Bancroft Fund Ltd Reaffirms Its 5% Minimum Distribution Policy and Declares Distribution of $0.25 Per Share
24 February 2018 - 1:13AM
Business Wire
The Board of Trustees of Bancroft Fund Ltd. (NYSE American:BCV)
(the “Fund”) reaffirmed its 5% distribution policy and declared a
$0.25 per share cash distribution payable on March 22, 2018 to
shareholders of record on March 15, 2018.
The Fund intends to pay a quarterly distribution of an amount
determined each quarter by the Board of Trustees. Under the Fund’s
current distribution policy, the Fund intends to pay a minimum
annual distribution of 5% of the Fund’s trailing 12-month average
month-end market price or an amount sufficient to satisfy the
minimum distribution requirements of the Internal Revenue Code for
regulated investment companies.
Each quarter, the Board of Trustees reviews the amount of any
potential distribution and the income, realized capital gain, or
capital available. The Board of Trustees will continue to monitor
the Fund’s distribution level, taking into consideration the Fund’s
net asset value and the financial market environment. If necessary,
the Fund will pay an adjusting distribution in December which
includes any additional income and net realized capital gains in
excess of the quarterly distributions for that year to satisfy the
minimum distribution requirements of the Internal Revenue Code for
regulated investment companies. The Fund’s distribution policy is
subject to modification or termination by the Board of Trustees at
any time, and there can be no guarantee that the policy will
continue. The distribution rate should not be considered the
dividend yield or total return on an investment in the Fund.
The Fund is managed by Gabelli Funds, LLC, and able to make
periodic distributions of long term capital gains. All or part of
the distribution may be treated as long-term capital gain or
qualified dividend income (or a combination of both) for
individuals, each subject to the maximum federal income tax rate,
which is currently 20% in taxable accounts for individuals (or less
depending on an individual’s tax bracket). In addition, certain
U.S. shareholders who are individuals, estates or trusts and whose
income exceeds certain thresholds will be required to pay a 3.8%
Medicare surcharge on their "net investment income", which includes
dividends received from the Fund and capital gains from the sale or
other disposition of shares of the Fund.
If the Fund does not generate sufficient earnings (dividends and
interest income and realized net capital gain) equal to or in
excess of the aggregate distributions paid by the Fund in a given
year, then the amount distributed in excess of the Fund’s earnings
would be deemed a return of capital. Since this would be considered
a return of a portion of a shareholder’s original investment, it is
generally not taxable and would be treated as a reduction in the
shareholder’s cost basis.
Long-term capital gains, qualified dividend income, ordinary
income, and return of capital, if any, will be allocated on a
pro-rata basis to all distributions to common shareholders for the
year. Based on the accounting records of the Fund currently
available, each of the distributions paid to common shareholders in
2018 would include approximately 36% from net investment income,
47% from net capital gains and 17% would be deemed a return of
capital on a book basis. This does not represent information for
tax reporting purposes. The estimated components of each
distribution are updated and provided to shareholders of record in
a notice accompanying the distribution and are available on our
website (www.gabelli.com). The final determination of the sources
of all distributions in 2018 will be made after year end and can
vary from the quarterly estimates. Shareholders should not draw any
conclusions about the Fund’s investment performance from the amount
of the current distribution. All shareholders with taxable accounts
will receive written notification regarding the components and tax
treatment for all 2018 distributions in early 2019 via Form
1099-DIV.
Investors should carefully consider the investment objectives,
risks, charges, and expenses of the Fund before investing. More
information regarding the Fund’s distribution policy and other
information about the Fund is available by calling 800-GABELLI
(800-422-3554) or visiting www.gabelli.com.
Bancroft Fund Ltd. is a diversified management investment
company with $160 million in total net assets. BCV invests
primarily in convertible securities, with the objectives of
providing income and the potential for capital appreciation; which
objectives the Fund considers to be relatively equal, over the
long-term, due to the nature of the securities in which it invests.
The Fund is managed by Gabelli Funds, LLC, a subsidiary of GAMCO
Investors, Inc. (NYSE:GBL).
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Bancroft Fund Ltd.Laurissa Martire, 914-921-5070
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