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INVESTMENT IN AFFILIATES (Parent Company)

12 Months Ended

Dec. 31, 2011

Parent Company

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


December 31, 2011	SBS			SBSFPC				TOTAL

Investment and advances		$	8,295,000		$	324,000			$	8,619,000
Income from equity investees		$	8,000		$	21,000			$	29,000
Distributions		$	1,185,000		$	—			$	1,185,000

December 31, 2010	SBS			SBSFPC				TOTAL

Investment and advances		$	9,512,000		$	304,000			$	9,816,000
Income (loss) from equity investees		$	4,102,000		$	(24,000	)		$	4,078,000
Distributions		$	3,344,000		$	2,000			$	3,346,000

December 31, 2009	SBS			SBSFPC				TOTAL

Income (loss) from equity investees		$	4,287,000		$	(63,000	)		$	4,224,000
Distributions		$	1,539,000		$	—			$	1,539,000

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 own a 33.33% initial interest in SBSFPC which engages in derivatives transactions related to the municipal underwriting business. The Operating Agreement provides that income/(loss) be shared 66.66% by the Principals and 33.33% by Financial.

Summarized financial data of SBS is as follows:


	2011		2010		2009

Total assets, including secured demand note of 1,200,000 in each year due from Siebert	$	31,403,000	$	37,741,000
Total liabilities, including subordinated liabilities $1,200,000 in each year due to Siebert		14,592,000		18,530,000
Total members’ capital		16,811,000		19,211,000
Regulatory minimum net capital requirement		493,000		1,122,000
Total revenue		26,441,000		48,769,000	$	45,391,000
Net income		17,000		8,372,000		8,749,000

During 2011, 2010 and 2009, Siebert charged SBS $75,000 for each year, respectively for general and administrative services, which Siebert believes approximates the cost of furnishing such services. In addition, during each of the years 2011, 2010 and 2009, Siebert earned interest income of $48,000 from SBS in connection with Siebert’s obligation to make a subordinated loan for up to $1,200,000 available to SBS and Siebert paid SBS interest earned on the restricted cash equivalents of $4,000, $4,000 and $10,000, respectively (see Note I). Further, on November 1, 2010, Siebert entered into a temporary subordinated loan agreement with SBS in the amount of $10 million bearing interest at 2% and maturing on December 15, 2010. The note was repaid in December 2010 and interest received from SBS amounted to $25,000.

Siebert’s share of undistributed earnings from SBS amounted to $7,845,000 and $9,021,000 at December 31, 2011 and 2010, respectively. Such amounts may not be immediately available for distribution to Siebert for various reasons including the amount of SBS’s available cash, the provisions of the agreement between Siebert and the Principals and SBS’s continued compliance with its regulatory net capital requirements.

Summarized financial data of SBSFPC is as follows:

	2011		2010			2009

Total assets	$	238,290,000	$	165,308,000
Total liabilities		237,317,000		164,396,000
Total members’ capital		974,000		913,000
Total revenue		610,000		124,000		$	23,000
Net income (loss)		61,000		(72,000	)		(188,000	)

At December 31, 2011 and 2010, SBSFPC had an accumulated loss of $226,000 and $287,000, respectively of which Siebert’s share was $75,000 and $96,000, respectively.