# EDGAR Filing Document

**Accession Number:** 0000803016
**File Stem:** 0000803016-23-000009
**Filing Date:** 2023-2
**Character Count:** 74317
**Document Hash:** ce3b1e9b9396612b92807429426627a5
**Contains OCR:** False
**Source Format:** 

## Filing Content

## Filing Summary
**0000803016-23-000009.hdr.sgml**: 20230202

**ACCESSION NUMBER**: 0000803016-23-000009

**CONFORMED SUBMISSION TYPE**: N-CSRS

**PUBLIC DOCUMENT COUNT**: 5

**CONFORMED PERIOD OF REPORT**: 20221231

**FILED AS OF DATE**: 20230202

**DATE AS OF CHANGE**: 20230202

**EFFECTIVENESS DATE**: 20230202

**FILER**: 

**COMPANY DATA:**
- **COMPANY CONFORMED NAME:** CALIFORNIA FIRST LEASING CORP
- **CENTRAL INDEX KEY:** 0000803016
- **STANDARD INDUSTRIAL CLASSIFICATION:** NATIONAL COMMERCIAL BANKS [6021]
- **IRS NUMBER:** 330964185
- **STATE OF INCORPORATION:** CA
- **FISCAL YEAR END:** 0630

**FILING VALUES:**
- **FORM TYPE:** N-CSRS
- **SEC ACT:** 1940 Act
- **SEC FILE NUMBER:** 811-23782
- **FILM NUMBER:** 23579092

**BUSINESS ADDRESS:**
- **STREET 1:** 5000 BIRCH STREET, SUITE 500
- **CITY:** NEWPORT BEACH
- **STATE:** CA
- **ZIP:** 92660
- **BUSINESS PHONE:** 949-255-0500

**MAIL ADDRESS:**
- **STREET 1:** 5000 BIRCH STREET, SUITE 500
- **CITY:** NEWPORT BEACH
- **STATE:** CA
- **ZIP:** 92660

**FORMER COMPANY:**
- **FORMER CONFORMED NAME:** CALIFORNIA FIRST LEASING Corp
- **DATE OF NAME CHANGE:** 20220203

**FORMER COMPANY:**
- **FORMER CONFORMED NAME:** CALIFORNIA FIRST LEASING CORP
- **DATE OF NAME CHANGE:** 20220203

**FORMER COMPANY:**
- **FORMER CONFORMED NAME:** CALIFORNIA FIRST NATIONAL BANCORP
- **DATE OF NAME CHANGE:** 20010608

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| |
|:---|
| &nbsp;&nbsp; **UNITED STATES** |
| &nbsp;&nbsp; **SECURITES AND EXCHANGE COMMISSION** |
| &nbsp;&nbsp; **Washington, D.C. 20549** |
| &nbsp;&nbsp; **FORM N-CSRS** |
| &nbsp;&nbsp; **CERTIFIED SHAREHOLDER REPORT OF REGISTERED** |
| &nbsp;&nbsp; **MANAGEMENT INVESTMENT COMPANIES** |
| &nbsp;&nbsp; Investment Company Act File Number 811-23782 |
| &nbsp;&nbsp; **<u>California First Leasing Corporation</u>** |
| &nbsp;&nbsp; (Exact name of registrant as specified in charter) |
| &nbsp;&nbsp; <u>5000 Birch Street, Suite 500, Newport Beach, CA 92660</u> |
| &nbsp;&nbsp; (Address of principal executive offices) |
| &nbsp;&nbsp; Glen T. Tsuma |
| &nbsp;&nbsp; California First Leasing Corporation |
| &nbsp;&nbsp; 5000 Birch Street, Suite 500 |
| &nbsp;&nbsp; Newport Beach, CA 92660 |
| &nbsp;&nbsp; (Name and address of agent for service) |
| &nbsp;&nbsp; Registrant's telephone number, including area code: 949-255-0500 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Date of fiscal year end: June 30, 2023 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Date of reporting period: December 31, 2022 |

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**Item 1(a). Reports to Stockholders**

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| | |
|:---|:---|
| &nbsp;&nbsp; ![cid:image006.jpg@01D6E402.62C232D0](x23013107014300.jpg)  | <br> **California First Leasing Corporation**<br> &nbsp;&nbsp;&nbsp;&nbsp;**‗‗‗‗‗‗‗‗‗‗‗‗‗‗‗‗‗‗‗‗‗‗‗‗‗‗‗‗‗‗‗‗‗‗‗‗‗‗‗‗‗‗‗‗‗‗‗‗‗‗‗‗‗‗‗‗‗‗‗‗‗‗‗‗‗‗‗‗** |

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**Semi-Annual Financial Report**

**December 31, 2022**

California First Leasing Corporation, (OTCQX: CFNB, "CalFirstLease" or the "Company"), headquartered in Newport Beach, California, registered as an internally managed non-diversified closed-end investment company under the Investment Company Act of 1940, as amended (the "1940 Act") in February 2022. The Company continues its lease business while using equity and other investments to maximize current income and generate capital appreciation.

**An investment in the Company's common stock involves certain risks, including the risk of loss. The shares of common stock are not deposits or obligations of, or guaranteed by any federal or other government agency. A registration statement dated July 20, 2022 (the "Registration Statement") containing additional information about the Company has been filed with the Securities and Exchange Commission (the "SEC"). Investors should carefully consider the Company's objectives and risks detailed in the Registration Statement that may adversely affect the Company's shareholders' equity and stock price and may make an investment in the Company not appropriate for all investors.** 

Statements made in this report that are not strictly historical in nature constitute "forward-looking statements." Forward-looking statements involve management judgment and assumptions, risks and uncertainties and include, but are not limited to, beliefs regarding investments in equity securities, swings in stock prices and the potential for significant volatility in reported net earnings, changes in the lease portfolio, the impact of external events on business activities, estimates of expected tax rates applicable to future periods, impact of changes in interest rates and equity and fixed income markets. Such forward-looking statements involve known and unknown risks and uncertainties and factors that could cause actual results to differ materially include political, economic, competitive, market, regulatory and other risks. Consequently, if management assumptions prove to be incorrect or such risks or uncertainties materialize, the Company's actual results could differ materially from the results forecast in the forward-looking statements. All forward-looking statements are qualified in their entirety by this cautionary statement, and the Company undertakes no obligation to revise or update this information to reflect events or circumstances arising after the date hereof (January 30, 2023).

**<u>CONTENTS</u>**

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| | |
|:---|:---|
|  | Page |
| &nbsp;&nbsp; [Overview](#page_3)……………………………………………......................................................................... | [1](#page_3)  |
| &nbsp;&nbsp; [Discussion of Performance and Results of Operations](#page_3)……………………………………………... | [1](#page_3)  |
| &nbsp;&nbsp; [Investment Operations](#page_4)……………………………………………................................................ | [2](#page_4)  |
| &nbsp;&nbsp; [Lease Operations](#page_5) ……………………………………………....................................................... | [3](#page_5)  |
| &nbsp;&nbsp; Financial Statements |  |
| &nbsp;&nbsp; [Statement of Investments](#page_7)……………………………………………............................................. | [5](#page_7)  |
| &nbsp;&nbsp; [Statements of Assets, Liabilities and Stockholders' Equity](#page_8)………………………………………. | [6](#page_8)  |
| &nbsp;&nbsp; [Statements of Operations](#page_9)……………………………………………............................................. | [7](#page_9)  |
| &nbsp;&nbsp; [Statements of Changes in Stockholders' Equity](#page_10)..................................................................... | [8](#page_10)  |
| &nbsp;&nbsp; [Statements of Cash Flows](#page_11)……………………………………………............................................ | [9](#page_11)  |
| &nbsp;&nbsp; [Financial Highlights](#page_12)……………………………………………...................................................... | [10](#page_12)  |
| &nbsp;&nbsp; [Notes to Financial Statements](#page_13)……………………………………………......................................... | [11-14](#page_13)  |
| &nbsp;&nbsp; [Other Information](#page_17)……………………………………………............................................................. | [15](#page_17)  |

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| | | |
|:---|:---|:---|
| &nbsp;&nbsp; ![cid:image006.jpg@01D6E402.62C232D0](x23013107013700.jpg) | &nbsp;&nbsp; California First Leasing Corporation | &nbsp;&nbsp; Semi-Annual Report for December 31, 2022 |

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**Overview**

For the six months ended December 31, 2022, net earnings decreased 68% to $3.4 million. This included a gain on equity securities of $12.8 million, a return of 10.0% for the three months ended December 31, 2022 that offset a loss on equity securities of $12.0 million reported for the first three months of fiscal 2023. The return on the equity portfolio for the six-month period of 1.9% compared to the return on the S&P 500<sup>®TR</sup> Index of 2.4% for the same period. The Company's overall return based on the change in net asset value of 3.0% for the first half of fiscal 2023 benefitted from increased interest income related to higher interest rates and higher short-term investment balances, an 18% increase in lease income and 12% decline in operating expenses.

During the first six months of fiscal 2023, the Company did not declare or pay any dividends as in years past, but it did successfully complete a tender offer to repurchase 580,683 shares, or 5.6% of CalFirstLease's common stock outstanding. The repurchase of shares below book value contributed to a 1.5% increase to net book value per share at December 31, 2022.

###### **Discussion of Performance and Results of Operations** 
The Company's operating results are comprised of two primary components:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· **Investment income** includes current income from dividends on equity securities, realized and unrealized gains or losses in the value of the securities, and interest earned on short-term treasury securities and money market balances.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· **Lease income** includes direct finance and interest income earned from leases and loans, as well as other income from sales of leased property, sales of leases and operating lease income.

The results discussed below represents past performance. Past performance is no guarantee of future results, and current or future performance may be lower or higher than the data included here. The Company's periodic earnings can fluctuate widely due to including gains and losses on equity securities, including unrealized amounts, that are determined based on stock prices on the last day of a fiscal period.

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| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| &nbsp;&nbsp; *(in thousands, except per share data)* | &nbsp;&nbsp; **Three Months** | &nbsp;&nbsp; **Three Months** | &nbsp;&nbsp; **Three Months** | &nbsp;&nbsp; **Six Months** | &nbsp;&nbsp; **Six Months** | &nbsp;&nbsp; **Six Months** |
|  | &nbsp;&nbsp; **Ended December 31,** | &nbsp;&nbsp; **Ended December 31,** | &nbsp;&nbsp; **Ended December 31,** | &nbsp;&nbsp; **Ended December 31,** | &nbsp;&nbsp; **Ended December 31,** | &nbsp;&nbsp; **Ended December 31,** |
|  |  | &nbsp;&nbsp; **2022** | &nbsp;&nbsp; **2021** |  | &nbsp;&nbsp; **2022** | &nbsp;&nbsp; **2021** |
| &nbsp;&nbsp; Dividend Income | &nbsp;&nbsp; $ | &nbsp;&nbsp; 854  | &nbsp;&nbsp; 1121  | &nbsp;&nbsp; $ | &nbsp;&nbsp; 1780  | &nbsp;&nbsp; 2023  |
| &nbsp;&nbsp; Interest Income |  | &nbsp;&nbsp; 442  | &nbsp;&nbsp; 2  |  | &nbsp;&nbsp; 700  | &nbsp;&nbsp; 9  |
| &nbsp;&nbsp; Realized and unrealized securities gain (loss)  |  | &nbsp;&nbsp; 12796  | &nbsp;&nbsp; 21266  |  | &nbsp;&nbsp; 831  | &nbsp;&nbsp; 11717  |
| &nbsp;&nbsp; &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Investment Income** |  | &nbsp;&nbsp; 14092  | &nbsp;&nbsp; 22389  |  | &nbsp;&nbsp; 3311  | &nbsp;&nbsp; 13749  |
| &nbsp;&nbsp; Finance and loan income, net |  | &nbsp;&nbsp; 334  | &nbsp;&nbsp; 597  |  | &nbsp;&nbsp; 730  | &nbsp;&nbsp; 1262  |
| &nbsp;&nbsp; Release of reserves |  | &nbsp;&nbsp; 100  | &nbsp;&nbsp; -  |  | &nbsp;&nbsp; 100  | &nbsp;&nbsp; 100  |
| &nbsp;&nbsp; Other lease income |  | &nbsp;&nbsp; 1094  | &nbsp;&nbsp; 343  |  | &nbsp;&nbsp; 1444  | &nbsp;&nbsp; 570  |
| &nbsp;&nbsp; &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Lease Income** |  | &nbsp;&nbsp; 1529  | &nbsp;&nbsp; 940  |  | &nbsp;&nbsp; 2274  | &nbsp;&nbsp; 1932  |
| &nbsp;&nbsp; &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Investment and Lease Income** |  | &nbsp;&nbsp; 15621  | &nbsp;&nbsp; 23328  |  | &nbsp;&nbsp; 5585  | &nbsp;&nbsp; 15682  |
| &nbsp;&nbsp; Total Expenses |  | &nbsp;&nbsp; 670  | &nbsp;&nbsp; 701  |  | &nbsp;&nbsp; 1358  | &nbsp;&nbsp; 1545  |
| &nbsp;&nbsp; Income taxes |  | &nbsp;&nbsp; 3129  | &nbsp;&nbsp; 6349  |  | &nbsp;&nbsp; 842  | &nbsp;&nbsp; 3614  |
| &nbsp;&nbsp; **Net Income** | &nbsp;&nbsp; $ | &nbsp;&nbsp; 11821 | &nbsp;&nbsp; 16279 | &nbsp;&nbsp; $ | &nbsp;&nbsp; 3384 | &nbsp;&nbsp; 10522 |
| &nbsp;&nbsp; **Net Asset Value, beginning of period** | &nbsp;&nbsp; $ | &nbsp;&nbsp; 19.78  | &nbsp;&nbsp; 21.83  | &nbsp;&nbsp; $ | &nbsp;&nbsp; 20.60  | &nbsp;&nbsp; 22.39  |
| &nbsp;&nbsp; &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net income |  | &nbsp;&nbsp; 1.16  | &nbsp;&nbsp; 1.58  |  | &nbsp;&nbsp; 0.33  | &nbsp;&nbsp; 1.02  |
| &nbsp;&nbsp; &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Dividends paid |  | &nbsp;&nbsp; -  | &nbsp;&nbsp; 0.56  |  | &nbsp;&nbsp; -  | &nbsp;&nbsp; 0.56  |
| &nbsp;&nbsp; &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net gain on share repurchase |  | &nbsp;&nbsp; 0.28  | &nbsp;&nbsp; -  |  | &nbsp;&nbsp; 0.29  | &nbsp;&nbsp; -  |
| &nbsp;&nbsp; **Net Asset Value, end of period** | &nbsp;&nbsp; $ | &nbsp;&nbsp; 21.22  | &nbsp;&nbsp; 22.86  | &nbsp;&nbsp; $ | &nbsp;&nbsp; 21.22  | &nbsp;&nbsp; 22.86  |
| &nbsp;&nbsp; Weighted Number of shares outstanding |  | &nbsp;&nbsp; 10177  | &nbsp;&nbsp; 10284  |  | &nbsp;&nbsp; 10230  | &nbsp;&nbsp; 10284  |
| &nbsp;&nbsp; Shares outstanding, end of period |  | &nbsp;&nbsp; 9703  | &nbsp;&nbsp; 10284  |  | &nbsp;&nbsp; 9703  | &nbsp;&nbsp; 10284  |
| &nbsp;&nbsp; **<u>Total return</u>** |  |  |  |  |  |  |
| &nbsp;&nbsp; CFNB, based on NAV |  | &nbsp;&nbsp; 7.28% | &nbsp;&nbsp; 7.24% |  | &nbsp;&nbsp; 3.01% | &nbsp;&nbsp; 4.56% |
| &nbsp;&nbsp; S&P 500 (TR) Index |  | &nbsp;&nbsp; 7.38% | &nbsp;&nbsp; 11.30% |  | &nbsp;&nbsp; 2.37% | &nbsp;&nbsp; 10.09% |

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(1) Total return for the Company is an after-tax amount. The S&P 500 (TR)"), an unmanaged benchmark of large U.S. corporations, assumes reinvestment of all distributions, and includes capital gains and distributions in the return calculation but does not include a deduction for expenses or taxes. It is not possible to invest directly in an index.

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| | | |
|:---|:---|:---|
| &nbsp;&nbsp; ![cid:image006.jpg@01D6E402.62C232D0](x23013107013700.jpg) | &nbsp;&nbsp; California First Leasing Corporation | &nbsp;&nbsp; Semi-Annual Report for December 31, 2022 |

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**<u>Investment Operations</u>**

The Company focuses on investing in fair or under-valued public companies that we expect to generate excess cash flow that can be reinvested into the business at attractive rates of return to continue substantial growth or be returned to shareholders via share repurchases or dividends. A high percentage of the equity portfolio generally is invested in U.S. large capitalization equities. From time to time, the Company may retain a significant amount of funds in short-term liquid investments in order to take advantage of investment or lease opportunities as they arise. The Company does not specialize in any specific industry, but may hold large positions in certain sectors that it believes offer the opportunity for long-term returns but may underperform in certain market environments.

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| | | | | |
|:---|:---|:---|:---|:---|
| **Investment Securities Distribution \*** | **12/31/2022** |  | **6/30/2022** |  |
| ($ in 000's) |  |  |  |  |
| US Large Cap Equities | $111698  | 60.3% | $116051  | 62.9% |
| US Mid Cap Equities | 23037  | 12.4% | 8715  | 4.7% |
| US Small Cap Equities | 1452  | 0.8% | 17  | 0.0% |
| Developed Markets, Non-US | 6366  | 3.4% | 5870  | 3.2% |
| Income fund | 930 | 0.5% | 984 | 0.5% |
| Emerging Market Equities | 431  | 0.2% | - | 0.0% |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Equity securities | $143914  | 77.6% | $131637  | 71.4% |
| Money market funds | 26568  | 14.3% | 52723  | 28.6% |
| US Treasury Bills | 14902  | 8.0% | -  | 0.0% |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Short-term securities  | 41470  | 22.4% | 52723  | 28.6% |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Investment securities | $185384  | 100.0% | $184360  | 100.0% |
| \* Equity securities classification based on information from Wells Fargo Advisors | \* Equity securities classification based on information from Wells Fargo Advisors | \* Equity securities classification based on information from Wells Fargo Advisors | \* Equity securities classification based on information from Wells Fargo Advisors |  |

---

U.S. equities made robust gains during the three months ended December 31, 2022, with the S&P 500 up 7.6% following the 4.9% decline during the September quarter, although technology and small-cap dominated NASDAQ was down slightly. While inflationary pressures persist, the latest consumer price index (CPI) data shows that inflation has slowed, GDP is stronger than earlier estimates and unemployment remains low. The Fed's last rate hike of 50 basis points in December signaled support for improving conditions.

The equity securities portfolio at December 31, 2022 consisted of common stock holdings in 30 public companies, all with readily available stock prices, compared to 34 public companies at June 30, 2022. Although the Company owns shares in 30 businesses, about 38% of the equity portfolio is invested in our top 5 holdings that amount to 27% of net assets. That is due to in most part to the strong performance of those investments since we purchased shares. The distribution of the Company's equity securities across four segments at December 31, 2022 and the comparative gains or losses by group is summarized below:

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| | | | | |
|:---|:---|:---|:---|:---|
| (in thousands) |  | Unrealized | Unrealized |  |
|  | Cost Basis | Gains | (Losses) | Fair Value |
| as of December 31, 2022 |  |  |  |  |
| Commercial / Industrial | $77793  | $17963  | $(12880) | $82876  |
| Consumer | 26186  | 281  | (4038) | 22429  |
| Financial | 15694  | 2570  | (705) | 17559  |
| Healthcare | 14983  | 6067  | 0  | 21050  |
|  | $134656  | $26881  | $(17623) | $143914  |

---

After declining into a net loss position during the September 2022 quarter, by the end of December 2022 the Company's equity securities had swung back into positive territory and produced a 1.9% return for the first six months of fiscal 2023, compared to a 2.4% all-in return on the benchmark S&P 500<sup>®TR</sup> Index for the comparable period. CFNB's six-month results include a 10.0% return on the equity portfolio for the 3 months ended December 31, 2022 compared to a 7.6% return on the S&P 500<sup>®TR</sup> Index.

The equity portfolio's recent performance relative to the broader market reflects better performance by energy, large-cap and value stocks, while growth and technology stocks continued to lag. Energy remains the Company's largest sector and this overweight, dominated by Exxon Mobil at 23% of the equity portfolio at December 31, made the group the top contributor to the Company's results for the second quarter and six months of fiscal 2023. The runner up contribution came from the health plan sector comprised of Cigna and United Health, followed by financial services led by Goldman Sachs. The greatest detractors to performance were telecom companies Verizon and AT&T, internet platforms Alphabet and Meta, as well as semiconductor companies, though the latter group did recover somewhat during the December quarter.

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| | | |
|:---|:---|:---|
| &nbsp;&nbsp; ![cid:image006.jpg@01D6E402.62C232D0](x23013107013700.jpg) | &nbsp;&nbsp; California First Leasing Corporation | &nbsp;&nbsp; Semi-Annual Report for December 31, 2022 |

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During the first six months of fiscal 2023, the Company invested $20.8 million in 7 existing holdings and 6 new positions. It also sold 10 positions for $9.3 million, realizing a net loss of $2.0 million. Following the sale of 9 positions during the first quarter, including AT&T, the Company did not make any sizable shifts to the equity portfolio during the second quarter other than to sell Warner Bros Discovery.

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| | |
|:---|:---|
| **Ten Largest Equity Holdings at December 31, 2022 as a percent of net assets** | **Ten Largest Equity Holdings at December 31, 2022 as a percent of net assets** |
| &nbsp;&nbsp; Exxon Mobil | &nbsp;&nbsp; 8.6% |
| &nbsp;&nbsp; Cigna Corp New | &nbsp;&nbsp; 4.9% |
| &nbsp;&nbsp; Applied Materials | &nbsp;&nbsp; 4.8% |
| &nbsp;&nbsp; Bristol Myers Squibb | &nbsp;&nbsp; 4.6% |
| &nbsp;&nbsp; Alphabet Inc. | &nbsp;&nbsp; 4.5% |
| &nbsp;&nbsp; Ovintiv Inc. | &nbsp;&nbsp; 4.2% |
| &nbsp;&nbsp; Qualcomm Inc | &nbsp;&nbsp; 3.6% |
| &nbsp;&nbsp; Ford Motor Company | &nbsp;&nbsp; 3.4% |
| &nbsp;&nbsp; Schlumberger LTD | &nbsp;&nbsp; 3.4% |
| &nbsp;&nbsp; Verizon Communications | &nbsp;&nbsp; 3.3% |
|  | &nbsp;&nbsp; 45.3%  |

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**Interest and Dividend Income** 

A key component of the Company's strategy is to generate current income through dividends in addition to the opportunity to realize investment returns from appreciation in stock values. Of the 30 stock positions held at December 31, 2022, 21 pay a dividend and account for 85% of the fair value of equity securities at December 31, 2022. In addition, following aggressive Federal Reserve actions to raise interest rates since March 2022, income from money market balances are a more meaningful contributor to income. The following table presents the Company's average balances and yields earned on investments for the periods shown:

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| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **Six months ended** | **Six months ended** | **Six months ended** | **Six months ended** | **Six months ended** | **Six months ended** |
|  | &nbsp;&nbsp;&nbsp;&nbsp;**December 31, 2022** | &nbsp;&nbsp;&nbsp;&nbsp;**December 31, 2022** | &nbsp;&nbsp;&nbsp;&nbsp;**December 31, 2022** | &nbsp;&nbsp;&nbsp;&nbsp;**December 31, 2021** | &nbsp;&nbsp;&nbsp;&nbsp;**December 31, 2021** | &nbsp;&nbsp;&nbsp;&nbsp;**December 31, 2021** |
|  | Average<br>Balance  | <br>Income | <br>Yield | Average<br>Balance  | <br>Income | <br>Yield (1) |
| *($ in thousands)* |  |  |  |  |  |  |
| Bank deposits  | $1415  | $2  | 0.28% | $5299  | $5  | 0.19% |
| Money market funds | 44131  | 637  | 2.89% | 20549  | 4  | 0.04% |
| US treasury bills | 2989  | 61  | 4.08% | -  | -  | 0.00% |
| Equity securities | 144237  | 1780  | 2.47% | 176276  | 2023  | 2.30% |
|  | $192772  | $2480  | 2.57% | $202124  | $2032  | 2.01% |

---

Total dividend and interest income for the six months ending December 31, 2022 increased 22% to $2.48 million as interest income jumped significantly on an 88% increase in average interest-earning balances and 282 basis point increase in average yield earned to 2.89%. This offset a 12% decline in dividend income related to an 22% decline in average equity balances to $144 million, notwithstanding a 17-basis point increase in average dividend yield to 2.47%.

**<u>Lease Operations</u>**

Lease bookings of $6.9 million for the first six months of fiscal 2023 were up from $5.2 million for the first six months of fiscal 2022. Lease originations in fiscal 2023 have been minimal, leaving the backlog of approved lease commitments of $5.9 million at December 31, 2022, down from $8.0 million at June 30, 2022. Transactions in process of $250,000 at December 31, 2022 are down from $2.7 million at June 30, 2022.

Finance and loan income of $730,000 for the first six months of fiscal 2023 was down 42% due to a 39.3% decrease in average balances to $20.8 million and a 35-basis point decrease in the average yield to 7.02%. The following table presents the Company's average lease and loan balances, income and related yields earned on an annualized basis.

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| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **Six months ended** | **Six months ended** | **Six months ended** | **Six months ended** | **Six months ended** | **Six months ended** |
|  | &nbsp;&nbsp;&nbsp;&nbsp;**December 31, 2022** | &nbsp;&nbsp;&nbsp;&nbsp;**December 31, 2022** | &nbsp;&nbsp;&nbsp;&nbsp;**December 31, 2022** | &nbsp;&nbsp;&nbsp;&nbsp;**December 31, 2021** | &nbsp;&nbsp;&nbsp;&nbsp;**December 31, 2021** | &nbsp;&nbsp;&nbsp;&nbsp;**December 31, 2021** |
|  | Average |  |  | Average |  |  |
| *($ in thousands)* | Balance  | Income | Yield | Balance  | Income | Yield |
| Commercial loans  | $&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3144  | $&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;73  | 4.64% | $&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3486  | $&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;95  | 5.45% |
| Net investment in leases  | &nbsp;&nbsp;&nbsp;&nbsp;17658  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;657  | 7.44% | &nbsp;&nbsp;&nbsp;&nbsp;30777  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1167  | 7.58% |
| &nbsp;&nbsp;&nbsp;&nbsp;Lease and loan assets | $20802  | $730  | 7.02% | $34263  | $1262  | 7.37% |

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| | | |
|:---|:---|:---|
| &nbsp;&nbsp; ![cid:image006.jpg@01D6E402.62C232D0](x23013107013700.jpg) | &nbsp;&nbsp; California First Leasing Corporation | &nbsp;&nbsp; Semi-Annual Report for December 31, 2022 |

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**Other Lease Income** – In December 2022, the Company recovered $906,200 on a lease-related claim filed in 2015 and recognized the recovery as part of other lease income in the period. An increase in operating lease income also contributed to a 130% increase in other lease income during the first six months of fiscal 2023.

**<u>Operating Expenses</u>** 

The Company's operating expenses for the six months ended December 31, 2022 decreased by 12.1% to $1.4 million compared to $1.5 million the year before. The decrease in fiscal 2023 included the continued release of reserves for credit losses along with a 16.2% decline in compensation and benefit costs despite absorbing the requirements related to registering with the SEC as an investment company.

**<u>Income Taxes</u>** 

The Company's effective income tax rate varies between periods due to changes in the mix of pre-tax earnings, the magnitude of gains or losses from equity securities included in earnings, and underlying income tax rates applicable in various taxing jurisdictions. For the first six months ending December 31, 2022, the tax provision of $842,000 included a provision accrued at an effective tax rate of 18.2% on pretax earnings of $3.40 million excluding the equity securities gain, and a provision accrued at 27.0% on the net equity security gain of $830,876. The effective tax rate reflects the benefit the Company receives from the dividends received exclusion. The equity gain for the first six months of fiscal 2023 included net realized taxable losses of $2.0 million on the sale of equity securities in the period, and unrealized gains of $2.83 million.

The components of earnings and taxes are summarized as follows:

---

| | | |
|:---|:---|:---|
| | Six months ended Dec. 31, | Six months ended Dec. 31, |
| (dollars in thousands) | 2022 | 2021 |
| Pretax earnings excluding securities gain  | $3395  | $2419  |
| Gain on securities | 831  | 11717  |
| **Pretax earnings**  | 4226  | 14136  |
| Income tax expense excluding securities gain  | 618  | 263  |
| Income tax expense (benefit) on securities gain  | 224  | 3351  |
| Income tax valuation allowance | -  | -  |
| **Net tax expense** | 842  | 3614  |
| Net earnings excluding equity gain | 2777  | 2156  |
| Net equity portfolio gain | 607  | 8366  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net earnings | $3384  | $10522  |

---

------

---

| | | |
|:---|:---|:---|
| &nbsp;&nbsp; ![cid:image006.jpg@01D6E402.62C232D0](x23013107013700.jpg) | &nbsp;&nbsp; California First Leasing Corporation | &nbsp;&nbsp; Semi-Annual Report for December 31, 2022 |

---

**<u>STATEMENT OF INVESTMENTS</u> <u>- December 31, 2022</u>**

(Unaudited - showing percentage of net assets)

---

| | | | |
|:---|:---|:---|:---|
| **<u>Common Stocks – 69.89%</u>**  | **<u>Company</u>** | **<u>Shares</u>** | **<u>Market Value</u>** |
| Auto & Truck Dealerships --0.42% | Lithia Mtrs Inc | 4265  | $873216  |
| Auto Manufacturers --3.37% | Ford Motor Company | 597300  | 6946599  |
| Banks - Diversified --4.19% | Bank of America Corporation | 117500  | 3891600  |
|  | JP Morgan Chase & Co | 4380  | 587358  |
|  | Wells Fargo & Co | 100400  | 4145516  |
|  |  |  | 8624474  |
| Capital Markets --3.10% | Goldman Sachs | 18600  | 6386868  |
| Credit Services --0.28% | Credit Acceptance Corporation (1) | 1220  | 578768  |
| Drug Manufacturers --4.64% | Bristol Myers Squibb | 132800  | 9554960  |
| Entertainment --0.38% | Netflix.com Inc. (1) | 2650  | 781432  |
| Financial --0.45% | Pimco Muni Income Fund III | 106754  | 929827  |
| Healthcare Plans --5.58% | Cigna Corp New | 30710  | 10175451  |
|  | United Health Group | 2489  | 1319618  |
|  |  |  | 11495069  |
| Insurance - Diversified --0.50% | Berkshire Hathaway Inc (1) | 3364  | 1039140  |
| Internet Content & Information --5.32% | Alphabet Inc. (1) | 105100  | 9272973  |
| Internet Content & Information  | Meta Platforms Inc (1) | 13907  | 1673568  |
|  |  |  | 10946541  |
| Internet Retail --0.21% | Alibaba Grp Hldg (1) | 4900  | 431641  |
| Oil & Gas E & P --4.15% | Ovintiv Inc. | 168325  | 8535761  |
| Oil & Gas Equipment & Services --3.35% | Schlumberger LTD | 129000  | 6896340  |
| Oil & Gas Integrated --8.61% | Exxon Mobil | 160800  | 17736240  |
| Scientific & Technical Instruments --0.44% | Sensata Technologies | 22300  | 900474  |
| Semiconductor Equip & Materials --4.82% | Applied Materials | 102000  | 9932760  |
| Semiconductors --8.85% | Advanced Micro Devices Inc. (1) | 31100  | 2014347  |
|  | Marvell Technology Inc | 129500  | 4796680  |
|  | Micron Technology Inc | 81300  | 4063374  |
|  | Qualcomm Inc | 66850  | 7349489  |
|  |  |  | 18223890  |
| Specialty Business Services --1.11% | Global Payments Inc. | 23050  | 2289326  |
| Specialty Chemicals --1.73% | Dupont De Nemours | 51940  | 3564642  |
| Steel --1.87% | Cleveland-Cliffs Inc. (1) | 239000  | 3850290  |
| Telecom Services --3.85% | Charter Communications Inc (1) | 3199  | 1084781  |
|  | Verizon Communications | 173750  | 6845750  |
|  |  |  | 7930531  |
| Tobacco --2.65% | British American Tobacco | 136700  | 5465266  |
|  | **Total-Equity Securities** |  | $**143914056**  |
| **<u>Short-term Investments – 20.91%</u>** |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Bank Deposit --0.77% | Liberty Bank, N.A.  |  | 1583060  |
| &nbsp;&nbsp;&nbsp;&nbsp;Fixed Income --7.24% | U.S. Treasury Bills (4.35%) |  | 14902386  |
| &nbsp;&nbsp;&nbsp;&nbsp;Money Market Mutual Funds --13.35% | JP Morgan Prime MMKt 3605 (4.45%) |  | 17371391  |
|  | Goldman FSQ Money Market (4.21%) |  | 9196262  |
|  | **Total Short-term investments** |  | $**43053099**  |
| **Total Equity Securities and Short-term investments --90.03%** | **Total Equity Securities and Short-term investments --90.03%** |  | $**186967155**  |
| **Net Assets at December 31, 2022** |  |  | $**205902553**  |
| (1) Non-income producing |  |  |  |

---

The accompanying notes are an integral part of these financial statements.

------

---

| | | |
|:---|:---|:---|
| &nbsp;&nbsp; ![cid:image006.jpg@01D6E402.62C232D0](x23013107013700.jpg) | &nbsp;&nbsp; California First Leasing Corporation | &nbsp;&nbsp; Semi-Annual Report for December 31, 2022 |

---

**<u>STATEMENTS OF ASSETS, LIABILITIES AND STOCKHOLDERS' EQUITY</u>**

(in thousands, except share amounts)

---

| | | |
|:---|:---|:---|
|  | December 31,<br>2022 | June 30,<br>2022<br>|
|  | *(unaudited)* |  |
| **<u>ASSETS</u>** |  |  |
| Cash and due from banks | $1583  | $1085  |
| Money-market mutual funds | 26568  | 52723  |
| U.S. Treasury bills | 14902  | -  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Cash and cash equivalents | 43053  | 53808  |
| Equity securities | 143914  | 131637  |
| Property acquired for transactions-in-process | 250  | 2672  |
| Leases and loans: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Net investment in leases | 18355  | 21961  |
| &nbsp;&nbsp;&nbsp;&nbsp;Commercial loans | 3101  | 3246  |
| &nbsp;&nbsp;&nbsp;&nbsp;Allowance for credit losses | (261) | (361) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net investment in leases and loans | 21195  | 24846  |
| Property on operating leases | 541  | 514  |
| Income tax receivable | 2082  | 2069  |
| Other assets | 1323  | 455  |
| Discounted lease rentals assigned to lenders | 158  | 515  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total Assets | $212516  | $216516  |
| **<u>LIABILITIES AND STOCKHOLDERS' EQUITY</u>** |  |  |
| Liabilities: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Accounts payable | $2381  | $954  |
| &nbsp;&nbsp;&nbsp;&nbsp;Accrued liabilities | 906  | 829  |
| &nbsp;&nbsp;&nbsp;&nbsp;Lease deposits | 61  | 145  |
| &nbsp;&nbsp;&nbsp;&nbsp;Non-recourse debt | 158  | 515  |
| &nbsp;&nbsp;&nbsp;&nbsp;Deferred income taxes, net  | 3107  | 2193  |
|  | 6613  | 4636  |
| Commitments and contingencies | -  | -  |
| Stockholders' equity: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Preferred stock; 2,500,000 shares authorized; none issued | -  | -  |
| &nbsp;&nbsp;&nbsp;&nbsp;Common stock; $.01 par value; 20,000,000 shares authorized; 9,703,456 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;December 31, 2022 and 10,284,139 June 30, 2022 issued and outstanding  | 97  | 103  |
| &nbsp;&nbsp;&nbsp;&nbsp;Additional paid in capital | 1694  | 2314  |
| &nbsp;&nbsp;&nbsp;&nbsp;Retained earnings | 204112  | 209463  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total Stockholders' Equity | 205903  | 211880  |
| Total Liabilities and Stockholders' Equity | $212516 | $216516 |

---

The accompanying notes are an integral part of these financial statements.

------

---

| | | |
|:---|:---|:---|
| &nbsp;&nbsp; ![cid:image006.jpg@01D6E402.62C232D0](x23013107013700.jpg) | &nbsp;&nbsp; California First Leasing Corporation | &nbsp;&nbsp; Semi-Annual Report for December 31, 2022 |

---

**<u>STATEMENTS OF OPERATIONS</u>**

(in thousands, except per share amounts)

*(Unaudited)*

---

| | | | |
|:---|:---|:---|:---|
|  | Six Months Ended | Six Months Ended | |
|  | December 31, | December 31, | |
|  | 2022 | 2021 | <br>Percent<br>Change |
| <u>Investment income</u> |  |  |  |
| Dividend income | $1780  | $2023  | (12.0)% |
| Interest income | 700  | 9  | nm% |
| Gain on equity securities | 831  | 11717  | (92.9)% |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total investment income | 3311  | 13749  | (75.9)% |
| <u>Lease income</u> |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Finance and loan income | 730  | 1262  | (42.2)% |
| &nbsp;&nbsp;&nbsp;&nbsp;Release of (provision for) reserves for credit losses | 100  | 100  | 0.0% |
| &nbsp;&nbsp;&nbsp;&nbsp;Operating and sales-type leases | 437  | 111  | 293.7% |
| &nbsp;&nbsp;&nbsp;&nbsp;Gain on sale of leases, loans and leased property | 106  | 143  | (25.9)% |
| &nbsp;&nbsp;&nbsp;&nbsp;Other fee income | 901  | 316  | 185.1% |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total lease income | 2274  | 1932  | 17.7% |
| <u>Operating expenses</u> |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Compensation and employee benefits | 918  | 1096  | (16.2)% |
| &nbsp;&nbsp;&nbsp;&nbsp;Director fees | 72  | 72  | 0.0% |
| &nbsp;&nbsp;&nbsp;&nbsp;Occupancy | 54  | 52  | 3.8% |
| &nbsp;&nbsp;&nbsp;&nbsp;Other general and administrative | 314  | 325  | (3.4)% |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total operating expenses | 1358  | 1545  | (12.1)% |
| Earnings before income taxes | 4227  | 14136  | (70.1)% |
| Income taxes | 842  | 3614  | (76.7)% |
| Net earnings | $3385  | $10522  | (67.8)% |
| Basic earnings per common share | $0.33  | $1.02  | (67.7)% |
| Weighted average common shares outstanding | 10230  | 10284  |  |

---

The accompanying notes are an integral part of these financial statements.

------

---

| | | |
|:---|:---|:---|
| &nbsp;&nbsp; ![cid:image006.jpg@01D6E402.62C232D0](x23013107013700.jpg) | &nbsp;&nbsp; California First Leasing Corporation | &nbsp;&nbsp; Semi-Annual Report for December 31, 2022 |

---

**<u>STATEMENT OF STOCKHOLDERS' EQUITY</u>**

(Unaudited, in thousands, except share amounts)

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | <br>Shares | <br>Amount | Additional<br>Paid in<br>Capital | <br>Retained<br>Earnings | <br>Total |
| Six months ended December 31, 2021 |  |  |  |  |  |
| Balance, June 30, 2021 | 10284139  | $103  | $2314  | $227883  | $230300  |
| &nbsp;&nbsp;&nbsp;&nbsp;Net earnings | -  | -  | -  | 10522  | 10522  |
| &nbsp;&nbsp;&nbsp;&nbsp;Dividends paid | -  | -  | - | (5759) | (5759) |
| Balance, December 31, 2021 | 10284139  | $103  | $2314  | $232646  | $235063  |
| Six months ended December 31, 2022 |  |  |  |  |  |
| Balance, June 30, 2022 | 10284139  | $103  | $2314  | $209463  | $211880  |
| &nbsp;&nbsp;&nbsp;&nbsp;Net earnings | - | -  | -  | 3385  | 3385  |
| &nbsp;&nbsp;&nbsp;&nbsp;Shares repurchased | (580683) | (6) | (620) | (8736) | (9362) |
| Balance, December 31, 2022 | 9703456  | $97  | $1694  | $204112  | $205903  |

---

The accompanying notes are an integral part of these financial statements.

------

---

| | | |
|:---|:---|:---|
| &nbsp;&nbsp; ![cid:image006.jpg@01D6E402.62C232D0](x23013107013700.jpg) | &nbsp;&nbsp; California First Leasing Corporation | &nbsp;&nbsp; Semi-Annual Report for December 31, 2022 |

---

**<u>STATEMENTS OF CASH FLOWS</u>** 

*(Unaudited, in thousands)*

---

| | | |
|:---|:---|:---|
|  | Six Months Ended | Six Months Ended |
|  | December 31, | December 31, |
|  | 2022 | 2021 |
| CASH FLOWS FROM OPERATING ACTIVITIES: |  |  |
| Net Earnings | $3385 | $10522  |
| Adjustments to reconcile net earnings to cash flows |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;provided by (used for) operating activities: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;(Release of) provision for credit losses | (100) | (100) |
| &nbsp;&nbsp;&nbsp;&nbsp;Depreciation and net amortization | 20 | 24  |
| &nbsp;&nbsp;&nbsp;&nbsp;Gain on sale of leased property and sales-type lease income | (37) | (137) |
| &nbsp;&nbsp;&nbsp;&nbsp;Gains on equity securities, net | (831) | (11717) |
| &nbsp;&nbsp;&nbsp;&nbsp;Deferred income taxes, including income taxes payable | 915  | 3251  |
| &nbsp;&nbsp;&nbsp;&nbsp;(Increase) decrease in income taxes receivable | (13) | 355  |
| &nbsp;&nbsp;&nbsp;&nbsp;Net increase (decrease) in accounts payable & accrued liabilities | 78  | (220) |
| &nbsp;&nbsp;&nbsp;&nbsp;Other, net | (1045) | (353) |
| Net cash provided by operating activities | 2372  | 1625  |
| CASH FLOWS FROM INVESTING ACTIVITIES: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Investment in leases and transactions in process | (2560) | (3187) |
| &nbsp;&nbsp;&nbsp;&nbsp;Payments received on lease receivables and loans | 9396  | 11885  |
| &nbsp;&nbsp;&nbsp;&nbsp;Proceeds from sales of leased property and sales-type leases | 862  | 396  |
| &nbsp;&nbsp;&nbsp;&nbsp;Purchase of equity securities | (20752)  | (41343) |
| &nbsp;&nbsp;&nbsp;&nbsp;Proceeds from sale of equity securities | 9306  | 11879  |
| &nbsp;&nbsp;&nbsp;&nbsp;Net (increase) decrease in other assets | (17) | 59  |
| Net cash used for investing activities | (3765) | (20311) |
| CASH FLOWS FROM FINANCING ACTIVITIES: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Payments to repurchase common stock | (9362) | - |
| &nbsp;&nbsp;&nbsp;&nbsp;Dividends to stockholders | -  | (5759) |
| Net cash used for financing activities | (9362) | (5759) |
| NET CHANGE IN CASH AND CASH EQUIVALENTS | (10755) | (24445) |
| CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD | 53808  | 37045  |
| CASH AND CASH EQUIVALENTS AT END OF PERIOD | $43053  | $12600  |
| <u>SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION</u> |  |  |
| Decrease in lease rentals assigned to lenders and related |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;non-recourse debt | $(357) | $(357) |
| Estimated residual values recorded on leases | $(7)  | $(19)  |
| Income taxes paid | $(60) | $8  |

---

The accompanying notes are an integral part of these financial statements.

------

---

| | | |
|:---|:---|:---|
| &nbsp;&nbsp; ![cid:image006.jpg@01D6E402.62C232D0](x23013107013700.jpg) | &nbsp;&nbsp; California First Leasing Corporation | &nbsp;&nbsp; Semi-Annual Report for December 31, 2022 |

---

**Financial Highlights\***

*(Unaudited)*

---

| | | |
|:---|:---|:---|
|  | Six Months Ended December 31, | Six Months Ended December 31, |
|  | 2022 | 2021  |
| <u>Per Share Operating Performance</u> |  |  |
| Net Asset Value, beginning of period | $20.60  | $22.39  |
| Net income | 0.33  | 1.02  |
| Less: Dividends paid | 0.00  | 0.56  |
| Net gain on share repurchase  | 0.29  | 0.00  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Net Asset Value, end of period** | $21.22  | $22.86  |
| **Market price, end of period** | $16.15 | $18.00 |
| **Return to Shareholders** (1) |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Based on net book value  | 3.00% | 4.56% |
| &nbsp;&nbsp;&nbsp;&nbsp;Based on market price | -7.18% | 1.37% |
| <u>Ratios, Supplemental Data</u> |  |  |
| Expenses per share | $&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;0.13  | $&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;0.15  |
| Expenses plus taxes per share | $&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;0.22  | $&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;0.50  |
| Average Book Value per share | $&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;21.86  | $&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;22.19  |
| Expenses to Average Book Value (2) | 1.27% | 1.35% |
| Net income to Average Book Value  | 1.59% | 4.61% |

---

(1) Return on market price assumes a purchase on the first day and sale on the last day of each period reported. Dividends and distributions are assumed to be reinvested. Total return on book value uses the same methodology, using book value for the beginning and ending values, and dividend reinvestment at the closing price on the day of distribution. Returns for periods of less than one year are not annualized.

(2) Expense ratio is annualized.

The accompanying notes are an integral part of these financial statements.

------

---

| | | |
|:---|:---|:---|
| &nbsp;&nbsp; ![cid:image006.jpg@01D6E402.62C232D0](x23013107013700.jpg) | &nbsp;&nbsp; California First Leasing Corporation | &nbsp;&nbsp; Semi-Annual Report for December 31, 2022 |

---

**<u>NOTES TO FINANCIAL STATEMENTS</u>**

**<u>Note 1 – Basis of Presentation</u>**

The accompanying unaudited financial statements of California First Leasing Corporation, ("CFNB" or the "Company"), have been prepared in accordance with U.S. generally accepted accounting principles for interim financial information and do not include all of the information and footnotes required for complete financial statements. These financial statements should be read in conjunction with the financial statements and notes thereto included in the Annual report on Form N-CSR for the year ended June 30, 2022.

In the opinion of management, the unaudited financial statements contain all adjustments, consisting only of normal recurring adjustments, necessary for a fair statement of investments as of December 31, 2022 and the related statements of operations, stockholders' equity and cash flows for the periods presented. The results of operations for the three and six-month periods ended December 31, 2022 are not necessarily indicative of the results of operations to be expected for the entire fiscal year ending June 30, 2023. Certain reclassifications have been made to the fiscal 2022 financial statements to conform to the presentation of the fiscal 2023 financial statements.

**<u>Note 2 –Fair Value Measurement:</u>**

ASC Topic 820: "Fair Value Measurements and Disclosures" defines fair value as the price that would be received in an orderly transaction between market participants in the principal or most advantageous market. ASC Topic 820 establishes a three-tiered value hierarchy that prioritizes inputs that are observable in the market and requires the maximum use of observable inputs and minimum use of unobservable inputs. The three levels of inputs are defined as follows:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· Level 1 - Valuation is based upon unadjusted quoted prices for identical instruments traded in active markets;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· Level 2 - Valuation is based upon quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active; 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· Level 3 - Valuation is generated from inputs not observable in the market and based on the Company's own judgment. Level 3 could include the use of discounted cash flow models and similar techniques, and rely on assumptions that market participants use in pricing the asset or liability.

ASC 820 applies whenever other accounting pronouncements require presentation of fair value measurements, but does not change existing guidance as to whether or not an instrument is carried at fair value. As such, ASC 820 does not apply to the Company's investment in leases.

The value of deposits with banks and short-term treasury securities, because of their short-term nature, approximate fair value and are classified as Level 1. Equity securities, money market funds and income fund are reported utilizing Level 1 inputs by reference to the market closing or last trade price. In the unlikely event that no trade occurred on the applicable date, an indicative bid or the last trade most proximate to the applicable date would be used (Level 2 input). Changes in markets, economic conditions or the Company valuation model may require the transfer of financial instruments from one level to another. Such transfer, if any, would be recorded at the fair value as of the beginning of the period in which the transfer occurred. The Company has had no transfers in fiscal 2022 and 2023.

The following table summarizes the Company's assets, which are measured at fair value on a recurring basis as of December 31, 2022 and June 30, 2022:

---

| | | | | |
|:---|:---|:---|:---|:---|
| |  | Quoted Price in | | Significant |
| |  | Active Markets for | Significant Other | Unobservable |
| | Total | Identical Assets | Observable Inputs | Inputs |
| Description of Assets | Fair Value | (Level 1)  | (Level 2)  | (Level 3)  |
|  | (in thousands) | (in thousands) | (in thousands) | (in thousands) |
| As of December 31, 2022 |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Equity securities | $143914  | $143914  | $-  | $-  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Money-market accounts  | 26568  | 26568  | -  | -  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;US Treasury bills | 14902  | 14902  | - | - |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Bank deposits | 1583  | 28151  | -  | -  |
|  | $186967  | $186967  | $-  | $-  |
| As of June 30, 2022 |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Equity securities | $130653  | $130653  | $-  | $-  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Money-market accounts | 52723 | 52723 | - | - |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Bank deposits | 1085  | 1085  | -  | -  |
|  | $185445  | $185445  | $-  | $-  |

---

------

---

| | | |
|:---|:---|:---|
| &nbsp;&nbsp; ![cid:image006.jpg@01D6E402.62C232D0](x23013107013700.jpg) | &nbsp;&nbsp; California First Leasing Corporation | &nbsp;&nbsp; Semi-Annual Report for December 31, 2022 |

---

The Company's loans are not accounted for or carried at fair value, but in accordance with the fair value disclosure requirements of ASC 825-50, the estimated fair value of the loans as of December 31, 2022 and June 30, 2022 is calculated based on discounted cash flow analyses, using interest rates currently being offered for loans with similar terms to borrowers of similar credit quality and are classified as Level 3 in the fair value hierarchy. Loan fair values are based on an exit value and have been adjusted for credit risk.

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | December 31, 2022 | December 31, 2022 | June 30, 2022 | June 30, 2022 |
|  | Carrying | Estimated | Carrying | Estimated |
| &nbsp;&nbsp;&nbsp;&nbsp;(in thousands) | Amount | Fair Value | Amount | Fair Value |
| &nbsp;&nbsp;&nbsp;&nbsp;Commercial loans | $3071  | $2830  | $3216  | $3097  |

---

These fair value estimates are based on relevant market information and data however, given there are no active market or observable market transactions, the Company has made estimates of fair values which are subjective in nature, involve uncertainties and cannot be determined with precision. Changes in assumptions could significantly affect the estimated values.

**<u>Note 3 – Investment Transactions and Compensation</u>:**

For the six months ended December 31, 2022, purchases and sales of investments, excluding short-term investments, were $20,752,604 and $9,306,495, respectively.

The aggregate remuneration paid to all officers and directors during the six months ended December 31, 2022 was $687,010 and $72,000, respectively.

**<u>Note 4– Leases</u>:**

The Company's net investment in leases consists of the following:

---

| | | |
|:---|:---|:---|
|  | December 31 June 30, | December 31 June 30, |
| *(in thousands)* | 2022 | 2022 |
| &nbsp;&nbsp;&nbsp;&nbsp;Minimum lease payments receivable | $19972  | $21909  |
| &nbsp;&nbsp;&nbsp;&nbsp;Estimated residual value | 998  | 1881  |
| &nbsp;&nbsp;&nbsp;&nbsp;Less unearned income | (2615) | (1829) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net investment in leases before allowances | 18355  | 21961  |
| &nbsp;&nbsp;&nbsp;&nbsp;Less allowance for lease losses | (231) | (331) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net investment in leases | $18124  | $21630  |

---

The minimum lease payments receivable and estimated residual value are discounted using the internal rate of return method related to each specific lease.

**<u>Note 5 – Commercial Loans</u>:**

Commercial loans consists of the following:

---

| | | |
|:---|:---|:---|
|  | December 31 June 30, | December 31 June 30, |
| (in thousands) | 2022 | 2022 |
| &nbsp;&nbsp;&nbsp;&nbsp;Commercial real estate loans | $2891  | $3040  |
| &nbsp;&nbsp;&nbsp;&nbsp;Commercial term loan participations | 223  | 223  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total commercial loans | 3114  | 3263  |
| &nbsp;&nbsp;&nbsp;&nbsp;Less unearned income and discounts | (13) | (17) |
| &nbsp;&nbsp;&nbsp;&nbsp;Less allowance for loan losses | (30) | (30) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net commercial loans | $3071  | $3216  |

---

**<u>Note 6 – Allowance for Credit Losses</u>:**

The allowance for credit losses includes amounts to cover losses related to the net investment in leases, commercial loans, and transactions-in-process. A summary of the allocation of the allowance for credit losses and selected statistics is as follows:

---

| | | |
|:---|:---|:---|
|  | December 31 June 30, | December 31 June 30, |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*(dollars in thousands)* | 2022 | 2022 |
| Allowance for credit losses at beginning of year | $361  | $620  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Charge-off of leases | -  | (44)  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Provision (release) of reserves for credit losses | (100) | (215) |
| Allowance for credit losses at end of year | $261  | $361  |
| Allowance for credit losses as percent of net |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;investment in leases and loans before allowances | 1.22% | 1.43% |

---

------

---

| | | |
|:---|:---|:---|
| &nbsp;&nbsp; ![cid:image006.jpg@01D6E402.62C232D0](x23013107013700.jpg) | &nbsp;&nbsp; California First Leasing Corporation | &nbsp;&nbsp; Semi-Annual Report for December 31, 2022 |

---

**<u>Note 7 – Credit Quality of Financing Receivables</u>:**

The following tables provide information related to "financing receivables" as defined under Topic 310, Receivables. "Financing receivables" include direct finance and sales-type leases and all commercial loans, but does not include operating leases and transactions in process. The portfolio is disaggregated into two segments of leases and loans and four classes: 1) commercial leases, 2) education, government and non-profit ("EGNP") leases, 3) commercial and industrial loans and 4) commercial real estate loans. Relevant risk characteristics generally include the nature of the borrower, structure of the transaction and collateral type. The Company classifies all credits under regulatory models that rate as "pass", "special mention", "substandard", or "doubtful" and reflect an assessment of the ability of the credit to service the obligation based on current financial position, historical payment experience, and collateral adequacy, among other factors. The Company uses the following definitions for risk ratings:

---

| |
|:---|
| Pass – Credits of the highest quality with positive primary repayment source but may have characteristics that are of higher than average risk. |
| Special Mention – Have a potential weakness that if left uncorrected may result in deterioration of the repayment prospects for the lease or loan or of the Company's credit position at some future date. |
| Substandard – Are inadequately protected by the paying capacity of the obligor or of the collateral, if any. Credits have a well-defined weakness that jeopardize the liquidation of the debt or indicate the distinct possibility that the Company will sustain some loss if the deficiencies are not corrected. |
| Doubtful – Based on current information and events, collection of all amounts due according to the contractual terms of the lease or loan agreement is considered highly questionable and improbable. |

---

The risk classification of financing receivables by portfolio class is as follows:

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  |  |  | Commercial  | Commercial  | Total  |
| (in thousands) | Commercial  | EGNP  | & Industrial  | Real Estate  | Financing  |
|  | Leases  | Leases  | Loans  | Loans  | Receivable  |
| As of December 31, 2022: |  |  |  |  |  |
| Pass | $6976 | $10598 | $210 | $2891 | $20675 |
| Special Mention | - | 473 | - | - | 473 |
| Substandard | 308 | - | - | - | 308 |
| Doubtful | - | - | - | - | - |
|  | $7284 | $11071 | $210 | $2891 | $21456 |

---

The accrual of interest income on leases and loans will be discontinued when the customer becomes ninety days or more past due on its lease or loan payments, unless the Company believes the investment is otherwise recoverable. Leases and loans may be placed on non-accrual earlier if the Company has significant doubt about the ability of the customer to meet its lease or loan obligations, as evidenced by consistent delinquency, deterioration in financial condition or other relevant factors. Payments received while on non-accrual are applied to reduce the Company's recorded value.

There were no past due credits at December 31, 2022 or June 30, 2022, and no increase in non-performing assets during either period.

The following table presents the allowance balances and activity in the allowance related to financing receivables, along with the recorded investment and allowance determined based on impairment method as of December 31 and June 30, 2022:

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| (in thousands)  |  |  | Commercial  | Commercial  | Total  |
|  | Commercial  | EGNP  | & Industrial  | Real Estate  | Financing  |
| As of December 31, 2022: | Leases  | Leases  | Loans  | Loans  | Receivable  |
| Allowance for lease and loan losses |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Balance beginning of period | $229  | $102  | $5  | $25  | $361  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Charge-offs | -  | -  | -  | -  | -  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Recoveries | -  | -  | -  | -  | -  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Provision | (100) | -  | -  | -  | (100) |
| &nbsp;&nbsp;&nbsp;&nbsp;Balance end of period | $129  | $102  | $5  | $25  | $261  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Individually evaluated for impairment | $31  | $24  | $-  | $-  | $55  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Collectively evaluated for impairment | 98  | 78  | 5  | 25  | 206  |
| Total ending allowance balance | $129  | $102  | $5  | $25  | $261  |
| Finance receivables |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Individually evaluated for impairment | $308  | $473  | $-  | $-  | $781  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Collectively evaluated for impairment | 6976  | 10598  | 210  | 2891  | 20675  |
| Total ending finance receivable balance | $7284  | $11071  | $210  | $2891  | $21456  |

---

------

---

| | | |
|:---|:---|:---|
| &nbsp;&nbsp; ![cid:image006.jpg@01D6E402.62C232D0](x23013107013700.jpg) | &nbsp;&nbsp; California First Leasing Corporation | &nbsp;&nbsp; Semi-Annual Report for December 31, 2022 |

---

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| (in thousands)  |  |  | Commercial  | Commercial  | Total  |
|  | Commercial  | EGNP  | & Industrial  | Real Estate  | Financing  |
|  | Leases  | Leases  | Loans  | Loans  | Receivable  |
| As of June 30, 2022: |  |  |  |  |  |
| Allowance for lease and loan losses |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Balance beginning of period | $448  | $137  | $5  | $30  | $620  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Charge-offs | (44) | -  | -  | -  | (44) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Recoveries | -  | -  | -  | -  | -  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Provision | (175) | (35) | -  | (5) | (215) |
| &nbsp;&nbsp;&nbsp;&nbsp;Balance end of period | $229  | $102  | $5  | $25  | $361  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Individually evaluated for impairment | $63  | $32  | $- | $-  | $95  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Collectively evaluated for impairment | 166  | 70  | 5  | 25  | 266  |
| Total ending allowance balance | $229  | $102  | $5  | $25  | $361  |
| Finance receivables |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Individually evaluated for impairment | $632  | $649  | $-  | $-  | $1281  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Collectively evaluated for impairment | 9670  | 11009  | 206  | 3041  | 23926  |
| Total ending finance receivable balance | $10302  | $11658  | $206  | $3041  | $25207  |

---

------

---

| | | |
|:---|:---|:---|
| &nbsp;&nbsp; ![cid:image006.jpg@01D6E402.62C232D0](x23013107013700.jpg) | &nbsp;&nbsp; California First Leasing Corporation | &nbsp;&nbsp; Semi-Annual Report for December 31, 2022 |

---

**<u>Other Information</u>**

**<u>Privacy Policy</u>**

The Company has systems in place to safeguard shareholder privacy, with access to all information limited to a need to know basis. Through our transfer agent, Computershare Trust Company, the Company has access to nonpublic shareholder information such as name, address, tax identification number and the shares held that is used to send annual reports, proxy statements, tax statements or other information required by law. This information is not shared with any non-affiliated third party except pursuant to contracts to perform transaction processing, servicing or maintaining shareholder accounts. These companies are required to protect information and use it solely for the purpose for which they received it.

**<u>Proxy Voting Policies and Procedures</u>**

The policies and procedures to determine how to vote proxies relating to the securities portfolio is available without charge by contacting investor relations at California First Leasing Corporation, 5000 Birch Street, Suite 500, Newport Beach, CA 92660; by email at invest@calfirstlease.com; or on the Securities and Exchange Commission's website at www.sec.gov. The Company's initial report on its proxy voting record for the twelve-month period ended June 30, 2022 is available without charge by email request at invest@calfirstlease.com or is available on the SEC's website at www.sec.gov.

**<u>Quarterly Portfolio Information</u>**

The Company files its complete schedule of investments with the SEC for the first and the third quarter of each fiscal year on Form N-PORT beginning in the third calendar quarter of 2022. The Company's Form N-PORT filing for September 30, 2022 is available on the SEC's website at www.sec.gov.

**<u>Annual Meeting of Shareholders</u>**

The annual meeting of shareholders of the Company was held on January 31, 2023. At the meeting, all of the directors of the Company were reelected by the following vote of the holders of Common Stock:

---

| | | | |
|:---|:---|:---|:---|
|  | Votes For | % Votes Cast | Votes Withheld |
| Patrick E. Paddon  | 6544862 | 84.64% | 1188171 |
| Glen T. Tsuma  | 6544862 | 84.64% | <br> 1188171 |
| Michael H. Lowry  | 6549776 | 84.70% | 1183247 |
| Harris Ravine  | 6572295 | 84.99% | 1160768 |
| Danilo Cacciamatta  | 6572295 | 84.99%  | 1160768 |
| Robert W. Kelley | 6574295 | 85.02% | 1158738 |

---

**<u>Transfer Agent</u>**

Computershare Inc. serves as transfer agent and registrar with respect to Shares of the Company.

**<u>Independent Auditors</u>**

Eide Bailly, LLP serves as the independent registered public accounting firm to the Company.

(b) Not applicable

**Item 2. Code of Ethics** The information required by this Item is only required in an annual report on this Form N-CSR.

**Item 3. Audit Committee Financial Expert** 

The information required by this Item is only required in an annual report on this Form N-CSR.

**Item 4. Principal Accountant fees and Services** 

The information required by this Item is only required in an annual report on this Form N-CSR.

**Item 5. Audit Committee of Listed Registrants.** Not applicable insofar as the Company is not a listed issuer under the Securities Exchange Act of 1934, as amended.

**Item 6. Investments.**

(a) Schedule is included as a part of the report to shareholders filed under Item 1 of this Form**.**

(b) Not applicable.

------

---

| | | |
|:---|:---|:---|
| &nbsp;&nbsp; ![cid:image006.jpg@01D6E402.62C232D0](x23013107013700.jpg) | &nbsp;&nbsp; California First Leasing Corporation | &nbsp;&nbsp; Semi-Annual Report for December 31, 2022 |

---

**Item 7. Disclose Proxy Voting Policies and Procedures for Closed-End Management Companies.**

The information required by this Item is only required in an annual report on this Form N-CSR.

**Item 8. Portfolio Managers of Closed-End Management Investment Companies.**

The information required by this Item is only required in an annual report on this Form N-CSR.

**Item 9. Purchases of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers.**

Not applicable insofar as the Company's shares are not registered pursuant to Section 12 of the Exchange Act.

---

| | |
|:---|:---|
| **Item 10.** | **Submission of Matters to a Vote of Security Holders** |

---

There have been no changes to the procedures by which shareholders may recommend nominees to the registrant's board of directors since such procedures were last described in the Company's proxy statement dated January 6, 2023.

**Item 11. Controls and Procedures.**

a) The Principal Executive Officer and Principal Financial Officer of the Company have concluded that the Company's Disclosure Controls and Procedures (as defined in Rule 30a-3(c) under the Act are effective as of a date within 90 days of the filing date of this report based on their evaluation of the Disclosure Controls and Procedures.

b) There have been no changes in the Company's internal control over financial reporting (as defined in Rule 30a-3(d) under the Act) that occurred during period covered by this report that has materially affected, or is reasonably likely to materially affect, the Company's internal control over financial reporting.

**Item 12. Disclosure of Securities Lending Activities for Closed-End Management Investment Companies.**

Not applicable.

**Item 13. Exhibits.** 

(a) (1) The information required by this Item is only required in an annual report on this Form N-CSR.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) A separate certification for each principal executive officer and principal financial officer of the registrant as required by Rule 30a-2(a) under the Act is attached hereto.

**SIGNATURES**

Pursuant to the requirements of the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

---

| | |
|:---|:---|
| &nbsp;&nbsp; California First Leasing Corporation | &nbsp;&nbsp; California First Leasing Corporation |
| &nbsp;&nbsp; By: | &nbsp;&nbsp; /s/ Patrick E. Paddon |
|  | &nbsp;&nbsp; Patrick E. Paddon |
|  | &nbsp;&nbsp; Chairman and Chief Executive Officer |
|  | &nbsp;&nbsp; February 2, 2023 |
| &nbsp;&nbsp; By: | &nbsp;&nbsp; /s/ S. Leslie Jewett |
|  | &nbsp;&nbsp; S. Leslie Jewett |
|  | &nbsp;&nbsp; Chief Financial Officer |
|  | &nbsp;&nbsp; February 2, 2023 |

---

## Ex-99

---

| | |
|:---|:---|
| &nbsp;&nbsp; ![cid:image006.jpg@01D6E402.62C232D0](x23013113245100.jpg) | &nbsp;&nbsp; California First Leasing Corporation |

---

**Exhibit 99.CERT**

**CERTIFICATION**

I, Patrick E. Paddon, certify that:

1. I have reviewed this report on Form N-CSRS of California First Leasing Corporation;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations, changes in net assets, and cash flows (if the financial statements are required to include a statement of cash flows) of the registrant as of, and for, the periods presented in this report;

4. The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) and internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) for the registrant and have:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant is made known to us by others, particularly during the period in which this report is being prepared;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of a date within 90 days prior to the filing date of this report based on such evaluation; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the period covered by this report that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5. The registrant's other certifying officer(s) and I have disclosed to the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize, and report financial information; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

---

| | | |
|:---|:---|:---|
| &nbsp;&nbsp; Date: | &nbsp;&nbsp; February 2, 2023 | &nbsp;&nbsp; /s/ Patrick E. Paddon |
|  |  | &nbsp;&nbsp; Patrick E. Paddon |
|  |  | &nbsp;&nbsp; Chief Executive Officer |

---

------

**CERTIFICATION**

I, S. Leslie Jewett, certify that:

1. I have reviewed this report on Form N-CSRS of California First Leasing Corporation;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations, changes in net assets, and cash flows (if the financial statements are required to include a statement of cash flows) of the registrant as of, and for, the periods presented in this report;

4. The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) and internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) for the registrant and have:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant is made known to us by others within those entities, particularly during the period in which this report is being prepared;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of a date within 90 days prior to the filing date of this report based on such evaluation; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the period covered by this report that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5. The registrant's other certifying officer(s) and I have disclosed to the registrant's audit committee of the registrant's board of directors (or persons performing the equivalent functions):

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize, and report financial information; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

---

| | | |
|:---|:---|:---|
| &nbsp;&nbsp; Date: | &nbsp;&nbsp; February 2, 2023 | &nbsp;&nbsp; /s/ S. Leslie Jewett |
|  |  | &nbsp;&nbsp; S. Leslie Jewett |
|  |  | &nbsp;&nbsp; Chief Financial Officer |

---