INVESTMENT IN FORMER AFFILIATES

12 Months Ended

Dec. 31, 2015

Investments in and Advances to Affiliates, Schedule of Investments [Abstract]

INVESTMENT IN FORMER AFFILIATES

Investment in and advances to, equity in income / (loss) of, and distributions received from, affiliates consist of the following:

December 31, 2015		SBSF	SBSFPC		TOTAL
Income from equity investee	$	671,000	—		671,000
Distributions	$	98,000	—		98,000
December 31, 2014		SBSF	SBSFPC		TOTAL
Investment and advances	$	7,979,000	—		7,979,000
Income (loss) from equity investees	$	84,000	(17,000	)	67,000
Distributions	$	13,000	173,000		186,000
December 31, 2013		SBS	SBSFPC		TOTAL
Investment and advances	$	7,832,000	190,000		8,022,000
Income (loss) from equity investees	$	94,000	(159,000	)	(65,000	)
Distributions	$	1,212,000	6,000		1,218,000

Siebert and two individuals (the “Principals”) formed SBS to succeed to the tax-exempt underwriting business of the Siebert Brandford Shank division of Siebert. The agreements with the Principals provide that profits will be shared 51% to the Principals and 49% to Siebert.

Pursuant to the terms of the Operating Agreement, Financial and each of the Principals owned a 33.33% interest in SBSFPC which engaged in derivatives transactions related to the municipal underwriting business. The Operating Agreement provided that income/(loss) be shared 66.66% by the Principals and 33.33% by Financial. SBSFPC ceased operations in December 2014.

Balance sheet data for 2015 is as of November 9 subsequent to the redemption of the Company’s interest, Revenue and net income for 2015 is for the period from January 1 through November 9.

Summarized consolidated financial data of SBSF and SBS in 2015 and 2014 and financial data for SBS in 2013 follows:

		2015			2014		2013
Total assets, including secured demand note of $1,200,000 in 2014 due from Siebert	$	30,903,000		$	28,518,000
Total liabilities, including obligations to Siebert of $6,051,000 to in 2015 and $3,057,000 in 2014		23,254,000			12,458,000
Total members’ capital		7,649,000			16,060,000
Regulatory minimum net capital requirement		250,000			250,000
Total revenue		27,774,000			24,806,000	$	24,965,000
Net income		1,369,000	(a)		171,000		193,000

(a) Includes interest expense on purchase obligation payable to Siebert of $195,000.

During 2015, 2014 and 2013 Siebert charged SBS $100,000 for each year, respectively, for general and administrative services, which Siebert believes approximates the cost of furnishing such services.

In 2015, 2014 and 2013 Siebert earned interest income of $32,000, $48,000 and $48,000, respectively, from SBS in connection with subordinated loans available or made to SBS and Siebert paid SBS interest earned on restricted cash equivalents of $1,000, $1,028 and $1,500 in 2015, 2014 and 2013, respectively. In addition, in 2015 and 2014, Siebert earned interest income of $235,000 and $36,000, respectively from SBSF on the purchase obligation in connection with the sale of the capital markets business (see Note B) and in 2015, Siebert earned interest income of $46,000 from SBSF on the receivable arising from the redemption of its ownership interest (see Note C).

Summarized financial data of SBSFPC is as follows:

		2014			2013
Total assets	$	26,000
Total liabilities		26,000
Total members’ capital		0
Total revenue		0		$	(222,000	)*
Net loss		(51,000	)		(478,000	)

*Negative balance was attributable to loss on derivative contracts

In July 2013, as a result of the filing of a bankruptcy petition by the City of Detroit, SBSFPC unwound certain derivative contracts with a financial institution pursuant to the terms of the contracts. The contracts were recorded as liabilities with a carrying value of $123,063,000. In connection therewith, SBSFPC assigned certain derivative contracts with the City of Detroit to the financial institution, which were recorded as assets with a carrying value of $123,063,000. No gain or loss was recognized by SBSFPC as a result of the unwinding and assignment of these derivative contracts and SBSFPC has no continuing obligations or rights with respect to the derivative contracts. During the quarter ended March 31, 2013 SBSFPC incurred a loss of $241,000 on the write down in value of the derivative contracts with the City of Detroit to adjust their carrying value to the carrying value of the derivative contracts with the financial institution. The Company received distributions from SBSFPC of $173,000 during 2014 which is shown on the statement of cash flows as an investing activity as they represent a return of capital.

Effective September 16, 2013, Suzanne Shank, one of the Principals having 25.5% ownership in SBS and 33.3% interest in SBSFP became the Company’s chief executive officer. On March 3, 2015, Ms. Shank completed her role as acting chief executive officer of the Company to devote full time to her continuing position as chief executive officer of SBSF.