XML 43 R24.htm IDEA: XBRL DOCUMENT
v3.24.0.1

Segment Reporting | 12 Months Ended
--- | ---
Dec. 31, 2023
Segment Reporting [Abstract] |
Segment Reporting | Segment Reporting At December 31, 2023, the Company’s reportable segments include (i) mortgage-related assets and (ii) Lima One. The Corporate column in the table below primarily consists of corporate cash and related interest income, investments in loan originators and related economics, general and administrative expenses not directly attributable to Lima One, interest expense on unsecured convertible senior notes (see Note 6), securitization issuance costs, and preferred stock dividends. The following tables summarize segment financial information, which in total reconciles to the same data for the Company as a whole:
(Dollars in Thousands) |  | Mortgage-Related Assets |  | Lima One |  | Corporate |  | Total
Year Ended December 31, 2023 |  |  |  |  |  |  |  |
Interest Income |  | $ | 364,081 |  |  | $ | 228,825 |  |  | $ | 12,691 |  |  | $ | 605,597 |
Interest Expense |  | 249,458 |  |  | 164,059 |  |  | 15,601 |  |  | 429,118 |
Net Interest Income/(Expense) |  | $ | 114,623 |  |  | $ | 64,766 |  |  | $ | (2,910) |  |  | $ | 176,479 |
Reversal of Provision/(Provision) for Credit Losses on Residential Whole Loans |  | 8,539 |  |  | 314 |  |  | — |  |  | 8,853 |
Net Interest Income/(Expense) after Reversal of Provision/(Provision) for Credit Losses |  | $ | 123,162 |  |  | $ | 65,080 |  |  | $ | (2,910) |  |  | $ | 185,332 |
Net gain on residential whole loans measured at fair value through earnings |  | $ | 69,486 |  |  | $ | 20,364 |  |  | $ | — |  |  | $ | 89,850 |
Impairment and other net gain/(loss) on securities and other portfolio investments |  | 8,073 |  |  | — |  |  | (1,848) |  |  | 6,225 |
Net gain on real estate owned |  | 9,274 |  |  | 118 |  |  | — |  |  | 9,392 |
Net gain on derivatives used for risk management purposes |  | 839 |  |  | 2,922 |  |  | — |  |  | 3,761 |
Net loss on securitized debt measured at fair value through earnings |  | (66,969) |  |  | (32,620) |  |  | — |  |  | (99,589) |
Lima One - origination, servicing and other fee income |  | — |  |  | 43,384 |  |  | — |  |  | 43,384 |
Net realized loss on residential whole loans held at carrying value |  | (1,240) |  |  | — |  |  | — |  |  | (1,240) |
Other, net |  | 7,960 |  |  | 2,284 |  |  | 1,087 |  |  | 11,331 |
Total Other Income/(Loss), net |  | $ | 27,423 |  |  | $ | 36,452 |  |  | $ | (761) |  |  | $ | 63,114 |
Compensation and benefits |  | $ | — |  |  | $ | 44,827 |  |  | $ | 40,972 |  |  | $ | 85,799 |
General and administrative expenses |  | 214 |  |  | 17,537 |  |  | 26,396 |  |  | 44,147 |
Loan servicing, financing, and other related costs |  | 20,100 |  |  | 1,515 |  |  | 12,521 |  |  | 34,136 |
Amortization of intangible assets |  | — |  |  | 4,200 |  |  | — |  |  | 4,200 |
Net Income/(Loss) |  | $ | 130,271 |  |  | $ | 33,453 |  |  | $ | (83,560) |  |  | $ | 80,164 |
Less Preferred Stock Dividend Requirement |  | $ | — |  |  | $ | — |  |  | $ | 32,875 |  |  | $ | 32,875 |
Net Income/(Loss) Available to Common Stock and Participating Securities |  | $ | 130,271 |  |  | $ | 33,453 |  |  | $ | (116,435) |  |  | $ | 47,289 |
(Dollars in Thousands) |  | Mortgage-Related Assets |  | Lima One |  | Corporate |  | Total
Year Ended December 31, 2022 |  |  |  |  |  |  |  |
Interest Income |  | $ | 364,761 |  |  | $ | 113,134 |  |  | $ | 4,524 |  |  | $ | 482,419 |
Interest Expense |  | 176,725 |  |  | 66,358 |  |  | 15,760 |  |  | 258,843 |
Net Interest Income/(Expense) |  | $ | 188,036 |  |  | $ | 46,776 |  |  | $ | (11,236) |  |  | $ | 223,576 |
Reversal of Provision/(Provision) for Credit Losses on Residential Whole Loans |  | $ | 2,842 |  |  | $ | (196) |  |  | $ | — |  |  | $ | 2,646 |
Provision for Credit Losses on Other Assets |  | — |  |  | — |  |  | (28,579) |  |  | (28,579) |
Net Interest Income/(Expense) after Reversal of Provision/(Provision) for Credit Losses |  | $ | 190,878 |  |  | $ | 46,580 |  |  | $ | (39,815) |  |  | $ | 197,643 |
Net gain/(loss) on residential whole loans measured at fair value through earnings |  | $ | (730,028) |  |  | $ | (136,734) |  |  | $ | — |  |  | $ | (866,762) |
Impairment and other net loss on securities and other portfolio investments |  | (3,146) |  |  | — |  |  | (21,921) |  |  | (25,067) |
Net gain on real estate owned |  | 25,348 |  |  | 31 |  |  | — |  |  | 25,379 |
Net gain/(loss) on derivatives used for risk management purposes |  | 217,961 |  |  | 37,218 |  |  | — |  |  | 255,179 |
Net gain on securitized debt measured at fair value through earnings |  | 231,176 |  |  | 59,463 |  |  | — |  |  | 290,639 |
Lima One - origination, servicing and other fee income |  | — |  |  | 46,745 |  |  | — |  |  | 46,745 |
Other, net |  | 4,282 |  |  | 537 |  |  | 3,804 |  |  | 8,623 |
Total Other Income/(Loss), net |  | $ | (254,407) |  |  | $ | 7,260 |  |  | $ | (18,117) |  |  | $ | (265,264) |
Compensation and benefits |  | $ | — |  |  | $ | 39,241 |  |  | $ | 37,487 |  |  | $ | 76,728 |
General and administrative expenses |  | — |  |  | 13,944 |  |  | 21,194 |  |  | 35,138 |
Loan servicing, financing, and other related costs |  | 25,384 |  |  | 1,120 |  |  | 16,390 |  |  | 42,894 |
Amortization of intangible assets |  | — |  |  | 9,200 |  |  | — |  |  | 9,200 |
Net Income/(Loss) |  | $ | (88,913) |  |  | $ | (9,665) |  |  | $ | (133,003) |  |  | $ | (231,581) |
Less Preferred Stock Dividend Requirement |  | $ | — |  |  | $ | — |  |  | $ | 32,875 |  |  | $ | 32,875 |
Net Income/(Loss) Available to Common Stock and Participating Securities |  | $ | (88,913) |  |  | $ | (9,665) |  |  | $ | (165,878) |  |  | $ | (264,456) |
(Dollars in Thousands) |  | Mortgage-Related Assets |  | Lima One |  | Corporate |  | Total
Year Ended December 31, 2021 |  |  |  |  |  |  |  |
Interest Income |  | $ | 347,863 |  |  | $ | 14,249 |  |  | $ | 190 |  |  | $ | 362,302 |
Interest Expense |  | 99,905 |  |  | 4,691 |  |  | 15,789 |  |  | 120,385 |
Net Interest Income/(Expense) |  | $ | 247,958 |  |  | $ | 9,558 |  |  | $ | (15,599) |  |  | $ | 241,917 |
Reversal of Provision/(Provision) for Credit Losses on Residential Whole Loans |  | 44,981 |  |  | (118) |  |  | — |  |  | 44,863 |
Net Interest Income/(Expense) after Reversal of Provision/(Provision) for Credit Losses |  | $ | 292,939 |  |  | $ | 9,440 |  |  | $ | (15,599) |  |  | $ | 286,780 |
Net gain/(loss) on residential whole loans measured at fair value through earnings |  | $ | (2,719) |  |  | $ | 18,962 |  |  | $ | — |  |  | $ | 16,243 |
Impairment and other net gain on securities and other portfolio investments |  | 1,607 |  |  | — |  |  | 72,889 |  |  | 74,496 |
Net gain on real estate owned |  | 22,760 |  |  | 78 |  |  | — |  |  | 22,838 |
Net gain/(loss) on derivatives used for risk management purposes |  | 1,457 |  |  | (31) |  |  | — |  |  | 1,426 |
Net gain on securitized debt measured at fair value through earnings |  | 14,594 |  |  | 433 |  |  | — |  |  | 15,027 |
Lima One - origination, servicing and other fee income |  | — |  |  | 22,600 |  |  | — |  |  | 22,600 |
Other, net |  | 759 |  |  | 128 |  |  | 8,760 |  |  | 9,647 |
Total Other Income/(Loss), net |  | $ | 38,458 |  |  | $ | 42,170 |  |  | $ | 81,649 |  |  | $ | 162,277 |
Compensation and benefits |  | $ | — |  |  | $ | 18,130 |  |  | $ | 35,687 |  |  | $ | 53,817 |
General and administrative expenses |  | — |  |  | 6,010 |  |  | 22,893 |  |  | 28,903 |
Loan servicing, financing, and other related costs |  | 25,250 |  |  | 436 |  |  | 5,181 |  |  | 30,867 |
Amortization of intangible assets |  | — |  |  | 6,600 |  |  | — |  |  | 6,600 |
Net Income/(Loss) |  | $ | 306,147 |  |  | $ | 20,434 |  |  | $ | 2,289 |  |  | $ | 328,870 |
Less Preferred Stock Dividend Requirement |  | $ | — |  |  | $ | — |  |  | $ | 32,875 |  |  | $ | 32,875 |
Net Income/(Loss) Available to Common Stock and Participating Securities |  | $ | 306,147 |  |  | $ | 20,434 |  |  | $ | (30,586) |  |  | $ | 295,995 |
(Dollars in Thousands) |  | Mortgage-Related Assets |  | Lima One |  | Corporate |  | Total
December 31, 2023 |  |  |  |  |  |  |  |
Total Assets |  | $ | 6,370,237 |  |  | $ | 4,000,932 |  |  | $ | 401,521 |  |  | $ | 10,772,690 |
December 31, 2022 |  |  |  |  |  |  |  |
Total Assets |  | $ | 6,065,557 |  |  | $ | 2,618,695 |  |  | $ | 428,153 |  |  | $ | 9,112,405 |
Lima One Segment On July 1, 2021, the Company completed the acquisition from affiliates of Magnetar Capital of their ownership interests in Lima One Holdings, LLC, the parent company of Lima One Capital, LLC (collectively, “Lima One”), a leading originator and servicer of business purpose loans. In connection with this transaction, the Company also acquired from certain members of management of Lima One their ownership interests in Lima One Holdings, LLC. With the completion of these transactions (collectively, “the transaction”), the Company acquired the remaining approximately 57% of the common equity interests of Lima One that it did not previously own, for cash consideration of $57.3 million and $4.7 million of restricted stock unit awards issued to certain members of the Lima One management team. As a result of these transactions, the Company gained control of 100% of the ownership interests in Lima One and was required to consolidate its financial results from that date. The transaction was accounted for under the purchase method of accounting. Under purchase accounting, the purchase consideration to acquire Lima One is defined as the cash paid to acquire the approximately 57% of the common equity interests not previously owned and the estimated fair value of the previously owned approximately 43% common equity interest. Further, under purchase accounting, the Company was required to revalue the previously owned common equity interest to fair value. At the time of the revaluation, the previously owned common equity interest had a carrying value of $5.6 million (net of a $21.0 million impairment charge that was recorded in the first quarter of 2020). Consequently, the revaluation resulted in the Company recording a gain of $38.9 million that is presented in Other Income/(Loss), net in the Company’s consolidated statement of operations for the year ended December 31, 2021. Accordingly, under the purchase method of accounting, the purchase consideration allocated was $101.7 million. The restricted stock awards issued are not included in the purchase consideration as it was determined that they should be accounted for as compensation expense for post-combination services. Additionally, concurrent with the closing of the transaction, the Company injected additional capital that facilitated the repayment by Lima One of $47.4 million of outstanding preferred equity interests, of which $22.0 million were held by the Company prior to closing. As the Company had previously recorded an impairment write-down on its investment in Lima One’s preferred equity that was repaid in connection with the transaction, the Company recorded a gain of $5.0 million to reflect the reversal of this impairment charge. This gain was recorded in Other Income/(Loss), net in the consolidated statements of operations for the year ended December 31, 2021. Further, the Company paid a total of $428,000 of acquisition related expenses, which were recorded in Operating and Other Expenses in the consolidated statements of operations for the year ended December 31, 2021. The Company performed an allocation of the purchase consideration and recorded the underlying assets acquired (including certain identified intangible assets) and liabilities assumed based on their estimated fair values using the information available at the acquisition date. The excess of the purchase consideration over the net assets acquired of $61.1 million was allocated to goodwill. The goodwill is attributed to further access and expansion into business purpose loan markets as well as access to an experienced management team and workforce that are expected to continue to provide services to the business. In addition, the Company identified and recorded finite-lived intangible assets totaling $28.0 million (see Note 5). The Lima One segment includes the stand-alone mortgage origination and servicing business of Lima One, including related goodwill, intangible assets, and direct expenses, plus Lima One-related residential whole loans and REO (defined as both those owned by Lima One on the acquisition date and those originated by Lima One since the acquisition date) and the economics related thereto (including any related taxes and the economics of associated financing and hedging instruments), all as recorded under GAAP. Associated financing economics are equal to the results of direct financings of Lima One-related residential whole loans and REO plus allocations of the results of financings which include Lima One related residential whole loans and REO as part of their collateral, based on the relative carrying values of the financed assets. Associated hedging economics are equal to allocations of the Company’s overall hedging results based on the relative estimated duration of each asset class hedged and the relative fair values of assets within each asset class. Mortgage-Related Assets Segment This segment is comprised of the remainder of the Company’s investments (including any related taxes and the economics of associated financing and hedging instruments).

X
- References No definition available. + Details
Name: | us-gaap_SegmentReportingAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- Definition The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Topic 280 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 22 -Publisher FASB -URI https://asc.fasb.org//1943274/2147482810/280-10-50-22 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Topic 280 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 15 -Publisher FASB -URI https://asc.fasb.org//1943274/2147482810/280-10-50-15 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Topic 280 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 31 -Publisher FASB -URI https://asc.fasb.org//1943274/2147482810/280-10-50-31 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Topic 280 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 32 -Subparagraph (d) -Publisher FASB -URI https://asc.fasb.org//1943274/2147482810/280-10-50-32 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Topic 280 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 42 -Publisher FASB -URI https://asc.fasb.org//1943274/2147482810/280-10-50-42 Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Topic 280 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 32 -Subparagraph (f) -Publisher FASB -URI https://asc.fasb.org//1943274/2147482810/280-10-50-32 Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Topic 280 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 40 -Publisher FASB -URI https://asc.fasb.org//1943274/2147482810/280-10-50-40 Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Topic 280 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org//280/tableOfContent Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Topic 280 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 26 -Publisher FASB -URI https://asc.fasb.org//1943274/2147482810/280-10-50-26 Reference 10: http://www.xbrl.org/2003/role/disclosureRef -Topic 280 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 34 -Publisher FASB -URI https://asc.fasb.org//1943274/2147482810/280-10-50-34 Reference 11: http://www.xbrl.org/2003/role/disclosureRef -Topic 280 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 41 -Publisher FASB -URI https://asc.fasb.org//1943274/2147482810/280-10-50-41 Reference 12: http://www.xbrl.org/2003/role/disclosureRef -Topic 280 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 21 -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org//1943274/2147482810/280-10-50-21 Reference 13: http://www.xbrl.org/2003/role/disclosureRef -Topic 280 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 21 -Subparagraph (b) -Publisher FASB -URI https://asc.fasb.org//1943274/2147482810/280-10-50-21 Reference 14: http://www.xbrl.org/2003/role/disclosureRef -Topic 280 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 32 -Subparagraph (e) -Publisher FASB -URI https://asc.fasb.org//1943274/2147482810/280-10-50-32 + Details
Name: | us-gaap_SegmentReportingDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | dtr-types:textBlockItemType
Balance Type: | na
Period Type: | duration