In This Article:
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CRE Portfolio: $8.1 billion total, with originated portfolio at $7.3 billion, a 6% decline.
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60-Day Plus Delinquencies: Increased by $53 million, equaling 6.2% of the total portfolio.
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New Originations: $246 million executed, with a pipeline growth of 34% to $730 million.
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M&A Portfolio: Reduced to $850 million, a 17% improvement.
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Small Business Lending Originations: Record $440 million, including $355 million SBA 7(a) loans.
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GAAP Losses Per Share: $0.07.
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Distributable Earnings: Loss of $0.28 per share; excluding realized losses, $0.25 per share.
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Revenue Increase: $19 million or 22% quarter over quarter to $104 million.
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Net Interest Income: Steady at $51 million.
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Non-Accrual Balances: Stable at $260 million, representing 2.8% of the portfolio.
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Book Value Per Share: $12.59, down from $12.97 last quarter.
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Liquidity Position: $181 million in unrestricted cash and $20 million in committed but undrawn borrowings.
Release Date: November 08, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
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Ready Capital Corp (NYSE:RC) reported stabilization in the commercial real estate market, particularly in the multi-family sector, driven by rate cuts and strong occupant demand.
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The company's small business lending operations achieved record growth, with $440 million in quarterly originations, marking the highest earnings contribution from this platform in RC's history.
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RC's strategic portfolio initiatives have made significant progress, with 72% of portfolio repositioning efforts complete, generating $55 million in net proceeds.
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The company's small business lending segment has become a leading national non-bank lender, exceeding its $1 billion annual target for SBA 7(a) loans.
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RC's leverage position remains conservative, with a total leverage of 3.3x, below its long-term target of 4x, allowing for opportunities to optimize its capital structure.
Negative Points
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Ready Capital Corp (NYSE:RC) reported a third-quarter GAAP loss per common share of $0.07 and a distributable earnings loss of $0.28, reflecting timing differences in valuation allowances and realized losses.
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The company's originated portfolio saw a 6% decline, with 60-day plus delinquencies increasing marginally, indicating ongoing challenges in credit migration.
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RC's M&A portfolio, although reduced by 17%, still has a high delinquency rate of 16%, highlighting ongoing risks in this segment.
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The company's exit from residential mortgage banking is still in progress, with remaining MSRs expected to generate $40 million in net proceeds, but the platform sale is pending agency approval.
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RC's book value per share decreased to $12.59 from $12.97 last quarter, primarily due to declines related to CECL reserves and net realized losses.