Gabelli Convertible & Income Securities Fund Reaffirms Its 8% Distribution Policy & Declares First Quarter Distribution of $0...
February 12 2020 - 8:24AM
Business Wire
The Board of Directors of The Gabelli Convertible and Income
Securities Fund Inc. (NYSE:GCV) (the “Fund”) reaffirmed its 8%
distribution policy and declared a $0.12 per share cash
distribution payable on March 24, 2020 to common stock shareholders
of record on March 17, 2020.
The Fund intends to pay a quarterly distribution of an amount
determined each quarter by the Board of Directors. Under the Fund’s
current distribution policy, the Fund intends to pay a minimum
annual distribution of 8% of the average net asset value of the
Fund within a calendar year or an amount sufficient to satisfy the
minimum distribution requirements of the Internal Revenue Code for
regulated investment companies. The average net asset value of the
Fund is based on the average net asset values as of the last day of
the four preceding calendar quarters during the year. The net asset
value per share fluctuates daily.
Each quarter, the Board of Directors reviews the amount of any
potential distribution from the income, realized capital gain, or
capital available. The Board of Directors will continue to monitor
the Fund’s distribution level, taking into consideration the Fund’s
net asset value and the financial market environment. The Fund’s
distribution policy is subject to modification by the Board of
Directors 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 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, 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 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, the current distribution paid to common shareholders in
2020 would be deemed 100% from paid-in 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 2020 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 2020 distributions in early 2021 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.
The Gabelli Convertible and Income Securities Fund Inc. is a
diversified, closed-end management investment company with $147
million in total net assets whose primary investment objective is
to seek a high level of total return on its assets through a
combination of current income and capital appreciation. The Fund is
managed by Gabelli Funds, LLC, a subsidiary of GAMCO Investors,
Inc. (NYSE:GBL).
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Laurissa Martire (914) 921-5070
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