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10. Investment In Affiliates:

9 Months Ended

Sep. 30, 2015

10. Investment In and Advances to Affiliates:

Siebert, Brandford, Shank Financials, L.L.C. (“SBSF”)

Siebert and two individuals (the “Principals”) formed SBS, a wholly-owned subsidiary of SBSF, to succeed to the tax-exempt underwriting business of the Siebert Brandford Shank division of Siebert (see Note 2). The agreement with the Principals provides that profits will be allocated 51% to the Principals and 49% to Siebert. Income or loss from SBS was considered to be integral to Siebert’s operations and material to the results of operations. Siebert’s investment in SBSF was sold on November 9, 2015 (see Note 13).

Summarized financial data of SBSF in 2015 and SBS in 2014 is set forth below.


	SBSF		SBS
	September 30,
	2015		2014

Total assets	24,497,000
Total liabilities, including purchase obligation of $2,031,000 and advance payable of $26,000 due to Siebert	7,030,000
Total members’ capital	17,467,000
Regulatory minimum net capital requirement for SBS	250,000
Nine months ended:
Total revenues	24,291,000		16,661,000
Net income	1,607,000	(a)	8,000
Three months ended:
Total revenues	10,322,000		4,277,000
Net income (loss)	1,114,000	(a)	(802,000	)

(a)	Includes interest expense on purchase obligation payable to Siebert of $174,000 (nine months) and $60,000 (three months)

Siebert charged SBS $75,000 for the nine months ended September 30, 2015 and 2014 respectively, and $25,000 for the three months ended September 30, 2015 and 2014, respectively, for general and administrative services, which Siebert believes approximates the cost of furnishing such services.

Siebert’s share of SBSF’s consolidated net income for the three and nine months ended September 30, 2015, respectively, amounted to $545,000 and $788,000, Siebert’s share of SBS’s net loss for the three months ended September 30, 2014 amounted to ($393,000) and its share of SBS’s net income for the nine months ended September 30, 2014 amounted to $4,000. Such amounts are shown on discontinued operations. Siebert also earned interest income from the receivable from the SCM sale to SBSF of $60,000 and $174,000 for the three and nine months ended September 30, 2015 which is included in revenue in continuing operations as the receivable will be retained by Siebert.

Siebert made collections of $79,000, net of advances from SBS, during the nine months ended September 30, 2015. As of September 30, 2015, Siebert had a receivable of approximately $26,000 due from SBS. Siebert received a distribution from SBSF of $98,000 during the nine months ended September 30, 2015, and Siebert’s share of undistributed earnings of SBSF amounted to $8.2 million at September 30, 2015.

SBS Financial Products Company, LLC (“SBSFPC”)

Pursuant to the terms of an Operating Agreement, Siebert 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 provides that income (loss) be shared 66.66% by the Principals and 33.33% by Financial. For the three and nine months ended September 30, 2014, SBSFPC had nominal activity and ceased operations in December 2014. Results by SBSFPC for the 2014 periods have been included in other general and administrative expenses.