April 24, 2006
Mail Stop 4563
By U.S. Mail and facsimile to (202) 362-2902
Robert E. Kernan, Jr.
Seneca-Cayuga Bancorp, Inc.
19 Cayuga Street
Seneca Falls, New York 13148
Re: Seneca-Cayuga Bancorp, Inc.
Form SB-2 filed on March 28, 2006
File Number 333-132759
Dear Mr. Kernan:
We have reviewed your filing and have the following comments.
Where indicated, we think you should revise your document in
response
to these comments. If you disagree, we will consider your
explanation as to why our comment is inapplicable or a revision is
unnecessary. Please be as detailed as necessary in your
explanation.
In some of our comments, we may ask you to provide us with
supplemental information so we may better understand your
disclosure.
After reviewing this information, we may or may not raise
additional
comments.
The purpose of our review process is to assist you in your
compliance with the applicable disclosure requirements and to
enhance
the overall disclosure in your filing. We look forward to working
with you in these respects. We welcome any questions you may have
about our comments or any other aspect of our review. Feel free
to
call us at the telephone numbers listed at the end of this letter.
General
1. Please include a cover letter on EDGAR as part of your next
response.
Cover Page
2. Revise to briefly describe the classes of investors who may
purchase as part of the offering and their relative priority.
Risk Factors - Risks Related to Our Business
If Economic Conditions Deteriorate, Our Results of Operations and
Financial..., page 20
3. We note from your disclosure under your section on "Business"
starting on page 55 that you have a concentration of over 85% of
your
loans in real estate. Please revise to mention that your
concentration on loans related to real estate constitutes a risk
and
that decreases in the property values of real estate would have a
proportionately greater impact on your financial performance and
condition than from your other business segments.
The Corporate Governance Provisions in our Charter and Bylaws May
Prevent..., page 25
4. Please include any impediments to a change of control such as
your
description of preferred stock on page 135.
Management`s Discussion and Analysis or Plan of Operation, page 40
5. Please revise to include a discussion, or refer the investor to
where a discussion is located, on market risk and derivatives.
Refer
to Item 303(c) of Regulation S-B.
Rate/Volume Analysis, page 50
6. We note your chart regarding interest-earning assets and
interest-
bearing assets and the text that repeats it. Please provide
analysis
explaining same.
Investment Activities, page 73
7. We note from your table on page 74 that a significant amount of
your mortgage-backed securities were issued by Fannie Mae or
Freddie
Mac. Please revise your discussion of mortgage-backed securities
on
page 73 and throughout your document, where appropriate, to
clearly
differentiate between government agencies (such as Ginnie Mae) and
government-sponsored entities (such as Fannie Mae, Freddie Mac and
the FHLB of New York), and clarify that securities issued by
government-sponsored entities are not guaranteed by the U.S.
government.
Supervision and Regulation - page 90
8. We note that you explain your compliance with certain
regulatory
authorities, such as the Federal Home Loan Bank System and the
Federal Reserve System, however, your compliance or performance
with
other regulatory authorities or laws, such as the USA PATRIOT Act
or
prohibitions against tying arrangements, is unclear. Please
revise.
Management - Executive Officers Who Are Not Directors, page 100
9. Please revise to include the full five years` experience of
Robert
F. Eberle, Jr. Refer to Item 401 of Regulation S-B.
Corporate Governance Policies and Procedures, page 103
10. Please revise your disclosure regarding your code of ethics to
state where investors may obtain a copy of the code and other
relevant information in accordance with Item 406 of Regulation S-
B.
Executive Officer Compensation - Summary Compensation Table, page
104
11. Revise the table to include Mr. Rosenkrans compensation in
Fiscal
Year 2005.
The Offering - Limitations on Purchase of Shares, page 121
12. Please clarify to which regulatory agency you refer regarding
Forms 13-D and 13-G.
Where You Can Find More Information, page 136
13. Please update the current address of the Securities and
Exchange
Commission.
Financial Statements
Note 2 - Summary of Significant Accounting Policies
(f) Loans Held for Sale and Related Commitments, page F-8
14. Please tell us how you determined that transfers of loans to
the
FHLB of Chicago met the criteria in paragraph 9 of SFAS 140 for
sale
treatment.
* Specifically explain whether sales of loans to the FHLB of
Chicago
are accomplished in a two-step transaction (i.e. through the use
of
an intermediary such as a trust.)
* To the extent that loans are transferred directly to the FHLB in
a
one-step transaction, please tell us how you determined that these
assets have been legally isolated in accordance with paragraph
9(a)
of SFAS 140.
* Tell us whether you obtained a legal opinion as evidence that
sale
treatment was appropriate in these circumstances. If not, please
tell us what evidence you obtained to support legal isolation
under
paragraph 9(a) SFAS 140. In addition, please explain to us how
you
and your auditors determined that the evidence obtained was
sufficient to provide reasonable assurance that the transferred
assets would be beyond the reach of the powers of a bankruptcy
trustee, FDIC or other receiver in your jurisdiction. Clearly
describe to us the legal analysis you performed.
Exhibit 5
15. Item 601(b)(5) of Regulation S-B requires including an opinion
of
counsel regarding the legality of the securities being registered,
however, your opinion does not address the legality of the
securities. Please revise your opinion accordingly.
* * *
Closing Comments
As appropriate, please amend your registration statement in
response to these comments. You may wish to provide us with
marked
copies of the amendment to expedite our review by showing deleted
sections as strikethrough and added sections as underlining.
Please
furnish a cover letter with your amendment that keys your
responses
to our comments and provides any requested supplemental
information.
Detailed cover letters greatly facilitate our review. Please
understand that we may have additional comments after reviewing
your
amendment and responses to our comments.
We direct your attention to Rules 460 and 461 regarding
acceleration of a registration statement. Please allow adequate
time
after the filing of any amendment for further review before
submitting a request for acceleration. Please provide this
request
at least two business days in advance of the requested effective
date.
We urge all persons who are responsible for the accuracy and
adequacy of the disclosure in the filings reviewed by the staff to
be
certain that they have provided all information investors require
for
an informed decision. Since the company and its management are in
possession of all facts relating to a company`s disclosure, they
are
responsible for the accuracy and adequacy of the disclosures they
have made.
Notwithstanding our comments, in the event the company
requests
acceleration of the effective date of the pending registration
statement, it should furnish a letter, at the time of such
request,
acknowledging that
* if the Commission or the staff, acting pursuant to delegated
authority, declares the filing effective, it does not foreclose
the
Commission from taking any action with respect to the filing;
* the action of the Commission or the staff, acting pursuant to
delegated authority, in declaring the filing effective, does not
relieve the company from its full responsibility for the adequacy
and
accuracy of the disclosure in the filing; and
* the company may not assert this action as defense in any
proceeding
initiated by the Commission or any person under the federal
securities laws of the United States.
In addition, please be advised that the Division of
Enforcement
has access to all information you provide to the staff of the
Division of Corporation Finance in connection with our review of
your
filing or in response to our comments on your filing.
We will consider a written request for acceleration of the
effective date of the registration statement as a confirmation of
the
fact that those requesting acceleration are aware of their
respective
responsibilities under the Securities Act of 1933 and the
Securities
Exchange Act of 1934 as they relate to the proposed public
offering
of the securities specified in the above registration statement.
We
will act on the request and, pursuant to delegated authority,
grant
acceleration of the effective date.
You may contact Kevin W. Vaughn at (202) 551-3494 or Angel
Connell at (202) 551-3426 if you have questions regarding comments
on
the financial statements and related matters. Please contact
Timothy
Geishecker at (202) 551-3422 or me at (202) 551-3419 with any
other
questions.
Sincerely,
Christian Windsor
Special Counsel
cc: Via Fax: (202) 362-2902
Eric Envall, Esq.
Kip Weissman, Esq.
Luse Gorman Pomerenk & Schick, P.C.
5335 Wisconsin Avenue, NW - Suite 400
Washington, DC 20015