Press Release: The Herzfeld Caribbean Basin Fund, Inc. Pays Distribution

Dow Jones
14 Jan

The Herzfeld Caribbean Basin Fund, Inc. Pays Distribution

MIAMI BEACH, Fla., Jan. 13, 2025 (GLOBE NEWSWIRE) -- The Herzfeld Caribbean Basin Fund, Inc. $(CUBA)$ (the "Fund") today announced that the Fund has made the following distribution pursuant to the Fund's Managed Distribution Policy (the "Policy"):

 
  Declaration 
   Date          Ex-Date       Record Date    Payment Date    Per Share 
-------------  ------------  -------------  --------------  ------------- 
  12/20/2024     12/31/2024    12/31/2024     01/13/2025     $  0.2325 
-------------  ------------  -------------  --------------      --------- 
 

The distribution for stockholders has been paid in all cash.

The primary purpose of the Policy is to provide stockholders with a constant, but not guaranteed, fixed minimum rate of distribution (currently set at the annual rate of 15% of the Fund's net asset value as determined on June 30, 2024). The Board recently amended the Policy to maintain the 15% annual rate of distribution, but at quarterly, semi-annual or annual periods of distribution to be reviewed by the Board each quarter. The purpose of the modification is to allow the Fund to maintain its 15% annual distribution of NAV, but provide flexibility in determining the timing of those distributions in order to account for required year-end regulatory distributions of capital gains necessary to maintain the Fund's tax-free status.

The Fund cannot predict what effect, if any, the Policy will have on the market price of its shares or whether such market price will reflect a greater or lesser discount to net asset value as compared to prior to the adoption of the Policy

Under the Policy, the Fund will distribute all available investment income to its stockholders, consistent with its investment objective and as required by the Internal Revenue Code of 1986, as amended (the "Code"). The amount distributed per share is subject to change at the discretion of the Board. If sufficient investment income is not available on a quarterly basis, the Fund will distribute long-term capital gains and/or return capital to its stockholders in order to maintain its managed distribution level. The Fund is currently not relying on any exemptive relief from Section 19(b) of the Investment Company Act of 1940, as amended (the "1940 Act"). The Fund may make additional distributions from time to time, including additional capital gain distributions at the end of the taxable year, if required to meet requirements imposed by the Code and/or the 1940 Act. Please note that for shareholders enrolled in the Fund's Dividend Distribution Reinvestment Plan, the distribution will be reinvested in additional shares of the Fund as described in the Policy.

The Fund expects that distributions under the Policy will exceed investment income and available capital gains and thus expects that distributions under the Policy will likely include returns of capital for the foreseeable future. A return of capital may occur, for example, when some or all of a stockholder's investment is paid back to the stockholder. A return of capital distribution does not necessarily reflect the Fund's investment performance and should not be confused with 'yield' or 'income.' Furthermore, a return of capital distribution is not a guarantee of future distributions or yield.' Any such returns of capital will decrease the Fund's total assets and, therefore, could have the effect of increasing the Fund's expense ratio. In addition, in order to maintain the level of distributions called for under its Policy, the Fund may have to sell portfolio securities at a less than opportune time.

The following table sets forth the estimated amounts of the current distribution and the cumulative distributions declared this fiscal year to date from the following sources: net investment income, net realized capital gains and return of capital. All amounts are expressed per common share.

 
                                                                             % Breakdown 
                                                                            of the Total 
                                                              Total          Cumulative 
                                          % Breakdown       Cumulative      Distributions 
                                             of the       Distributions        for the 
                            Current         Current       for the Fiscal     Fiscal Year 
                         Distribution     Distribution     Year to Date        to Date 
---------------------  ---------------  --------------  ----------------  --------------- 
  Net Investment 
   Income              $          0.00              0%  $           0.00               0% 
---------------------   --------------  --------------   ---------------  --------------- 
  Net Realized 
   Short-Term Capital 
   Gains               $          0.00              0%  $           0.00               0% 
---------------------   --------------  --------------   ---------------  --------------- 
  Net Realized 
   Long-Term Capital 
   Gains               $          0.00              0%  $           0.00               0% 
---------------------   --------------  --------------   ---------------  --------------- 
  Return of Capital    $        0.2325            100%  $         0.2325             100% 
---------------------   --------------  --------------   ---------------  --------------- 
  Total (per common 
   share)              $        0.2325            100%  $         0.2325             100% 
---------------------   --------------  --------------   ---------------  --------------- 
 
 
  Average annual total return (in relation to NAV) for 
   the 5-year period ending on December 31, 2024           -4.50% 
-------------------------------------------------------  -------- 
  Annualized current distribution rate expressed as 
   a percentage of NAV as of December 31, 2024             15.15% 
-------------------------------------------------------  -------- 
  Cumulative total return (in relation to NAV) for the 
   fiscal year through December 31, 2024                    6.53% 
-------------------------------------------------------  -------- 
  Cumulative fiscal year distributions as a percentage 
   of NAV as of December 31, 2024                           7.57% 
-------------------------------------------------------  -------- 
 

No conclusions should be drawn about the Fund's investment performance from the amount of the Fund's distributions or from the terms of the Policy.

The amount distributed per share is subject to change at the discretion of the Board. The Policy is subject to ongoing review by the Board to determine whether it should be continued, modified or terminated. The Board may amend the terms of the Policy, suspend the Policy, or terminate the Policy at any time without prior notice to the Fund's stockholders if it deems such actions to be in the best interest of the Fund or its stockholders. The amendment or termination of the Policy could have an adverse effect on the market price of the Fund's shares. On May 9, 2024, the Board approved certain modifications to the Policy and extended the Policy through June 30, 2025.

With each distribution that does not consist solely of net investment income, the Fund will issue a notice to stockholders and an accompanying press release that will provide detailed information regarding the amount and composition of the distribution and other related information. The amounts and sources of distributions reported in the notice to stockholders are only estimates and are not being provided for tax reporting purposes. The actual amounts and sources of the amounts for tax reporting purposes will depend upon the Fund's investment experience during its full fiscal year and may be subject to changes based on tax regulations. The Fund will send stockholders a Form 1099-DIV for the respective calendar year that will tell them how to report these distributions for federal income tax purposes. Stockholders should consult their tax advisor for proper tax treatment of the Fund's distributions.

About Thomas J. Herzfeld Advisors, Inc.

Thomas J. Herzfeld Advisors, Inc., founded in 1984, is an SEC registered investment advisor, specializing in investment analysis and account management in closed-end funds. The Firm also specializes in investment in the Caribbean Basin. The HERZFELD/CUBA division of Thomas J. Herzfeld Advisors, Inc. serves as the investment advisor to The Herzfeld Caribbean Basin Fund, Inc. a publicly traded closed-end fund (NASDAQ: CUBA).

More information about the advisor can be found at www.herzfeld.com.

Past performance is no guarantee of future performance. An investment in the Fund is subject to certain risks, including market risk. In general, shares of closed-end funds often trade at a discount from their net asset value and at the time of sale may be trading on the exchange at a price which is more or less than the original purchase price or the net asset value. An investor should carefully consider the Fund's investment objective, risks, charges and expenses. Please read the Fund's disclosure documents before investing.

Forward-Looking Statements

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January 13, 2025 16:00 ET (21:00 GMT)

Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.

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