fair value subject to the disclosure requirements of ASC 820-10-35 at September 30, 2015, were as follows: |
| LEVEL 3 | ||||||||||||||||
| LEVEL 2 | SIGNIFICANT | |||||||||||||||
| TOTAL FAIR | LEVEL 1 | SIGNIFICANT | UNOBSERVABLE | |||||||||||||
| VALUE AT 09-30-15 | QUOTED PRICE | OBSERVABLE INPUTS | INPUTS | |||||||||||||
| Term Loan | $ | 46,750,000 | $ | — | $ | 46,750,000 | $ | — | ||||||||
| Debt Securities | 32,341,349 | — | 32,341,349 | — | ||||||||||||
| Trust Preferred Securities | 48,028,379 | 7,508,378 | 40,520,001 | — | ||||||||||||
| Preferred Stock | 53,383,648 | 2,801,134 | 50,582,514 | — | ||||||||||||
| Convertible Preferred Stock | 5,208,833 | — | 5,208,833 | — | ||||||||||||
| Common Stock | 5,086,127 | 2,386,931 | — | 2,699,196 | ||||||||||||
| Exchange Traded Fund | 3,785,897 | 3,785,897 | — | — | ||||||||||||
| Limited Partnership Interest | 1,000,000 | — | — | 1,000,000 | ||||||||||||
| Short-Term Investment | 1,913,490 | 1,913,490 | — | — | ||||||||||||
| Total Investments in Securities | $ | 197,497,723 | $ | 18,395,830 | $ | 175,402,697 | $ | 3,699,196 | ||||||||
The Level 3 categorized assets listed above have been valued via the use of a) independent third party valuation firms, or, b) fair valued as determined in good faith by the Board of Directors, in accordance with procedures established by the Board of Directors.
For fair valuations using significant unobservable inputs, U.S. generally accepted accounting principles (“U.S. GAAP”) requires SCFC to present reconciliation of the beginning to ending balances for reported fair values that presents changes attributable to total realized and unrealized gains or losses, purchase |
| | StoneCastle Financial Corp. | 6 |
| and sales, and transfers in and out of Level 3 during the period. Transfers in and out between levels are based on values at the end of a period. U.S. GAAP also requires SCFC to disclose amounts and reasons for all transfers in and out of Level 1 and Level 2 fair value measurements. A reconciliation of Level 3 investments is presented below: |
| CONVERTIBLE | LIMITED | |||||||||||||||||||||||
| TERM | DEBT | PREFERRED | COMMON | PARTNERSHIP | ||||||||||||||||||||
| LOAN | SECURITIES | STOCK | STOCK | INTEREST | TOTAL | |||||||||||||||||||
| Balance at | ||||||||||||||||||||||||
| December 31, 2014 | $ | 13,250,000 | $ | 3,500,000 | $ | 2,500,000 | $ | 2,362,650 | $ | 1,000,000 | $ | 22,612,650 | ||||||||||||
| Realized gains including earnings | — | — | — | — | — | — | ||||||||||||||||||
| Unrealized appreciation on investments | — | — | — | 336,546 | — | 336,546 | ||||||||||||||||||
| Purchases | — | — | — | — | — | |||||||||||||||||||
| Sales | — | — | — | — | — | — | ||||||||||||||||||
| Transfers in | — | — | — | — | — | — | ||||||||||||||||||
| Transfers out * | (13,250,000 | ) | (3,500,000 | ) | (2,500,000 | ) | — | — | (19,250,000 | ) | ||||||||||||||
| Balance at September 30, 2015 | $ | — | $ | — | $ | — | 2,699,196 | (1) | 1,000,000 | (2) | $ | 3,699,196 | ||||||||||||
| For more information with regard to significant accounting policies, see the most recent Company’s annual report filed with the Securities and Exchange Commissions. |
* Valuation changed from single broker quote to multiple broker quotes.
(1) Value based on price to book valuation analysis.
(2) Value based on single broker quote.
| 7 | StoneCastle Financial Corp. | |
Item 2. Controls and Procedures.
| (a) | The registrant’s principal executive and principal financial officers, or persons performing similar functions, have concluded that the registrant’s disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940, as amended (the “1940 Act”) (17 CFR 270.30a-3(c))) are effective, as of a date within 90 days of the filing date of the report that includes the disclosure required by this paragraph, based on their evaluation of these controls and procedures required by Rule 30a-3(b) under the 1940 Act (17 CFR 270.30a-3(b)) and Rules 13a-15(b) or 15d-15(b) under the Securities Exchange Act of 1934, as amended (17 CFR 240.13a-15(b) or 240.15d-15(b)). |
| (b) | There were no changes in the registrant’s internal control over financial reporting (as defined in Rule 30a-3(d) under the 1940 Act (17 CFR 270.30a-3(d))) that occurred during the registrant’s last fiscal quarter that have materially affected, or are reasonably likely to materially affect, the registrant’s internal control over financial reporting. |
Item 3. Exhibits.
Certifications pursuant to Rule 30a-2(a) under the 1940 Act and Section 302 of the Sarbanes-Oxley Act of 2002 are attached hereto.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| (Registrant) | StoneCastle Financial Corp. |
| By (Signature and Title)* | /s/ Joshua S. Siegel | |
| Joshua S. Siegel, Chief Executive Officer | ||
| & Chairman of the Board | ||
| (principal executive officer) |
| Date | 11/12/2015 |
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.
| By (Signature and Title)* | /s/ Joshua S. Siegel | |
| Joshua S. Siegel, Chief Executive Officer | ||
| & Chairman of the Board | ||
| (principal executive officer) |
| Date | 11/12/2015 |
| By (Signature and Title)* | /s/ Patrick J. Farrell | |
| Patrick J. Farrell, Chief Financial Officer | ||
| (principal financial officer) |
| Date | 11/12/2015 |
* Print the name and title of each signing officer under his or her signature.
Exhibit 99.Cert
Certification Pursuant to Rule 30a-2(a) under the 1940 Act and Section 302 of the Sarbanes-Oxley Act
I, Joshua S. Siegel, certify that:
| 1. | I have reviewed this report on Form N-Q of StoneCastle Financial Corp.; |
| 2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
| 3. | Based on my knowledge, the schedules of investments included in this report fairly present in all material respects the investments of the registrant as of the end of the fiscal quarter for which the report is filed; |
| 4. | The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) and internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) for the registrant and have: |
| (a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
| (b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
| (c) | Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of a date within 90 days prior to the filing date of this report, based on such evaluation; and |
| (d) | Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and |
| 5. | The registrant’s other certifying officer(s) and I have disclosed to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions): |
| (a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize, and report financial information; and |
| (b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. |
| Date: | 11/12/2015 | /s/ Joshua S. Siegel | ||
| Joshua S. Siegel, Chief Executive Officer | ||||
| & Chairman of the Board | ||||
| (principal executive officer) |
Certification Pursuant to Rule 30a-2(a) under the 1940 Act and Section 302 of the Sarbanes-Oxley Act
I, Patrick J. Farrell, certify that:
| 1. | I have reviewed this report on Form N-Q of StoneCastle Financial Corp.; |
| 2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
| 3. | Based on my knowledge, the schedules of investments included in this report fairly present in all material respects the investments of the registrant as of the end of the fiscal quarter for which the report is filed; |
| 4. | The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) and internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) for the registrant and have: |
| (a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
| (b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
| (c) | Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of a date within 90 days prior to the filing date of this report, based on such evaluation; and |
| (d) | Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and |
| 5. | The registrant’s other certifying officer(s) and I have disclosed to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions): |
| (a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize, and report financial information; and |
| (b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. |
| Date: | 11/12/2015 | /s/ Patrick J. Farrell | ||
| Patrick J. Farrell, Chief Financial Officer | ||||
| (principal financial officer) |