Arbor Realty Trust, Inc. (NYSE: ABR), today announced financial
results for the fourth quarter ended December 31, 2023. Arbor
reported net income for the quarter of $91.7 million, or $0.48 per
diluted common share, compared to net income of $88.2 million, or
$0.49 per diluted common share for the quarter ended
December 31, 2022. Net income for the year was $330.1 million,
or $1.75 per diluted common share, compared to $284.8 million, or
$1.67 per diluted common share for the year ended December 31,
2022. Distributable earnings for the quarter was $104.1 million, or
$0.51 per diluted common share, compared to $114.0 million, or
$0.60 per diluted common share for the quarter ended
December 31, 2022. Distributable earnings for the year was
$452.5 million, or $2.25 per diluted common share, compared to
$405.7 million, or $2.23 per diluted common share for the year
ended December 31, 2022. 1
Agency Business
Loan Origination Platform
|
Agency Loan Volume (in thousands) |
|
Quarter Ended |
|
Year Ended |
|
December 31, 2023 |
|
September 30, 2023 |
|
December 31, 2023 |
|
December 31, 2022 |
Fannie Mae |
$ |
1,177,203 |
|
|
$ |
721,398 |
|
|
$ |
3,773,532 |
|
|
$ |
2,919,566 |
|
Freddie Mac |
|
98,370 |
|
|
|
339,241 |
|
|
|
756,827 |
|
|
|
1,353,001 |
|
Private Label |
|
140,606 |
|
|
|
67,965 |
|
|
|
299,934 |
|
|
|
217,542 |
|
FHA |
|
26,493 |
|
|
|
19,215 |
|
|
|
257,199 |
|
|
|
188,394 |
|
SFR - Fixed Rate |
|
— |
|
|
|
2,030 |
|
|
|
19,328 |
|
|
|
89,683 |
|
Total Originations |
$ |
1,442,672 |
|
|
$ |
1,149,849 |
|
|
$ |
5,106,820 |
|
|
$ |
4,768,186 |
|
|
|
|
|
|
|
|
|
Total Loan Sales |
$ |
1,270,356 |
|
|
$ |
1,275,420 |
|
|
$ |
4,889,199 |
|
|
$ |
5,438,623 |
|
|
|
|
|
|
|
|
|
Total Loan Commitments |
$ |
1,362,379 |
|
|
$ |
1,211,347 |
|
|
$ |
5,207,148 |
|
|
$ |
5,146,718 |
|
|
For the quarter ended December 31, 2023,
the Agency Business generated revenues of $96.3 million, compared
to $80.8 million for the third quarter of 2023. Gain on sales,
including fee-based services, net on the GSE/Agency business
(excluding private label and SFR) was $15.4 million for the
quarter, reflecting a margin of 1.36%, compared to $17.7 million
and 1.48% for the third quarter of 2023. Income from mortgage
servicing rights was $21.1 million for the quarter, reflecting a
rate of 1.55% as a percentage of loan commitments, compared to
$14.1 million and 1.16% for the third quarter of 2023.
At December 31, 2023, loans held-for-sale
was $551.7 million, with financing associated with these loans
totaling $413.3 million.
Fee-Based Servicing
Portfolio
The Company’s fee-based servicing portfolio
totaled $30.98 billion at December 31, 2023. Servicing
revenue, net was $33.1 million for the quarter and consisted of
servicing revenue of $49.2 million, net of amortization of mortgage
servicing rights totaling $16.2 million.
|
Fee-Based Servicing Portfolio ($ in thousands) |
|
December 31, 2023 |
|
September 30, 2023 |
|
December 31, 2022 |
|
UPB |
|
Wtd. Avg.Fee (bps) |
|
Wtd. Avg.Life (years) |
|
UPB |
|
Wtd. Avg.Fee (bps) |
|
Wtd. Avg.Life (years) |
|
UPB |
|
Wtd. Avg.Fee (bps) |
|
Wtd. Avg.Life (years) |
Fannie Mae |
$ |
21,264,578 |
|
47.4 |
|
7.4 |
|
$ |
20,463,620 |
|
48.3 |
|
7.7 |
|
$ |
19,038,124 |
|
50.2 |
|
8.0 |
Freddie Mac |
|
5,181,933 |
|
24.0 |
|
8.5 |
|
|
5,184,888 |
|
24.2 |
|
8.5 |
|
|
5,153,207 |
|
25.0 |
|
9.0 |
Private Label |
|
2,510,449 |
|
19.5 |
|
6.7 |
|
|
2,371,475 |
|
19.2 |
|
7.3 |
|
|
2,074,859 |
|
18.5 |
|
7.6 |
FHA |
|
1,359,624 |
|
14.4 |
|
19.2 |
|
|
1,322,832 |
|
14.5 |
|
19.9 |
|
|
1,155,893 |
|
14.9 |
|
19.5 |
Bridge |
|
379,425 |
|
10.9 |
|
3.2 |
|
|
305,950 |
|
11.2 |
|
3.6 |
|
|
301,182 |
|
12.5 |
|
1.7 |
SFR-Fixed Rate |
|
287,446 |
|
20.1 |
|
5.1 |
|
|
287,942 |
|
20.1 |
|
5.8 |
|
|
274,764 |
|
19.8 |
|
6.0 |
Total |
$ |
30,983,455 |
|
39.1 |
|
8.0 |
|
$ |
29,936,707 |
|
39.7 |
|
8.3 |
|
$ |
27,998,029 |
|
41.1 |
|
8.6 |
|
Loans sold under the Fannie Mae program contain
an obligation to partially guarantee the performance of the loan
(“loss-sharing obligations”) and includes $34.6 million for the
fair value of the guarantee obligation undertaken at
December 31, 2023. The Company recorded a $3.1 million net
provision for loss sharing associated with CECL for the fourth
quarter of 2023. At December 31, 2023, the Company’s total
CECL allowance for loss-sharing obligations was $37.0 million,
representing 0.17% of the Fannie Mae servicing portfolio.
Structured Business
Portfolio and Investment
Activity
|
Structured Portfolio Activity ($ in thousands) |
|
Quarter Ended |
|
Year Ended |
|
December 31, 2023 |
|
September 30, 2023 |
|
December 31, 2023 |
|
December 31, 2022 |
|
UPB |
|
% |
|
UPB |
|
% |
|
UPB |
|
% |
|
UPB |
|
% |
Bridge: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Multifamily |
$ |
38,700 |
|
|
|
14 |
% |
|
$ |
92,000 |
|
|
|
38 |
% |
|
$ |
415,330 |
|
|
|
42 |
% |
|
$ |
5,468,222 |
|
|
|
89 |
% |
SFR |
|
198,629 |
|
|
|
75 |
% |
|
|
140,379 |
|
|
|
59 |
% |
|
|
524,060 |
|
|
|
54 |
% |
|
|
613,819 |
|
|
|
10 |
% |
|
|
237,329 |
|
|
|
89 |
% |
|
|
232,379 |
|
|
|
97 |
% |
|
|
939,390 |
|
|
|
96 |
% |
|
|
6,082,041 |
|
|
|
99 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Mezzanine/Preferred
Equity |
|
28,829 |
|
|
|
11 |
% |
|
|
7,779 |
|
|
|
3 |
% |
|
|
43,953 |
|
|
|
4 |
% |
|
|
69,606 |
|
|
|
1 |
% |
Total Originations |
$ |
266,158 |
|
|
|
100 |
% |
|
$ |
240,158 |
|
|
|
100 |
% |
|
$ |
983,343 |
|
|
|
100 |
% |
|
$ |
6,151,647 |
|
|
|
100 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Number of Loans
Originated |
|
58 |
|
|
|
|
|
42 |
|
|
|
|
|
150 |
|
|
|
|
|
318 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SFR Commitments |
$ |
466,703 |
|
|
|
|
$ |
429,452 |
|
|
|
|
$ |
1,150,687 |
|
|
|
|
$ |
1,086,833 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Runoff |
$ |
817,394 |
|
|
|
|
$ |
664,792 |
|
|
|
|
$ |
3,354,055 |
|
|
|
|
$ |
3,818,554 |
|
|
|
|
Structured Portfolio ($ in thousands) |
|
December 31, 2023 |
|
September 30, 2023 |
|
December 31, 2022 |
|
UPB |
|
% |
|
UPB |
|
% |
|
UPB |
|
% |
Bridge: |
|
|
|
|
|
|
|
|
|
|
|
Multifamily |
$ |
10,789,936 |
|
|
|
86 |
% |
|
$ |
11,421,819 |
|
|
|
87 |
% |
|
$ |
12,830,999 |
|
|
|
89 |
% |
SFR |
|
1,316,803 |
|
|
|
10 |
% |
|
|
1,163,648 |
|
|
|
9 |
% |
|
|
927,373 |
|
|
|
6 |
% |
Other |
|
166,505 |
|
|
|
1 |
% |
|
|
205,505 |
|
|
|
2 |
% |
|
|
337,682 |
|
|
|
2 |
% |
|
|
12,273,244 |
|
|
|
97 |
% |
|
|
12,790,972 |
|
|
|
98 |
% |
|
|
14,096,054 |
|
|
|
97 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
Mezzanine/Preferred
Equity |
|
334,198 |
|
|
|
3 |
% |
|
|
321,729 |
|
|
|
2 |
% |
|
|
324,224 |
|
|
|
2 |
% |
SFR Permanent |
|
7,564 |
|
|
|
<1 |
% |
|
|
9,694 |
|
|
|
<1 |
% |
|
|
35,854 |
|
|
|
<1 |
% |
Total Portfolio |
$ |
12,615,006 |
|
|
|
100 |
% |
|
$ |
13,122,395 |
|
|
|
100 |
% |
|
$ |
14,456,132 |
|
|
|
100 |
% |
|
At December 31, 2023, the loan and
investment portfolio’s unpaid principal balance, excluding loan
loss reserves, was $12.62 billion, with a weighted average current
interest pay rate of 8.42%, compared to $13.12 billion and 8.80% at
September 30, 2023. Including certain fees earned and costs
associated with the loan and investment portfolio, the weighted
average current interest pay rate was 8.98% at December 31,
2023, compared to 9.12% at September 30, 2023. The decrease in
pay rate was primarily due to an increase in non-performing loans
in the fourth quarter of 2023.
The average balance of the Company’s loan and
investment portfolio during the fourth quarter of 2023, excluding
loan loss reserves, was $12.96 billion with a weighted average
yield of 9.31%, compared to $13.40 billion and 9.28% for the third
quarter of 2023.
During the fourth quarter of 2023, the Company
recorded a $17.3 million provision for loan losses associated with
CECL, which was net of $4.8 million of loan loss recoveries. At
December 31, 2023, the Company’s total allowance for loan
losses was $195.7 million. The Company had sixteen non-performing
loans with a carrying value of $262.7 million, before related loan
loss reserves of $27.1 million, compared to twelve loans with a
carrying value of $150.5 million, before loan loss reserves of
$12.6 million at September 30, 2023.
Financing Activity
The balance of debt that finances the Company’s
loan and investment portfolio at December 31, 2023 was $11.57
billion with a weighted average interest rate including fees of
7.45% as compared to $11.86 billion and a rate of 7.41% at
September 30, 2023.
The average balance of debt that finances the
Company’s loan and investment portfolio for the fourth quarter of
2023 was $11.77 billion, as compared to $12.00 billion for the
third quarter of 2023. The average cost of borrowings for the
fourth quarter of 2023 was 7.48%, compared to 7.37% for the third
quarter of 2023. The increase in average cost was primarily due to
an increase in the SOFR rate in the fourth quarter of 2023.
Dividend
The Company announced today that its Board of
Directors has declared a quarterly cash dividend of $0.43 per share
of common stock for the quarter ended December 31, 2023. The
dividend is payable on March 15, 2024 to common stockholders of
record on March 4, 2024. The ex-dividend date is March 1, 2024.
Earnings Conference Call
The Company will host a conference call today at
10:00 a.m. Eastern Time. A live webcast and replay of the
conference call will be available at www.arbor.com in the investor
relations section of the Company’s website, or you can access the
call telephonically at least ten minutes prior to the conference
call. The dial-in numbers are (800) 245-3047 for domestic callers
and (203) 518-9765 for international callers. Please use
participant passcode ABRQ423 when prompted by the operator.
A telephonic replay of the call will be
available until February 23, 2024. The replay dial-in numbers are
(800) 934-8221 for domestic callers and (402) 220-6990 for
international callers.
About Arbor Realty Trust,
Inc.
Arbor Realty Trust, Inc. (NYSE: ABR) is a
nationwide real estate investment trust and direct lender,
providing loan origination and servicing for multifamily,
single-family rental (SFR) portfolios, and other diverse commercial
real estate assets. Headquartered in New York, Arbor manages a
multibillion-dollar servicing portfolio, specializing in
government-sponsored enterprise products. Arbor is a leading Fannie
Mae DUS® lender and Freddie Mac Optigo® Seller/Servicer, and an
approved FHA Multifamily Accelerated Processing (MAP) lender.
Arbor’s product platform also includes bridge, CMBS, mezzanine and
preferred equity loans. Rated by Standard and Poor’s and Fitch
Ratings, Arbor is committed to building on its reputation for
service, quality, and customized solutions with an unparalleled
dedication to providing our clients excellence over the entire life
of a loan.
Safe Harbor Statement
Certain items in this press release may
constitute forward-looking statements within the meaning of the
“safe harbor” provisions of the Private Securities Litigation
Reform Act of 1995. These statements are based on management’s
current expectations and beliefs and are subject to a number of
trends and uncertainties that could cause actual results to differ
materially from those described in the forward-looking statements.
Arbor can give no assurance that its expectations will be attained.
Factors that could cause actual results to differ materially from
Arbor’s expectations include, but are not limited to, changes in
economic conditions generally, and the real estate markets
specifically, continued ability to source new investments, changes
in interest rates and/or credit spreads, and other risks detailed
in Arbor’s Annual Report on Form 10-K for the year ended
December 31, 2023 and its other reports filed with the SEC.
Such forward-looking statements speak only as of the date of this
press release. Arbor expressly disclaims any obligation or
undertaking to release publicly any updates or revisions to any
forward-looking statements contained herein to reflect any change
in Arbor’s expectations with regard thereto or change in events,
conditions, or circumstances on which any such statement is
based.
Notes
- During the
quarterly earnings conference call, the Company may discuss
non-GAAP financial measures as defined by SEC Regulation G. In
addition, the Company has used non-GAAP financial measures in this
press release. A supplemental schedule of non-GAAP financial
measures and the comparable GAAP financial measure can be found on
the last page of this release.
- Amounts reflect
approximate balances as of February 14, 2024.
Contact: |
Arbor Realty Trust, Inc.Paul
Elenio, Chief Financial Officer516-506-4422pelenio@arbor.com |
ARBOR REALTY TRUST, INC. AND
SUBSIDIARIESConsolidated Statements of Income($ in
thousands—except share and per share data) |
|
|
Quarter Ended December 31, |
|
Year Ended December 31, |
|
|
2023 |
|
|
|
2022 |
|
|
|
2023 |
|
|
|
2022 |
|
|
(Unaudited) |
|
(Unaudited) |
|
|
|
|
Interest income |
$ |
331,060 |
|
|
$ |
320,597 |
|
|
$ |
1,331,219 |
|
|
$ |
948,401 |
|
Interest expense |
|
227,479 |
|
|
|
207,538 |
|
|
|
903,228 |
|
|
|
557,617 |
|
Net interest income |
|
103,581 |
|
|
|
113,059 |
|
|
|
427,991 |
|
|
|
390,784 |
|
|
|
|
|
|
|
|
|
Other
revenue: |
|
|
|
|
|
|
|
Gain on sales, including
fee-based services, net |
|
16,727 |
|
|
|
23,290 |
|
|
|
72,522 |
|
|
|
55,816 |
|
Mortgage servicing rights |
|
21,144 |
|
|
|
17,059 |
|
|
|
69,912 |
|
|
|
69,346 |
|
Servicing revenue, net |
|
33,073 |
|
|
|
27,679 |
|
|
|
130,449 |
|
|
|
92,192 |
|
Property operating income |
|
1,447 |
|
|
|
846 |
|
|
|
5,708 |
|
|
|
1,877 |
|
Gain on derivative
instruments, net |
|
10,345 |
|
|
|
16,526 |
|
|
|
6,763 |
|
|
|
26,609 |
|
Other income (loss), net |
|
2,571 |
|
|
|
(1,500 |
) |
|
|
7,667 |
|
|
|
(17,563 |
) |
Total other revenue |
|
85,307 |
|
|
|
83,900 |
|
|
|
293,021 |
|
|
|
228,277 |
|
|
|
|
|
|
|
|
|
Other
expenses: |
|
|
|
|
|
|
|
Employee compensation and
benefits |
|
36,270 |
|
|
|
42,089 |
|
|
|
159,788 |
|
|
|
161,825 |
|
Selling and
administrative |
|
12,686 |
|
|
|
13,030 |
|
|
|
51,260 |
|
|
|
53,990 |
|
Property operating
expenses |
|
1,670 |
|
|
|
694 |
|
|
|
5,897 |
|
|
|
2,136 |
|
Depreciation and
amortization |
|
2,446 |
|
|
|
2,640 |
|
|
|
9,743 |
|
|
|
8,732 |
|
Provision for loss sharing
(net of recoveries) |
|
3,168 |
|
|
|
4,061 |
|
|
|
15,695 |
|
|
|
1,862 |
|
Provision for credit losses
(net of recoveries) |
|
18,399 |
|
|
|
11,469 |
|
|
|
73,446 |
|
|
|
21,169 |
|
Litigation settlement |
|
— |
|
|
|
7,350 |
|
|
|
— |
|
|
|
7,350 |
|
Total other expenses |
|
74,639 |
|
|
|
81,333 |
|
|
|
315,829 |
|
|
|
257,064 |
|
|
|
|
|
|
|
|
|
Income before extinguishment
of debt, income from equity affiliates, and income taxes |
|
114,249 |
|
|
|
115,626 |
|
|
|
405,183 |
|
|
|
361,997 |
|
Loss on extinguishment of
debt |
|
— |
|
|
|
(320 |
) |
|
|
(1,561 |
) |
|
|
(4,933 |
) |
Income (loss) from equity
affiliates |
|
3,586 |
|
|
|
(4,260 |
) |
|
|
24,281 |
|
|
|
14,247 |
|
Provision for income
taxes |
|
(7,911 |
) |
|
|
(4,318 |
) |
|
|
(27,347 |
) |
|
|
(17,484 |
) |
|
|
|
|
|
|
|
|
Net income |
|
109,924 |
|
|
|
106,728 |
|
|
|
400,556 |
|
|
|
353,827 |
|
|
|
|
|
|
|
|
|
Preferred stock dividends |
|
10,342 |
|
|
|
10,342 |
|
|
|
41,369 |
|
|
|
40,954 |
|
Net income attributable to
noncontrolling interest |
|
7,923 |
|
|
|
8,234 |
|
|
|
29,122 |
|
|
|
28,044 |
|
Net income attributable to
common stockholders |
$ |
91,659 |
|
|
$ |
88,152 |
|
|
$ |
330,065 |
|
|
$ |
284,829 |
|
|
|
|
|
|
|
|
|
Basic earnings per common
share |
$ |
0.49 |
|
|
$ |
0.51 |
|
|
$ |
1.79 |
|
|
$ |
1.72 |
|
Diluted earnings per common
share |
$ |
0.48 |
|
|
$ |
0.49 |
|
|
$ |
1.75 |
|
|
$ |
1.67 |
|
|
|
|
|
|
|
|
|
Weighted average shares
outstanding: |
|
|
|
|
|
|
|
Basic |
|
188,503,682 |
|
|
|
174,444,084 |
|
|
|
184,641,642 |
|
|
|
165,355,167 |
|
Diluted |
|
222,861,214 |
|
|
|
209,743,771 |
|
|
|
218,843,613 |
|
|
|
199,112,630 |
|
|
|
|
|
|
|
|
|
Dividends declared per common
share |
$ |
0.43 |
|
|
$ |
0.40 |
|
|
$ |
1.68 |
|
|
$ |
1.54 |
|
ARBOR REALTY TRUST, INC. AND
SUBSIDIARIESConsolidated Balance Sheets($ in
thousands—except share and per share data) |
|
|
December 31, 2023 |
|
December 31, 2022 |
Assets: |
|
|
|
Cash and cash equivalents |
$ |
928,974 |
|
|
$ |
534,357 |
|
Restricted cash |
|
608,233 |
|
|
|
713,808 |
|
Loans and investments, net
(allowance for credit losses of $195,664 and $132,559) |
|
12,377,806 |
|
|
|
14,254,674 |
|
Loans held-for-sale, net |
|
551,707 |
|
|
|
354,070 |
|
Capitalized mortgage servicing
rights, net |
|
391,254 |
|
|
|
401,471 |
|
Securities held-to-maturity,
net (allowance for credit losses of $6,256 and $3,153) |
|
155,279 |
|
|
|
156,547 |
|
Investments in equity
affiliates |
|
79,303 |
|
|
|
79,130 |
|
Due from related party |
|
64,421 |
|
|
|
77,419 |
|
Goodwill and other intangible
assets |
|
91,378 |
|
|
|
96,069 |
|
Other assets |
|
490,281 |
|
|
|
371,440 |
|
Total assets |
$ |
15,738,636 |
|
|
$ |
17,038,985 |
|
|
|
|
|
Liabilities and
Equity: |
|
|
|
Credit and repurchase
facilities |
$ |
3,237,827 |
|
|
$ |
3,841,814 |
|
Securitized debt |
|
6,935,010 |
|
|
|
7,849,270 |
|
Senior unsecured notes |
|
1,333,968 |
|
|
|
1,385,994 |
|
Convertible senior unsecured
notes |
|
283,118 |
|
|
|
280,356 |
|
Junior subordinated notes to
subsidiary trust issuing preferred securities |
|
143,896 |
|
|
|
143,128 |
|
Due to related party |
|
13,799 |
|
|
|
12,350 |
|
Due to borrowers |
|
121,707 |
|
|
|
61,237 |
|
Allowance for loss-sharing
obligations |
|
71,634 |
|
|
|
57,168 |
|
Other liabilities |
|
343,072 |
|
|
|
335,789 |
|
Total liabilities |
|
12,484,031 |
|
|
|
13,967,106 |
|
|
|
|
|
Equity: |
|
|
|
Arbor Realty Trust, Inc. stockholders' equity: |
|
|
|
Preferred stock, cumulative, redeemable, $0.01 par value:
100,000,000 shares authorized, shares issued and outstanding by
period: |
|
633,684 |
|
|
|
633,684 |
|
Special voting preferred shares - 16,293,589 shares |
|
|
|
6.375% Series D - 9,200,000 shares |
|
|
|
6.25% Series E - 5,750,000 shares |
|
|
|
6.25% Series F - 11,342,000 shares |
|
|
|
Common stock, $0.01 par value: 500,000,000 shares authorized -
188,505,264 and 178,230,522 shares issued and outstanding |
|
1,885 |
|
|
|
1,782 |
|
Additional paid-in capital |
|
2,367,188 |
|
|
|
2,204,481 |
|
Retained earnings |
|
115,216 |
|
|
|
97,049 |
|
Total Arbor Realty Trust, Inc.
stockholders’ equity |
|
3,117,973 |
|
|
|
2,936,996 |
|
|
|
|
|
Noncontrolling interest |
|
136,632 |
|
|
|
134,883 |
|
Total equity |
|
3,254,605 |
|
|
|
3,071,879 |
|
|
|
|
|
Total liabilities and
equity |
$ |
15,738,636 |
|
|
$ |
17,038,985 |
|
ARBOR REALTY TRUST, INC. AND SUBSIDIARIESStatement
of Income Segment Information - (Unaudited)(in thousands) |
|
|
Quarter Ended December 31, 2023 |
|
StructuredBusiness |
|
AgencyBusiness |
|
Other(1) |
|
Consolidated |
Interest income |
$ |
317,132 |
|
|
$ |
13,928 |
|
|
$ |
- |
|
|
$ |
331,060 |
|
Interest expense |
|
221,747 |
|
|
|
5,732 |
|
|
|
- |
|
|
|
227,479 |
|
Net interest income |
|
95,385 |
|
|
|
8,196 |
|
|
|
- |
|
|
|
103,581 |
|
|
|
|
|
|
|
|
|
Other
revenue: |
|
|
|
|
|
|
|
Gain on sales, including
fee-based services, net |
|
- |
|
|
|
16,727 |
|
|
|
- |
|
|
|
16,727 |
|
Mortgage servicing rights |
|
- |
|
|
|
21,144 |
|
|
|
- |
|
|
|
21,144 |
|
Servicing revenue |
|
- |
|
|
|
49,246 |
|
|
|
- |
|
|
|
49,246 |
|
Amortization of MSRs |
|
- |
|
|
|
(16,173 |
) |
|
|
- |
|
|
|
(16,173 |
) |
Property operating income |
|
1,447 |
|
|
|
- |
|
|
|
- |
|
|
|
1,447 |
|
Gain on derivative
instruments, net |
|
- |
|
|
|
10,345 |
|
|
|
- |
|
|
|
10,345 |
|
Other income |
|
1,448 |
|
|
|
1,123 |
|
|
|
- |
|
|
|
2,571 |
|
Total other revenue |
|
2,895 |
|
|
|
82,412 |
|
|
|
- |
|
|
|
85,307 |
|
|
|
|
|
|
|
|
|
Other
expenses: |
|
|
|
|
|
|
|
Employee compensation and
benefits |
|
11,516 |
|
|
|
24,754 |
|
|
|
- |
|
|
|
36,270 |
|
Selling and
administrative |
|
5,399 |
|
|
|
7,287 |
|
|
|
- |
|
|
|
12,686 |
|
Property operating
expenses |
|
1,670 |
|
|
|
- |
|
|
|
- |
|
|
|
1,670 |
|
Depreciation and
amortization |
|
1,273 |
|
|
|
1,173 |
|
|
|
- |
|
|
|
2,446 |
|
Provision for loss sharing
(net of recoveries) |
|
- |
|
|
|
3,168 |
|
|
|
- |
|
|
|
3,168 |
|
Provision for credit losses
(net of recoveries) |
|
18,086 |
|
|
|
313 |
|
|
|
- |
|
|
|
18,399 |
|
Total other expenses |
|
37,944 |
|
|
|
36,695 |
|
|
|
- |
|
|
|
74,639 |
|
|
|
|
|
|
|
|
|
Income before income from
equity affiliates and income taxes |
|
60,336 |
|
|
|
53,913 |
|
|
|
- |
|
|
|
114,249 |
|
|
|
|
|
|
|
|
|
Income from equity
affiliates |
|
3,586 |
|
|
|
- |
|
|
|
- |
|
|
|
3,586 |
|
Benefit from (provision for)
income taxes |
|
497 |
|
|
|
(8,408 |
) |
|
|
- |
|
|
|
(7,911 |
) |
|
|
|
|
|
|
|
|
Net income |
|
64,419 |
|
|
|
45,505 |
|
|
|
- |
|
|
|
109,924 |
|
|
|
|
|
|
|
|
|
Preferred stock dividends |
|
10,342 |
|
|
|
- |
|
|
|
- |
|
|
|
10,342 |
|
Net income attributable to
noncontrolling interest |
|
- |
|
|
|
- |
|
|
|
7,923 |
|
|
|
7,923 |
|
Net income attributable to
common stockholders |
$ |
54,077 |
|
|
$ |
45,505 |
|
|
$ |
(7,923 |
) |
|
$ |
91,659 |
|
(1) Includes income allocated to the
noncontrolling interest holders not allocated to the two reportable
segments.
ARBOR REALTY TRUST, INC. AND SUBSIDIARIESBalance
Sheet Segment Information - (Unaudited)(in thousands) |
|
|
|
December 31, 2023 |
|
StructuredBusiness |
|
AgencyBusiness |
|
Consolidated |
Assets: |
|
|
|
|
|
Cash and cash equivalents |
$ |
619,487 |
|
|
$ |
309,487 |
|
|
$ |
928,974 |
|
Restricted cash |
|
595,342 |
|
|
|
12,891 |
|
|
|
608,233 |
|
Loans and investments,
net |
|
12,377,806 |
|
|
|
- |
|
|
|
12,377,806 |
|
Loans held-for-sale, net |
|
- |
|
|
|
551,707 |
|
|
|
551,707 |
|
Capitalized mortgage servicing
rights, net |
|
- |
|
|
|
391,254 |
|
|
|
391,254 |
|
Securities held-to-maturity,
net |
|
- |
|
|
|
155,279 |
|
|
|
155,279 |
|
Investments in equity
affiliates |
|
79,303 |
|
|
|
- |
|
|
|
79,303 |
|
Goodwill and other intangible
assets |
|
12,500 |
|
|
|
78,878 |
|
|
|
91,378 |
|
Other assets and due from
related party |
|
453,073 |
|
|
|
101,629 |
|
|
|
554,702 |
|
Total assets |
$ |
14,137,511 |
|
|
$ |
1,601,125 |
|
|
$ |
15,738,636 |
|
|
|
|
|
|
|
Liabilities: |
|
|
|
|
|
Debt obligations |
$ |
11,520,492 |
|
|
$ |
413,327 |
|
|
$ |
11,933,819 |
|
Allowance for loss-sharing
obligations |
|
- |
|
|
|
71,634 |
|
|
|
71,634 |
|
Other liabilities and due to
related party |
|
369,588 |
|
|
|
108,990 |
|
|
|
478,578 |
|
Total liabilities |
$ |
11,890,080 |
|
|
$ |
593,951 |
|
|
$ |
12,484,031 |
|
ARBOR REALTY TRUST, INC. AND
SUBSIDIARIESReconciliation of Distributable Earnings to
GAAP Net Income - (Unaudited)($ in thousands—except share and per
share data) |
|
|
Quarter Ended December 31, |
|
Year Ended December 31, |
|
|
2023 |
|
|
|
2022 |
|
|
|
2023 |
|
|
|
2022 |
|
Net income attributable to
common stockholders |
$ |
91,659 |
|
|
$ |
88,152 |
|
|
$ |
330,065 |
|
|
$ |
284,829 |
|
|
|
|
|
|
|
|
|
Adjustments: |
|
|
|
|
|
|
|
Net income attributable to noncontrolling interest |
|
7,923 |
|
|
|
8,234 |
|
|
|
29,122 |
|
|
|
28,044 |
|
Income from mortgage servicing rights |
|
(21,144 |
) |
|
|
(17,059 |
) |
|
|
(69,912 |
) |
|
|
(69,346 |
) |
Deferred tax (benefit) provision |
|
(719 |
) |
|
|
6,092 |
|
|
|
(7,349 |
) |
|
|
(1,741 |
) |
Amortization and write-offs of MSRs |
|
19,145 |
|
|
|
22,528 |
|
|
|
77,829 |
|
|
|
104,378 |
|
Depreciation and amortization |
|
4,115 |
|
|
|
3,225 |
|
|
|
16,425 |
|
|
|
11,069 |
|
Loss on extinguishment of debt |
|
- |
|
|
|
320 |
|
|
|
1,561 |
|
|
|
4,933 |
|
Provision for credit losses, net |
|
11,206 |
|
|
|
14,823 |
|
|
|
68,642 |
|
|
|
25,077 |
|
(Gain) loss on derivative instruments, net |
|
(10,880 |
) |
|
|
(14,992 |
) |
|
|
(8,844 |
) |
|
|
3,480 |
|
Stock-based compensation |
|
2,799 |
|
|
|
2,643 |
|
|
|
14,940 |
|
|
|
14,973 |
|
|
|
|
|
|
|
|
|
Distributable earnings
(1) |
$ |
104,104 |
|
|
$ |
113,966 |
|
|
$ |
452,479 |
|
|
$ |
405,696 |
|
|
|
|
|
|
|
|
|
Diluted distributable earnings
per share (1) |
$ |
0.51 |
|
|
$ |
0.60 |
|
|
$ |
2.25 |
|
|
$ |
2.23 |
|
|
|
|
|
|
|
|
|
Diluted weighted average
shares outstanding (1) (2) |
|
205,498,651 |
|
|
|
191,273,691 |
|
|
|
201,549,221 |
|
|
|
182,224,404 |
|
(1) Amounts are attributable to common stockholders and
OP Unit holders. The OP Units are redeemable for cash, or at the
Company's option for shares of the Company's common stock on a
one-for-one basis.
(2) The diluted
weighted average shares outstanding were adjusted to exclude the
potential shares issuable upon conversion and settlement of the
Company's convertible senior notes principal balance. For the
quarters ended December 31, 2023 and December 31, 2022, the diluted
weighted average shares outstanding excluded 17,362,563 and
18,470,080 of these potentially issuable shares, respectively. For
the years ended December 31, 2023 and December 31, 2022, the
diluted weighted average shares outstanding excluded 17,294,392 and
16,888,226 of these potentially issuable shares, respectively.
The Company is presenting distributable earnings
because management believes it is an important supplemental measure
of the Company's operating performance and is useful to investors,
analysts and other parties in the evaluation of REITs and their
ability to provide dividends to stockholders. Dividends are one of
the principal reasons investors invest in REITs. To maintain REIT
status, REITs are required to distribute at least 90% of their
REIT-taxable income. The Company considers distributable earnings
in determining its quarterly dividend and believes that, over time,
distributable earnings is a useful indicator of the Company's
dividends per share.
The Company defines distributable earnings as
net income (loss) attributable to common stockholders computed in
accordance with GAAP, adjusted for accounting items such as
depreciation and amortization (adjusted for unconsolidated joint
ventures), non-cash stock-based compensation expense, income from
MSRs, amortization and write-offs of MSRs, gains/losses on
derivative instruments primarily associated with Private Label
loans not yet sold and securitized, changes in fair value of
GSE-related derivatives that temporarily flow through earnings (net
of any tax impact), deferred tax provision (benefit), CECL
provisions for credit losses (adjusted for realized losses as
described below) and gains/losses on the receipt of real estate
from the settlement of loans (prior to the sale of the real
estate). The Company also adds back one-time charges such as
acquisition costs and one-time gains/losses on the early
extinguishment of debt and redemption of preferred stock.
The Company reduces distributable earnings for
realized losses in the period management determines that a loan is
deemed nonrecoverable in whole or in part. Loans are deemed
nonrecoverable upon the earlier of: (1) when the loan receivable is
settled (i.e., when the loan is repaid, or in the case of
foreclosure, when the underlying asset is sold); or (2) when
management determines that it is nearly certain that all amounts
due will not be collected. The realized loss amount is equal to the
difference between the cash received, or expected to be received,
and the book value of the asset.
Distributable earnings is not intended to be an
indication of the Company's cash flows from operating activities
(determined in accordance with GAAP) or a measure of its liquidity,
nor is it entirely indicative of funding the Company's cash needs,
including its ability to make cash distributions. The Company's
calculation of distributable earnings may be different from the
calculations used by other companies and, therefore, comparability
may be limited.
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