FORM 4 Check this box if no longer subject to Section 16. Form 4 or Form 5 obligations may continue. See Instruction 1(b).

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 STATEMENT OF CHANGES IN BENEFICIAL OWNERSHIP OF SECURITIES Filed pursuant to Section 16(a) of the Securities Exchange Act of 1934, Section 17(a) of the Public Utility Holding Company Act of 1935 or Section 30(h) of the Investment Company Act of 1940

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1. Name and Address of Reporting Person * OZ MANAGEMENT LLC   2. Issuer Name and Ticker or Trading Symbol NewStar Financial, Inc. [NEWS] 5. Relationship of Reporting Person(s) to Issuer (Check all applicable) _____ Director __X__ 10% Owner _____ Officer (give title below) _____ Other (specify below) (Last) (First) (Middle) 9 WEST 57TH STREET, 39TH FLOOR 3. Date of Earliest Transaction (Month/Day/Year) 12/19/2006 (Street) NEW YORK, NY 10019 4. If Amendment, Date Original Filed(Month/Day/Year) 6. Individual or Joint/Group Filing(Check Applicable Line) _X_ Form filed by One Reporting Person ___ Form filed by More than One Reporting Person (City) (State) (Zip) Table I - Non-Derivative Securities Acquired, Disposed of, or Beneficially Owned

1.Title of Security (Instr. 3) 2. Transaction Date (Month/Day/Year) 2A. Deemed Execution Date, if any (Month/Day/Year) 3. Transaction Code (Instr. 8) 4. Securities Acquired (A) or Disposed of (D) (Instr. 3, 4 and 5) 5. Amount of Securities Beneficially Owned Following Reported Transaction(s) (Instr. 3 and 4) 6. Ownership Form: Direct (D) or Indirect (I) (Instr. 4) 7. Nature of Indirect Beneficial Ownership (Instr. 4) Code V Amount (A) or (D) Price Common Stock, par value $0.01 per share 12/19/2006   C   4,587,278 A (1) 6,122,064 (2) I See Footnotes (3) (4) (5) Common Stock, par value $0.01 per share 12/20/2006   P   92,900 A $ 18.1 6,214,964 I See Footnotes (3) (4) (5) Common Stock, par value $0.01 per share 12/20/2006   P   50,000 A $ 18.25 6,264,964 I See Footnotes (3) (4) (5) Common Stock, par value $0.01 per share 12/20/2006   P   50,000 A $ 18.218 6,314,964 I See Footnotes (3) (4) (5)

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Table II - Derivative Securities Acquired, Disposed of, or Beneficially Owned
(e.g., puts, calls, warrants, options, convertible securities)

1. Title of Derivative Security (Instr. 3)

2. Conversion or Exercise Price of Derivative Security

3. Transaction Date (Month/Day/Year)

3A. Deemed Execution Date, if any (Month/Day/Year)

4. Transaction Code (Instr. 8)

5. Number of Derivative Securities Acquired (A) or Disposed of (D) (Instr. 3, 4, and 5)

6. Date Exercisable and Expiration Date (Month/Day/Year)

7. Title and Amount of Underlying Securities (Instr. 3 and 4)

8. Price of Derivative Security (Instr. 5)

9. Number of Derivative Securities Beneficially Owned Following Reported Transaction(s) (Instr. 4)

10. Ownership Form of Derivative Security: Direct (D) or Indirect (I) (Instr. 4)

11. Nature of Indirect Beneficial Ownership (Instr. 4)

Code

V

(A)

(D)

Date Exercisable

Expiration Date

Title

Amount or Number of Shares

Series A convertible Preferred Stock, par value $0.01

(1)

12/19/2006

C

11,380,000

(1)

(1)

Common Stock

4,587,331 (2)

(6)

0

I

See Footnotes (3) (4) (5)

Reporting Owners

Reporting Owner Name / Address	Relationships
	Director	10% Owner	Officer	Other
OZ MANAGEMENT LLC 9 WEST 57TH STREET, 39TH FLOOR NEW YORK, NY 10019		X

Signatures

/s/ Daniel S. Och, Senior Managing Member of OZ Management, LLC		12/21/2006
**Signature of Reporting Person		Date

Explanation of Responses:

*	If the form is filed by more than one reporting person, see Instruction 4(b)(v).
**	Intentional misstatements or omissions of facts constitute Federal Criminal Violations. See 18 U.S.C. 1001 and 15 U.S.C. 78ff(a).
(1)	The Series A Convertible Preferred Stock converted into NewStar Financial, Inc. Common Stock on a one-for 2.2760 basis and had no expiration date.
(2)	Reflects a 1-for-2.4808 reverse split of our Common Stock that became effective on December 19, 2006.
(3)	Represents securities directly held by OZ Master Fund, Ltd. (the "Fund").
(4)	OZ Management, LLC ("OZ"), as investment manager to the Fund, may be deemed to be the beneficial owner of the Issuer's securities held by the Fund. OZ disclaims beneficial ownership of such securities, and this report shall not be deemed an admission that OZ is the beneficial owner of the securities for the purpose of Section 16 or for any other purpose, except to its pecuniary interest therein.
(5)	Daniel S. Och, as Senior Managing Member of OZ Management, LLC, may be deemed to be the beneficial owner of the Issuer's securities held by the Fund. Mr. Och disclaims beneficial ownership of such securities, and this report shall not be deemed an admission that Mr. Och is the beneficial owner of the securities for the purpose of Section 16 or for any other purpose, except to his pecuniary interest therein.
(6)	Not applicable.

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