SOURCE: Resource Capital Corp.

May 06, 2014 18:33 ET

Resource Capital Corp. Reports Results for Three Months Ended March 31, 2014

NEW YORK, NY--(Marketwired - May 6, 2014) - Resource Capital Corp. (NYSE: RSO)

Highlights

  • Adjusted Funds from Operations ("AFFO") of $0.20 per share-diluted (see Schedule I).

  • Invested over $300.0 million in new assets including over $161.0 million in commercial real estate loans and securities during the twelve months ended March 31, 2014.

  • GAAP net income allocable to common shares of $0.12 per share-diluted.
     
  • Common stock cash dividend of $0.20 per share.

Resource Capital Corp. (NYSE: RSO) ("RSO" or the "Company"), a real estate investment trust, or REIT, whose investment strategy focuses on commercial real estate assets, commercial mortgage-backed securities ("CMBS"), commercial finance assets and other investments, reported results for the three months ended March 31, 2014.

  • AFFO for the three months ended March 31, 2014 was $25.0 million, or $0.20 per share-diluted as compared to $21.0 million, or $0.20 per share-diluted for the three months ended March 31, 2013. A reconciliation of GAAP net income to AFFO is set forth in Schedule I of this release.

  • GAAP net income allocable to common shares for the three months ended March 31, 2014 was $15.1 million, or $0.12 per share-diluted, as compared to $11.5 million, or $0.11 per share-diluted, for the three months ended March 31, 2013. 

Jonathan Cohen, CEO and President of Resource Capital Corp., commented, "We are pleased with our investment program during the 1st quarter. We are seeing real momentum in achieving our goals of increased commercial real estate loan originations, good credit, and adjusted funds from operations in line or better than our dividend."

Additional highlights:

Commercial Real Estate

  • CRE loan portfolio is comprised of approximately 91% senior whole loans as of March 31, 2014, as compared to 85% a year ago.

  • RSO closed $374.1 million of new whole loans in the last 12 months with a weighted average yield of 6.31%, including origination fees. In addition, RSO funded $20.4 million of previous loan commitments on existing loans. 

The following table summarizes RSO's CRE loan activities and fundings of previous commitments, at par, for the three and the twelve months ended March 31, 2014 (in millions, except percentages):

                         
    Three Months Ended
March 31,
 2014
    12 Months Ended
March 31,
 2014
    Floating Weighted
Average Spread (1) (2)
    Weighted Average
Fixed Rate
 
New whole loans production (3)   $ 111.6     $ 394.5     4.70 %   -- %
Payoffs (4)     (22.2 )     (81.5 )            
Sales     --       (29.9 )            
Principal paydowns     (1.0 )     (16.7 )            
Loans, net   $ 88.4     $ 266.4              
                             
(1) Represents the weighted average rate above the one-month London Interbank Offered Rate ("LIBOR") on loans whose interest rate is based on LIBOR as of March 31, 2014. Of these loans, $107.9 million have LIBOR floors with a weighted average floor of 0.80%.
(2) Reflects rates on RSO's portfolio balance as of March 31, 2014.
(3) Whole loan production includes the funding of previous commitments of $3.7 million for the three months and $20.4 million for the twelve months ended March 31, 2014, respectively.
(4) CRE loan payoffs and extensions resulted in $148,000 in extension and exit fees during the three months ended March 31, 2014

CMBS

  • During the three months ended March 31, 2014, RSO acquired $36.8 million, par value, of CMBS which were partially financed by 30-day repurchase contracts with a repurchase value of $25.0 million. In addition, RSO acquired $4.1 million, par value, of CMBS, which were financed by RSO's Wells Fargo repurchase facility and were AAA rated by at least one rating agency. 

Commercial Finance - Syndicated Bank Loans

  • RSO's bank loan portfolio, including asset-backed securities ("ABS"), corporate bonds and certain loans held for sale, at the end of the first quarter of 2014 was $726.0 million, at amortized cost, with a weighted-average spread of one-month and three-month LIBOR plus 3.43% at March 31, 2014. RSO's bank loan portfolio was nearly 100% match-funded through three CLOs issuances.
  • RSO, through its subsidiary Resource Capital Asset Management, earned $1.7 million of net fees during the three months ended March 31, 2014.

Middle Market Loans

  •  RSO's middle market lending platform has made $58.2 million of loan commitments since January 1, 2014 and funded $41.2 million of those commitments.

Investment Portfolio

The table below summarizes the amortized cost and net carrying amount of RSO's investment portfolio as of March 31, 2014, classified by interest rate and by asset type. The following table includes both (i) the amortized cost of RSO's investment portfolio and the related dollar price, which is computed by dividing amortized cost by par amount, and (ii) the net carrying amount of RSO's investment portfolio and the related dollar price, which is computed by dividing the net carrying amount by par amount (in thousands, except percentages):

                                 
    Amortized
cost
  Dollar price     Net carrying
 amount
  Dollar price     Net carrying
amount less amortized cost
    Dollar price  
March 31, 2014                                
Floating rate                                
RMBS   $ 1,909   20.68 %   $ 438   4.74 %   $ (1,471 )   (15.93 )%
CMBS-private placement     27,138   91.99 %     15,508   52.57 %     (11,630 )   (39.42 )%
Structured notes - trading     8,057   34.49 %     9,549   40.88 %     1,492     6.39 %
Structured notes - available-for-sale     12,841   100.00 %     12,841   100.00 %     --     -- %
Mezzanine loans     12,467   99.06 %     12,365   98.25 %     (102 )   (0.81 )%
Whole loans (1)     833,853   99.56 %     828,664   98.94 %     (5,189 )   (0.62 )%
Bank loans (2)     687,154   99.56 %     686,413   99.45 %     (741 )   (0.11 )%
Loans held for sale (3)     272   22.08 %     272   22.08 %     --     -- %
ABS Securities     35,648   94.25 %     36,839   97.40 %     1,191     3.51 %
Corporate Bonds     2,603   96.23 %     2,580   95.38 %     (23 )   (0.85 )%
  Total floating rate     1,621,942   97.88 %     1,605,469   96.89 %     (16,473 )   (0.99 )%
Fixed rate                                      
CMBS-private placement     159,565   80.24 %     165,783   83.36 %     6,218     3.12 %
CMBS-linked transactions     38,214   105.59 %     34,829   96.24 %     (3,385 )   (9.40 )%
B notes (1)     16,168   99.54 %     16,036   98.73 %     (132 )   (0.81 )%
Mezzanine loans (1)     51,832   100.05 %     51,410   99.24 %     (422 )   (0.81 )%
Residential mortgage loans     1,843   100.00 %     1,843   100.00 %     --     -- %
Loans held for sale (3)     15,117   100.00 %     15,117   100.00 %     --     -- %
Loans receivable-related party     6,498   100.00 %     6,498   100.00 %     --     -- %
  Total fixed rate     289,237   88.57 %     291,516   89.27 %     2,279     0.70 %
Other (non-interest bearing)                                      
Investment in real estate     19,971   100.00 %     19,971   100.00 %     --     -- %
Property available-for-sale     35,256   100.00 %     35,256   100.00 %     --     -- %
Investment in unconsolidated entities     62,053   100.00 %     62,053   100.00 %     --     -- %
  Total other     117,280   100.00 %     117,280   100.00 %     --     -- %
    Grand total   $ 2,028,459   96.55 %   $ 2,014,265   95.88 %   $ (14,194 )   (0.68 )%
                                           
(1) Net carrying amount includes an allowance for loan losses of $5.8 million at March 31, 2014, allocated as follows: B notes $132,000, mezzanine loans $524,000 and whole loans $5.2 million.
(2) Net carrying amount includes allowance for loan losses of $741,000 at March 31, 2014.
(3) Loans held for sale are carried at the lower of cost or fair market value. Amortized cost is equal to fair value.
 

Liquidity

At April 30, 2014, after paying RSO's first quarter 2014 common and preferred stock dividends, RSO's liquidity is derived from three primary sources:

  • unrestricted cash and cash equivalents of $156.1 million, restricted cash of $500,000 in margin call accounts and $2.1 million in the form of real estate escrows, reserves and deposits;

  • capital available for reinvestment in its securitizations of $40.3 million, of which $4.9 million is designated to finance future funding commitments on CRE loans; and

  • loan principal repayments that will pay down outstanding CLO notes of $9.3 million and $4.7 million in interest collections.

In addition, RSO has funds available through three term financing facilities to finance the origination of CRE loans of $130.6 million and $194.3 million, respectively, and to finance the purchase of CMBS of $61.1 million.

Capital Allocation

As of March 31, 2014, RSO had allocated its invested equity capital among its targeted asset classes as follows: 73% in CRE assets, 26% in commercial finance assets and 1% in other investments.

Supplemental Information

The following schedules of reconciliations or supplemental information as of March 31, 2014 are included at the end of this release:

  • Schedule I - Reconciliation of GAAP Net Income to Funds from Operations ("FFO") and AFFO.
  • Schedule II - Book Value Allocable to Common Shareholders Rollforward.
  • Schedule III - Securitizations - Distributions and Coverage Test Summary.
  • Supplemental Information regarding loan investment statistics, CRE loans and bank loans.

About Resource Capital Corp.

RSO is a real estate investment trust that is primarily focused on originating, holding and managing commercial mortgage loans and other commercial real estate-related debt and equity investments. RSO also makes other commercial finance investments.

RSO is externally managed by Resource Capital Manager, Inc., an indirect wholly-owned subsidiary of Resource America, Inc. (NASDAQ: REXI), an asset management company that specializes in real estate and credit investments.

For more information, please visit RSO's website at www.resourcecapitalcorp.com or contact investor relations at pkamdar@resourceamerica.com.

Safe Harbor Statement

Statements made in this release may include forward-looking statements, which involve substantial risks and uncertainties. RSO's actual results, performance or achievements could differ materially from those expressed or implied in this release. The risks and uncertainties associated with forward-looking statements contained in this release include those related to:

  • fluctuations in interest rates and related hedging activities;
  • the availability of debt and equity capital to acquire and finance investments;
  • defaults or bankruptcies by borrowers on RSO's loans or on loans underlying its investments;
  • adverse market trends which have affected and may continue to affect the value of real estate and other assets underlying RSO's investments;
  • increases in financing or administrative costs; and
  • general business and economic conditions that have impaired and may continue to impair the credit quality of borrowers and RSO's ability to originate loans.

For further information concerning these and other risks pertaining to the forward-looking statements contained in this release, and to the general risks to which RSO is subject, see Item 1A, "Risk Factors" included in its Annual Report on Form 10-K and the risks expressed in other of its public filings with the Securities and Exchange Commission.

RSO cautions you not to place undue reliance on any forward-looking statements contained in this release, which speak only as of the date of this release. All subsequent written and oral forward-looking statements attributable to RSO or any person acting on its behalf are expressly qualified in their entirety by the cautionary statements contained or referred to in this release. Except to the extent required by applicable law or regulation, RSO undertakes no obligation to update these forward-looking statements to reflect events or circumstances after the date of this filing or to reflect the occurrence of unanticipated events.

The remainder of this release contains RSO's unaudited consolidated balance sheets, unaudited consolidated statements of income, reconciliation of GAAP net income to FFO and AFFO, Book value allocable to common shareholders rollforward, summary of CDO and CLO performance statistics and supplemental information regarding RSO's CRE loan and bank loan portfolios.

   
RESOURCE CAPITAL CORP. AND SUBSIDIARIES  
CONSOLIDATED BALANCE SHEETS  
(in thousands, except share and per share data)  
   
   
    March 31,
 2014
    December 31,
 2013
 
    (unaudited)        
ASSETS (1)                
  Cash and cash equivalents   $ 166,686     $ 262,270  
  Restricted cash     115,952       63,309  
  Investment securities, trading     9,987       11,558  
  Investment securities available-for-sale, pledged as collateral, at fair value     159,051       162,608  
  Investment securities available-for-sale, at fair value     74,500       52,598  
  Linked transactions, net at fair value     34,829       30,066  
  Loans held for sale     15,389       21,916  
  Property available-for-sale     35,256       25,346  
  Investment in real estate     19,971       29,778  
  Loans, pledged as collateral and net of allowances of $6.6 million and $13.8 million     1,596,731       1,369,526  
  Loans receivable-related party     6,498       6,966  
  Investments in unconsolidated entities     62,053       69,069  
  Derivatives, at fair value     556       --  
  Interest receivable     10,503       8,965  
  Deferred tax asset     5,048       5,212  
  Principal paydown receivable     1       6,821  
  Intangible assets     11,283       11,822  
  Prepaid expenses     4,155       2,871  
  Other assets     13,459       10,726  
    Total assets   $ 2,341,908     $ 2,151,427  
LIABILITIES (2)                
  Borrowings   $ 1,502,089     $ 1,319,810  
  Distribution payable     27,601       27,023  
  Accrued interest expense     3,848       1,693  
  Derivatives, at fair value     10,242       10,586  
  Accrued tax liability     387       1,629  
  Deferred tax liability     4,036       4,112  
  Accounts payable and other liabilities     13,511       12,650  
    Total liabilities     1,561,714       1,377,503  
STOCKHOLDERS' EQUITY                
  Preferred stock, par value $0.001: 100,000,000 shares authorized 8.50% Series A cumulative redeemable preferred shares, liquidation preference $25.00per share, 872,039 and 680,952 shares issued and outstanding     1       1  
  Preferred stock, par value $0.001: 100,000,000 shares authorized 8.25% Series B cumulative redeemable preferred shares, liquidation preference $25.00 per share 3,988,977 and 3,485,078 shares issued and outstanding     4       3  
  Common stock, par value $0.001: 500,000,000 shares authorized; 128,577,980 and 127,918,927 shares issued and outstanding (including 2,670,189 and 3,112,595 unvested restricted shares)     129       128  
  Additional paid-in capital     1,059,805       1,042,480  
  Accumulated other comprehensive loss     (14,071 )     (14,043 )
  Distributions in excess of earnings     (265,618 )     (254,645 )
    Total stockholders' equity     780,250       773,924  
  Non-controlling interest     (56 )     --  
    Total equity     780,194       773,924  
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY   $ 2,341,908     $ 2,151,427  
                 
                 
 
RESOURCE CAPITAL CORP. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS - (Continued)
(in thousands, except share and per share data)
 
 
    March 31,
 2014
  December 31,
 2013
    (unaudited)    
(1) Assets of consolidated VIEs included in the total assets:            
  Restricted cash   $ 113,362   $ 61,372
  Investment securities available-for-sale, pledged as collateral, at fair value     116,429     105,846
  Loans held for sale     272     2,376
  Loans, pledged as collateral and net of allowances of $5.1 million and $8.8 million     1,305,377     1,219,569
  Interest receivable     6,626     5,627
  Prepaid expenses     163     247
  Principal paydown receivable     1     6,821
  Total assets of consolidated VIEs (a)   $ 1,542,230   $ 1,401,858
             
(2) Liabilities of consolidated VIEs included in the total liabilities:            
  Borrowings   $ 1,183,468   $ 1,070,339
  Accrued interest expense     1,356     918
  Derivatives, at fair value     9,841     10,191
  Accounts payable and other liabilities     4,150     1,604
  Total liabilities of consolidated VIEs (b)   $ 1,198,815   $ 1,083,052
               
(a) Assets of each of the consolidated variable interest entities ("VIE"s) may only be used to settle the obligations of each respective VIE.
(b) The creditors of the Company's VIEs have no recourse to the general credit of the Company.
   
   
   
RESOURCE CAPITAL CORP. AND SUBSIDIARIES  
CONSOLIDATED STATEMENTS OF OPERATIONS  
(in thousands, except share and per share data)  
(unaudited)  
   
   
    Three Months Ended  
    March 31,  
    2014     2013  
REVENUES                
  Interest income:                
    Loans   $ 20,229     $ 27,812  
    Securities     4,004       3,642  
    Interest income − other     2,852       1,866  
      Total interest income     27,085       33,320  
  Interest expense     9,637       11,165  
      Net interest income     17,448       22,155  
  Rental income     5,152       6,174  
  Dividend income     136       16  
  Equity in net earnings (losses) of unconsolidated subsidiaries     2,014       (425 )
  Fee income     2,756       1,410  
  Net realized gain on sales of investment securities available-for-sale and loans     3,680       391  
  Net realized and unrealized (loss) gain on investment securities, trading     (1,560 )     1,116  
  Unrealized gain (loss) and net interest income on linked transactions, net     2,305       (259 )
    Total revenues     31,931       30,578  
OPERATING EXPENSES                
  Management fees − related party     3,080       2,978  
  Equity compensation − related party     1,667       3,591  
  Rental operating expense     3,396       3,937  
  General and administrative     8,105       3,481  
  Depreciation and amortization     836       1,138  
  Income tax expense     16       1,762  
  Net impairment losses recognized in earnings     -       21  
  (Benefit) provision for loan losses     (3,960 )     1,042  
    Total operating expenses     13,140       17,950  
      18,791       12,628  
OTHER REVENUE (EXPENSE)                
  Other expense     (1,262 )     -  
  Loss on the extinguishment of debt     (69 )     -  
    Total other expense     (1,331 )     -  
NET INCOME     17,460       12,628  
  Net income allocated to preferred shares     (2,400 )     (1,311 )
  Net loss allocable to non-controlling interest     56       209  
NET INCOME ALLOCABLE TO COMMON SHARES   $ 15,116     $ 11,526  
NET INCOME PER COMMON SHARE - BASIC   $ 0.12     $ 0.11  
NET INCOME PER COMMON SHARE - DILUTED   $ 0.12     $ 0.11  
WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING − BASIC     125,616,537       104,224,083  
WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING − DILUTED     126,667,614       105,326,614  
                 
                 

SCHEDULE I

RESOURCE CAPITAL CORP. AND SUBSIDIARIES
RECONCILIATION OF GAAP NET INCOME TO FFO and AFFO
(in thousands, except per share data)
(unaudited)

Funds from Operations

The Company evaluates its performance based on several performance measures, including funds from operations, or FFO, and adjusted funds from operations ("AFFO") in addition to net income. The Company computes FFO in accordance with the standards established by the National Association of Real Estate Investment Trusts as net income (computed in accordance with GAAP), excluding gains or losses on the sale of depreciable real estate, the cumulative effect of changes in accounting principles, real estate-related depreciation and amortization, and after adjustments for unconsolidated/uncombined partnerships and joint ventures.

AFFO is a computation made by analysts and investors to measure a real estate company's cash flow generated by operations. The Company calculates AFFO by adding or subtracting from FFO the non-cash impacts of the following: non-cash impairment losses resulting from fair value adjustments on financial instruments, provision for loan losses, equity investment gains and losses, straight-line rental effects, share based compensation, amortization of various deferred items and intangible assets, gains on sales of property that are wholly owned or through a joint venture in addition to the cash impact of capital expenditures that are related to its real estate owned. In addition, the Company calculates AFFO by adding and subtracting from FFO the cash impacts of the following: extinguishment of debt and sales of property.

Management believes that FFO and AFFO are appropriate measures of the Company's operating performance in that they are frequently used by analysts, investors and other parties in the evaluation of REITs. Management uses FFO and AFFO as measures of its operating performance, and believes they are also useful to investors, because they facilitate an understanding of the Company's operating performance after adjustment for certain non-cash items, such as real estate depreciation, share-based compensation and various other items required by GAAP, and capital expenditures, that may not necessarily be indicative of current operating performance and that may not accurately compare the Company's operating performance between periods.

While the Company calculations of AFFO may differ from the methodology used for calculating AFFO by other REITs and its AFFO may not be comparable to AFFO reported by other REITs, the Company also believe that FFO and AFFO may provide the Company and its investors with an additional useful measure to compare its performance with some other REITs. Neither FFO nor AFFO is equivalent to net income or cash generated from operating activities determined in accordance with GAAP. Furthermore, FFO and AFFO do not represent amounts available for management's discretionary use because of needed capital replacement or expansion, debt service obligations or other commitments or uncertainties. Neither FFO nor AFFO should be considered as an alternative to GAAP net income as an indicator of the Company's operating performance or as an alternative to cash flow from operating activities as a measure of its liquidity.

The following table reconciles GAAP net income to FFO and AFFO for the periods presented (unaudited) (in thousands, except per share data):

       
    March 31,  
    2014     2013  
Net income allocable to common shares - GAAP   $ 15,116     $ 11,526  
Adjustments:                
  Real estate depreciation and amortization     292       673  
  (Gains) losses on sales of property (1)     (866 )     22  
  Gains on sale of preferred equity     (984 )     --  
FFO     13,558       12,221  
Adjustments:                
Non-cash items:                
  Adjust for impact of imputed interest on VIE accounting     --       (1,090 )
  (Benefit) provision for loan losses     (125 )     194  
  Amortization of deferred costs (non real estate) and intangible assets     2,223       1,866  
  Equity investment losses     1,282       336  
  Share-based compensation     1,667       3,591  
  Impairment losses     --       21  
  Unrealized gain on CMBS marks - linked transactions     (1,763 )     --  
  Unrealized loss on trading portfolio     442       --  
  Straight line rental adjustments     2       2  
  Loss on the extinguishment of debt     69       --  
  PCA expenses     300       --  
REIT tax planning adjustments     957       726  
Cash items:                
  Gains (losses) on sales of property (1)     866       (22 )
  Gains on sale of preferred equity     984       --  
  Gain on the extinguishment of debt     4,532       3,585  
  Capital expenditures     (13 )     (418 )
AFFO   $ 24,981     $ 21,012  
                 
Weighted average shares - diluted     126,668       105,327  
                 
AFFO per share - diluted   $ 0.20     $ 0.20  
                 
(1) Amount represents gains/losses on sales of joint venture real estate interests that were recorded by RSO on an equity basis.
   
   

SCHEDULE II

RESOURCE CAPITAL CORP. AND SUBSIDIARIES  
BOOK VALUE ALLOCABLE TO COMMON SHAREHOLDERS ROLLFORWARD  
(dollars in thousands, except per share data)  
(unaudited)  
   
   
    Amount     Per Share  
Book value at December 31, 2013, allocable to common shareholders (1)   $ 674,681     $ 5.41  
Net income allocable to common shareholders     15,116       0.12  
                 
Change in other comprehensive income:                
  Available for sale securities     (289 )     --  
  Derivatives     458       --  
  Foreign currency conversion     (196 )     --  
Common dividends     (25,663 )     (0.20 )
Proceeds (dilution) from additional shares issued during the year (2)     1,193       (0.05 )
Total net decrease     (9,381 )     (0.13 )
Book value at March 31, 2014, allocable to common shareholders (1)(3)   $ 665,300     $ 5.28  
                 
(1) Per share calculations exclude unvested restricted stock, as disclosed on the consolidated balance sheets, of 2.7 million and 3.1 million shares as of March 31, 2014 and December 31, 2013, respectively.
(2) Includes issuance of common shares from the Company's dividend reinvestment plan of 111,000 shares and 442,000 vesting of shares of restricted stock.
(3) Book value is calculated as total stockholder's equity of $780.2 million less preferred stock equity of $114.9 million.
   
   

SCHEDULE III

RESOURCE CAPITAL CORP. AND SUBSIDIARIES
SUMMARY OF CDO AND CLO PERFORMANCE STATISTICS
(in thousands)
(unaudited)

Securitizations - Distributions and Coverage Test Summary

The following table sets forth the distributions made and coverage test summaries for each of RSO's securitizations for the periods presented (in thousands):

             
Name   Cash Distributions   Annualized Interest Coverage Cushion   Overcollateralization Cushion
Three Months Ended
 March 31,

2014 (1)
  Year Ended
December 31,

2013 (1)
  Three Months Ended
 March 31,

2014 (2) (3)
  Three Months Ended
 March 31,

2014 (4)
  As of Initial
Measurement Date
Apidos CDO I (5)   $ 532   $ 4,615   $ 1,512   $ 11,272   $ 17,136
Apidos CDO III (6)   $ 1,170   $ 6,495   $ 3,225   $ 8,853   $ 11,269
Apidos Cinco CDO (7)   $ 2,764   $ 12,058   $ 5,451   $ 19,639   $ 17,774
RREF 2006-1 (8)   $ 1,770   $ 36,828   $ 5,272   $ 67,336   $ 24,941
RREF 2007-1 (9)   $ 2,433   $ 10,880   $ 9,022   $ 39,703   $ 26,032
RCC CRE Notes 2013 (10)   $ 2,398     N/A     N/A     N/A     N/A
                               

* The above table does not include new CLO investments made in the quarter ended March 31, 2014, as cash distributions were received subsequent to period end. In addition, the above table does not include Apidos CLO VIII or Whitney CLO I, as these CLOs were previously called and were substantially liquidated as of March 31, 2014.

(1) Distributions on retained equity interests in CDOs (comprised of note investments and preference share ownership) and principal paydowns on notes owned; RREF CDO 2006-1 includes $231,000 and $28.1 million of paydowns during the three months ended March 31, 2014 and the year ended December 31, 2013, respectively.
(2) Interest coverage includes annualized amounts based on the most recent trustee statements.
(3) Interest coverage cushion represents the amount by which annualized interest income expected exceeds the annualized amount payable on all classes of CDO notes senior to the Company's preference shares. 
(4) Overcollateralization cushion represents the amount by which the collateral held by the CDO issuer exceeds the maximum amount required. 
(5) Apidos CDO I's reinvestment period expired in July 2011. 
(6)  Apidos CDO III's reinvestment period expired in June 2012. 
(7) Apidos Cinco CDO's reinvestment period ends in May 2014. 
(8) RREF CDO 2006-1's reinvestment period expired in September 2011. 
(9) RREF CDO 2007-1's reinvestment period expired in June 2012.
(10) RCC CRE Notes 2013 closed on December 23, 2013; the first distribution was in January 2014. There is no reinvestment period for the securitization. Additionally, the indenture contains no coverage tests.
   
   
 
RESOURCE CAPITAL CORP. AND SUBSIDIARIES
SUPPLEMENTAL INFORMATION
(in thousands, except percentages)
(unaudited)
 

Loan Investment Statistics

The following table presents information on RSO's impaired loans and related allowances for the periods indicated (based on amortized cost):

             
    March 31,
 2014
    December 31,
 2013
 
Allowance for loan losses:                
Specific allowance:                
  Commercial real estate loans   $ --     $ 4,572  
  Bank loans     441       2,621  
Total specific allowance     441       7,193  
General allowance:                
  Commercial real estate loans     5,844       5,844  
  Bank loans     300       770  
Total general allowance     6,144       6,614  
Total allowance for loans   $ 6,585     $ 13,807  
Allowance as a percentage of total loans     0.4 %     1.0 %
                 
Loans held for sale:                
  Commercial real estate   $ --     $ --  
  Bank loans     272       6,850  
  Residential mortgage loans     15,117       15,066  
Total loans held for sale (1)   $ 15,389     $ 21,916  
                 
(1)  Loans held for sale are presented at the lower of cost or fair value.
   
   
RESOURCE CAPITAL CORP. AND SUBSIDIARIES
SUPPLEMENTAL INFORMATION
(unaudited)
 

The following table presents commercial real estate loan portfolio statistics as of March 31, 2014 (based on par value):

       
Security type:      
Whole loans   91.2 %
Mezzanine loans   7.0 %
B Notes   1.8 %
Total   100.0 %
       
Collateral type:      
Multifamily   39.9 %
Hotel   19.3 %
Retail   18.9 %
Office   14.0 %
Mixed Use   3.6 %
Industrial   1.5 %
Other   2.8 %
Total   100.0 %
       
Collateral location:      
Southern California   27.3 %
Northern California   9.2 %
Texas   13.2 %
Arizona   10.7 %
Florida   5.9 %
Utah   3.4 %
Washington   3.3 %
Minnesota   3.2 %
Nevada   2.7 %
Other   21.1 %
Total   100.0 %
       
       
 
RESOURCE CAPITAL CORP. AND SUBSIDIARIES
SUPPLEMENTAL INFORMATION
(unaudited)

The following table presents bank loan portfolio statistics by industry as of March 31, 2014 (based on par value):

       
Industry type:      
Healthcare, education and childcare   13.3 %
Diversified/conglomerate service   11.6 %
Broadcasting and entertainment   6.9 %
Automobile   6.3 %
Chemicals, plastics and rubber   5.8 %
CDO   5.2 %
Retail stores   5.1 %
Telecommunications   4.2 %
Oil and gas   3.5 %
Leisure, amusement, motion pictures, entertainment   3.4 %
Hotels, motels, inns and gaming   3.3 %
Personal, food and miscellaneous services   3.2 %
Electronics   3.0 %
Utilities   2.7 %
Finance   2.3 %
Aerospace and defense   2.1 %
Mining, steel, iron and non-precious metals   2.0 %
Other   16.1 %
Total   100.0 %

Contact Information

  • CONTACT:
    DAVID J. BRYANT
    CHIEF FINANCIAL OFFICER
    RESOURCE CAPITAL CORP.
    712 Fifth Ave, 12
    THFloor
    New York, NY 10019
    212-506-3870