Bancroft Fund Ltd. NAV Performance up 37% and Market Return up 29% in 2020 Declares Distribution of $0.32 Per Share
February 25 2021 - 10:00AM
Business Wire
The Board of Trustees of Bancroft Fund Ltd. (NYSE American: BCV)
(the “Fund”) declared a $0.32 per share cash distribution payable
on March 24, 2021 to common shareholders of record on March 17,
2021. The distribution follows on the strength of the Fund’s
returns in 2020.
The Fund intends to pay the greater of either an annual
distribution of 5% of the Fund’s trailing 12-month average
month-end market price or an amount that meets the minimum
distribution requirement of the Internal Revenue Code for regulated
investment companies. The total 2020 distributions paid to common
shareholders was $3.12 per share, an amount greater than 5% of the
Fund’s trailing 12-month average month-end market price which was
$1.24.
Each quarter, the Board of Trustees reviews the amount of any
potential distribution from 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 pays an adjusting distribution in December, which includes
any additional income and net realized capital gains in excess of
the quarterly distributions. 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.
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 for long term capital gains, 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 with income that 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, less expenses, 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 share-holder’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, investment
company taxable 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, the current distribution paid in 2021 to
common shareholders with respect to the Fund’s fiscal year ending
October 31, 2021 would include approximately 3% from net investment
income and 97% from net capital gains on a book basis. This
information 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. The final
determination of the sources of all distributions in 2021 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 individual shareholders with taxable accounts will receive
written notification regarding the components and tax treatment for
all 2021 distributions in early 2022 via Form 1099-DIV.
Returns represent past performance and do not guarantee future
results. Current performance may be lower or higher than the
performance data quoted. Investment return and principal value will
fluctuate so, upon redemption, shares may be worth more or less
than their original cost.
The Fund’s NAV per share will fluctuate with changes in the
market value of the Fund’s portfolio securities. Stocks are subject
to market, economic, and business risks that cause their prices to
fluctuate. Investors acquire shares of the Fund on a securities
exchange at market value, which fluctuates according to the
dynamics of supply and demand. When Fund shares are sold, they may
be worth more or less than their original cost. Consequently, you
can lose money by investing in the Fund.
Investors should carefully consider the investment objectives,
risks, charges, and expenses of the Fund before investing. To
obtain the most recent month end performance information or for
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.
About Bancroft Fund Ltd.
Bancroft Fund Ltd. is a diversified, closed-end management
investment company with $222 million in total net assets. BCV
invests primarily in convertible securities with the objectives of
providing income and the potential for capital appreciation,
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).
NYSE American – BCV CUSIP – 059695106
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version on businesswire.com: https://www.businesswire.com/news/home/20210225005756/en/
Investor Relations Contact: Laurissa Martire (914) 921-5399
lmartire@gabelli.com
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