StoneCastle to invest in TARP preferred stock with stock proceeds

By Toni Weeks

San Luis Obispo, Calif., Nov. 7 - StoneCastle Financial Corp. announced in a 497 filing with the Securities and Exchange Commission its plans to conduct an offering of stock.

The non-diversified, closed-end management investment company seeks to provide current income and, secondarily, capital appreciation by investing in preferred equity, subordinated debt, convertible securities and, to a lesser extent, common equity investments in U.S.-domiciled community banks. The initial portfolio will consist primarily of perpetual preferred stock issued by community banks under the U.S. Treasury's Troubled Asset Relief Program Capital Purchase Plan.

Keefe, Bruyette & Woods will lead the syndicate of underwriters.

Joshua S. Siegel and George Shilowitz will lead the portfolio management team, which also includes Erik Eisenstein and Robert McPherson.

The company plans to offer 4.4 million shares at $25 each for potential proceeds of $110 million. There is also a $16.5 million greenshoe.

Settlement is expected Nov. 13.

The company plans to list its shares on the Nasdaq Global Select Market under the symbol "BANX."

The sales load is 5%. Including a 2.14% management fee, net annual expenses are expected to be 4.79%.

New York-based StoneCastle Asset Management LLC is the investment adviser.

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