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Business Segment Reporting | 9 Months Ended
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Sep. 30, 2024
Segment Reporting [Abstract] |
Business Segment Reporting |
Note 18 – Business Segment Reporting
Our business segments reflect the internal reporting that our Chief Executive Officer uses to evaluate our operating and financial performance and to assess the allocation of our resources. Our current reportable business segments consist of Servicing, Originations, and Corporate Items and Other. During the three months ended September 30, 2024, there have been no changes to our business segments as disclosed in our Annual Report on Form 10-K for the year ended December 31, 2023. Effective in the fourth quarter of 2023, the Servicing segment includes CR Limited (CRL), our wholly-owned captive reinsurance subsidiary previously included in the Corporate Items and Other segment. Segment results for the three and nine months ended September 30, 2023 have been recast to conform to the current segment presentation.
Financial information for our segments is as follows: |  |  |  |  |  |  |  |
| Three Months Ended September 30, 2024
Results of Operations | Servicing |  | Originations |  | Corporate Items and Other |  |  |  | Business Segments Consolidated
Servicing and subservicing fees | $ | 210.2 |  |  | $ | 1.0 |  |  | $ | — |  |  |  |  | $ | 211.1 |
Gain on reverse loans held for investment and HMBS-related borrowings, net | 11.9 |  |  | 6.2 |  |  | — |  |  |  |  | 18.0 |
Gain on loans held for sale, net | 9.4 |  |  | 16.4 |  |  | — |  |  |  |  | 25.8 |
Other revenue, net | 4.7 |  |  | 6.1 |  |  | — |  |  |  |  | 10.8 |
Revenue | 236.1 |  |  | 29.6 |  |  | — |  |  |  |  | 265.7 |
MSR valuation adjustments, net | (35.6) |  |  | 4.1 |  |  | — |  |  |  |  | (31.5) |
Operating expenses |  |  |  |  |  |  |  |  |
Compensation and benefits | 26.0 |  |  | 11.8 |  |  | 21.7 |  |  |  |  | 59.5 |
Servicing and origination | 8.9 |  |  | 1.8 |  |  | 0.4 |  |  |  |  | 11.1 |
Technology and communications | 6.0 |  |  | 1.9 |  |  | 5.3 |  |  |  |  | 13.2 |
Professional services | 9.6 |  |  | 0.6 |  |  | 7.2 |  |  |  |  | 17.3 |
Occupancy, equipment and mailing | 6.7 |  |  | 0.7 |  |  | 0.5 |  |  |  |  | 7.9 |
Corporate overhead allocations | 11.5 |  |  | 4.2 |  |  | (15.7) |  |  |  |  | — |
Other expenses | 0.9 |  |  | 1.3 |  |  | 1.2 |  |  |  |  | 3.4 |
Operating expenses | 69.6 |  |  | 22.2 |  |  | 20.6 |  |  |  |  | 112.4 |
Other income (expense): |  |  |  |  |  |  |  |  |
Interest income | 8.4 |  |  | 14.8 |  |  | 1.3 |  |  |  |  | 24.5 |
Interest expense | (46.6) |  |  | (16.2) |  |  | (11.4) |  |  |  |  | (74.2) |
Pledged MSR liability expense | (42.3) |  |  | — |  |  | — |  |  |  |  | (42.3) |
Earnings of equity method investee | 0.8 |  |  | — |  |  | — |  |  |  |  | 0.8 |
Gain on extinguishment of debt | — |  |  | — |  |  | 0.3 |  |  |  |  | 0.3 |
Other, net | (3.4) |  |  | — |  |  | 0.2 |  |  |  |  | (3.3) |
Other income (expense), net | (83.2) |  |  | (1.4) |  |  | (9.6) |  |  |  |  | (94.1) |
Income (loss) before income taxes | $ | 47.7 |  |  | $ | 10.2 |  |  | $ | (30.2) |  |  |  |  | $ | 27.6 |
| Three Months Ended September 30, 2023
Results of Operations | Servicing |  | Originations |  | Corporate Items and Other |  |  |  | Business Segments Consolidated
Servicing and subservicing fees | $ | 236.9 |  |  | $ | 0.8 |  |  | $ | — |  |  |  |  | 237.8 |
Gain on reverse loans held for investment and HMBS-related borrowings, net | (6.1) |  |  | 5.7 |  |  | — |  |  |  |  | (0.4) |
Gain (loss) on loans held for sale, net | (0.8) |  |  | 9.0 |  |  | — |  |  |  |  | 8.2 |
Other revenue, net | 4.4 |  |  | 5.5 |  |  | — |  |  |  |  | 10.0 |
Revenue | 234.5 |  |  | 21.0 |  |  | — |  |  |  |  | 255.5 |
MSR valuation adjustments, net | (21.0) |  |  | 4.6 |  |  | — |  |  |  |  | (16.4) |
Operating expenses |  |  |  |  |  |  |  |  |
Compensation and benefits | 25.2 |  |  | 11.6 |  |  | 18.9 |  |  |  |  | 55.7 |
Servicing and origination | 13.2 |  |  | 2.0 |  |  | 0.3 |  |  |  |  | 15.5 |
Technology and communications | 6.1 |  |  | 1.9 |  |  | 5.0 |  |  |  |  | 13.1 |
Professional services | 8.2 |  |  | 0.7 |  |  | 4.7 |  |  |  |  | 13.5 |
Occupancy, equipment and mailing | 6.8 |  |  | 0.6 |  |  | 0.3 |  |  |  |  | 7.7 |
Corporate overhead allocations | 11.4 |  |  | 4.5 |  |  | (15.9) |  |  |  |  | — |
Other expenses | 1.9 |  |  | 1.1 |  |  | 1.5 |  |  |  |  | 4.6 |
Operating expenses | 72.9 |  |  | 22.3 |  |  | 14.8 |  |  |  |  | 110.0 |
Other income (expense): |  |  |  |  |  |  |  |  |
Interest income | 5.9 |  |  | 18.7 |  |  | 1.2 |  |  |  |  | 25.9 |
Interest expense | (43.3) |  |  | (20.0) |  |  | (11.0) |  |  |  |  | (74.3) |
Pledged MSR liability expense | (76.5) |  |  | — |  |  | — |  |  |  |  | (76.5) |
Earnings of equity method investee | 2.8 |  |  | — |  |  | — |  |  |  |  | 2.8 |
Gain on extinguishment of debt | — |  |  | — |  |  | 1.2 |  |  |  |  | 1.2 |
Other, net | 1.2 |  |  | (0.1) |  |  | 0.2 |  |  |  |  | 1.3 |
Other income (expense), net | (109.9) |  |  | (1.5) |  |  | (8.3) |  |  |  |  | (119.7) |
Income (loss) before income taxes | $ | 30.7 |  |  | $ | 1.9 |  |  | $ | (23.1) |  |  |  |  | $ | 9.5 |
| Nine Months Ended September 30, 2024
Results of Operations | Servicing |  | Originations |  | Corporate Items and Other |  |  |  | Business Segments Consolidated
Servicing and subservicing fees | $ | 624.5 |  |  | $ | 2.0 |  |  | $ | — |  |  |  |  | $ | 626.5 |
Gain on reverse loans held for investment and HMBS-related borrowings, net | 23.2 |  |  | 18.7 |  |  | — |  |  |  |  | 41.9 |
Gain on loans held for sale, net | 11.0 |  |  | 42.2 |  |  | — |  |  |  |  | 53.2 |
Other revenue, net | 13.5 |  |  | 16.1 |  |  | — |  |  |  |  | 29.6 |
Revenue | 672.3 |  |  | 78.9 |  |  | — |  |  |  |  | 751.2 |
MSR valuation adjustments, net | (83.9) |  |  | 8.1 |  |  | — |  |  |  |  | (75.8) |
Operating expenses |  |  |  |  |  |  |  |  |
Compensation and benefits | 75.8 |  |  | 33.3 |  |  | 59.1 |  |  |  |  | 168.1 |
Servicing and origination | 33.3 |  |  | 5.5 |  |  | 1.2 |  |  |  |  | 40.0 |
Technology and communications | 18.4 |  |  | 5.3 |  |  | 15.3 |  |  |  |  | 38.9 |
Professional services | 19.5 |  |  | 1.4 |  |  | 19.1 |  |  |  |  | 40.1 |
Occupancy, equipment and mailing | 20.2 |  |  | 1.7 |  |  | 1.3 |  |  |  |  | 23.1 |
Corporate overhead allocations | 33.2 |  |  | 12.4 |  |  | (45.6) |  |  |  |  | — |
Other expenses | 2.9 |  |  | 3.7 |  |  | 4.0 |  |  |  |  | 10.6 |
Operating expenses | 203.3 |  |  | 63.2 |  |  | 54.3 |  |  |  |  | 320.8 |
Other income (expense): |  |  |  |  |  |  |  |  |
Interest income | 22.3 |  |  | 38.6 |  |  | 3.6 |  |  |  |  | 64.5 |
Interest expense | (139.4) |  |  | (41.4) |  |  | (33.8) |  |  |  |  | (214.6) |
Pledged MSR liability expense | (133.4) |  |  | — |  |  | 0.1 |  |  |  |  | (133.3) |
Earnings of equity method investee | 6.7 |  |  | — |  |  | — |  |  |  |  | 6.7 |
Gain on extinguishment of debt | — |  |  | — |  |  | 1.8 |  |  |  |  | 1.8 |
Other | (6.9) |  |  | (0.3) |  |  | 0.5 |  |  |  |  | (6.7) |
Other income (expense), net | (250.8) |  |  | (3.1) |  |  | (27.8) |  |  |  |  | (281.7) |
Income (loss) before income taxes | $ | 134.3 |  |  | $ | 20.7 |  |  | $ | (82.1) |  |  |  |  | $ | 72.9 |
| Nine Months Ended September 30, 2023
Results of Operations | Servicing |  | Originations |  | Corporate Items and Other |  |  |  | Business Segments Consolidated
Servicing and subservicing fees | $ | 705.9 |  |  | $ | 1.6 |  |  | $ | — |  |  |  |  | $ | 707.5 |
Gain (loss) on reverse loans held for investment and HMBS-related borrowings, net | 3.9 |  |  | 17.7 |  |  | — |  |  |  |  | 21.5 |
Gain (loss) on loans held for sale, net | 13.0 |  |  | 23.3 |  |  | — |  |  |  |  | 36.3 |
Other revenue, net | 11.4 |  |  | 12.6 |  |  | — |  |  |  |  | 24.0 |
Revenue | 734.3 |  |  | 55.2 |  |  | — |  |  |  |  | 789.4 |
MSR valuation adjustments, net | (142.4) |  |  | 8.2 |  |  | — |  |  |  |  | (134.2) |
Operating expenses |  |  |  |  |  |  |  |  |
Compensation and benefits | 81.3 |  |  | 32.1 |  |  | 58.0 |  |  |  |  | 171.4 |
Servicing and origination | 44.8 |  |  | 3.1 |  |  | 0.8 |  |  |  |  | 48.8 |
Technology and communications | 18.6 |  |  | 5.4 |  |  | 15.5 |  |  |  |  | 39.5 |
Professional services | 27.5 |  |  | 1.4 |  |  | (19.0) |  |  |  |  | 9.9 |
Occupancy, equipment and mailing | 21.7 |  |  | 1.6 |  |  | 0.9 |  |  |  |  | 24.2 |
Corporate overhead allocations | 34.0 |  |  | 14.4 |  |  | (48.4) |  |  |  |  | — |
Other expenses | 6.4 |  |  | 4.1 |  |  | 4.2 |  |  |  |  | 14.7 |
Operating expenses | 234.2 |  |  | 62.1 |  |  | 12.1 |  |  |  |  | 308.4 |
Other income (expense): |  |  |  |  |  |  |  |  |
Interest income | 16.0 |  |  | 40.8 |  |  | 3.4 |  |  |  |  | 60.2 |
Interest expense | (128.2) |  |  | (44.0) |  |  | (32.6) |  |  |  |  | (204.8) |
Pledged MSR liability expense | (219.9) |  |  | — |  |  | 0.1 |  |  |  |  | (219.8) |
Earnings of equity method investee | 5.9 |  |  | — |  |  | — |  |  |  |  | 5.9 |
Gain on extinguishment of debt | — |  |  | — |  |  | 1.2 |  |  |  |  | 1.2 |
Other | (3.8) |  |  | (0.1) |  |  | 2.0 |  |  |  |  | (1.9) |
Other income (expense), net | (329.9) |  |  | (3.4) |  |  | (26.0) |  |  |  |  | (359.2) |
Income (loss) before income taxes | $ | 27.7 |  |  | $ | (2.2) |  |  | $ | (38.0) |  |  |  |  | $ | (12.5) |
Total Assets | Servicing |  | Originations |  | Corporate Items and Other |  |  |  | Business Segments Consolidated
September 30, 2024 | $ | 12,110.2 |  |  | $ | 856.6 |  |  | $ | 259.9 |  |  |  |  | $ | 13,226.7 |
December 31, 2023 | 11,687.6 |  |  | 551.9 |  |  | 274.3 |  |  |  |  | 12,513.7 |

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- 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
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