Schedule I Financial Information

12 Months Ended

Dec. 31, 2014

Condensed Financial Information of Parent Company Only Disclosure [Abstract]

Schedule I - Financial Information (Parent Company Only)

Schedule I

Financial Information

(Parent Company Only)

(in thousands, except share and per share data)

	December 31,
	2014		2013
ASSETS
Cash and cash equivalents	$	3,162	$	100,009
Restricted cash and cash equivalents	10,507		14,753
Residential loans at amortized cost, net	13,302		6,341
Receivables, net	16,363		51,681
Premises and equipment, net	157		277
Other assets	69,780		65,293
Due from affiliates, net	697,979		711,797
Investments in consolidated subsidiaries and variable interest entities	2,641,527		2,621,934
Total assets	$	3,452,777	$	3,572,085
LIABILITIES AND STOCKHOLDERS' EQUITY
Payables and accrued liabilities	$	42,076	$	57,187
Corporate debt	2,265,668		2,267,979
Deferred tax liability, net	68,374		79,903
Total liabilities	2,376,118		2,405,069
Stockholders' equity:
Preferred stock, $0.01 par value per share:
Authorized - 10,000,000 shares
Issued and outstanding - 0 shares at December 31, 2014 and 2013	—		—
Common stock, $0.01 par value per share:
Authorized - 90,000,000 shares
Issued and outstanding - 37,711,623 and 37,377,274 shares at December 31, 2014 and 2013, respectively	377		374
Additional paid-in capital	600,643		580,572
Retained earnings	475,244		585,572
Accumulated other comprehensive income	395		498
Total stockholders' equity	1,076,659		1,167,016
Total liabilities and stockholders' equity	$	3,452,777	$	3,572,085

Schedule I

Financial Information

(Parent Company Only)

(in thousands)

	For the Years Ended December 31,
	2014			2013			2012
REVENUES
Interest income on loans	$	1,007		$	612		$	328
Other revenues	1,456			739			382
Total revenues	2,463			1,351			710
EXPENSES
Interest expense	147,633			123,629			77,645
Salaries and benefits	19,311			16,911			19,708
General and administrative	32,198			55,023			17,528
Depreciation and amortization	120			124			131
Corporate allocations	(46,764		)	(40,519		)	(25,393		)
Other expenses, net	1,598			759			1,350
Total expenses	154,096			155,927			90,969
OTHER LOSSES
Losses on extinguishments	—			(12,489		)	(48,579		)
Other net fair value losses	(54		)	(4,813		)	(1,197		)
Total other losses	(54		)	(17,302		)	(49,776		)
Loss before income taxes	(151,687		)	(171,878		)	(140,035		)
Income tax benefit	(49,405		)	(55,556		)	(48,808		)
Loss before equity in earnings of consolidated subsidiaries and variable interest entities	(102,282		)	(116,322		)	(91,227		)
Equity in earnings or (losses) of consolidated subsidiaries and variable interest entities	(8,046		)	369,789			69,093
Net income (loss)	$	(110,328	)	$	253,467		$	(22,134	)
Comprehensive income (loss)	$	(110,431	)	$	253,472		$	(22,057	)

Schedule I

Financial Information

(Parent Company Only)

(in thousands)

	For the Years Ended December 31,
	2014			2013			2012
Cash flows used in operating activities	$	(74,452	)	$	(99,050	)	$	(78,619	)
Investing activities
Principal payments received on mortgage loans related to Residual Trusts	535			84			148
Cash proceeds from sales of real estate owned, net related to Residual Trusts	227			254			670
Decrease (increase) in restricted cash and cash equivalents	4,246			(752		)	31,175
Payments for acquisitions of businesses, net of cash acquired	—			(477,021		)	(130,000		)
Capital contributions to subsidiaries and variable interest entities	(83,544		)	(331,107		)	(31,118		)
Returns of capital from subsidiaries and variable interest entities	76,214			37,796			37,536
Change in due from affiliates	88,360			(688,070		)	12,469
Other	(2,283		)	(15,200		)	—
Cash flows provided by (used in) investing activities	83,755			(1,474,016		)	(79,120		)
Financing activities
Proceeds from issuance of corporate debt, net of debt issuance costs	—			3,106,263			962,524
Payments on corporate debt	(15,000		)	(360,826		)	(65,000		)
Debt prepayment penalty	—			—			(29,440		)
Other debt issuance costs paid	—			(1,936		)	(6,179		)
Extinguishments and settlement of debt	—			(1,405,424		)	(690,000		)
Secondary equity offering, net of issuance costs	—			—			276,013
Change in due to affiliates	(98,071		)	(29,618		)	72,588
Other	6,921			(1,777		)	3,076
Cash flows provided by (used in) financing activities	(106,150		)	1,306,682			523,582
Net increase (decrease) in cash and cash equivalents	(96,847		)	(266,384		)	365,843
Cash and cash equivalents at the beginning of the year	100,009			366,393			550
Cash and cash equivalents at the end of the year	$	3,162		$	100,009		$	366,393

The accompanying notes are an integral part of the consolidated financial statements.

Notes to the Parent Company Financial Statements

1. Basis of Presentation

The financial information of the Parent Company should be read in conjunction with the Consolidated Financial Statements included in Item 8 of this report. These Parent Company financial statements reflect the results of operations, financial position and cash flows for the Parent Company and its consolidated subsidiaries and VIEs in which it is the primary beneficiary. These consolidated subsidiaries and VIEs are accounted for using the equity method of accounting.

The accompanying Parent Company financial statements have been prepared in accordance with GAAP. The preparation of these Parent Company financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. These Parent Company financial statements include certain intercompany allocations to its subsidiaries that management believes have been made on a reasonable basis. These costs primarily include executive salaries and other centralized business functions. Refer to Note 27 of the Notes to Consolidated Financial Statements for additional information on intercompany allocations.

2. Acquisitions

On December 31, 2012, in connection with the execution of a stock purchase agreement, the Parent Company agreed to acquire all of the outstanding shares of Security One Lending. Refer to Note 3 of the Notes to Consolidated Financial Statements for additional information on this acquisition.

3. Corporate Debt

Corporate debt is comprised of secured term loans, convertible senior subordinated notes, and unsecured senior notes. In addition, the Parent Company has a $125 million senior secured revolving credit facility. Refer to Note 20 of the Notes to Consolidated Financial Statements for additional information on corporate debt.

4. Supplemental Disclosures of Cash Flow Information

The Company’s supplemental disclosures of cash flow information are summarized as follows (in thousands):

	For the Years Ended December 31,
	2014			2013		2012
Supplemental Disclosure of Cash Flow Information
Cash paid for interest	$	132,422		$	100,464	$	64,603
Cash paid (received) for income taxes	(6,067		)	91,646		28,728
Supplemental Disclosure of Non-Cash Investing and Financing Activities
Real estate owned acquired through foreclosure	671			657		870
Residential loans originated to finance the sale of real estate owned	1,657			1,962		2,925
Issuance of common stock for business acquisitions	—			—		41,346
Transfer of fixed assets	—			—		532

5. Guarantees

Refer to Note 28 of the Notes to Consolidated Financial Statements for certain guarantees made by the Parent Company in regards to Green Tree Servicing and RMS. In addition to these guarantees, all obligations of Green Tree Servicing, RMS and Ditech under master repurchase agreements and certain servicing advance facilities are guaranteed by the Parent