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Segment Information (Tables) | 6 Months Ended
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Jun. 30, 2021
Segment Reporting [Abstract] |
Business Segment Financial Information | The following tables present financial information by segment for the three and six months ended June 30, 2021 and 2020. Table 23.1 – Business Segment Financial Information
|  | Three Months Ended June 30, 2021
(In Thousands) |  | Residential Lending |  | Business Purpose Lending |  | Third-Party Investments |  | Corporate/ Other |  | Total
Interest income |  | $ | 33,033 |  |  | $ | 70,515 |  |  | $ | 33,972 |  |  | $ | 1,175 |  |  | $ | 138,695 |
Interest expense |  | (21,056) |  |  | (54,442) |  |  | (22,334) |  |  | (10,233) |  |  | (108,065) |
Net interest income |  | 11,977 |  |  | 16,073 |  |  | 11,638 |  |  | (9,058) |  |  | 30,630 |
Non-interest income |  |  |  |  |  |  |  |  |  |
Mortgage banking activities, net |  | 21,265 |  |  | 33,154 |  |  | — |  |  | — |  |  | 54,419 |
Investment fair value changes, net |  | 3,927 |  |  | 3,782 |  |  | 42,018 |  |  | (247) |  |  | 49,480 |
Other income, net |  | 839 |  |  | 1,017 |  |  | 5 |  |  | 265 |  |  | 2,126 |
Realized gains, net |  | 6,687 |  |  | 390 |  |  | 1,307 |  |  | — |  |  | 8,384 |
Total non-interest income (loss), net |  | 32,718 |  |  | 38,343 |  |  | 43,330 |  |  | 18 |  |  | 114,409 |
General and administrative expenses |  | (7,793) |  |  | (13,688) |  |  | (930) |  |  | (18,183) |  |  | (40,594) |
Loan acquisition costs |  | (1,887) |  |  | (1,861) |  |  | — |  |  | — |  |  | (3,748) |
Other expenses |  | — |  |  | (3,873) |  |  | (112) |  |  | — |  |  | (3,985) |
Provision for income taxes |  | (4,171) |  |  | (2,182) |  |  | (334) |  |  | — |  |  | (6,687) |
Segment Contribution |  | $ | 30,844 |  |  | $ | 32,812 |  |  | $ | 53,592 |  |  | $ | (27,223) |  |  |
Net Income |  |  |  |  |  |  |  |  |  | $ | 90,025 |
Non-cash amortization (expense) income, net |  | $ | 1,339 |  |  | $ | (5,584) |  |  | $ | 185 |  |  | $ | (1,955) |  |  | $ | (6,015) |
|  | Six Months Ended June 30, 2021
(In Thousands) |  | Residential Lending |  | Business Purpose Lending |  | Third-Party Investments |  | Corporate/ Other |  | Total
Interest income |  | $ | 60,581 |  |  | $ | 134,920 |  |  | $ | 68,962 |  |  | $ | 2,537 |  |  | $ | 267,000 |
Interest expense |  | (40,093) |  |  | (104,517) |  |  | (45,513) |  |  | (20,494) |  |  | (210,617) |
Net interest income |  | 20,488 |  |  | 30,403 |  |  | 23,449 |  |  | (17,957) |  |  | 56,383 |
Non-interest income |  |  |  |  |  |  |  |  |  |
Mortgage banking activities, net |  | 82,700 |  |  | 54,326 |  |  | — |  |  | — |  |  | 137,026 |
Investment fair value changes, net |  | 6,673 |  |  | 7,081 |  |  | 81,734 |  |  | (921) |  |  | 94,567 |
Other income, net |  | 3,692 |  |  | 1,860 |  |  | 5 |  |  | 412 |  |  | 5,969 |
Realized gains, net |  | 9,095 |  |  | 498 |  |  | 1,507 |  |  | — |  |  | 11,100 |
Total non-interest income, net |  | 102,160 |  |  | 63,765 |  |  | 83,246 |  |  | (509) |  |  | 248,662 |
General and administrative expenses |  | (21,550) |  |  | (24,847) |  |  | (2,061) |  |  | (35,687) |  |  | (84,145) |
Loan acquisition costs |  | (3,303) |  |  | (3,913) |  |  | (87) |  |  | (4) |  |  | (7,307) |
Other expenses |  | (6) |  |  | (7,650) |  |  | (442) |  |  | 17 |  |  | (8,081) |
Provision for income taxes |  | (14,150) |  |  | (3,503) |  |  | (577) |  |  | — |  |  | (18,230) |
Segment Contribution |  | $ | 83,639 |  |  | $ | 54,255 |  |  | $ | 103,528 |  |  | $ | (54,140) |  |  |
Net Income |  |  |  |  |  |  |  |  |  | $ | 187,282 |
Non-cash amortization (expense) income, net |  | $ | 3,005 |  |  | $ | (11,441) |  |  | $ | 41 |  |  | $ | (3,850) |  |  | $ | (12,245) |
|  | Three Months Ended June 30, 2020
(In Thousands) |  | Residential Lending |  | Business Purpose Lending |  | Third-Party Investments |  | Corporate/ Other |  | Total
Interest income |  | $ | 36,653 |  |  | $ | 53,742 |  |  | $ | 36,811 |  |  | $ | 2,740 |  |  | $ | 129,946 |
Interest expense |  | (28,762) |  |  | (36,631) |  |  | (24,927) |  |  | (12,346) |  |  | (102,666) |
Net interest income |  | 7,891 |  |  | 17,111 |  |  | 11,884 |  |  | (9,606) |  |  | 27,280 |
Non-interest income |  |  |  |  |  |  |  |  |  |
Mortgage banking activities, net |  | (8,005) |  |  | 2,023 |  |  | — |  |  | — |  |  | (5,982) |
Investment fair value changes, net |  | 35,085 |  |  | 40,401 |  |  | 76,972 |  |  | (230) |  |  | 152,228 |
Other income, net |  | 230 |  |  | 686 |  |  | (509) |  |  | 758 |  |  | 1,165 |
Realized gains, net |  | 205 |  |  | — |  |  | 578 |  |  | 25,182 |  |  | 25,965 |
Total non-interest income, net |  | 27,515 |  |  | 43,110 |  |  | 77,041 |  |  | 25,710 |  |  | 173,376 |
General and administrative expenses |  | (3,700) |  |  | (9,016) |  |  | (1,986) |  |  | (13,818) |  |  | (28,520) |
Loan acquisition costs |  | (175) |  |  | (1,277) |  |  | (120) |  |  | — |  |  | (1,572) |
Other expenses |  | — |  |  | (3,884) |  |  | (1,065) |  |  | (134) |  |  | (5,083) |
Benefit from (provision for) income taxes |  | 3,323 |  |  | 2,439 |  |  | (5,799) |  |  | — |  |  | (37) |
Segment Contribution |  | $ | 34,854 |  |  | $ | 48,483 |  |  | $ | 79,955 |  |  | $ | 2,152 |  |  |
Net Income |  |  |  |  |  |  |  |  |  | $ | 165,444 |
Non-cash amortization income (expense), net |  | $ | (1,265) |  |  | $ | (6,391) |  |  | $ | 312 |  |  | $ | (1,619) |  |  | $ | (8,963) |
|  | Six Months Ended June 30, 2020
(In Thousands) |  | Residential Lending |  | Business Purpose Lending |  | Third-Party Investments |  | Corporate/ Other |  | Total
Interest income |  | $ | 97,284 |  |  | $ | 106,802 |  |  | $ | 118,007 |  |  | $ | 5,934 |  |  | $ | 328,027 |
Interest expense |  | (66,324) |  |  | (68,984) |  |  | (87,428) |  |  | (26,601) |  |  | (249,337) |
Net interest income |  | 30,960 |  |  | 37,818 |  |  | 30,579 |  |  | (20,667) |  |  | 78,690 |
Non-interest income |  |  |  |  |  |  |  |  |  |
Mortgage banking activities, net |  | (31,086) |  |  | (3,798) |  |  | — |  |  | — |  |  | (34,884) |
Investment fair value changes, net |  | (161,550) |  |  | (101,729) |  |  | (454,586) |  |  | (739) |  |  | (718,604) |
Other income, net |  | (267) |  |  | 2,870 |  |  | 732 |  |  | 758 |  |  | 4,093 |
Realized gains, net |  | 2,001 |  |  | — |  |  | 2,634 |  |  | 25,182 |  |  | 29,817 |
Total non-interest income, net |  | (190,902) |  |  | (102,657) |  |  | (451,220) |  |  | 25,201 |  |  | (719,578) |
General and administrative expenses |  | (8,299) |  |  | (20,656) |  |  | (3,521) |  |  | (24,726) |  |  | (57,202) |
Loan acquisition costs |  | (1,208) |  |  | (3,970) |  |  | (373) |  |  | (7) |  |  | (5,558) |
Other expenses |  | — |  |  | (96,869) |  |  | 817 |  |  | (446) |  |  | (96,498) |
Benefit from income taxes |  | 8,653 |  |  | 9,021 |  |  | 4,518 |  |  | — |  |  | 22,192 |
Segment Contribution |  | $ | (160,796) |  |  | $ | (177,313) |  |  | $ | (419,200) |  |  | $ | (20,645) |  |  |
Net Loss |  |  |  |  |  |  |  |  |  | $ | (777,954) |
Non-cash amortization income (expense), net |  | $ | (1,053) |  |  | $ | (11,316) |  |  | $ | 1,053 |  |  | $ | (1,728) |  |  | $ | (13,044) |
Other significant non-cash expense: goodwill impairment |  | $ | — |  |  | $ | (88,675) |  |  | $ | — |  |  | $ | — |  |  | $ | (88,675) |
Components of Corporate and Other | The following table presents the components of Corporate/Other for the three and six months ended June 30, 2021 and 2020. Table 23.2 – Components of Corporate/Other
|  | Three Months Ended June 30,
|  | 2021 |  | 2020
(In Thousands) |  | Legacy Consolidated VIEs (1) |  | Other |  | Total |  | Legacy Consolidated VIEs (1) |  | Other |  | Total
Interest income |  | $ | 1,169 |  |  | $ | 6 |  |  | $ | 1,175 |  |  | $ | 2,685 |  |  | $ | 55 |  |  | $ | 2,740 |
Interest expense |  | (755) |  |  | (9,478) |  |  | (10,233) |  |  | (1,518) |  |  | (10,828) |  |  | (12,346) |
Net interest income |  | 414 |  |  | (9,472) |  |  | (9,058) |  |  | 1,167 |  |  | (10,773) |  |  | (9,606) |
Non-interest income |  |  |  |  |  |  |  |  |  |  |  |
Investment fair value changes, net |  | (216) |  |  | (31) |  |  | (247) |  |  | (230) |  |  | — |  |  | (230) |
Other income |  | — |  |  | 265 |  |  | 265 |  |  | — |  |  | 758 |  |  | 758 |
Realized gains, net |  | — |  |  | — |  |  | — |  |  | — |  |  | 25,182 |  |  | 25,182 |
Total non-interest income, net |  | (216) |  |  | 234 |  |  | 18 |  |  | (230) |  |  | 25,940 |  |  | 25,710 |
General and administrative expenses |  | — |  |  | (18,183) |  |  | (18,183) |  |  | — |  |  | (13,818) |  |  | (13,818) |
Other expenses |  | — |  |  | — |  |  | — |  |  | — |  |  | (134) |  |  | (134) |
Total |  | $ | 198 |  |  | $ | (27,421) |  |  | $ | (27,223) |  |  | $ | 937 |  |  | $ | 1,215 |  |  | $ | 2,152 |
|  | Six Months Ended June 30,
|  | 2021 |  | 2020
(In Thousands) |  | Legacy Consolidated VIEs (1) |  | Other |  | Total |  | Legacy Consolidated VIEs (1) |  | Other |  | Total
Interest income |  | $ | 2,517 |  |  | $ | 20 |  |  | $ | 2,537 |  |  | $ | 5,879 |  |  | $ | 55 |  |  | $ | 5,934 |
Interest expense |  | (1,630) |  |  | (18,864) |  |  | (20,494) |  |  | (4,040) |  |  | (22,561) |  |  | (26,601) |
Net interest income |  | 887 |  |  | (18,844) |  |  | (17,957) |  |  | 1,839 |  |  | (22,506) |  |  | (20,667) |
Non-interest income |  |  |  |  |  |  |  |  |  |  |  |
Investment fair value changes, net |  | (915) |  |  | (6) |  |  | (921) |  |  | (621) |  |  | (118) |  |  | (739) |
Other income |  | — |  |  | 412 |  |  | 412 |  |  | — |  |  | 758 |  |  | 758 |
Realized gains, net |  | — |  |  | — |  |  | — |  |  | — |  |  | 25,182 |  |  | 25,182 |
Total non-interest income, net |  | (915) |  |  | 406 |  |  | (509) |  |  | (621) |  |  | 25,822 |  |  | 25,201 |
General and administrative expenses |  | — |  |  | (35,687) |  |  | (35,687) |  |  | — |  |  | (24,726) |  |  | (24,726) |
Loan acquisition costs |  | — |  |  | (4) |  |  | (4) |  |  | — |  |  | (7) |  |  | (7) |
Other expenses |  | — |  |  | 17 |  |  | 17 |  |  | — |  |  | (446) |  |  | (446) |
Total |  | $ | (28) |  |  | $ | (54,112) |  |  | $ | (54,140) |  |  | $ | 1,218 |  |  | $ | (21,863) |  |  | $ | (20,645) |
(1) Legacy consolidated VIEs represent Legacy Sequoia entities that are consolidated for GAAP financial reporting purposes. See Note 4 for further discussion on VIEs.
Supplemental Information by Segment | The following table presents supplemental information by segment at June 30, 2021 and December 31, 2020. Table 23.3 – Supplemental Segment Information
(In Thousands) |  | Residential Lending |  | Business Purpose Lending |  |  |  | Third-Party Investments |  | Corporate/ Other |  | Total
June 30, 2021 |  |  |  |  |  |  |  |  |  |  |  |
Residential loans |  | $ | 3,383,101 |  |  | $ | — |  |  |  |  | $ | 2,098,624 |  |  | $ | 260,875 |  |  | $ | 5,742,600 |
Business purpose loans |  | — |  |  | 4,408,889 |  |  |  |  | — |  |  | — |  |  | 4,408,889 |
Multifamily loans |  | — |  |  | — |  |  |  |  | 485,157 |  |  | — |  |  | 485,157 |
Real estate securities |  | 163,609 |  |  | — |  |  |  |  | 191,277 |  |  | — |  |  | 354,886 |
Other investments |  | 8,721 |  |  | 13,168 |  |  |  |  | 267,851 |  |  | 18,992 |  |  | 308,732 |
Intangible assets |  | — |  |  | 49,119 |  |  |  |  | — |  |  | — |  |  | 49,119 |
Total assets |  | 3,615,860 |  |  | 4,576,139 |  |  |  |  | 3,063,094 |  |  | 741,298 |  |  | 11,996,391 |
December 31, 2020 |  |  |  |  |  |  |  |  |  |  |  |
Residential loans |  | $ | 1,741,963 |  |  | $ | — |  |  |  |  | $ | 2,221,153 |  |  | $ | 285,935 |  |  | $ | 4,249,051 |
Business purpose loans |  | — |  |  | 4,136,353 |  |  |  |  | — |  |  | — |  |  | 4,136,353 |
Multifamily loans |  | — |  |  | — |  |  |  |  | 492,221 |  |  | — |  |  | 492,221 |
Real estate securities |  | 160,780 |  |  | — |  |  |  |  | 183,345 |  |  | — |  |  | 344,125 |
Other investments |  | 8,815 |  |  | 21,627 |  |  |  |  | 317,282 |  |  | 451 |  |  | 348,175 |
Intangible assets |  | — |  |  | 56,865 |  |  |  |  | — |  |  | — |  |  | 56,865 |
Total assets |  | 1,989,802 |  |  | 4,323,040 |  |  |  |  | 3,232,415 |  |  | 809,809 |  |  | 10,355,066 |

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