þ
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QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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o
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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Delaware
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13-3949418
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(State or other jurisdiction of incorporation or organization)
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(I.R.S. Employer Identification No.)
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100 Church Street, New York, New York
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10007
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(Address of principal executive offices)
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(Zip Code)
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Large accelerated filer
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o
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Accelerated filer
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o
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Non-accelerated filer
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o
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(Do not check if a smaller reporting company)
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Smaller reporting company
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þ
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Table of Contents
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CENTERLINE HOLDING COMPANY
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FORM 10-Q
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PART I – Financial Information
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Page
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Item 1
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Financial Statements
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Condensed Consolidated Balance Sheets
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3
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Condensed Consolidated Statements of Operations
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4
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Condensed Consolidated Statements of Comprehensive Income
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5
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Condensed Consolidated Statement of Changes in Equity
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6
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Condensed Consolidated Statements of Cash Flows
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7
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Notes to Condensed Consolidated Financial Statements
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Note 1 – Description of Business and Basis of Presentation
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9
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Note 2 – Fair Value Measurement
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10
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Note 3 – Assets Pledged as Collateral
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16
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Note 4 – Available-for-Sale Investments
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17
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Note 5 – Equity Method Investments
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21
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Note 6 – Mortgage Loans Held for Sale and Other Assets, Net
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21
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Note 7 – Mortgage Servicing Rights, Net
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22
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Note 8 – Deferred Costs and Other Assets, Net
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23
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Note 9 – Consolidated Partnerships
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24
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Note 10 – Notes Payable and Other Borrowings
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27
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Note 11 – Secured Financing
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29
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Note 12 – Accounts Payable, Accrued Expenses and Other Liabilities
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29
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Note 13 – Redeemable Securities
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30
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Note 14 – Non-Controlling Interests
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31
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Note 15 – General and Administrative Expenses
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32
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Note 16 – Provision for (Recovery of) Losses
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32
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Note 17 – Earnings per Share
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33
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Note 18 – Financial Risk Management and Derivatives
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34
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Note 19 – Related Party Transactions
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35
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Note 20 – Business Segments
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37
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Note 21 – Commitments and Contingencies
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39
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Note 22 – Subsequent Events
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43
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Item 2
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Management’s Discussion and Analysis of Financial Condition and Results of Operations
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44
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Item 3
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Quantitative and Qualitative Disclosures about Market Risk
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70
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Item 4
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Controls and Procedures
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71
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PART II – Other Information
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Item 1
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Legal Proceedings
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72
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Item 1A
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Risk Factors
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72
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Item 2
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Unregistered Sales of Equity Securities and Use of Proceeds
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73
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Item 3
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Defaults Upon Senior Securities
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74
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Item 4
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Mine Safety Disclosures
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74
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Item 5
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Other Information
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74
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Item 6
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Exhibits
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74
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SIGNATURES
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PART I. FINANCIAL INFORMATION
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||||||
Item 1. Financial Statements | ||||||||
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CENTERLINE HOLDING COMPANY
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||||||
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CONDENSED CONSOLIDATED BALANCE SHEETS
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||||||
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(in thousands)
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||||||
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March 31,
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December 31,
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||
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2012
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2011
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(Unaudited)
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Assets:
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|||
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Cash and cash equivalents
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$
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93,584
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$
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95,992
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Restricted cash
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16,658
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16,185
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Investments:
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Available-for-sale
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399,406
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394,355
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Equity method
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4,625
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8,794
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Mortgage loans held for sale and other assets
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84,046
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190,192
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Investments in and loans to affiliates, net
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5,970
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5,641
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Intangible assets, net
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8,634
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8,784
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Mortgage servicing rights, net
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75,103
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72,520
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Deferred costs and other assets, net
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75,341
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75,791
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Consolidated partnerships:
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Equity method investments
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2,889,695
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3,079,803
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Land, buildings and improvements, net
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435,830
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460,804
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Other assets
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268,043
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264,437
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Total assets
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$
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4,356,935
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$
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4,673,298
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|||
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Liabilities:
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Notes payable and other borrowings
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$
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218,450
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$
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322,849
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Secured financing
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615,982
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618,163
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Accounts payable, accrued expenses and other liabilities
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179,402
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187,230
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Preferred shares of subsidiary (subject to mandatory repurchase)
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55,000
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55,000
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Redeemable securities
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6,000
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-
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Consolidated partnerships:
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Notes payable
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137,970
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156,643
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Due to tax credit property partnerships
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122,435
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132,246
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Other liabilities
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324,957
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319,256
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Total liabilities
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1,660,196
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1,791,387
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Redeemable securities
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-
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6,000
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Commitments and contingencies
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Equity:
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Centerline Holding Company beneficial owners’ equity:
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Special preferred voting shares; no par value; 11,867 shares issued and outstanding in 2012 and 2011
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119
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119
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Common shares; no par value; 800,000 shares authorized; 356,226 issued and 349,166 outstanding in 2012 and 2011
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204,336
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209,735
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Treasury shares of beneficial interest – common, at cost; 7,060 shares in 2012 and 2011
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(65,764)
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(65,764)
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Accumulated other comprehensive income
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74,991
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66,661
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Centerline Holding Company total
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213,682
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210,751
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Non-controlling interests
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2,483,057
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2,665,160
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Total equity
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2,696,739
|
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2,875,911
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|||
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Total liabilities and equity
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$
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4,356,935
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$
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4,673,298
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CENTERLINE HOLDING COMPANY
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||||||||||
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
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||||||||||
(in thousands, except per share amounts)
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||||||||||
(Unaudited)
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||||||||||
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|||
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Three Months Ended
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|||||||
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March 31,
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|||||||
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2012
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2011
|
|||||
Revenues:
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|||||
Interest income
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$
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12,136
|
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$
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7,827
|
|||||
Fee income
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|
9,255
|
|
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7,930
|
|||||
Gain on sale of mortgage loans
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10,413
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|
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5,723
|
|||||
Other
|
|
1,070
|
|
|
971
|
|||||
Consolidated partnerships:
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|
|||||
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Interest income, net
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(1,357)
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245
|
||||
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Rental income
|
|
28,739
|
|
|
25,923
|
||||
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Other
|
|
195
|
|
|
90
|
||||
|
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Total revenues
|
|
60,451
|
|
|
48,709
|
|||
|
|
|
|
|
|
|
|
|||
Expenses:
|
|
|
|
|
|
|||||
General and administrative
|
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27,302
|
|
|
23,578
|
|||||
Provision for (recovery of) losses
|
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6,005
|
|
|
(2,789)
|
|||||
Interest
|
|
12,671
|
|
|
13,499
|
|||||
Interest – distributions to preferred shareholders of subsidiary
|
|
960
|
|
|
960
|
|||||
Depreciation and amortization
|
|
3,859
|
|
|
3,546
|
|||||
Consolidated partnerships:
|
|
|
|
|
|
|||||
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Interest
|
|
5,072
|
|
|
4,661
|
||||
|
Other expenses
|
|
60,411
|
|
|
45,833
|
||||
|
|
Total expenses
|
|
116,280
|
|
|
89,288
|
|||
|
|
|
|
|
|
|
|
|||
Loss before other (loss) income
|
|
(55,829)
|
|
|
(40,579)
|
|||||
|
|
|
|
|
|
|
|
|||
Other (loss) income:
|
|
|
|
|
|
|||||
Gain on settlement of liabilities
|
|
-
|
|
|
1,756
|
|||||
Other losses from consolidated partnerships
|
|
(153,364)
|
|
|
(61,441)
|
|||||
|
|
|
|
|
|
|
|
|||
Loss from continuing operations before income tax provision
|
|
(209,193)
|
|
|
(100,264)
|
|||||
Income tax provision – continuing operations
|
|
(60)
|
|
|
(193)
|
|||||
|
|
|
|
|
|
|
|
|||
Net loss from continuing operations
|
|
(209,253)
|
|
|
(100,457)
|
|||||
|
|
|
|
|
|
|
|
|||
Discontinued operations
|
|
|
|
|
|
|||||
Net income from discontinued operations
|
|
-
|
|
|
253
|
|||||
|
|
|
|
|
|
|
|
|||
Net loss
|
|
(209,253)
|
|
|
(100,204)
|
|||||
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|
|
|
|
|
|
|
|||
Net loss attributable to non-controlling interests
|
|
203,854
|
|
|
100,966
|
|||||
|
|
|
|
|
|
|
|
|||
Net (loss) income attributable to Centerline Holding Company shareholders
|
$
|
(5,399)
|
|
$
|
762
|
|||||
|
|
|
|
|
|
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|
|||
Net (loss) income per share
|
|
|
|
|
|
|||||
Basic
|
|
|
|
|
|
|||||
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(Loss) income from continuing operations
|
$
|
(0.02)
|
|
$
|
-
|
(1)
|
|||
|
(Loss) income from discontinued operations
|
$
|
N/A
|
|
$
|
-
|
(1)
|
|||
Diluted
|
|
|
|
|
|
|||||
|
(Loss) income from continuing operations
|
$
|
(0.02)
|
|
$
|
-
|
(1)
|
|||
|
(Loss) income from discontinued operations
|
$
|
N/A
|
|
$
|
-
|
(1)
|
|||
|
|
|
|
|
|
|
|
|||
Weighted average shares outstanding
|
|
|
|
|
|
|||||
Basic
|
|
349,166
|
|
|
348,647
|
|||||
Diluted
|
|
349,166
|
|
|
349,268
|
|||||
|
|
|
|
|
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|
|||
(1)
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Amount calculates to zero when rounded.
|
|||||||||
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|||
N/A - Not applicable |
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CENTERLINE HOLDING COMPANY
|
||||||||||
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
|
||||||||||
(in thousands)
|
||||||||||
(Unaudited)
|
||||||||||
|
|
|
|
|
|
|
|
|||
|
|
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Three Months Ended
|
|||||||
|
|
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March 31,
|
|||||||
|
|
|
2012
|
|
2011
|
|||||
|
|
|
|
|
||||||
Net Loss
|
$
|
(209,253)
|
|
$
|
(100,204)
|
|||||
|
|
|
|
|
|
|
|
|||
Other comprehensive income - unrealized gains, net
|
|
8,344
|
|
|
3,654
|
|||||
|
|
|
|
|
|
|
|
|||
Comprehensive loss
|
|
(200,909)
|
|
|
(96,550)
|
|||||
|
|
|
|
|
|
|
|
|||
Less: Other comprehensive loss attributable to non-controlling interests
|
|
203,840
|
|
|
100,978
|
|||||
|
|
|
|
|
|
|
|
|||
Comprehensive income attributable to Centerline Holding Company shareholders
|
$
|
2,931
|
|
$
|
4,428
|
CENTERLINE HOLDING COMPANY
|
||||||||||||||||||||||
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
|
||||||||||||||||||||||
(in thousands)
|
||||||||||||||||||||||
(Unaudited)
|
||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accumulated
|
|
|
|
|
|
|
|
|
|
|
|
Special
|
|
|
|
|
|
|
|
|
|
Other
|
|
Non-
|
|
|
|
|||
|
|
|
|
Preferred
|
|
|
|
|
|
|
|
|
|
Comprehensive
|
|
Controlling
|
|
|
|
|||
|
|
|
|
Voting Shares
|
|
Common Shares
|
|
Treasury Shares
|
|
Income/(loss)
|
|
Interests
|
|
Total
|
||||||||
|
|
|
|
|
|
|
Shares
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
January 1, 2012
|
|
$
|
119
|
|
349,166
|
|
$
|
209,735
|
|
$
|
(65,764)
|
|
$
|
66,661
|
|
$
|
2,665,160
|
|
$
|
2,875,911
|
||
|
Net loss
|
|
|
-
|
|
-
|
|
|
(5,399)
|
|
|
-
|
|
|
-
|
|
|
(203,854)
|
|
|
(209,253)
|
|
|
Unrealized gains, net
|
|
|
-
|
|
-
|
|
|
-
|
|
|
-
|
|
|
8,330
|
|
|
14
|
|
|
8,344
|
|
|
Contributions
|
|
|
-
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
29,845
|
|
|
29,845
|
|
|
Net decrease due to newly consolidated general partnerships
|
|
|
-
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
(985)
|
|
|
(985)
|
|
|
Distributions
|
|
|
-
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
(7,123)
|
|
|
(7,123)
|
|
March 31,2012
|
|
$
|
119
|
|
349,166
|
|
$
|
204,336
|
|
$
|
(65,764)
|
|
$
|
74,991
|
|
$
|
2,483,057
|
|
$
|
2,696,739
|
CENTERLINE HOLDING COMPANY
|
||||||
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
|
||||||
(in thousands)
|
||||||
(Unaudited)
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
||||
|
|
March 31,
|
||||
|
|
2012
|
|
2011
|
||
|
|
|
|
|
|
|
CASH FLOWS FROM OPERATING ACTIVITIES:
|
|
|
|
|
|
|
Net loss
|
$
|
(209,253)
|
|
$
|
(100,204)
|
|
Adjustments to reconcile net income (loss) to cash flows used in operating activities:
|
|
|
|
|
|
|
|
Non-cash loss from consolidated partnerships
|
|
205,426
|
|
|
102,780
|
|
Gain on settlement of liabilities
|
|
-
|
|
|
(1,756)
|
|
Lease termination costs
|
|
3,318
|
|
|
-
|
|
Credit intermediation assumption fees
|
|
911
|
|
|
1,397
|
|
Reserves for bad debts, net of reversals
|
|
3,287
|
|
|
2,711
|
|
Affordable Housing loss reserve recovery
|
|
(600)
|
|
|
(5,500)
|
|
Depreciation and amortization
|
|
3,859
|
|
|
3,546
|
|
Share-based compensation expense
|
|
-
|
|
|
20
|
|
Change in fair value of derivatives
|
|
(850)
|
|
|
(703)
|
|
Non-cash expense, net
|
|
4,100
|
|
|
5,705
|
|
Capitalization of mortgage servicing rights
|
|
(5,779)
|
|
|
(3,634)
|
Changes in operating assets and liabilities:
|
|
|
|
|
|
|
|
Mortgage loans held for sale
|
|
106,101
|
|
|
(4,790)
|
|
Receivables
|
|
416
|
|
|
972
|
|
Other assets
|
|
(1,630)
|
|
|
(772)
|
|
Deferred revenues
|
|
(1,528)
|
|
|
1,295
|
|
Accounts payable, accrued expenses and other liabilities
|
|
(7,376)
|
|
|
(4,538)
|
|
|
|
|
|
|
|
Net cash flow provided by (used in) operating activities
|
|
100,402
|
|
|
(3,471)
|
|
|
|
|
|
|
|
|
CASH FLOWS FROM INVESTING ACTIVITIES:
|
|
|
|
|
|
|
|
Sale and repayment of available-for-sale securities
|
|
49
|
|
|
(54)
|
|
Sale and repayments of mortgage loans held for investment
|
|
6
|
|
|
11
|
|
Acquisition of equity interests in Tax Credit Property Partnerships
|
|
(3,193)
|
|
|
(6,988)
|
|
Proceeds from sale of equity interests to Tax Credit Fund Partnerships
|
|
7,362
|
|
|
5,628
|
|
Deferred investment acquisition cost
|
|
(72)
|
|
|
-
|
|
(Increase) decrease in restricted cash, escrows and other cash collateral
|
|
(472)
|
|
|
612
|
|
Acquisition of furniture, fixtures and leasehold improvements
|
|
(438)
|
|
|
(76)
|
|
Equity investments and other investing activities
|
|
2
|
|
|
(861)
|
|
|
|
|
|
|
|
Net cash flow provided by (used in) investing activities
|
|
3,244
|
|
|
(1,728)
|
CENTERLINE HOLDING COMPANY
|
|||||||
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
|
|||||||
(in thousands)
|
|||||||
(Unaudited)
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
||||
|
|
|
March 31,
|
||||
|
|
|
2012
|
|
2011
|
||
|
|
|
|
|
|
|
|
CASH FLOWS FROM FINANCING ACTIVITIES:
|
|
|
|
|
|
||
|
Distributions to equity holders
|
|
(1,556)
|
|
|
(1,556)
|
|
|
Repayments of term loan
|
|
(2,976)
|
|
|
-
|
|
|
(Decrease) increase in mortgage banking warehouse and repurchase facilities
|
|
(103,622)
|
|
|
4,938
|
|
|
Increase in revolving credit facility
|
|
2,200
|
|
|
4,000
|
|
|
Redemption of Convertible CRA Shares
|
|
-
|
|
|
(161)
|
|
|
Deferred financing and other offering costs
|
|
(100)
|
|
|
-
|
|
|
|
|
|
|
|
|
|
Net cash flow (used in) provided by financing activities
|
|
(106,054)
|
|
|
7,221
|
||
|
|
|
|
|
|
|
|
Net (decrease) increase in cash and cash equivalents
|
|
(2,408)
|
|
|
2,022
|
||
Cash and cash equivalents at the beginning of the period
|
|
95,992
|
|
|
119,616
|
||
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents at end of period
|
$
|
93,584
|
|
$
|
121,638
|
|
|
|
|
|
|
|
|
Non-cash investing and financing activities:
|
|
|
|
|
|
||
|
Net change in re-securitized mortgage revenue bonds:
|
|
|
|
|
|
|
|
|
Secured financing liability
|
$
|
2,181
|
|
$
|
14,330
|
|
|
Mortgage revenue bonds
|
$
|
(2,181)
|
|
$
|
(16,020)
|
|
|
Decrease in Series B Freddie Mac Certificates
|
$
|
-
|
|
$
|
1,683
|
|
|
Decrease in Series A-1 Freddie Mac Certificates
|
$
|
-
|
|
$
|
6
|
|
Exchange of Convertible Special Common Units to Common Shares
|
$
|
-
|
|
$
|
7,102
|
|
|
|
|
|
|
|
|
|
A.
|
Description of Business
|
B.
|
Basis of Presentation
|
C.
|
Recently Issued and Adopted Accounting Pronouncements
|
|
During the three months ended March 31, 2012 we adopted the following new accounting pronouncements:
|
·
|
On January 1, 2012, we adopted Accounting Standards Update (“ASU”) No. 2011-03, Transfers and Servicing (Topic 860): Reconsideration of Effective Control for Repurchase Agreements. This update revises the criteria for assessing effective control for repurchase agreements and other agreements that both entitle and obligate a transferor to repurchase or redeem financial assets before their maturity. The adoption of ASU 2011-03 did not have a material impact on our consolidated financial statements.
|
·
|
On January 1, 2012, we adopted ASU No. 2011-04, Fair Value Measurement (Topic 820): Amendments to Achieve Common Fair Value Measurement and Disclosure Requirements in U.S. GAAP and IFRSs. This update amends the existing fair value guidance to improve consistency in the application and disclosure of fair value measurements in U.S. GAAP and International Financial Reporting Standards. ASU 2011-04 provides certain clarifications to the existing guidance, changes certain fair value principles, and enhances disclosure requirements. While requiring additional disclosures, the adoption of ASU 2011-04 did not have an impact on our financial condition, results of operations or cash flows.
|
·
|
On January 1, 2012, we adopted ASU No. 2011-05, Comprehensive Income (Topic 220): Presentation of Comprehensive Income. ASU 2011-05 removes the option to present the components of other comprehensive income (“OCI”) as part of the statement of changes in equity. In addition, ASU 2011-05 requires consecutive presentation of the statement of operations and OCI and presentation of reclassification adjustments on the face of the financial statements from OCI to net income. The adoption of ASU 2011-05 impacts presentation of a separate financial statement only and did not have an impact on our financial condition, results of operations or cash flows.
|
·
|
On January 1, 2012, we adopted ASU No. 2011-12, Comprehensive Income (Topic 220), Deferral of the Effective Date for Amendments to the Presentation of Reclassifications of Items Out of Accumulated Other Comprehensive Income in ASU 2011-05, to defer the effective date of the specific requirement to present items that are reclassified out of accumulated other comprehensive income to net income alongside their respective components of net income and OCI until the Financial Accounting Standards Board is able to reconsider the applicable provisions. The adoption of ASU 2011-12 impacts presentation only and did not have an impact on our financial condition, results of operations or cash flows.
|
A.
|
General
|
B.
|
Valuation Hierarchy
|
·
|
Level 1 inputs utilize quoted prices (unadjusted) in active markets for identical assets or liabilities that we have the ability to access.
|
·
|
Level 2 inputs utilize other-than-quoted prices that are observable, either directly or indirectly. Level 2 inputs include quoted prices for similar assets and liabilities in active markets, and inputs such as interest rates and yield curves that are observable at commonly quoted intervals.
|
·
|
Level 3 inputs are unobservable and typically based on our own assumptions, including situations where there is little, if any, market activity.
|
C.
|
Assets and Liabilities Measured at Fair Value on a Recurring Basis
|
Series A-1 Freddie Mac Certificates
|
We generally determine fair value based on observable market transactions of similar instruments when available. Because these certificates typically have a limited or inactive market, and in the absence of observable market transactions, we estimate fair value for each certificate utilizing the present value of the expected cash flows of the scheduled interest payments on each certificate discounted at a rate for comparable tax-exempt investments and then compare it against any similar market transactions.
|
|
Series B Freddie Mac Certificates
|
We determine fair value of the Series B Freddie Mac Certificates, which represent the residual interests of the re-securitized portfolio, based upon a discounted cash flow model that follows the contractual provisions of the certificates. The significant assumptions of the valuation which impact the cash flow and thus the valuation include: | |
● |
estimating the constant default rate (“CDR”) and the prepayment rates of the mortgage revenue bonds in the managed portfolio, estimates which are based on our historical experience and industry studies related to properties comparable to those underlying the bonds;
|
|
● | estimating the loss severity, upon default, associated with the mortgage revenue bonds collateral;
|
|
● | estimating the extent to which other parties involved in our planned restructuring of the bonds underlying the certificates will participate and the timing of that restructuring; and
|
|
● | applying an appropriate discount rate, which we consider in comparison to comparable residual interests, along with consideration of the tax-exempt nature of the associated income. |
Mortgage revenue bonds
|
As mortgage revenue bonds typically have a limited or inactive market, in the absence of observable market transactions, we estimate fair value for bonds secured by performing properties (“Performing Assets”) by calculating the net present value based on the original bond amortization schedule, utilizing a discount rate for comparable tax-exempt investments as obtained from relevant market makers. For bonds secured by properties with substandard performance (“Non-performing Assets”), the fair value is determined by utilizing the direct capitalization methodology and applying a capitalization rate obtained from market data for comparative tax exempt investments to assumed stabilized net operating income levels. Management uses judgment based on individual property markets to determine stabilized net operating income.
|
Interest rate derivatives
|
The fair values of interest rate derivatives are determined using the market standard methodology of netting the discounted future fixed cash receipts (or payments) and the discounted expected variable cash payments (or receipts). The variable cash payments (or receipts) are based on an expectation of future interest rates (forward curve) derived from observable market interest rate curves. In adjusting the fair value of our derivative contracts for the effect of nonperformance risk, we have considered the impact of netting and any applicable credit enhancements, such as thresholds and guarantees.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
as of
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
March 31,
|
||
(in thousands)
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
2012
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
Available-for-sale investments:
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
|
Freddie Mac Certificates:
|
|
|
|
|
|
|
|
|
|
|
|
|
||
|
|
Series A-1
|
|
$
|
-
|
|
$
|
-
|
|
$
|
133,897
|
|
$
|
133,897
|
|
|
|
Series B
|
|
|
-
|
|
|
-
|
|
|
62,388
|
|
|
62,388
|
|
|
Mortgage revenue bonds
|
|
|
-
|
|
|
-
|
|
|
203,121
|
|
|
203,121
|
||
|
|
Total available-for-sale investments
|
|
$
|
-
|
|
$
|
-
|
|
$
|
399,406
|
|
$
|
399,406
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest rate derivatives(1)
|
|
$
|
-
|
|
$
|
1,397
|
|
$
|
-
|
|
$
|
1,397
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
Interest rate derivatives(2)
|
|
$
|
-
|
|
$
|
27,796
|
|
$
|
-
|
|
$
|
27,796
|
(1)
|
Included in “Deferred costs and other assets, net” on the Condensed Consolidated Balance Sheets.
|
(2)
|
Included in “Accounts payable, accrued expenses and other liabilities” on the Condensed Consolidated Balance Sheets.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
as of
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December 31,
|
|
(in thousands)
|
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
2011
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
Available-for-sale investments:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
|
Freddie Mac Certificates:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
|
|
Series A-1
|
|
|
$
|
-
|
|
$
|
-
|
|
$
|
134,360
|
|
$
|
134,360
|
|
|
|
Series B
|
|
|
|
-
|
|
|
-
|
|
|
64,857
|
|
|
64,857
|
|
|
Mortgage revenue bonds
|
|
|
|
-
|
|
|
-
|
|
|
195,138
|
|
|
195,138
|
||
|
|
Total available-for-sale investments
|
|
|
$
|
-
|
|
$
|
-
|
|
$
|
394,355
|
|
$
|
394,355
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest rate derivatives
|
|
|
$
|
-
|
|
$
|
1,488
|
|
$
|
-
|
|
$
|
1,488
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
Interest rate derivatives
|
|
|
$
|
-
|
|
$
|
28,737
|
|
$
|
-
|
|
$
|
28,737
|
|
|
|
|
Three Months Ended March 31, 2012
|
|||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
|
|
|
|
Series A-1
|
|
Series B
|
|
Mortgage
|
|
|
|||||
|
|
|
|
Freddie Mac
|
|
Freddie Mac
|
|
Revenue
|
|
|
|||||
(in thousands)
|
|
Certificates
|
|
Certificates
|
|
Bonds
|
Total
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
Balance at January 1, 2012
|
|
$
|
134,360
|
|
$
|
64,857
|
|
$
|
195,138
|
$
|
394,355
|
||||
|
Total realized and unrealized gains or (losses):
|
|
|
|
|
|
|
|
|
|
|
|
|||
|
|
Realized gain recognized in earnings
|
|
|
-
|
|
|
-
|
|
|
-
|
|
-
|
||
|
|
Unrealized (loss) gain recorded in other
|
|
|
|
|
|
|
|
|
|
|
|
||
|
|
|
comprehensive income (loss)
|
|
|
(459)
|
|
|
(444)
|
|
|
9,234
|
|
8,331
|
|
|
Amortization or accretion
|
|
|
(4)
|
|
|
(2,025)
|
|
|
43
|
|
(1,986)
|
|||
|
Purchases, sales, issuances, settlements and other adjustments(1)
|
|
|
-
|
|
|
-
|
|
|
(1,294)
|
(2) |
|
(1,294)
|
||
|
Net transfers in and/or out of Level 3
|
|
|
-
|
|
|
-
|
|
|
-
|
|
-
|
|||
Balance at March 31, 2012
|
|
$
|
133,897
|
|
$
|
62,388
|
|
$
|
203,121
|
$
|
399,406
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
Amount of total gains for the period included in
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
earnings attributable to the change in unrealized
|
|
|
|
|
|
|
|
|
|
|
|
|||
|
gains or losses relating to assets still held at
|
|
|
|
|
|
|
|
|
|
|
|
|||
|
March 31, 2012
|
|
$
|
-
|
|
$
|
-
|
|
$
|
-
|
$
|
-
|
|
|
|
|
Three Months Ended March 31, 2011
|
|||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
|
|
|
|
Series A-1
|
|
Series B
|
Mortgage
|
|
|
||||||
|
|
|
|
Freddie Mac
|
|
Freddie Mac
|
Revenue
|
|
|
||||||
(in thousands)
|
|
Certificates
|
|
Certificates
|
Bonds
|
Total
|
|||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
Balance at January 1, 2011
|
|
$
|
129,406
|
|
$
|
63,215
|
$
|
292,659
|
$
|
485,280
|
|||||
|
Total realized and unrealized gains or (losses):
|
|
|
|
|
|
|
|
|
|
|
||||
|
|
Realized gain recognized in earnings
|
|
|
-
|
|
|
-
|
|
-
|
|
-
|
|||
|
|
Unrealized (loss) gain recorded in other
|
|
|
|
|
|
|
|
|
|
|
|||
|
|
|
comprehensive income (loss)
|
|
|
(2,022)
|
|
|
4,412
|
|
(1,326)
|
|
1,064
|
||
|
Amortization or accretion
|
|
|
(3)
|
|
|
(4,454)
|
|
49
|
|
(4,408)
|
||||
|
Purchases, sales, issuances, settlements and other adjustments(1) |
|
|
1,844
|
|
|
6
|
|
(35,668)
|
(3)
|
|
(33,818)
|
|||
|
Net transfers in and/or out of Level 3
|
|
|
-
|
|
|
-
|
|
-
|
|
-
|
||||
Balance at March 31, 2011
|
|
$
|
129,225
|
|
$
|
63,179
|
$
|
255,714
|
$
|
448,118
|
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
Amount of total gains for the period included in
|
|
|
|
|
|
|
|
|
|
|
|||||
|
earnings attributable to the change in unrealized
|
|
|
|
|
|
|
|
|
|
|
||||
|
gains or losses relating to assets still held at
|
|
|
|
|
|
|
|
|
|
|
||||
|
March 31, 2011
|
|
$
|
-
|
|
$
|
-
|
$
|
-
|
$
|
-
|
(1)
|
No purchases, sales, issuances or settlements occurred during the reporting period.
|
(2)
|
Reflects de-recognition of one mortgage revenue bond as a result of repayment during the period.
|
(3)
|
Reflects the elimination of certain mortgage revenue bonds as a result of the consolidation of the underlying properties upon obtaining control of the related Tax Credit Property Partnerships, as well as a bond that received sale treatment during the period (see Note 4).
|
D.
|
Assets and Liabilities Not Measured at Fair Value
|
Mortgage loans held for investment
|
Fair value is determined by using a combination of updated appraised values and broker quotes or services supplying market and sales data in various geographical locations where the collateral is located.
|
Mortgage loans held for sale
|
Fair value is estimated by calculating the assumed gain/loss of the expected loan sale to the buyer, the expected net future cash flows associated with the servicing of the loan and the effects of interest rate movements between the date of rate lock and the balance sheet date.
|
MSRs
|
We estimate the fair value through a discounted cash flow analysis utilizing market information obtained with the assistance of third-party valuation specialists. Inputs into this analysis include contractual servicing fees, our projected cost to service as well as estimates of default rates, prepayment speeds and an appropriate discount rate. While certain of the inputs such as fee rates and discount rates are observable, most of the other inputs are based on historical company data.
|
Secured financing
|
Fair value is estimated using either quoted market prices or discounted cash flow analyses based on our current borrowing rates for similar types of borrowing arrangements, which reflect our current credit standing.
|
Preferred shares of subsidiary (subject to mandatory repurchase)
|
As the preferred shares are economically defeased by the Series A-1 Freddie Mac certificates, the fair value is determined in a manner consistent with the Series A-1 Freddie Mac certificates. As these instruments typically have a limited or inactive market, and in the absence of observable market transactions, we estimate the fair value utilizing the present value of the expected cash flows discounted at a rate for comparable tax-exempt investments.
|
Fixed-rate notes payable
|
Fair value is estimated by utilizing the present value of the expected cash flows discounted at a rate for comparable tax-exempt investments.
|
The following table presents information about our more significant assets and liabilities that are not carried at fair value:
|
|||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
March 31, 2012
|
|
December 31, 2011
|
||||||||
|
|
|
Fair Value
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Hierarchy
|
|
Carrying
|
|
|
|
|
Carrying
|
|
|
|
||
(in thousands)
|
|
Level
|
|
Value
|
|
Fair Value
|
|
Value
|
|
Fair Value
|
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Mortgage loans held for investment
|
|
3
|
|
$
|
1,291
|
|
$
|
1,329
|
|
$
|
1,335
|
|
$
|
1,335
|
|
Mortgage loans held for sale
|
|
2
|
|
|
82,755
|
|
|
85,335
|
|
|
188,855
|
|
|
196,669
|
|
MSRs
|
|
3
|
|
|
75,103
|
|
|
82,040
|
|
|
72,520
|
|
|
78,814
|
|
Secured financing
|
|
3
|
|
|
615,982
|
|
|
481,815
|
|
|
618,163
|
|
|
474,968
|
|
Preferred shares of subsidiary (subject to
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
mandatory repurchase)
|
|
3
|
|
|
55,000
|
|
|
61,553
|
|
|
55,000
|
|
|
61,981
|
Redeemable securities
|
|
3
|
|
|
6,000
|
|
|
1,425
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated Partnerships:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fixed-rate notes payable
|
|
3
|
|
|
137,970
|
|
|
96,087
|
|
|
156,643
|
|
|
99,527
|
|
|
|
|
|
|
Carrying
|
|
|
|
|
|
|
|
|
|
|
Amount of
|
|
|
|
|
|
|
|
|
|
|
Collateral at
|
|
|
|
|
|
|
|
|
|
|
March 31,
|
|
|
|
|
|
|
|
|
|
|
2012
|
|
|
|
|
Collateral
|
|
Balance Sheet Classification
|
|
(in thousands)
|
|
Associated Debt Facility/Liability
|
||||
|
|
|
|
|
|
|
|
|
|
|
Cash at Centerline Mortgage
|
|
Restricted cash
|
|
$
|
12,535
|
|
Mortgage loan loss sharing agreements (Note 21)
|
|||
|
Capital Inc. (“CMC”)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash at Centerline Financial LLC
|
|
Cash and cash equivalents
|
|
$
|
66,314
|
|
Affordable Housing Yield transactions (Note 21)
|
|||
|
("CFin" or "Centerline Financial")
|
|
|
|
|
|
|
|
|
and Centerline Financial undrawn credit facility (Note 10)(1)
|
|
|
|
|
|
|
|
|
|
|
|
Series A-1 Freddie Mac
|
|
Investments – available-for-sale – Freddie Mac
|
|
$
|
114,515
|
|
Preferred shares of subsidiary (2)
|
|||
|
certificates at Centerline
|
|
|
certificates (Note 4)
|
|
|
|
|
|
|
|
Equity Issuer Trust ("Equity Issuer")
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Series A-1 Freddie Mac
|
|
Investments – available-for-sale – Freddie Mac
|
|
$
|
19,382
|
|
Affordable Housing Yield transactions (Note 21)
|
|||
|
Certificates at Centerline
|
|
|
certificates (Note 4)
|
|
|
|
|
|
|
|
Guaranteed Holdings LLC ("Guaranteed Holdings")
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Mortgage loans at CMC and
|
|
Other investments – mortgage loans held for
|
|
$
|
82,755
|
|
Mortgage Banking warehouse facilities
|
|||
|
Centerline Mortgage Partners
|
|
|
sale (Note 6)
|
|
|
|
|
|
|
|
Inc. (“CMP”)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Collateral posted with
|
|
Deferred costs and other assets, net (Note 8)
|
|
$
|
44,149
|
|
Affordable Housing Yield transactions (Note 21)
|
|||
|
counterparties at Guaranteed
|
|
|
|
|
|
|
|
|
|
|
Holdings
|
|
|
|
|
|
|
|
|
|
(1)
|
These assets are subject to a priority lien related to the Affordable Housing Yield transactions and a subordinated lien related to the Centerline Financial undrawn credit facility.
|
(2)
|
While not collateral, these assets economically defease the preferred shares of subsidiary.
|
Available-for-sale investments consisted of:
|
|||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
March 31,
|
|
December 31,
|
|
||
|
(in thousands)
|
|
2012
|
|
2011
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
Freddie Mac Certificates:
|
|
|
|
|
|
|
|
|
|
|
Series A-1
|
|
$
|
133,897
|
|
$
|
134,360
|
|
|
|
Series B
|
|
|
62,388
|
|
|
64,857
|
|
|
Mortgage revenue bonds
|
|
|
203,121
|
|
|
195,138
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
$
|
399,406
|
|
$
|
394,355
|
|
A.
|
Freddie Mac Certificates
|
|
|
|
March 31,
|
|
December 31,
|
|
|||
|
(in thousands)
|
|
2012
|
|
2011
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
Amortized cost
|
|
$
|
177,575
|
|
$
|
177,579
|
|
|
|
Gross unrealized gains
|
|
|
20,664
|
|
|
21,344
|
|
|
|
Fair value
|
|
|
198,239
|
|
|
198,923
|
|
|
|
|
Less: eliminations(1)
|
|
|
(64,342)
|
|
|
(64,563)
|
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated fair value
|
|
$
|
133,897
|
|
$
|
134,360
|
|
|
(1)
|
A portion of the Series A-1 Freddie Mac Certificates relate to re-securitized mortgage revenue bonds that are not reflected as sold for GAAP purposes. Accordingly, that portion is eliminated in consolidation. |
|
The fair value and the sensitivity of the fair value to immediate adverse changes in those assumptions are as follows:
|
||||||
|
|
|
|
|
|
|
|
|
|
|
March 31,
|
|
|
|
(in thousands)
|
|
2012
|
|
||
|
|
|
|
|
|
|
|
Fair value of Freddie Mac A-1 Certificates
|
|
$
|
133,897
|
|
|
|
|
|
|
|
|
|
|
Discount rate:
|
|
|
|
|
|
|
|
Fair value after impact of 2% adverse change
|
|
|
124,624
|
|
|
|
Fair value after impact of 4% adverse change
|
|
|
116,310
|
|
Series B
|
|
||||||||
|
|
|
|
|
|
|
|
|
|
Information with respect to the Series B Freddie Mac Certificates is as follows:
|
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
March 31,
|
|
December 31,
|
|
|||
|
(in thousands)
|
|
2012
|
|
2011
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
Amortized cost basis
|
|
$
|
26,046
|
|
$
|
30,915
|
|
|
|
Gross unrealized gains
|
|
|
36,906
|
|
|
35,573
|
|
|
|
|
Subtotal/fair value(1)
|
|
|
62,952
|
|
|
66,488
|
|
|
|
Less: eliminations(2)
|
|
|
(564)
|
|
|
(1,631)
|
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated fair value
|
|
$
|
62,388
|
|
$
|
64,857
|
|
(1) |
The fair value of the Series B Freddie Mac Certificates decreased primarily due to the December 31, 2011 projected cash flows which included contingent interest of $2.2 million on an underlying bond which was received in the first quarter of 2011 as expected.
|
||
(2) |
A portion of the Series B Freddie Mac Certificates relates to re-securitized mortgage revenue bonds that were not reflected as sold. Accordingly, that portion is eliminated in consolidation.
|
|
|
|
March 31,
|
|
|
December 31,
|
|
|
|
|
|
2012
|
|
|
2011
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average discount rate
|
|
26.0
|
%
|
|
26.0
|
%
|
|
|
Constant prepayment rate
|
|
90.0
|
%
|
|
90.0
|
%
|
|
|
Weighted average life
|
|
8.1
|
years
|
|
8.3
|
years
|
|
|
Constant default rate
|
|
2.0
|
%
|
|
2.0
|
%
|
|
|
Default severity rate
|
|
21.0
|
%
|
|
21.0
|
%
|
|
|
|
|
|
March 31,
|
|
|
|
(in thousands)
|
|
2012
|
|
||
|
|
|
|
|
|
|
|
Fair value of Freddie Mac B Certificates
|
|
$
|
62,388
|
|
|
|
|
|
|
|
|
|
|
Constant prepayment rate:
|
|
|
|
|
|
|
|
Fair value after impact of 5% adverse change
|
|
|
62,157
|
|
|
|
Fair value after impact of 10% adverse change
|
|
|
61,396
|
|
|
|
|
|
|
|
|
|
Discount rate:
|
|
|
|
|
|
|
|
Fair value after impact of 5% adverse change
|
|
|
54,098
|
|
|
|
Fair value after impact of 10% adverse change
|
|
|
47,705
|
|
|
|
|
|
|
|
|
|
Constant default rate:
|
|
|
|
|
|
|
|
Fair value after impact of 1% adverse change
|
|
|
56,524
|
|
|
|
Fair value after impact of 2% adverse change
|
|
|
50,917
|
|
|
|
|
|
|
|
|
|
Default severity rate:
|
|
|
|
|
|
|
|
Fair value after impact of 5% adverse change
|
|
|
60,936
|
|
|
|
Fair value after impact of 10% adverse change
|
|
|
59,483
|
|
B. Mortgage Revenue Bonds
|
||||||||||
|
|
|
|
|
|
|
|
|
|
|
The following table summarizes our mortgage revenue bond portfolio:
|
||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
March 31,
|
|
December 31,
|
|
||
|
(in thousands)
|
|
2012
|
|
2011
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
Securitized:
|
|
|
|
|
|
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
Included in December 2007 re-securitization transaction and accounted for as financed |
|
$
|
199,649
|
|
$
|
191,564
|
|
|
|
Not securitized
|
|
|
3,472
|
|
|
3,574
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
Total at fair value
|
|
$
|
203,121
|
|
$
|
195,138
|
|
|
|
|
March 31,
|
|
December 31,
|
|
||
|
(in thousands)
|
|
2012
|
|
2011
|
|
||
|
|
|
|
|
|
|
|
|
|
Amortized cost basis
|
|
$
|
218,218
|
|
$
|
219,469
|
|
|
Gross unrealized gains
|
|
|
20,499
|
|
|
18,960
|
|
|
Gross unrealized losses
|
|
|
(35,596)
|
|
|
(43,291)
|
|
|
|
|
|
|
|
|
|
|
|
Fair value
|
|
$
|
203,121
|
|
$
|
195,138
|
|
Key fair value assumptions used in measuring the mortgage revenue bonds are provided in the table below:
|
|||||
|
|
|
|
||
|
|
March 31,
|
|
December 31,
|
|
|
|
2012
|
|
2011
|
|
|
|
|
|
|
|
|
Capitalization rate range (Non-performing Assets)
|
6.95-9.15
|
%
|
6.95-9.15
|
%
|
|
|
|
|
|
|
|
Discount Rate (Performing Assets)
|
6.5
|
%
|
6.5
|
%
|
The fair value and the sensitivity of the fair value to the immediate adverse changes in those assumptions are as follows:
|
||||||
|
|
|
|
|
|
|
|
|
|
|
March 31, |
|
|
|
(in thousands)
|
|
2012 |
|
||
|
|
|
|
|
|
|
|
Fair value of Mortgage revenue bonds
|
|
$
|
203,121
|
|
|
|
|
|
|
|
|
|
|
Capitalization rate (Non-performing Assets):
|
|
|
|
|
|
|
|
Fair value after impact of 5% adverse change
|
|
|
183,684
|
|
|
|
Fair value after impact of 10% adverse change
|
|
|
168,218
|
|
|
|
|
|
|
|
|
|
Discount rate (Performing Assets):
|
|
|
|
|
|
|
|
Fair value after impact of 5% adverse change
|
|
|
201,289
|
|
|
|
Fair value after impact of 10% adverse change
|
|
|
199,580
|
|
|
|
|
|
|
|
|
|
|
|
Less than
|
|
12 Months
|
|
|
|
|
||
|
(dollars in thousands)
|
|
12 Months
|
|
or More
|
|
Total
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
March 31, 2012
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Number
|
|
|
6
|
|
|
16
|
|
|
22
|
|
|
Fair value
|
|
$
|
20,267
|
|
$
|
62,939
|
|
$
|
83,206
|
|
|
Gross unrealized losses
|
|
$
|
7,791
|
|
$
|
27,805
|
|
$
|
35,596
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December 31, 2011
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Number
|
|
|
11
|
|
|
14
|
|
|
25
|
|
|
Fair value
|
|
$
|
43,098
|
|
$
|
42,021
|
|
$
|
85,119
|
|
|
Gross unrealized losses
|
|
$
|
14,622
|
|
$
|
28,669
|
|
$
|
43,291
|
|
NOTE 5 – Equity Method Investments
|
||||||||
|
|
|
|
|
|
|
|
|
The table below provides the components of equity method investments as of:
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
March 31,
|
|
December 31,
|
|
||
|
(in thousands)
|
|
2012
|
|
2011
|
|
||
|
|
|
|
|
|
|
|
|
|
Equity interests in Tax Credit Property Partnerships
|
|
$
|
4,625
|
|
$
|
8,794
|
|
NOTE 6 – Mortgage Loans Held for Sale and Other Assets
|
|||||||||
|
|
|
|
|
|
|
|
|
|
The table below provides the components of other investments as of:
|
|||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
March 31,
|
|
December 31,
|
|
||
|
(in thousands)
|
|
2012
|
|
2011
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
Mortgage loans held for sale
|
|
$
|
82,755
|
|
$
|
188,855
|
|
|
|
Mortgage loans held for investment
|
|
|
1,291
|
|
|
1,335
|
|
|
|
Stabilization escrow
|
|
|
-
|
|
|
2
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
$
|
84,046
|
|
$
|
190,192
|
|
A.
|
Mortgage Loans Held for Sale
|
B.
|
Mortgage Loans Held for Investment
|
C.
|
Stabilization Escrow
|
NOTE 7 – Mortgage Servicing Rights, Net
|
||||
|
|
|
|
|
The components of the change in MSRs and related reserves were as follows:
|
||||
|
|
|
|
|
|
|
(in thousands)
|
|
|
|
|
|
|
|
|
Balance at January 1, 2011
|
$
|
65,614
|
|
|
MSRs capitalized
|
|
3,634
|
|
|
Amortization
|
|
(2,760)
|
|
|
Balance at March 31, 2011
|
$
|
66,488
|
|
|
|
|
|
|
|
Balance at January 1, 2012
|
$
|
72,520
|
|
|
MSRs capitalized
|
|
5,779
|
|
|
Amortization
|
|
(3,196)
|
|
|
Balance at March 31, 2012
|
$
|
75,103
|
|
|
|
March 31,
|
|
|
December 31,
|
|
|
||
|
|
2012
|
|
|
2011
|
|
|
||
|
|
|
|
|
|
|
|
|
|
|
Fair value of MSRs
|
$
|
82,040
|
|
|
$
|
78,814
|
|
|
|
Weighted average discount rate
|
|
17.67
|
%
|
|
|
17.64
|
%
|
|
|
Weighted average pre-pay speed
|
|
9.49
|
%
|
|
|
9.50
|
%
|
|
|
Weighted average lockout period (years)
|
|
4.1
|
|
|
|
4.1
|
|
|
|
Weighted average default rate
|
|
0.95
|
%
|
|
|
0.72
|
%
|
|
|
Cost to service loans
|
$
|
2,472
|
|
|
$
|
2,284
|
|
|
|
Acquisition cost (per loan)
|
$
|
1,486
|
|
|
$
|
1,484
|
|
|
|
|
|
|
March 31,
|
|
|
|
(in thousands)
|
|
2012
|
|
||
|
|
|
|
|
|
|
|
Fair value of MSRs
|
|
$
|
82,040
|
|
|
|
|
|
|
|
|
|
|
Prepayment speed:
|
|
|
|
|
|
|
|
Fair value after impact of 10% adverse change
|
|
|
81,390
|
|
|
|
Fair value after impact of 20% adverse change
|
|
|
80,772
|
|
|
|
|
|
|
|
|
|
Discount rate:
|
|
|
|
|
|
|
|
Fair value after impact of 10% adverse change
|
|
|
78,041
|
|
|
|
Fair value after impact of 20% adverse change
|
|
|
74,418
|
|
|
|
|
|
|
|
|
|
Default rate:
|
|
|
|
|
|
|
|
Fair value after impact of 10% adverse change
|
|
|
81,937
|
|
|
|
Fair value after impact of 20% adverse change
|
|
|
81,827
|
|
|
|
|
|
Three Months Ended
|
|
||||
|
|
|
|
March 31,
|
|
||||
|
(in thousands)
|
|
2012
|
|
2011
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
Total servicing fees
|
|
$
|
6,348
|
|
$
|
5,880
|
|
|
|
Servicing fees from securitized assets
|
|
|
|
|
|
|
|
|
|
|
(included in Total servicing fees)
|
|
$
|
524
|
|
$
|
540
|
|
NOTE 8 – Deferred Costs and Other Assets, Net
|
|||||||||
|
|
|
|
|
|
|
|
|
|
The table below provides the components of deferred costs and other assets, net as of the dates presented:
|
|||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
March 31,
|
|
December 31,
|
|
|||
|
(in thousands)
|
|
2012
|
|
2011
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
Deferred financing and other costs(1)
|
|
$
|
11,140
|
|
$
|
11,854
|
|
|
|
Less: Accumulated amortization
|
|
|
(4,348)
|
|
|
(4,041)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net deferred costs
|
|
|
6,792
|
|
|
7,813
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Collateral posted with counterparties
|
|
|
44,198
|
|
|
44,763
|
|
|
|
Interest and fees receivable, net
|
|
|
5,550
|
|
|
6,102
|
|
|
|
Other receivables
|
|
|
6,917
|
|
|
6,443
|
|
|
|
Furniture, fixtures and leasehold improvements, net
|
|
|
4,159
|
|
|
3,926
|
|
|
|
Other
|
|
|
7,725
|
|
|
6,744
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
$
|
75,341
|
|
$
|
75,791
|
|
|
(1) |
Excludes items included in deferred financing and other costs that have been fully amortized.
|
|
|
|
March 31,
|
|
December 31,
|
|
||||
|
(in thousands)
|
|
2012
|
|
2011
|
|
||||
|
|
|
|
|
|
|
|
|||
|
Assets:
|
|
|
|
|
|
|
|
||
|
|
Equity interests in Tax Credit Property Partnerships
|
|
$
|
2,889,695
|
|
$
|
3,079,803
|
|
|
|
|
Land, buildings and improvements, net
|
|
|
435,830
|
|
|
460,804
|
|
|
|
|
Other assets
|
|
|
268,043
|
|
|
264,437
|
|
|
|
|
Total assets
|
|
$
|
3,593,568
|
|
$
|
3,805,044
|
|
|
|
|
|
|
|
|
|
|
|
||
|
|
|
|
|
|
|
|
|
||
|
Liabilities:
|
|
|
|
|
|
|
|
||
|
|
Notes payable
|
|
$
|
137,970
|
|
$
|
156,643
|
|
|
|
|
Due to Tax Credit Property Partnerships
|
|
|
122,435
|
|
|
132,246
|
|
|
|
|
Other liabilities
|
|
|
324,957
|
|
|
319,256
|
|
|
|
|
Total liabilities
|
|
$
|
585,362
|
|
$
|
608,145
|
|
|
|
|
|
|
|
|
|
|
|
||
|
Net eliminations(1)
|
|
|
562,575
|
|
|
557,444
|
|
||
|
|
|
|
|
|
|
|
|
||
|
Equity:
|
|
|
|
|
|
|
|
||
|
|
Non-controlling interests
|
|
|
2,451,485
|
|
|
2,633,604
|
|
|
|
|
Centerline Holding Company
|
|
|
(5,854)
|
|
|
5,851
|
|
|
|
|
Total equity
|
|
|
2,445,631
|
|
|
2,639,455
|
|
|
|
|
|
|
|
|
|
|
|
||
|
|
Total liabilities and equity
|
|
$
|
3,593,568
|
|
$
|
3,805,044
|
|
|
|
|
|
|
|
|
|
|
|
||
|
(1)
|
Reflects the impact on assets and liabilities for transactions eliminated between the Company and Consolidated Partnerships.
|
|
Equity Interests in Tax Credit Property Partnerships
|
Land, Buildings and Improvements, Net
|
|
|
Three Months Ended
|
|
||||||
|
|
March 31,
|
|
||||||
|
(in thousands)
|
|
2012
|
|
2011
|
|
|||
|
|
|
|
|
|
|
|
||
|
Interest income, net
|
|
$
|
(1,357)
|
|
$
|
245
|
|
|
|
Rental income
|
|
|
28,739
|
|
|
25,923
|
|
|
|
Other revenues
|
|
|
195
|
|
|
90
|
|
|
|
|
|
|
|
|
|
|
||
|
Total revenues
|
|
$
|
27,577
|
|
$
|
26,258
|
|
|
|
|
|
|
|
|
|
|
||
|
Interest expense
|
|
$
|
5,072
|
|
$
|
4,661
|
|
|
|
Other expenses:
|
|
|
|
|
|
|
|
|
|
Asset management fees
|
|
|
9,558
|
|
|
10,378
|
|
|
|
Property operating expenses
|
|
|
10,652
|
|
|
9,703
|
|
|
|
General and administrative expenses
|
|
|
10,625
|
|
|
8,987
|
|
|
|
Depreciation and amortization
|
|
|
14,834
|
|
|
12,364
|
|
|
|
Other
|
|
|
14,742
|
|
|
4,401
|
|
|
|
Total other expenses
|
|
|
60,411
|
|
|
45,833
|
|
|
|
|
|
|
|
|
|
|
||
|
Total expenses
|
|
$
|
65,483
|
|
$
|
50,494
|
|
|
|
|
|
|
|
|
|
|
||
|
Other losses from consolidated partnerships, net
|
|
$
|
(153,364)
|
|
$
|
(61,441)
|
|
|
|
|
|
|
|
|
|
|
||
|
Net loss
|
|
|
(191,270)
|
|
|
(85,677)
|
|
|
|
|
|
|
|
|
|
|
||
|
Net eliminations(1)
|
|
|
(14,158)
|
|
|
(17,105)
|
|
|
|
|
|
|
|
|
|
|
||
|
Net loss attributable to non-controlling interests
|
|
|
(205,426)
|
|
|
(102,780)
|
|
|
|
|
|
|
|
|
|
|
||
|
Net loss attributable to Centerline Holding Company shareholders
|
|
$
|
(2)
|
|
$
|
(2)
|
|
|
|
|
|
|
|
|
|
|
||
|
(1)
|
Reflects the transactions eliminated between the Company and Consolidated Partnerships.
|
|
NOTE 10 – Notes Payable and Other Borrowings
|
|||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The table below provides the components of notes payable and other borrowings as of the dates presented:
|
|||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest Rate
|
|
|
|
|
|
|
|
|
|
|
|
|
|
at March 31,
|
|
|
March 31,
|
|
December 31,
|
|
|||
|
(in thousands)
|
|
2012
|
|
|
2012
|
|
2011
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Term loan
|
|
|
3.24
|
%
|
|
$
|
122,037
|
|
$
|
125,014
|
|
|
|
Revolving credit facility
|
|
|
3.24
|
|
|
|
14,300
|
|
|
12,100
|
|
|
|
Mortgage Banking warehouse facilities
|
|
|
2.79
|
|
|
|
48,676
|
|
|
105,615
|
|
|
|
Mortgage Banking repurchase facilities
|
|
|
-
|
|
|
|
-
|
|
|
8,450
|
|
|
|
Multifamily ASAP facility
|
|
|
1.84
|
|
|
|
33,437
|
|
|
71,670
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
|
|
|
|
$
|
218,450
|
|
$
|
322,849
|
|
A.
|
Term Loan and Revolving Credit Facility
|
·
|
minimum ratio of consolidated EBITDA to fixed charges, which became effective for us as of June 30, 2011; and
|
·
|
maximum ratio of funded debt to consolidated EBITDA, which will become effective for us as of June 30, 2012.
|
·
|
extended the deadline by which we were required to deliver certain specified financial data and other information to the administrative agent under the Credit Facility and, in certain cases, to the lenders under the Credit Agreement;
|
·
|
included certain conditions subsequent requiring us to deliver additional specified financial data and other information to the administrative agent by certain dates;
|
·
|
granted a waiver of our noncompliance with the Credit Agreement’s consolidated EBITDA to fixed charges ratio solely with respect to the quarter ended December 31, 2011, although we have determined that we were in compliance with such ratio with respect to the quarter ended December 31, 2011;
|
·
|
required us to pay certain costs and expenses incurred by the administrative agent in administering the Credit Agreement; and
|
·
|
requires us to pay prescribed monthly consulting fees to the administrative agent’s consultant.
|
B.
|
Mortgage Banking Warehouse Facilities
|
·
|
We have a $100 million committed warehouse facility that matures in September 2012 and bears interest at a rate of LIBOR plus 2.50%. The interest rate on the warehouse facility was 2.74% as of March 31, 2012 and 2.80% as of December 31, 2011.
|
·
|
We have a $50 million committed warehouse facility that matures in November 2012 and bears interest at a rate of LIBOR plus a minimum of 2.75% and a maximum of 4.25%. The interest rate on the warehouse facility was 2.99% as of March 31, 2012 and 3.05% as of December 31, 2011.
|
·
|
We have two uncommitted warehouse repurchase facilities that provide us with additional resources for warehousing of mortgage loans with Freddie Mac and Fannie Mae. These agreements are scheduled to mature on November 16, 2012 and bear interest at a rate of LIBOR plus 3.50% with a minimum of 4.50% for all Fannie Mae loans and 4.00% for all Freddie Mac loans.
|
·
|
We have an uncommitted facility with Fannie Mae under its Multifamily As Soon As Pooled (“ASAP”) Facility funding program. After approval of certain loan documents, Fannie Mae will fund loans after closing and the advances are used to repay our warehouse facilities. Subsequently, Fannie Mae funds approximately 99% of the loan and CMC funds the remaining 1%. CMC is later reimbursed by Fannie Mae when the assets are sold. Interest on this facility currently accrues at a rate of LIBOR plus 1.35% with a minimum rate of 1.70%. The interest rate on this facility was 1.84% as of March 31, 2012 and 1.70% as of December 31, 2011.
|
C.
|
Centerline Financial Credit Facility
|
·
|
LIBOR plus 0.40% or;
|
·
|
1.40% plus the higher of the prime rate or the federal funds effective rate plus 0.50%.
|
D.
|
Covenants
|
NOTE 11 – Secured Financing
|
||||||||
|
|
|
|
|
|
|
|
|
The table below provides the secured financing as of the dates presented:
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
March 31,
|
|
December 31,
|
|
||
|
(in thousands)
|
|
2012
|
|
2011
|
|
||
|
|
|
|
|
|
|
|
|
|
Freddie Mac secured financing
|
|
$
|
615,982
|
|
$
|
618,163
|
|
NOTE 12 – Accounts Payable, Accrued Expenses and Other Liabilities
|
|||||||||
|
|
|
|
|
|
|
|
|
|
Accounts payable, accrued expenses and other liabilities consisted of the following:
|
|||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
March 31,
|
|
December 31,
|
|
|||
|
(in thousands)
|
|
2012
|
|
2011
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
Deferred revenues
|
|
$
|
33,086
|
|
$
|
34,614
|
|
|
|
Allowance for risk-sharing obligations (Note 21)
|
|
|
21,715
|
|
|
21,715
|
|
|
|
Affordable Housing loss reserve
|
|
|
31,700
|
|
|
32,300
|
|
|
|
Accrued expenses
|
|
|
5,048
|
|
|
5,583
|
|
|
|
Accounts payable
|
|
|
1,453
|
|
|
1,545
|
|
|
|
Accrued credit intermediation assumption fees
|
|
|
29,706
|
|
|
28,795
|
|
|
|
Interest rate derivatives (Note 18)
|
|
|
27,796
|
|
|
28,737
|
|
|
|
Salaries and benefits payable
|
|
|
8,453
|
|
|
15,067
|
|
|
|
Accrued interest payable
|
|
|
4,465
|
|
|
4,546
|
|
|
|
Lease termination costs and deferred rent
|
|
|
7,283
|
|
|
4,158
|
|
|
|
Other
|
|
|
8,697
|
|
|
10,170
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
$
|
179,402
|
|
$
|
187,230
|
|
A.
|
Deferred Revenues
|
B.
|
Affordable Housing Loss Reserve
|
C.
|
Accrued Credit Intermediation Assumption Fees
|
D.
|
Interest Rate Derivatives
|
E.
|
Lease Termination Costs and Deferred Rent
|
NOTE 13 - Redeemable Securities
|
||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The table below provides the components of redeemable securities as of the dates presented:
|
||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(in thousands)
|
|
March 31, 2012
|
|
December 31, 2011
|
||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Number of
|
|
|
|
|
|
|
Number of
|
|
|
|
|
|
|
|
Common
|
|
|
|
|
|
|
Common
|
|
|
Carrying
|
|
Number of
|
|
Shares if
|
|
Carrying
|
|
Number of
|
|
Shares if
|
||
Series
|
|
Value
|
|
Shares
|
|
converted
|
|
Value
|
|
Shares
|
|
converted
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Convertible CRA Shares
|
|
$
|
6,000
|
|
320
|
|
320
|
|
$
|
6,000
|
|
320
|
|
320
|
NOTE 14 – Non-controlling Interests
|
|||||||||
|
|
|
|
|
|
|
|
|
|
The table below provides the components of non-controlling interests as of the dates presented:
|
|||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
March 31,
|
|
December 31,
|
|
|||
|
(in thousands)
|
|
2012
|
|
2011
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
Limited partners interests in consolidated partnerships
|
|
$
|
2,451,485
|
|
$
|
2,633,604
|
|
|
|
Preferred shares of a subsidiary (not subject to mandatory repurchase)(1)
|
|
|
104,000
|
|
|
104,000
|
|
|
|
Convertible Special Common Units (“SCUs”) of a subsidiary; 11,867
|
|
|
|
|
|
|
|
|
|
|
outstanding in 2012 and 2011
|
|
|
(82,356)
|
|
|
(82,356)
|
|
|
Other(2)
|
|
|
9,928
|
|
|
9,912
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
$
|
2,483,057
|
|
$
|
2,665,160
|
|
(1)
|
For detail of the terms of these securities (as well as Preferred shares of a subsidiary (subject to mandatory repurchase)) refer to the 2011 Form 10-K.
|
(2)
|
“Other” non-controlling interests represent the 10.0% interest in Centerline Financial Holdings LLC (“CFin Holdings”) owned by Natixis Capital Markets North America Inc. (“Natixis”).
|
|
|
|
|
Three Months Ended
|
|
||||
|
|
|
|
March 31,
|
|
||||
|
(in thousands)
|
|
2012
|
|
2011
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
Limited partners interests in consolidated partnerships
|
|
$
|
205,426
|
|
$
|
102,780
|
|
|
|
Preferred shares of a subsidiary (not subject to mandatory repurchase)
|
|
|
(1,556)
|
|
|
(1,556)
|
|
|
|
Other
|
|
|
(16)
|
|
|
(258)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
$
|
203,854
|
|
$
|
100,966
|
|
NOTE 15 – General and Administrative Expenses
|
|||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
The table below provides the components of general and administrative expenses for the periods presented:
|
|||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
||||
|
|
|
|
|
|
March 31,
|
|
||||
|
(in thousands)
|
|
2012
|
|
2011
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|
Salaries and benefits
|
|
$
|
13,343
|
|
$
|
10,868
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
Other:
|
|
|
|
|
|
|
|
|||
|
|
Credit intermediation assumption and other fees
|
|
|
1,039
|
|
|
1,450
|
|
||
|
|
Professional fees
|
|
|
3,838
|
|
|
2,579
|
|
||
|
|
Site visits and acquisition fees
|
|
|
1,367
|
|
|
1,297
|
|
||
|
|
Advisory fees
|
|
|
1,250
|
|
|
1,250
|
|
||
|
|
Subservicing fees
|
|
|
1,803
|
|
|
1,690
|
|
||
|
|
Rent expense
|
|
|
963
|
|
|
1,352
|
|
||
|
|
Miscellaneous
|
|
|
3,699
|
|
|
3,092
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
$
|
27,302
|
|
$
|
23,578
|
|
A.
|
Salaries and Benefits
|
B.
|
Professional fees
|
C.
|
Advisory Fees
|
NOTE 16 – Provision for (Recovery of) Losses
|
||||||||||
|
|
|
|
|
|
|
|
|
|
|
The table below provides the components of the provision for (recovery of) losses for the periods presented:
|
||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
||||
|
|
|
|
|
March 31,
|
|
||||
|
(in thousands)
|
|
2012
|
|
2011
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
Affordable Housing loss reserve recovery (see Note 21)
|
|
$
|
(600)
|
|
$
|
(5,500)
|
|
||
|
Provision for risk-sharing obligations (see Note 21)
|
|
|
-
|
|
|
238
|
|
||
|
Lease termination costs
|
|
|
3,318
|
|
|
-
|
|
||
|
Bad debt reserves
|
|
|
3,287
|
|
|
2,473
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
$
|
6,005
|
|
$
|
(2,789)
|
|
A.
|
Affordable Housing Loss Reserve Recovery
|
B.
|
Lease Termination Costs
|
C.
|
Bad Debt Reserves
|
NOTE 17 - Earnings per Share
|
|
|
|
|
|
|
|
|
|
||||
|
|
|
|
|
|
|
|
|
|
||||
The calculation of basic and diluted net loss per share is as follows:
|
|||||||||||||
|
|
|
|
|
|
|
|
|
|
||||
|
|
Three Months Ended March 31,
|
|
||||||||||
|
|
2012
|
|
|
2011
|
|
|||||||
|
|
|
|
|
|
|
|
|
|
||||
|
|
Continuing
|
|
|
Continuing
|
|
Discontinued
|
|
|||||
(in thousands, except per share amounts)
|
|
Operations
|
|
|
Operations
|
|
Operations
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||
Numerator:
|
|
|
|
|
|
|
|
|
|
||||
|
Net (loss) income attributable to Centerline Holding Company
|
|
|
|
|
|
|
|
|
|
|||
|
shareholders
|
|
$
|
(5,399)
|
|
|
$
|
509
|
|
$
|
253
|
|
|
|
Undistributed (loss) income attributable to Centerline Holding
|
|
|
|
|
|
|
|
|
|
|||
|
Company shareholders
|
|
|
(5,399)
|
|
|
|
509
|
|
|
253
|
|
|
|
Undistributed earnings attributable to redeemable
|
|
|
|
|
|
|
|
|
|
|||
|
securities
|
|
$
|
-
|
|
|
|
(1)
|
|
|
-
|
|
|
|
Effect of redeemable share conversions
|
|
|
-
|
|
|
|
(113)
|
|
|
-
|
|
|
|
Net (loss) income attributable to Centerline Holding Company
|
|
|
|
|
|
|
|
|
|
|||
|
shareholders used for EPS calculations – basic
|
|
$
|
(5,399)
|
|
|
$
|
395
|
|
$
|
253
|
|
|
|
Net (loss) income attributable to Centerline Holding Company
|
|
|
|
|
|
|
|
|
|
|||
|
shareholders used for EPS calculations – diluted
|
|
$
|
(5,399)
|
|
|
$
|
395
|
|
$
|
253
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Denominator:
|
|
|
|
|
|
|
|
|
|
||||
|
Weighted average shares outstanding
|
|
|
|
|
|
|
|
|
|
|||
|
Basic
|
|
|
349,166
|
|
|
|
348,647
|
|
|
348,647
|
|
|
|
Effect of dilutive shares
|
|
|
-
|
|
|
|
621
|
|
|
621
|
|
|
|
Diluted
|
|
|
349,166
|
|
|
|
349,268
|
|
|
349,268
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Calculation of EPS:
|
|
|
|
|
|
|
|
|
|
||||
|
Net (loss) income attributable to Centerline Holding Company
|
|
|
|
|
|
|
|
|
|
|||
|
shareholders – basic
|
|
$
|
(5,399)
|
|
|
$
|
395
|
|
$
|
253
|
|
|
|
Weighted average shares outstanding – basic
|
|
|
349,166
|
|
|
|
348,647
|
|
|
348,647
|
|
|
|
Net (loss) income per share attributable to Centerline Holding
|
|
|
|
|
|
|
|
|
|
|||
|
Company shareholders – basic
|
|
$
|
(0.02)
|
|
|
$
|
- (1)
|
|
$
|
- (1)
|
|
|
|
Net (loss) income attributable to Centerline Holding Company
|
|
|
|
|
|
|
|
|
|
|||
|
shareholders – diluted
|
|
$
|
(5,399)
|
|
|
$
|
395
|
|
$
|
253
|
|
|
|
Weighted average shares outstanding –diluted
|
|
|
349,166
|
|
|
|
349,268
|
|
|
349,268
|
|
|
|
Net (loss) income per share attributable to Centerline Holding
|
|
|
|
|
|
|
|
|
|
|||
|
Company shareholders – diluted
|
|
$
|
(0.02)
|
|
|
$
|
- (1)
|
|
$
|
- (1)
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
(1)
|
Amount calculates to zero when rounded.
|
|
A.
|
General
|
B.
|
Derivative Positions
|
·
|
We were party to 17 interest rate derivative agreements with the developers of properties relating to certain mortgage revenue bonds we previously owned. We entered into these derivative agreements to effectively convert the fixed rate of interest (per the terms of the mortgage revenue bond) to a variable rate. Under the terms of these agreements, we pay fixed interest rates equal to those of the related bonds and receive interest at a variable rate (based on the SIFMA index). Since the December 2007 re-securitization transaction, these derivatives are now deemed to be free-standing derivatives. At March 31, 2012, these derivatives had an aggregate notional amount of $157.6 million, a weighted average interest rate of 5.76% and a weighted average remaining term of 10.7 years.
|
·
|
Our Affordable Housing Equity segment is party to an interest rate derivative whereby we pay a variable rate of interest (based on the SIFMA index) and receive interest at a fixed rate of 3.83%. This derivative is a free-standing derivative. At March 31, 2012, the derivative had a notional amount of $9.5 million, with a variable interest rate of 1.68% payable to a third party and remaining term of 11.2 years.
|
C.
|
Financial Statement Impact
|
|
|
|
March 31,
|
|
December 31,
|
|
||
|
(in thousands)
|
|
2012
|
|
2011
|
|
||
|
|
|
|
|
|
|
|
|
|
Net liability position
|
|
$
|
27,796
|
|
$
|
28,737
|
|
|
Net asset position
|
|
|
1,397
|
|
|
1,488
|
|
|
|
|
Three Months Ended
|
|
||||
|
|
|
March 31,
|
|
||||
|
(in thousands)
|
|
2012
|
|
2011
|
|
||
|
|
|
|
|
|
|
|
|
|
Not designated as hedges:
|
|
|
|
|
|
|
|
|
Interest payments
|
|
$
|
2,518
|
|
$
|
2,519
|
|
|
Interest receipts
|
|
|
(922)
|
|
|
(981)
|
|
|
Change in fair value
|
|
|
(850)
|
|
|
(703)
|
|
|
Included in interest expense
|
|
$
|
746
|
|
$
|
835
|
|
NOTE 19 – Related Party Transactions
|
||||||||||
|
|
|
|
|
|
|
|
|
||
Investments in and Loans to Affiliates
|
||||||||||
|
|
|
|
|
|
|
|
|
||
The table below provides the components of investments in and loans to affiliates as of the dates presented:
|
||||||||||
|
|
|
|
|
|
|
|
|
||
|
|
|
March 31,
|
|
December 31,
|
|
||||
|
(in thousands)
|
|
2012
|
|
2011
|
|
||||
|
|
|
|
|
|
|
|
|
||
|
Fund advances related to Tax Credit Property Partnerships, net(1)
|
|
$
|
65,828
|
|
$
|
64,067
|
|
||
|
Advances to Tax Credit Fund Partnerships, net
|
|
|
2,247
|
|
|
1,871
|
|
||
|
Fees receivable and other, net
|
|
|
23,869
|
|
|
29,166
|
|
||
|
|
Subtotal
|
|
|
91,944
|
|
|
95,104
|
|
|
|
|
Less: Eliminations(2)
|
|
|
(85,974)
|
|
|
(89,463)
|
|
|
|
|
|
|
|
|
|
|
|
||
|
|
Total
|
|
$
|
5,970
|
|
$
|
5,641
|
|
|
(1)
|
Net of reserves of $41.5 million at March 31, 2012 and $38.5 million at December 31, 2011.
|
|
(2)
|
For management purposes, we treat Consolidated Partnerships as equity investments in evaluating our results. As we consolidate the funds, we eliminate the investments for presentation in the condensed consolidated financial statements. In addition, any fees or advances receivable from Consolidated Partnerships are eliminated in consolidation.
|
Impact to Statements of Operations
|
||||||||||
|
|
|
|
|
|
|
|
|
|
|
Our Condensed Consolidated Statements of Operations included the following amounts pertaining to related party transactions:
|
||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Included in following line item
|
|
Three Months Ended
|
|||||
|
|
|
on Condensed Consolidated
|
|
March 31,
|
|||||
(in thousands)
|
|
Statements of Operations
|
|
2012
|
|
2011
|
||||
|
|
|
|
|
|
|
|
|
|
|
Expenses for advisory services provided by Island and procedures
|
|
General and Administrative
|
|
$
|
1,250
|
|
$
|
2,137
|
||
|
review payments made to Island
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Expenses for subservicing of and net referral fees for mortgage loans
|
|
General and Administrative
|
|
|
1,787
|
|
|
1,863
|
||
|
by C-III Capital Partners, LLC (“C-III”)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Transition services charged to C-III, net
|
|
General and Administrative
|
|
|
15
|
|
|
(37)
|
||
|
|
|
|
|
|
|
|
|
|
|
Sublease charges to C-III
|
|
General and Administrative
|
|
|
(398)
|
|
|
(410)
|
||
|
|
|
|
|
|
|
|
|
|
|
Expenses for consulting and advisory services provided by
|
|
General and Administrative
|
|
|
40
|
|
|
40
|
||
|
The Related Companies LP (“TRCLP”)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Expenses for property management services provided by TRCLP
|
|
Other Losses from Consolidated
|
|
|
1,659
|
|
|
1,480
|
||
|
|
|
|
Partnerships
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net interest rate derivative payments to property developers controlled
|
|
Interest Expense
|
|
|
643
|
|
|
630
|
||
|
by TRCLP
|
|
|
|
|
|
|
|
|
|
A.
|
Island Centerline Manager LLC (the “Advisor”) and C-III
|
·
|
Island will provide strategic and general advisory services to us; and
|
·
|
we paid $5.0 million for procedures review fees over a 12 month period from the date of the agreement for certain fund management review services. We have also paid and will pay a $5.0 million annual base advisory fee and will pay an annual incentive fee if and once certain EBITDA thresholds are met (as defined in the agreement).
|
B.
|
The Related Companies L.P.
|
C.
|
Fund Advances Related to Tax Credit Property Partnerships, Net
|
D.
|
Other
|
|
Three Months Ended March 31, 2012
|
||||||||||||||||||||||
Affordable
|
Affordable
|
||||||||||||||||||||||
Housing
|
Housing
|
Mortgage
|
Asset
|
Consolidated
|
|||||||||||||||||||
(in thousands)
|
Equity
|
Debt
|
Banking
|
Management
|
Corporate
|
Partnerships
|
Total
|
||||||||||||||||
Revenues
|
|||||||||||||||||||||||
Interest income
|
$
|
1,178
|
$
|
18,699
|
$
|
813
|
$
|
-
|
$
|
4
|
$
|
(1,357)
|
$
|
19,337
|
|||||||||
Non-interest income
|
7,339
|
3,728
|
15,562
|
5,719
|
122
|
28,934
|
61,404
|
||||||||||||||||
Total Revenues
|
$
|
8,517
|
$
|
22,427
|
$
|
16,375
|
$
|
5,719
|
$
|
126
|
$
|
27,577
|
$
|
80,741
|
|||||||||
Expenses
|
|||||||||||||||||||||||
Interest expense
|
$
|
287
|
$
|
11,703
|
$
|
437
|
$
|
-
|
$
|
1,229
|
$
|
13,549
|
$
|
27,205
|
|||||||||
G&A expense
|
7,682
|
3,585
|
7,823
|
2,535
|
11,705
|
-
|
33,330
|
||||||||||||||||
Provision for losses
|
2,687
|
-
|
-
|
-
|
3,318
|
-
|
6,005
|
||||||||||||||||
Depreciation and amortization
|
33
|
330
|
3,146
|
36
|
314
|
-
|
3,859
|
||||||||||||||||
Other expense
|
-
|
-
|
-
|
-
|
-
|
66,092
|
66,092
|
||||||||||||||||
Total Expenses
|
$
|
10,689
|
$
|
15,618
|
$
|
11,406
|
$
|
2,571
|
$
|
16,566
|
$
|
79,641
|
$
|
136,491
|
|||||||||
Other income(loss)
|
-
|
-
|
-
|
-
|
-
|
(153,364)
|
(153,364)
|
||||||||||||||||
Income tax provision
|
-
|
-
|
-
|
-
|
(60)
|
-
|
(60)
|
||||||||||||||||
Net (loss) income - continuing operations
|
(2,172)
|
6,809
|
4,969
|
3,148
|
(16,500)
|
(205,428)
|
(209,174)
|
||||||||||||||||
Net income (loss) attributable to non-controlling interests
|
16
|
1,556
|
-
|
-
|
-
|
(205,426)
|
(203,854)
|
||||||||||||||||
Intersegment expense allocations
|
2,828
|
3,416
|
3,497
|
3,769
|
(13,510)
|
-
|
-
|
||||||||||||||||
Net (loss) income attributable to
|
|||||||||||||||||||||||
Centerline Holding Company Shareholders –
|
|||||||||||||||||||||||
continuing operations
|
$
|
(5,016)
|
$
|
1,837
|
$
|
1,472
|
$
|
(621)
|
$
|
(2,990)
|
$
|
(2)
|
$
|
(5,320)
|
|||||||||
Below is the reconciliation of the segment results to the consolidated results:
|
|||||||||||||||||||||||
Net loss from reportable segments
|
$
|
(5,320)
|
|||||||||||||||||||||
Reconciliation items
|
|||||||||||||||||||||||
Interest income
|
(8,558)
|
||||||||||||||||||||||
Non-interest income
|
(11,732)
|
||||||||||||||||||||||
Interest expense
|
8,502
|
||||||||||||||||||||||
Non-interest expense
|
11,709
|
||||||||||||||||||||||
Consolidated Net loss attributable to
|
|||||||||||||||||||||||
Centerline Holding Company shareholders
|
$
|
(5,399)
|
|
|
|
|
Three Months Ended March 31, 2011
|
|||||||||||||||||||
|
|
|
|
Affordable
|
|
Affordable
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
|
|
|
|
Housing
|
|
Housing
|
|
Mortgage
|
|
Asset
|
|
|
|
|
Consolidated
|
|
|
|
|||||
(in thousands)
|
|
Equity
|
|
Debt
|
|
Banking
|
|
Management
|
|
Corporate
|
|
Partnerships
|
|
Total
|
|||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
|
Interest income
|
|
$
|
657
|
|
$
|
14,702
|
|
$
|
808
|
|
$
|
-
|
|
$
|
17
|
|
$
|
245
|
|
$
|
16,429
|
|
|
Non-interest income
|
|
|
10,709
|
|
|
2,065
|
|
|
10,897
|
|
|
5,930
|
|
|
101
|
|
|
26,013
|
|
|
55,715
|
|
Total Revenues
|
|
$
|
11,366
|
|
$
|
16,767
|
|
$
|
11,705
|
|
$
|
5,930
|
|
$
|
118
|
|
$
|
26,258
|
|
$
|
72,144
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Expenses
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
|
Interest expense
|
|
$
|
803
|
|
$
|
12,336
|
|
$
|
249
|
|
$
|
-
|
|
$
|
1,297
|
|
$
|
12,916
|
|
$
|
27,601
|
|
|
G&A expense
|
|
|
9,197
|
|
|
2,192
|
|
|
5,206
|
|
|
2,401
|
|
|
10,791
|
|
|
-
|
|
|
29,787
|
|
|
(Recovery of)/provision for losses
|
|
|
(3,029)
|
|
|
238
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
(2,791)
|
|
|
Depreciation and amortization
|
|
|
41
|
|
|
280
|
|
|
2,731
|
|
|
54
|
|
|
440
|
|
|
-
|
|
|
3,546
|
|
|
Other expense
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
54,683
|
|
|
54,683
|
|
Total Expenses
|
|
$
|
7,012
|
|
$
|
15,046
|
|
$
|
8,186
|
|
$
|
2,455
|
|
$
|
12,528
|
|
$
|
67,599
|
|
$
|
112,826
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
Other income(loss)
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
1,756
|
|
|
(61,441)
|
|
|
(59,685)
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income tax provision
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
(193)
|
|
|
-
|
|
|
(193)
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) - continuing operations
|
|
|
4,354
|
|
|
1,721
|
|
|
3,519
|
|
|
3,475
|
|
|
(10,847)
|
|
|
(102,782)
|
|
|
(100,560)
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
Net income (loss) attributable to non-controlling interests
|
|
|
671
|
|
|
1,556
|
|
|
-
|
|
|
-
|
|
|
(413)
|
|
|
(102,780)
|
|
|
(100,966)
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
Intersegment expense allocations
|
|
|
2,184
|
|
|
1,936
|
|
|
2,473
|
|
|
3,086
|
|
|
(9,679)
|
|
|
-
|
|
|
-
|
||
Net income (loss) attributable to
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
|
Centerline Holding Company Shareholders –
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
continuing operations
|
|
$
|
1,499
|
|
$
|
(1,771)
|
|
$
|
1,046
|
|
$
|
389
|
|
$
|
(755)
|
|
$
|
(2)
|
|
$
|
406
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Below is the reconciliation of the segment results to the consolidated results:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income from reportable segments
|
|
$
|
406
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
|
Reconciliation items
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest income
|
|
|
(8,357)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-interest income
|
|
|
(15,078)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense
|
|
|
8,481
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-interest expense
|
|
|
15,057
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income attributable to CHC-shareholders - discontinued operations
|
|
|
253
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated Net income attributable to
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
|
Centerline Holding Company shareholders
|
|
$
|
762
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
A.
|
Affordable Housing Transactions
|
·
|
Five of the agreements (comprising $514.3 million of the total potential exposure) are with our subsidiary, Centerline Financial, an isolated special purpose entity wholly owned by CFin Holdings.
|
·
|
Seven of the agreements (comprising $374.8 million of the total potential exposure) are with our subsidiary, CFin Holdings, an isolated special purpose entity owned 90% by CCG and 10% by Natixis.
|
·
|
Eight of the credit intermediation agreements (comprising $302.3 million of the total potential exposure) are with Guaranteed Holdings, an isolated special purpose entity and wholly owned subsidiary of CCG.
|
B.
|
Funding Commitments
|
C.
|
Mortgage Loan Loss Sharing Agreements
|
|
|
|
(in thousands)
|
|
|
|
|
|
|
|
|
|
Balance at January 1, 2011
|
|
$
|
29,924
|
|
|
Provision recorded during the period
|
|
|
238
|
|
|
Realized losses on risk-sharing obligations
|
|
|
(469)
|
|
|
|
|
|
|
|
|
Balance at March 31, 2011
|
|
$
|
29,693
|
|
|
|
|
|
|
|
|
Balance at January 1, 2012 and March 31, 2012
|
|
$
|
21,715
|
|
|
|
|
|
|
|
D.
|
Legal Contingencies
|
E.
|
Other Contingent Liabilities
|
·
|
On April 25, 2012, we signed a $75 million committed warehouse facility that matures in April 2013 and bears interest at a rate of LIBOR plus a minimum of 2.50% and a maximum of 3.50%. The new warehouse facility provides us with additional resources for warehousing of mortgage loans relating to our Mortgage Banking and Affordable Housing Debt segments.
|
·
|
On May 18, 2012, we entered into a fourth amendment of the Waiver, which among other things: (i) again granted a waiver through July 16, 2012 of our noncompliance with the Consolidated EBITDA to Fixed Charges Ratio covenant contained in our Credit Agreement with respect to the fiscal quarter ended September 30, 2011 which was necessitated by our failure to deliver certain 2012 projections that demonstrate compliance with the financial covenant set forth in the prior waiver; (ii) granted a waiver through July 16, 2012 of our noncompliance with the Consolidated EBITDA to Fixed Charges Ratio covenant contained in our Credit Agreement with respect to the fiscal quarter ended March 31, 2012; and (iii) waived the requirement that we provide the lenders under our Credit Agreement with certain 2012 projections that demonstrate compliance with the financial covenant.
|
Significant components of the MD&A section include:
|
|
Page
|
|
|
|
|
|
SECTION 1 – Overview
|
|
|
|
The overview section provides a summary of the Company and our reportable business segments. We also include a discussion of factors affecting our consolidated results of operations as well as items specific to each business segment.
|
|
45
|
|
|
|
|
|
SECTION 2 – Consolidated Results of Operations
|
|
|
|
The consolidated results of operations section provides an analysis of our consolidated results on a reportable segment basis for the three months ended March 31, 2012, against the comparable prior year period. Significant subsections within this section are as follows:
|
|
46
|
|
|
|
|
|
|
Summary Consolidated Results
|
|
47
|
|
Comparability of Results
|
|
48
|
|
Affordable Housing Equity
|
|
48
|
|
Affordable Housing Debt
|
|
52
|
|
Mortgage Banking
|
|
56
|
|
Asset Management
|
|
59
|
|
Corporate
|
|
60
|
|
Consolidated Partnerships
|
|
61
|
|
Expense Allocation
|
|
62
|
|
Eliminations and Adjustments
|
|
63
|
|
Income Taxes
|
|
63
|
|
Accounting Developments
|
|
63
|
|
Inflation
|
|
63
|
|
|
|
|
SECTON 3 - Financial Condition
|
|
|
|
The financial condition section discusses our ability to generate adequate amounts of cash to meet our current and future needs. Significant subsections within this section are as follows:
|
|
64
|
|
|
|
|
|
|
Liquidity
|
|
64
|
|
Cash Flows
|
|
65
|
|
Capital Resources
|
|
66
|
|
Commitments and Contingencies
|
|
69
|
|
|
|
|
SECTION 4 – Forward Looking Statements
|
70
|
|
|
|
|
Three Months Ended March 31,
|
|
|
|
||||||||||||||||||||||||||||||||||||||||||||||||||||
|
|
|
|
2012
|
|
2011
|
|
|
|
||||||||||||||||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Affordable
|
|
Affordable
|
|
|
|
|
|
|
|
|
|
Eliminations
|
|
|
|
|
|
Affordable
|
|
Affordable
|
|
|
|
|
|
|
|
|
|
Eliminations
|
|
|
|
|
|
|
|||||||||||||||||||
|
|
|
|
Housing
|
|
Housing
|
|
Mortgage
|
|
Asset
|
|
|
|
Consolidated
|
|
and
|
|
|
|
% of
|
|
Housing
|
|
Housing
|
|
Mortgage
|
|
Asset
|
|
|
|
Consolidated
|
|
and
|
|
|
|
% of
|
|
|
|||||||||||||||||||
(in thousands)
|
|
Equity
|
|
Debt
|
|
Banking
|
|
Management
|
|
Corporate
|
|
Partnerships
|
|
Adjustments
|
|
Total
|
|
Revenues
|
|
Equity
|
|
Debt
|
|
Banking
|
|
Management
|
|
Corporate
|
|
Partnerships
|
|
Adjustments
|
|
Total
|
|
Revenues
|
|
% Change
|
|||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
|
Mortgage revenue bonds
|
|
$
|
146
|
|
$
|
13,783
|
|
$
|
-
|
|
$
|
-
|
|
$
|
-
|
|
$
|
-
|
|
$
|
(8,466)
|
|
$
|
5,463
|
|
9.0
|
%
|
|
$
|
159
|
|
$
|
12,219
|
|
$
|
-
|
|
$
|
-
|
|
$
|
-
|
|
$
|
-
|
|
$
|
(8,240)
|
|
$
|
4,138
|
|
8.5
|
%
|
|
32.0
|
%
|
|
|
Other interest income
|
|
|
1,032
|
|
|
4,916
|
|
|
813
|
|
|
-
|
|
|
4
|
|
|
-
|
|
|
(92)
|
|
|
6,673
|
|
11.1
|
|
|
|
498
|
|
|
2,483
|
|
|
808
|
|
|
-
|
|
|
17
|
|
|
-
|
|
|
(117)
|
|
|
3,689
|
|
7.6
|
|
|
80.9
|
|
|
|
|
Interest income
|
|
|
1,178
|
|
|
18,699
|
|
|
813
|
|
|
-
|
|
|
4
|
|
|
-
|
|
|
(8,558)
|
|
|
12,136
|
|
20.1
|
|
|
|
657
|
|
|
14,702
|
|
|
808
|
|
|
-
|
|
|
17
|
|
|
-
|
|
|
(8,357)
|
|
|
7,827
|
|
16.1
|
|
|
55.1
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fund sponsorship
|
|
|
4,873
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
(3,575)
|
|
|
1,298
|
|
2.1
|
|
|
|
7,284
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
(6,168)
|
|
|
1,116
|
|
2.3
|
|
|
16.3
|
|
|
|
Application and processing fees
|
|
|
-
|
|
|
56
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
56
|
|
0.1
|
|
|
|
-
|
|
|
42
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
42
|
|
0.1
|
|
|
34.2
|
|
|
|
Asset management fees
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
5,719
|
|
|
-
|
|
|
-
|
|
|
(5,719)
|
|
|
-
|
|
-
|
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
5,885
|
|
|
-
|
|
|
-
|
|
|
(5,885)
|
|
|
-
|
|
-
|
|
|
N/A
|
|
|
|
Mortgage origination fees
|
|
|
-
|
|
|
448
|
|
|
1,277
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
1,725
|
|
2.9
|
|
|
|
-
|
|
|
230
|
|
|
823
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
1,053
|
|
2.2
|
|
|
63.8
|
|
|
|
Mortgage servicing fees
|
|
|
-
|
|
|
974
|
|
|
5,269
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
6,243
|
|
10.3
|
|
|
|
-
|
|
|
894
|
|
|
4,879
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
14
|
|
|
5,787
|
|
11.9
|
|
|
7.9
|
|
|
|
Credit intermediation fees
|
|
|
736
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
(705)
|
|
|
31
|
|
0.1
|
|
|
|
1,169
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
(1,139)
|
|
|
30
|
|
0.1
|
|
|
3.3
|
|
|
|
Other fee income
|
|
|
-
|
|
|
-
|
|
|
109
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
(207)
|
|
|
(98)
|
|
(0.2)
|
|
|
|
-
|
|
|
-
|
|
|
120
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
(218)
|
|
|
(98)
|
|
(0.2)
|
|
|
-
|
|
|
|
|
Fee income
|
|
|
5,609
|
|
|
1,478
|
|
|
6,655
|
|
|
5,719
|
|
|
-
|
|
|
-
|
|
|
(10,206)
|
|
|
9,255
|
|
15.3
|
|
|
|
8,453
|
|
|
1,166
|
|
|
5,822
|
|
|
5,885
|
|
|
-
|
|
|
-
|
|
|
(13,396)
|
|
|
7,930
|
|
16.3
|
|
|
16.7
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gain on sale of mortgage loans
|
|
|
-
|
|
|
2,205
|
|
|
8,208
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
10,413
|
|
17.2
|
|
|
|
-
|
|
|
880
|
|
|
4,843
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
5,723
|
|
11.7
|
|
|
82.0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Prepayment penalties
|
|
|
-
|
|
|
-
|
|
|
162
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
162
|
|
0.3
|
|
|
|
-
|
|
|
-
|
|
|
39
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
39
|
|
0.1
|
|
|
315.4
|
|
|
|
Expense reimbursement
|
|
|
1,426
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
100
|
|
|
-
|
|
|
(1,525)
|
|
|
1
|
|
-
|
|
|
|
2,251
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
100
|
|
|
-
|
|
|
(1,681)
|
|
|
670
|
|
1.4
|
|
|
(99.9)
|
|
|
|
Miscellaneous
|
|
|
304
|
|
|
45
|
|
|
537
|
|
|
-
|
|
|
22
|
|
|
-
|
|
|
(1)
|
|
|
907
|
|
1.5
|
|
|
|
5
|
|
|
19
|
|
|
193
|
|
|
45
|
|
|
1
|
|
|
-
|
|
|
(1)
|
|
|
262
|
|
0.5
|
|
|
246.9
|
|
|
|
|
Other revenues
|
|
|
1,730
|
|
|
45
|
|
|
699
|
|
|
-
|
|
|
122
|
|
|
-
|
|
|
(1,526)
|
|
|
1,070
|
|
1.8
|
|
|
|
2,256
|
|
|
19
|
|
|
232
|
|
|
45
|
|
|
101
|
|
|
-
|
|
|
(1,682)
|
|
|
971
|
|
2.0
|
|
|
10.2
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues - consolidated partnerships
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
27,577
|
|
|
-
|
|
|
27,577
|
|
45.6
|
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
26,258
|
|
|
-
|
|
|
26,258
|
|
53.9
|
|
|
5.0
|
|
|
Total revenues
|
|
$
|
8,517
|
|
$
|
22,427
|
|
$
|
16,375
|
|
$
|
5,719
|
|
$
|
126
|
|
$
|
27,577
|
|
$
|
(20,290)
|
|
$
|
60,451
|
|
100.0
|
%
|
|
$
|
11,366
|
|
$
|
16,767
|
|
$
|
11,705
|
|
$
|
5,930
|
|
$
|
118
|
|
$
|
26,258
|
|
$
|
(23,435)
|
|
$
|
48,709
|
|
100.0
|
%
|
|
24.1
|
%
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Expenses
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
|
Salary
|
|
$
|
1,607
|
|
$
|
1,379
|
|
$
|
4,403
|
|
$
|
1,880
|
|
$
|
4,074
|
|
$
|
-
|
|
$
|
-
|
|
$
|
13,343
|
|
22.1
|
%
|
|
$
|
1,944
|
|
$
|
117
|
|
$
|
2,877
|
|
$
|
1,979
|
|
$
|
3,951
|
|
$
|
-
|
|
$
|
-
|
|
$
|
10,868
|
|
22.3
|
%
|
|
22.8
|
%
|
|
|
Other general and administrative
|
|
|
6,075
|
|
|
2,206
|
|
|
3,420
|
|
|
655
|
|
|
7,631
|
|
|
-
|
|
|
(6,028)
|
|
|
13,959
|
|
23.1
|
|
|
|
7,253
|
|
|
2,075
|
|
|
2,329
|
|
|
422
|
|
|
6,840
|
|
|
-
|
|
|
(6,209)
|
|
|
12,710
|
|
26.1
|
|
|
9.8
|
|
|
|
|
General and administrative
|
|
|
7,682
|
|
|
3,585
|
|
|
7,823
|
|
|
2,535
|
|
|
11,705
|
|
|
-
|
|
|
(6,028)
|
|
|
27,302
|
|
45.2
|
|
|
|
9,197
|
|
|
2,192
|
|
|
5,206
|
|
|
2,401
|
|
|
10,791
|
|
|
-
|
|
|
(6,209)
|
|
|
23,578
|
|
48.4
|
|
|
15.8
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Affordable Housing loss reserve
|
|
|
(600)
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
(600)
|
|
(1.0)
|
|
|
|
(5,500)
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
(5,500)
|
|
(11.3)
|
|
|
(89.1)
|
|
|
|
Bad debt expense
|
|
|
3,287
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
3,287
|
|
5.4
|
|
|
|
2,471
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
2
|
|
|
2,473
|
|
5.1
|
|
|
32.9
|
|
|
|
Provision (recovery) for risk sharing
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
obligations
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
-
|
|
|
|
-
|
|
|
238
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
238
|
|
0.5
|
|
|
(100.0)
|
|
|
Lease termination costs
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
3,318
|
|
|
-
|
|
|
-
|
|
|
3,318
|
|
5.5
|
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
-
|
|
|
N/A
|
|
|
|
|
Provision for (recovery of) losses
|
|
|
2,687
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
3,318
|
|
|
-
|
|
|
-
|
|
|
6,005
|
|
9.9
|
|
|
|
(3,029)
|
|
|
238
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
2
|
|
|
(2,789)
|
|
(5.7)
|
|
|
(315.3)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Borrowing and financing
|
|
|
196
|
|
|
11,684
|
|
|
437
|
|
|
-
|
|
|
1,229
|
|
|
-
|
|
|
(25)
|
|
|
13,521
|
|
22.4
|
|
|
|
785
|
|
|
12,097
|
|
|
249
|
|
|
-
|
|
|
1,297
|
|
|
-
|
|
|
(226)
|
|
|
14,202
|
|
29.2
|
|
|
(4.8)
|
|
|
|
Derivatives - change in fair value
|
|
|
91
|
|
|
(941)
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
(850)
|
|
(1.4)
|
|
|
|
18
|
|
|
(721)
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
(703)
|
|
(1.4)
|
|
|
20.9
|
|
|
|
Preferred shares of subsidiary
|
|
|
-
|
|
|
960
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
960
|
|
1.6
|
|
|
|
-
|
|
|
960
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
960
|
|
2.0
|
|
|
-
|
|
|
|
|
Interest expense
|
|
|
287
|
|
|
11,703
|
|
|
437
|
|
|
-
|
|
|
1,229
|
|
|
-
|
|
|
(25)
|
|
|
13,631
|
|
22.6
|
|
|
|
803
|
|
|
12,336
|
|
|
249
|
|
|
-
|
|
|
1,297
|
|
|
-
|
|
|
(226)
|
|
|
14,459
|
|
29.8
|
|
|
(5.7)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation and amortization
|
|
|
33
|
|
|
330
|
|
|
3,146
|
|
|
36
|
|
|
314
|
|
|
-
|
|
|
-
|
|
|
3,859
|
|
6.4
|
|
|
|
41
|
|
|
280
|
|
|
2,731
|
|
|
54
|
|
|
440
|
|
|
-
|
|
|
-
|
|
|
3,546
|
|
7.3
|
|
|
8.8
|
|
|
|
Interest expense - consolidated partnerships
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
13,549
|
|
|
(8,477)
|
|
|
5,072
|
|
8.4
|
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
12,916
|
|
|
(8,255)
|
|
|
4,661
|
|
9.6
|
|
|
8.8
|
|
|
|
Other expense - consolidated partnerships
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
66,092
|
|
|
(5,681)
|
|
|
60,411
|
|
99.9
|
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
54,683
|
|
|
(8,850)
|
|
|
45,833
|
|
94.1
|
|
|
31.8
|
|
|
Total expenses
|
|
$
|
10,689
|
|
$
|
15,618
|
|
$
|
11,406
|
|
$
|
2,571
|
|
$
|
16,566
|
|
$
|
79,641
|
|
$
|
(20,211)
|
|
$
|
116,280
|
|
192.4
|
%
|
|
$
|
7,012
|
|
$
|
15,046
|
|
$
|
8,186
|
|
$
|
2,455
|
|
$
|
12,528
|
|
$
|
67,599
|
|
$
|
(23,538)
|
|
$
|
89,288
|
|
183.5
|
%
|
|
30.2
|
%
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended March 31,
|
|
|
|
||||||||||||||||||||||||||||||||||||||||||||||||||||
|
|
|
|
2012
|
|
2011
|
|
|
|
||||||||||||||||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Affordable
|
|
Affordable
|
|
|
|
|
|
|
|
|
|
Eliminations
|
|
|
|
|
|
Affordable
|
|
Affordable
|
|
|
|
|
|
|
|
|
|
Eliminations
|
|
|
|
|
|
|
|||||||||||||||||||
|
|
|
|
Housing
|
|
Housing
|
|
Mortgage
|
|
Asset
|
|
|
|
Consolidated
|
|
and
|
|
|
|
% of
|
|
Housing
|
|
Housing
|
|
Mortgage
|
|
Asset
|
|
|
|
Consolidated
|
|
and
|
|
|
|
% of
|
|
|
|||||||||||||||||||
(in thousands)
|
|
Equity
|
|
Debt
|
|
Banking
|
|
Management
|
|
Corporate
|
|
Partnerships
|
|
Adjustments
|
|
Total
|
|
Revenues
|
|
Equity
|
|
Debt
|
|
Banking
|
|
Management
|
|
Corporate
|
|
Partnerships
|
|
Adjustments
|
|
Total
|
|
Revenues
|
|
% Change
|
|||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gain on settlement of liabilities
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
-
|
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
1,756
|
|
|
-
|
|
|
-
|
|
|
1,756
|
|
3.6
|
|
|
(100.0)
|
|
||
Other losses – consolidated partnerships
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
(153,364)
|
|
|
-
|
|
|
(153,364)
|
|
(253.7)
|
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
(61,441)
|
|
|
-
|
|
|
(61,441)
|
|
(126.1)
|
|
|
149.6
|
|
||
|
Other income (loss)
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
(153,364)
|
|
|
-
|
|
|
(153,364)
|
|
(253.7)
|
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
1,756
|
|
|
(61,441)
|
|
|
-
|
|
|
(59,685)
|
|
(122.5)
|
|
|
157.0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income tax (provision)/benefit – continuing
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
|
operations
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
(60)
|
|
|
-
|
|
|
-
|
|
|
(60)
|
|
(0.1)
|
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
(193)
|
|
|
-
|
|
|
-
|
|
|
(193)
|
|
(0.4)
|
|
|
(68.8)
|
|
|
|
Net (loss) income continuing operations
|
|
|
(2,172)
|
|
|
6,809
|
|
|
4,969
|
|
|
3,148
|
|
|
(16,500)
|
|
|
(205,428)
|
|
|
(79)
|
|
|
(209,253)
|
|
(346.2)
|
|
|
|
4,354
|
|
|
1,721
|
|
|
3,519
|
|
|
3,475
|
|
|
(10,847)
|
|
|
(102,782)
|
|
|
103
|
|
|
(100,457)
|
|
(206.2)
|
|
|
108.3
|
|
|
Allocation – preferred shares
|
|
|
-
|
|
|
1,556
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
|
|
|
1,556
|
|
2.6
|
|
|
|
-
|
|
|
1,556
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
1,556
|
|
3.2
|
|
|
-
|
|
||
Allocation – non-controlling interests
|
|
|
16
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
|
|
|
16
|
|
-
|
|
|
|
671
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
(413)
|
|
|
-
|
|
|
-
|
|
|
258
|
|
0.5
|
|
|
(93.8)
|
|
||
Allocation – consolidated partnerships
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
(205,426)
|
|
|
|
|
|
(205,426)
|
|
(339.8)
|
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
(102,780)
|
|
|
-
|
|
|
(102,780)
|
|
(211.0)
|
|
|
99.9
|
|
||
Net loss (income) attributable to non-controlling
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
|
interest – continuing operations
|
|
|
16
|
|
|
1,556
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
(205,426)
|
|
|
-
|
|
|
(203,854)
|
|
(337.2)
|
|
|
|
671
|
|
|
1,556
|
|
|
-
|
|
|
-
|
|
|
(413)
|
|
|
(102,780)
|
|
|
-
|
|
|
(100,966)
|
|
(207.3)
|
|
|
101.9
|
|
|
Net (loss) income attributable to Centerline
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
|
Holding Company shareholders - continuing
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
operations, pre-allocations
|
|
|
(2,188)
|
|
|
5,253
|
|
|
4,969
|
|
|
3,148
|
|
|
(16,500)
|
|
|
(2)
|
|
|
(79)
|
|
|
(5,399)
|
|
(9.0)
|
|
|
|
3,683
|
|
|
165
|
|
|
3,519
|
|
|
3,475
|
|
|
(10,434)
|
|
|
(2)
|
|
|
103
|
|
|
509
|
|
1.1
|
|
|
N/M
|
|
|
Inter-segment expense allocation
|
|
|
2,828
|
|
|
3,416
|
|
|
3,497
|
|
|
3,769
|
|
|
(13,510)
|
|
|
-
|
|
|
-
|
|
|
-
|
|
-
|
|
|
|
2,184
|
|
|
1,936
|
|
|
2,473
|
|
|
3,086
|
|
|
(9,679)
|
|
|
-
|
|
|
-
|
|
|
-
|
|
-
|
|
|
N/A
|
|
||
|
Net (loss) income attributable to Centerline
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Holding Company shareholders – continuing
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
operations
|
|
$
|
(5,016)
|
|
$
|
1,837
|
|
$
|
1,472
|
|
$
|
(621)
|
|
$
|
(2,990)
|
|
$
|
(2)
|
|
$
|
(79)
|
|
$
|
(5,399)
|
|
(9.0)
|
%
|
|
$
|
1,499
|
|
$
|
(1,771)
|
|
$
|
1,046
|
|
$
|
389
|
|
$
|
(755)
|
|
$
|
(2)
|
|
$
|
103
|
|
$
|
509
|
|
1.1
|
%
|
|
N/M
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income – discontinued operations
|
|
|
|
|
|
|
|
|
-
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
253
|
|
0.5
|
|
|
(100.0)
|
|
|||||||||||||||||
Net income attributable to Centerline Holding Company shareholders – discontinued operations
|
|
|
|
|
|
|
|
|
-
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
253
|
|
0.5
|
|
|
(100.0)
|
|
|||||||||||||||||
Total (loss) income attributable to Centerline Holding Company shareholders
|
|
|
|
|
|
|
|
$
|
(5,399)
|
|
(9.0)
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
762
|
|
1.6
|
%
|
|
N/M
|
%
|
|||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
N/M – Not meaningful.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
|
||||
|
|
|
|
|
March 31,
|
|
|
||||
|
(in thousands)
|
|
2012
|
|
2011
|
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
Reduction/(Increase) to net income:
|
|
|
|
|
|
|
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other items:
|
|
|
|
|
|
|
|
|
|
|
|
|
Affordable Housing Equity segment:
|
|
|
|
|
|
|
|
|
|
|
|
Affordable housing loss reserve recovery
|
|
$
|
(600)
|
|
$
|
(5,500)
|
|
|
|
|
|
Assumption fee relating to restructuring of credit intermediation
|
|
|
|
|
|
|
|
|
|
|
|
agreements
|
|
|
911
|
|
|
1,397
|
|
|
|
|
|
Change in fair value of derivatives
|
|
|
91
|
|
|
18
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Affordable Housing Debt segment:
|
|
|
|
|
|
|
|
|
|
|
|
Provision for risk-sharing obligations
|
|
|
-
|
|
|
238
|
|
|
|
|
|
Change in fair value of derivatives
|
|
|
(941)
|
|
|
(721)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Corporate segment:
|
|
|
|
|
|
|
|
|
|
|
|
Gain on settlement of liabilities
|
|
|
-
|
|
|
(1,756)
|
|
|
|
|
|
Lease termination costs
|
|
|
3,318
|
|
|
-
|
|
|
Revenues
|
|||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
For a description of our revenue recognition policies, see Note 2 to our 2011 Form 10-K.
|
|||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended March 31,
|
|
||||||
|
(dollars in thousands)
|
|
2012
|
|
2011
|
|
% Change
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest income:
|
|
|
|
|
|
|
|
|
|
|
|
|
Mortgage revenue bond interest income
|
|
$
|
146
|
|
$
|
159
|
|
(8.2)
|
%
|
|
|
Other interest income
|
|
|
1,032
|
|
|
498
|
|
107.2
|
|
|
Fee income:
|
|
|
|
|
|
|
|
|
|
|
|
|
Fund sponsorship
|
|
|
4,873
|
|
|
7,284
|
|
(33.1)
|
|
|
|
Credit intermediation fees
|
|
|
736
|
|
|
1,169
|
|
(37.0)
|
|
|
Other:
|
|
|
|
|
|
|
|
|
|
|
|
|
Expense reimbursements
|
|
|
1,426
|
|
|
2,251
|
|
(36.7)
|
|
|
|
Miscellaneous
|
|
|
304
|
|
|
5
|
|
N/M
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total revenues
|
|
$
|
8,517
|
|
$
|
11,366
|
|
(25.1)
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
N/M - Not Meaningful.
|
|
Fund Sponsorship
|
|
|
|
|
|
|
|
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended March 31,
|
|
|||||||
(dollars in thousands)
|
|
2012
|
|
2011
|
|
% Change
|
|
||||
|
|
|
|
|
|
|
|
|
|
||
Fees based on equity invested
|
|
|
|
|
|
|
|
|
|
||
Property acquisition fees
|
|
$
|
234
|
|
$
|
1,400
|
|
(83.3)
|
%
|
||
Organization, offering and acquisition allowance fees
|
|
|
208
|
|
|
1,244
|
|
(83.3)
|
|
||
|
|
|
|
|
|
|
|
|
|||
Fees based on management of sponsored Tax Credit Fund Partnerships
|
|
|
|
|
|
|
|
|
|
||
Partnership management fees
|
|
|
810
|
|
|
1,340
|
|
(39.6)
|
|
||
Asset management fees
|
|
|
2,109
|
|
|
1,917
|
|
10.0
|
|
||
Other fee income
|
|
|
1,512
|
|
|
1,383
|
|
9.3
|
|
||
|
|
|
|
|
|
|
|
|
|||
Total fund sponsorship fee income
|
|
$
|
4,873
|
|
$
|
7,284
|
|
(33.1)
|
%
|
||
|
|
|
|
|
|
|
|
|
|||
|
|
|
|
|
|
|
|
|
|||
Assets under management – Tax Credit Fund Partnerships
|
|
$
|
9,285,253
|
|
$
|
9,410,437
|
|
(1.3)
|
%
|
||
Equity raised by Tax Credit Fund Partnerships
|
|
$
|
-
|
|
$
|
119,250
|
|
(100.0)
|
%
|
||
Equity invested by Tax Credit Fund Partnerships(1)
|
|
$
|
10,398
|
|
$
|
62,220
|
|
(83.3)
|
%
|
||
|
|
|
|
|
|
|
|
|
(1)
|
Excludes warehoused properties that have not yet closed into a Tax Credit Fund Partnership.
|
Expenses
|
|||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
Expenses for the Affordable Housing Equity segment for the three months ended March 31 were as follows:
|
|||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended March 31,
|
|
||||||
|
(dollars in thousands)
|
|
2012
|
|
2011
|
|
% Change
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
General and administrative expenses
|
|
|
|
|
|
|
|
|
|
|
|
|
Salaries and benefits
|
|
$
|
1,607
|
|
$
|
1,944
|
|
(17.3)
|
%
|
|
|
Other
|
|
|
6,075
|
|
|
7,253
|
|
(16.2)
|
|
|
|
Total general and administrative
|
|
|
7,682
|
|
|
9,197
|
|
(16.5)
|
|
|
Provision for (recovery of) losses
|
|
|
2,687
|
|
|
(3,029)
|
|
(188.7)
|
|
|
|
Interest expense:
|
|
|
|
|
|
|
|
|
|
|
|
|
Borrowings and financings
|
|
|
196
|
|
|
785
|
|
(75.0)
|
|
|
|
Derivatives – change in fair value
|
|
|
91
|
|
|
18
|
|
405.6
|
|
|
Depreciation and amortization
|
|
|
33
|
|
|
41
|
|
(19.5)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total expenses
|
|
$
|
10,689
|
|
$
|
7,012
|
|
52.4
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average borrowing rate
|
|
|
6.46
|
%
|
|
6.33
|
%
|
|
|
|
|
Average Securities Industry and Financial Markets Association (“SIFMA”) rate
|
|
|
0.12
|
%
|
|
0.26
|
%
|
|
|
Provision for (recovery of) Losses
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended March 31,
|
|
|
||||||
|
(dollars in thousands)
|
|
2012
|
|
2011
|
|
% Change
|
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Affordable Housing loss reserve recovery
|
|
$
|
(600)
|
|
$
|
(5,500)
|
|
(89.1)
|
%
|
|
|
|
Bad debt expense
|
|
|
3,287
|
|
|
2,471
|
|
33.0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total provision for (recovery of) losses
|
|
$
|
2,687
|
|
$
|
(3,029)
|
|
(188.7)
|
%
|
|
·
|
A reduction in our Affordable Housing loss reserve recovery in 2012. In 2011, as we worked with parties that have an economic interest in the properties that secure mortgage revenue bonds associated with our credit intermediation agreements, we estimated the payments that were required to be made in order to complete the restructuring and reduce the principal balance of certain mortgage revenue bonds at levels below the amounts reached in the March 2010 agreements with such counterparties. Provisions recorded in 2012 reflect revisions to the assumed timing of the restructurings (see further discussion in Note 21 under Loss Reserve Relating to Yield Transactions).
|
·
|
An increase of $0.8 million in bad debt expense primarily due to increased advances to Tax Credit Fund Partnerships.
|
Profitability
|
|||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
Profitability for the Affordable Housing Equity segment for the three months ended March 31 was as follows:
|
|||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended March 31,
|
|
|
||||||
|
(dollars in thousands)
|
|
2012
|
|
2011
|
|
% Change
|
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
(Loss) income before other allocations
|
|
$
|
(2,172)
|
|
$
|
4,354
|
|
(149.9)
|
%
|
|
|
Net (loss) income
|
|
|
(5,016)
|
|
$
|
1,499
|
|
(434.6)
|
|
|
Revenues
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
For a discussion of the accounting policies with respect to revenue recognition, see Note 2 in our 2011 Form 10-K
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended March 31,
|
|
|
||||||
|
(dollars in thousands)
|
|
2012
|
|
2011
|
|
% Change
|
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest income:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Mortgage revenue bond interest income
|
|
$
|
13,783
|
|
$
|
12,219
|
|
12.8
|
%
|
|
|
|
Other interest income
|
|
|
4,916
|
|
|
2,483
|
|
98.0
|
|
|
|
Fee income:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Application and processing fees
|
|
|
56
|
|
|
42
|
|
33.3
|
|
|
|
|
Mortgage origination fees
|
|
|
448
|
|
|
230
|
|
94.8
|
|
|
|
|
Mortgage servicing fees
|
|
|
974
|
|
|
894
|
|
8.9
|
|
|
|
Other:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gain on sale of mortgage loans
|
|
|
2,205
|
|
|
880
|
|
150.6
|
|
|
|
|
Miscellaneous
|
|
|
45
|
|
|
19
|
|
136.8
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total revenues
|
|
$
|
22,427
|
|
$
|
16,767
|
|
33.8
|
%
|
|
The following table presents information related to our mortgage revenue bond interest income:
|
|||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended March 31,
|
|
|
||||||
|
(dollars in thousands)
|
|
2012
|
|
2011
|
|
% Change
|
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
Average number of bonds on the balance sheet not receiving sale recognition
|
|
|
95
|
|
|
96
|
|
(1.0)
|
%
|
|
|
Average balance (unpaid principal balance)
|
|
$
|
829,911
|
|
$
|
857,805
|
|
(3.3)
|
%
|
|
|
Weighted average yield
|
|
|
6.64
|
%
|
|
5.70
|
%
|
|
|
|
Fee Income
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Mortgage Origination Fees
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Affordable Housing Debt mortgage loan originations for the three months ended March 31 were as follows:
|
||||||||||
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended March 31,
|
|
|||||||||
2012
|
|
|
|
2011
|
|
% Change
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
Total mortgage origination activity(1)
|
$
|
20,815
|
|
|
|
$
|
8,545
|
|
143.6
|
%
|
Mortgages originated in prior periods and sold during the period
|
|
54,557
|
|
|
|
|
17,000
|
|
|
|
Less: mortgages originated but not yet sold(2)
|
|
(9,750)
|
|
|
|
|
(4,203)
|
|
|
|
Total mortgage origination activity recognized for GAAP and for which revenue is recognized
|
$
|
65,622
|
|
|
|
$
|
21,342
|
|
207.5
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
% of Total
|
|
|
|
% of Total
|
|||
|
|
|
|
|
|
|
|
|
|
|
Fannie Mae
|
$
|
65,622
|
|
100.0
|
%
|
$
|
21,342
|
|
100.0
|
%
|
$
|
65,622
|
|
100.0
|
%
|
$
|
21,342
|
|
100.0
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Includes all mortgages funded during the period.
|
||||||||||
(2) Included in Other Investments – mortgage loans held for sale.
|
Our portfolio balances at March 31, 2012 and 2011 were as follows:
|
||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
March 31,
|
|
||||||
|
(dollars in thousands)
|
|
2012
|
|
2011
|
|
% Change
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
Primary servicing portfolio
|
|
$
|
594,711
|
|
$
|
467,676
|
|
27.2
|
%
|
Expenses
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
Expenses for the Affordable Housing Debt segment for the three months ended March 31 were as follows:
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended March 31,
|
|
|
||||||
|
(dollars in thousands)
|
|
2012
|
|
2011
|
|
% Change
|
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
General and administrative expenses
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Salaries and benefits
|
|
$
|
1,379
|
|
$
|
117
|
|
N/M
|
%
|
|
|
|
Other
|
|
|
2,206
|
|
|
2,075
|
|
6.3
|
|
|
|
|
Total general and administrative
|
|
|
3,585
|
|
|
2,192
|
|
63.5
|
|
|
|
Provision for risk sharing obligations
|
|
|
-
|
|
|
238
|
|
(100.0)
|
|
|
|
|
Interest expense:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Borrowings and financings
|
|
|
11,684
|
|
|
12,097
|
|
(3.4)
|
|
|
|
|
Derivatives – change in fair value
|
|
|
(941)
|
|
|
(721)
|
|
30.5
|
|
|
|
|
Preferred shares of subsidiary
|
|
|
960
|
|
|
960
|
|
-
|
|
|
|
Depreciation and amortization
|
|
|
330
|
|
|
280
|
|
17.9
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total expenses
|
|
$
|
15,618
|
|
$
|
15,046
|
|
3.8
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average borrowing rate
|
|
|
6.46
|
%
|
|
6.33
|
%
|
|
|
|
|
|
Average SIFMA rate
|
|
|
0.12
|
%
|
|
0.26
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
N/M – Not meaningful.
|
|
Profitability
|
|||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
Profitability for the Affordable Housing Debt segment for the three months ended March 31 was as follows:
|
|||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended March 31,
|
|
|
||||||
|
(dollars in thousands)
|
|
2012
|
|
2011
|
|
% Change
|
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
Income before other allocations
|
|
$
|
6,809
|
|
$
|
1,721
|
|
295.6
|
%
|
|
|
Net income (loss)
|
|
$
|
1,837
|
|
$
|
(1,771)
|
|
(203.7)
|
%
|
|
Revenues
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
For a description of our revenue recognition policies, see Note 2 to our 2011 Form 10-K
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended March 31,
|
|
|
||||||
|
(dollars in thousands)
|
|
2012
|
|
2011
|
|
% Change
|
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest income
|
|
$
|
813
|
|
$
|
808
|
|
0.6
|
%
|
|
|
|
Fee income:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Mortgage origination fees
|
|
|
1,277
|
|
|
823
|
|
55.2
|
|
|
|
|
Mortgage servicing fees
|
|
|
5,269
|
|
|
4,879
|
|
8.0
|
|
|
|
|
Other fee income
|
|
|
109
|
|
|
120
|
|
(9.2)
|
|
|
|
Other:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gain on sale of mortgage loans
|
|
|
8,208
|
|
|
4,843
|
|
69.5
|
|
|
|
|
Prepayment penalties
|
|
|
162
|
|
|
39
|
|
315.4
|
|
|
|
|
Other revenues
|
|
|
537
|
|
|
193
|
|
178.2
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total revenues
|
|
$
|
16,375
|
|
$
|
11,705
|
|
39.9
|
%
|
|
Fee Income
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Mortgage Origination Fees
|
|
||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
Mortgage originations for the three months ended March 31 were as follows:
|
|
||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended March 31,
|
|
|||||||||
|
2012
|
|
|
|
2011
|
|
% Change
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
Total mortgage origination activity (1)
|
$
|
234,179
|
|
|
|
$
|
170,993
|
|
37.0
|
%
|
|
Mortgages originated in prior periods and sold during the period
|
|
134,728
|
|
|
|
|
58,460
|
|
|
|
|
Less: mortgages originated but not yet sold(2)
|
|
(73,096)
|
|
|
|
|
(76,274)
|
|
|
|
|
Total mortgage origination activity recognized for GAAP and for which revenue is recognized
|
$
|
295,811
|
|
|
|
$
|
153,179
|
|
93.1
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
% of Total
|
|
|
|
|
% of Total
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fannie Mae
|
$
|
184,385
|
|
62.3
|
%
|
$
|
142,179
|
|
92.8
|
%
|
|
Freddie Mac
|
|
69,864
|
|
23.6
|
|
|
11,000
|
|
7.2
|
|
|
FHA
|
|
41,562
|
|
14.1
|
|
|
-
|
|
-
|
|
|
|
$
|
295,811
|
|
100.0
|
%
|
$
|
153,179
|
|
100.0
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
Includes all mortgages funded during the period.
|
||||||||||
(2)
|
Included in Other Investments – mortgage loans held for sale.
|
Our portfolio balances at March 31 were as follows:
|
|
||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
March 31,
|
|
|
|
|
||||
|
(dollars in thousands)
|
|
2012
|
|
2011
|
|
% Change
|
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
Primary servicing portfolio
|
|
$
|
8,367,843
|
|
$
|
8,256,253
|
|
1.4
|
%
|
|
|
|
|
|
Three Months Ended March 31,
|
|
|
||||||
|
(dollars in thousands)
|
|
2012
|
|
2011
|
|
% Change
|
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
General and administrative expenses
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Salaries and benefits
|
|
$
|
4,403
|
|
$
|
2,877
|
|
53.0
|
%
|
|
|
|
Other
|
|
|
3,420
|
|
|
2,329
|
|
46.8
|
|
|
|
|
Total general and administrative
|
|
|
7,823
|
|
|
5,206
|
|
50.3
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest
|
|
|
437
|
|
|
249
|
|
75.5
|
|
|
|
|
Depreciation and amortization
|
|
|
3,146
|
|
|
2,731
|
|
15.2
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total expenses
|
|
$
|
11,406
|
|
$
|
8,186
|
|
39.3
|
%
|
|
Profitability
|
|||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
Profitability for the Mortgage Banking segment for the three months ended March 31 was as follows:
|
|||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended March 31,
|
|
|
||||||
|
(dollars in thousands)
|
|
2012
|
|
2011
|
|
% Change
|
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
Income before other allocations
|
|
$
|
4,969
|
|
$
|
3,519
|
|
41.2
|
%
|
|
|
Net income
|
|
|
1,472
|
|
|
1,046
|
|
40.7
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The change in income before other allocations reflects the revenues and expense changes discussed above.
|
Revenues
|
|
|
||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
For a description of our revenue recognition policies, see Note 2 of our 2011 Form 10-K.
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended March 31,
|
|
|
||||||
|
(dollars in thousands)
|
|
2012
|
|
2011
|
|
% Change
|
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Asset management fees
|
|
$
|
5,719
|
|
$
|
5,885
|
|
(2.8)
|
%
|
|
|
|
Other revenues
|
|
|
-
|
|
|
45
|
|
(100.0)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total revenues
|
|
$
|
5,719
|
|
$
|
5,930
|
|
(3.6)
|
%
|
|
Expenses
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended March 31,
|
|
|
||||||
|
(dollars in thousands)
|
|
2012
|
|
2011
|
|
% Change
|
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
General and administrative expenses
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Salaries and benefits
|
|
$
|
1,880
|
|
$
|
1,979
|
|
(5.0)
|
%
|
|
|
|
Other
|
|
|
655
|
|
|
422
|
|
55.2
|
|
|
|
|
Total general and administrative
|
|
|
2,535
|
|
|
2,401
|
|
5.6
|
|
|
|
Depreciation and amortization
|
|
|
36
|
|
|
54
|
|
(33.3)
|
|
|
|
|
|
Total expenses
|
|
$
|
2,571
|
|
$
|
2,455
|
|
4.7
|
%
|
|
Profitability
|
|||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
Profitability for the Asset Management segment as of March 31 was as follows:
|
|||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended March 31,
|
|
|
||||||
|
(dollars in thousands)
|
|
2012
|
|
2011
|
|
% Change
|
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
Income before other allocations
|
|
$
|
3,148
|
|
$
|
3,475
|
|
(9.4)
|
%
|
|
|
Net (loss) income
|
|
|
(621)
|
|
$
|
389
|
|
(259.6)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The change in income before other allocations refelcts the revenue and expense changes presented above.
|
|
|
|
|
Three Months Ended March 31,
|
|
|
||||||
|
(dollars in thousands)
|
|
2012
|
|
2011
|
|
% Change
|
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
General and administrative expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Salaries and benefits
|
|
$
|
4,074
|
|
$
|
3,951
|
|
3.1
|
%
|
|
|
|
Other
|
|
|
7,631
|
|
|
6,840
|
|
11.6
|
|
|
|
|
Total general and administrative
|
|
|
11,705
|
|
|
10,791
|
|
8.5
|
|
|
|
Interest expense:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Borrowings and financings
|
|
|
1,229
|
|
|
1,297
|
|
(5.2)
|
|
|
|
Lease termination costs
|
|
|
3,318
|
|
|
-
|
|
N/A
|
|
|
|
|
Depreciation and amortization
|
|
|
314
|
|
|
440
|
|
(28.6)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total expenses
|
|
$
|
16,566
|
|
$
|
12,528
|
|
32.2
|
%
|
|
Other income
|
|||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended March 31,
|
|
|
||||||
|
(dollars in thousands)
|
|
2012
|
|
2011
|
|
% Change
|
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
Gain on settlement of liabilities
|
|
$
|
-
|
|
$
|
1,756
|
|
(100.0)
|
%
|
|
|
|
|
Three Months Ended
|
|
|
||||
|
|
|
March 31,
|
|
|
||||
|
(in thousands)
|
|
2012
|
|
2011
|
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues
|
|
$
|
27,577
|
|
$
|
26,258
|
|
|
|
Interest expense
|
|
|
(13,549)
|
|
|
(12,916)
|
|
|
|
Other expenses
|
|
|
(66,092)
|
|
|
(54,683)
|
|
|
|
Other losses
|
|
|
(153,364)
|
|
|
(61,441)
|
|
|
|
Allocations to limited partners
|
|
|
205,426
|
|
|
102,780
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net impact
|
|
$
|
(2)
|
|
$
|
(2)
|
|
|
The following table summarizes the number of Consolidated Partnerships at March 31:
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
2012
|
|
2011
|
|
||
|
|
|
|
|
|
|
|
|
|
Tax Credit Fund Partnerships
|
|
|
140
|
|
|
141
|
|
|
Tax Credit Property Partnerships
|
|
|
89
|
|
|
96
|
|
Income Taxes
|
||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The following table details the taxable and non-taxable components of our reported income (loss) for the periods ended:
|
||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended March 31,
|
|
||||||||||
|
|
|
|
|
|
% of
|
|
|
|
|
% of
|
|
|
|
(dollars in thousands)
|
|
2012
|
|
Revenues
|
|
2011
|
|
Revenues
|
|
% Change
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Within continuing operations:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gain (loss) subject to tax
|
|
$
|
(6,154)
|
|
(10.2)
|
%
|
$
|
714
|
|
1.5
|
%
|
N/M
|
%
|
|
Loss not subject to tax
|
|
$
|
(203,039)
|
|
(336.0)
|
%
|
$
|
(100,978)
|
|
(207.3)
|
%
|
101.1
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss before income taxes
|
|
$
|
(209,193)
|
|
(346.1)
|
%
|
$
|
(100,264)
|
|
(205.8)
|
%
|
108.6
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income taxes
|
|
$
|
60
|
|
0.1
|
%
|
$
|
193
|
|
0.4
|
%
|
(68.9)
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Effective tax rate – consolidated basis
|
|
|
(0.03)
|
%
|
|
|
|
(0.19)
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Effective tax rate for corporate subsidiaries subject to tax
|
|
|
(0.98)
|
%
|
|
|
|
27.0
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Within discontinued operations:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) subject to tax
|
|
$
|
-
|
|
N/M
|
|
$
|
253
|
|
0.5
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss before income taxes
|
|
$
|
-
|
|
N/M
|
|
$
|
253
|
|
0.5
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
N/M – Not meaningful.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
·
|
the low price of our Common Shares has made obtaining equity capital through equity offerings extremely difficult and uneconomical for us; and
|
·
|
the lower level of debt financing available in the marketplace.
|
·
|
increasing revenues through increased volume of mortgage originations, fund originations, and growth of assets under management;
|
·
|
instituting measures to reduce general and administrative expenses;
|
·
|
continuing to sell and/or monetize investments that do not meet our long-term investment criteria;
|
·
|
reducing our risk of loss by continuing to improve our Asset Management infrastructure;
|
·
|
increasing access to asset-backed warehouse facilities;
|
·
|
improving collection of Tax Credit Fund Partnership fees through improved monitoring and asset disposition; and
|
·
|
restructuring and execution of agreements to increase cash flow from our Freddie Mac B Certificates.
|
Cash Flows
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
||||
|
|
|
March 31,
|
|
||||
|
(in thousands)
|
|
2012
|
|
2011
|
|
||
|
|
|
|
|
|
|
|
|
|
Cash flow provided by (used in) operating activities
|
|
$
|
100,402
|
|
$
|
(3,471)
|
|
|
Cash flow provided by (used in) investing activities
|
|
|
3,244
|
|
|
(1,728)
|
|
|
Cash flow (used in) provided by financing activities
|
|
|
(106,054)
|
|
|
7,221
|
|
|
|
|
|
|
|
|
|
|
|
Net (decrease) increase in cash and cash equivalents
|
|
$
|
(2,408)
|
|
$
|
2,022
|
|
Capital Resources
|
|||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
To fund our operations, we use cash provided by our operations as well as borrowings and other financing arrangements used as capital resources.
|
|||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The table below reflects our financing obligations at the dates presented:
|
|||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
March 31, 2012
|
||||
|
|
|
March 31,
|
|
December 31,
|
|
Available to
|
|
Maximum
|
||||
(in thousands)
|
|
2012
|
|
2011
|
|
Borrow
|
|
Commitment
|
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Term loan
|
|
$
|
122,037
|
|
$
|
125,014
|
|
$
|
-
|
|
$
|
122,037
|
|
Revolving credit facility
|
|
|
14,300
|
|
|
12,100
|
|
|
8,928
|
(1)
|
|
37,000
|
|
Mortgage Banking committed warehouse facilities
|
|
|
48,676
|
|
|
105,615
|
|
|
101,324
|
(2)
|
|
150,000
|
|
Mortgage Banking repurchase facilities
|
|
|
-
|
|
|
8,450
|
|
|
-
|
(2)
|
|
N/A
|
|
Multifamily ASAP facility
|
|
|
33,437
|
|
|
71,670
|
|
|
-
|
(2)
|
|
N/A
|
|
Centerline Financial LLC ("CFin" or "Centerline Financial") credit facility
|
|
|
-
|
|
|
-
|
|
|
30,000
|
|
|
30,000
|
Subtotal
|
|
|
218,450
|
|
|
322,849
|
|
|
140,252
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Freddie Mac Secured Financing(3)
|
|
|
615,982
|
|
|
618,163
|
|
|
N/A
|
|
|
N/A
|
|
Subtotal (excluding Consolidated Partnerships)
|
|
|
834,432
|
|
|
941,012
|
|
|
140,252
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated Partnerships
|
|
|
137,970
|
|
|
156,643
|
|
|
N/A
|
|
|
N/A
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
$
|
972,402
|
|
$
|
1,097,655
|
|
$
|
140,252
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
N/A – Not meaningful.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Borrowing availability reduced by outstanding letters of credit in the amount of $13.8 million. Once these letters of credit are terminated, the $13.8 million associated with these letters of credit may not be redrawn.
|
|||||||||||||
(2) Borrowings under these facilities are limited to qualified mortgage loans, which serve as collateral.
|
|||||||||||||
(3) Relates to mortgage revenue bonds that we re-securitized but have not been accounted for as sold for accounting purposes (see Note 14 to the condensed consolidated financial statements).
|
·
|
minimum ratio of consolidated EBITDA to fixed charges, which became effective for us as of June 30, 2011; and
|
·
|
maximum ratio of funded debt to consolidated EBITDA which will become effective for us as of June 30, 2012.
|
Mortgage Banking Warehouse and Repurchase Facilities
|
·
|
A $100 million committed warehouse facility that matures in September 2012 and bears interest at a rate of LIBOR plus 2.50%. The interest rate on the warehouse facility was 2.74% as of March 31, 2012 and 2.80% as of December 31, 2011.
|
·
|
We have a $50 million committed warehouse facility that matures in November 2012 and bears interest at a rate of LIBOR plus a minimum of 2.75% and a maximum of 4.25%. The interest rate on the warehouse facility was 2.99% as of March 31, 2012 and 3.05% as of December 31, 2011.
|
·
|
Two uncommitted warehouse repurchase facilities that provide additional resources for warehousing of mortgage loans with Freddie Mac and Fannie Mae. These facilities are scheduled to mature on November 16, 2012 and bear interest at a rate of LIBOR plus 3.50% with a minimum of 4.50% for all Fannie Mae loans and 4.00% for all Freddie Mac loans.
|
·
|
An uncommitted facility with Fannie Mae under its Multifamily As Soon As Pooled (“ASAP”) Facility funding program. After approval of certain loan documents, Fannie Mae will fund loans after closing and the advances are used to repay our warehouse facilities. Subsequently, Fannie Mae funds approximately 99% of the loan and Centerline Mortgage Capital Inc. (“CMC”) funds the remaining 1%. CMC is later reimbursed by Fannie Mae when the assets are sold. Interest on this facility currently accrues at a rate of LIBOR plus 1.35%, with a minimum rate of 1.70%. The interest rate on this facility was 1.84% as of March 31, 2012 and 1.70% as of December 31, 2011.
|
Centerline Financial Credit Facility
|
·
|
LIBOR plus 0.40% or;
|
·
|
1.40% plus the higher of the prime rate or the federal funds effective rate plus 0.50%.
|
·
|
notes payable by the Tax Credit Fund Partnerships collateralized either by the funds’ limited partners’ equity subscriptions or by the underlying investments of the funds; and
|
·
|
mortgages and notes payable on properties.
|
|
|
Maximum
|
|
Carrying
|
|
|||
|
(in thousands)
|
|
Exposure
|
|
Amount
|
|
||
|
|
|
|
|
|
|
|
|
|
Tax Credit Fund Partnerships credit intermediation(1)
|
|
$
|
1,191,342
|
|
$
|
18,837
|
|
|
Mortgage banking loss sharing agreements(2)
|
|
|
882,236
|
|
|
21,715
|
|
|
Credit support to developers(3)
|
|
|
174,754
|
|
|
-
|
|
|
Centerline Financial credit intermediation(4)
|
|
|
33,715
|
|
|
846
|
|
|
Letters of credit
|
|
|
13,772
|
|
|
-
|
|
|
General Partner property indemnifications
|
|
|
1,940
|
|
|
-
|
|
|
Contingent liabilities at the Consolidated Partnerships
|
|
|
11,270
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
2,309,029
|
|
$
|
41,398
|
|
|
|
|
|
|
|
|
|
|
(1) |
Through the isolated special purpose entities, these transactions were undertaken to expand the Affordable Housing Equity business by offering agreed-upon rates of return to third-party investors for pools of multifamily properties in certain Tax Credit Fund Partnerships. The carrying values of $18.8 million disclosed above relate to the deferred fees we earn for the transactions that we recognize over the period until maturity of these credit intermediations.
|
||
(2) |
The loss sharing agreements with Fannie Mae and Freddie Mac are a normal part of the DUS and DUI lender programs. The carrying value disclosed above is our estimate of potential exposure under the guarantees. Based on current expectations of defaults in the portfolio of loans, we anticipate that we may be required to pay between $3.0 and $5.0 million in the next 12 months.
|
||
(3) | Generally relates to business requirements for developers to obtain construction financing. As part of our role as co-developer of certain properties, we issue these guarantees in order to secure properties as assets for the Tax Credit Fund Partnerships we manage. To date, we have had minimal exposure to losses under these guarantees. |
(4) |
These transactions were undertaken to expand our Credit Risk Products business by offering credit intermediation to third-party customers. To date, we have had minimal exposure to losses and anticipate no material liquidity requirements in satisfaction of any arrangement. The carrying values disclosed above relate to the deferred fees we earn for the transactions that we recognize over the period until maturity of these derivatives.
|
·
|
business limitations caused by adverse changes in real estate and credit markets and general economic and business conditions;
|
·
|
risks related to the form and structure of our financing arrangements;
|
·
|
our ability to generate new income sources, raise capital for investment funds and maintain business relationships with providers and users of capital;
|
·
|
changes in applicable laws and regulations;
|
·
|
our tax treatment, the tax treatment of our subsidiaries and the tax treatment of our investments;
|
·
|
competition with other companies;
|
·
|
risk of loss associated with our mortgage originations;
|
·
|
risks associated with providing credit intermediation; and
|
·
|
risks associated with enforcement by our creditors of any rights or remedies which they may possess.
|
a)
|
Evaluation of Disclosure Controls and Procedures
|
b)
|
Internal Control over Financial Reporting
|
·
|
our cash flow from operations may be insufficient to make required payments of principal and interest;
|
·
|
our vulnerability to downturns in our business is increased, requiring us to reduce expenditures we need to expand our businesses;
|
·
|
we may be unable to refinance existing indebtedness; and the terms of any refinancing may be less favorable than the terms of existing indebtedness; and
|
·
|
we may be unable to satisfy ongoing financial and other covenants, which if not waived or amended by our lenders, could lead to accelerations of, and cross-defaults on, our debt obligations.
|
·
|
limitations on our incurring additional unsecured indebtedness without lender approval;
|
·
|
restrictions on our ability to make any distributions or redeem or purchase any of our shares including Series A Convertible Community Reinvestment Act Preferred Shares (“Convertible CRA Shares”), except in certain circumstances, such as distributions to the holders of preferred shares of Centerline Equity Issuer Trust (“Equity Issuer”), a subsidiary of the Company, if and to the extent that such distributions are made solely out of funds received from Freddie Mac as contemplated by a specified transaction (“EIT Preferred Share Distributions”);
|
·
|
limitations on our ability to make new business investments without lender approval; and
|
·
|
restrictions on our ability to conduct transactions with our affiliates.
|
|
|
|
|
|
|
|
Total number
|
|
Maximum
|
|
|
|
|
|
|
|
of shares
|
|
number
|
|
|
|
|
|
|
|
purchased as
|
|
of shares that
|
|
|
|
|
|
|
|
part of
|
|
may yet be
|
|
|
Total
|
|
Weighted
|
|
publicly
|
|
purchased
|
|
|
|
number of
|
|
average
|
|
announced
|
|
under the
|
|
|
|
shares
|
|
price paid
|
|
plans
|
|
plans or
|
|
Period
|
|
purchased
|
|
per share
|
|
or programs
|
|
programs
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
January 1 – 31, 2012
|
|
-
|
|
$
|
-
|
|
-
|
|
-
|
February 1-29, 2012
|
|
-
|
|
|
-
|
|
-
|
|
-
|
March 1-31, 2012
|
|
-
|
|
|
-
|
|
-
|
|
-
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
-
|
|
$
|
-
|
|
-
|
|
303,854
|
Exhibits.
|
||||
31.1
|
||||
31.2
|
32.1
|
||||
101
|
Interactive Data File
|
|||
*
|
Filed herewith.
|
Date: May 21, 2012
|
By:
|
/s/ Robert L. Levy
|
Robert L. Levy
President and Chief Operating Officer
(Principal Executive Officer)
|
Date: May 21, 2012
|
By:
|
/s/ Michael P. Larsen
|
Michael P. Larsen
Chief Financial Officer
(Principal Financial Officer)
|
1.
|
I have reviewed this quarterly report on Form 10-Q for the period ended March 31, 2012 of Centerline Holding Company;
|
||||
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
||||
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
||||
4.
|
I am responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
||||
a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
|||||
b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
|||||
c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
|||||
d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
|||||
5.
|
I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
||||
a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
|||||
b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
|||||
Date:
|
May 21, 2012
|
By:
|
/s/ Robert L. Levy
|
||
Robert L. Levy
President and Chief Operating Officer
(Principal Executive Officer)
|
1.
|
I have reviewed this quarterly report on Form 10-Q for the period ended March 31, 2012 of Centerline Holding Company;
|
||||
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
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3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
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4.
|
I am responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
||||
a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
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b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
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c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
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d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
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5.
|
I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
||||
a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
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b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
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Date:
|
May 21, 2012
|
By:
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/s/ Michael P. Larsen
|
||
Michael P. Larsen
Chief Financial Officer
(Principal Financial Officer)
|
In connection with the Quarterly Report on Form 10-Q of Centerline Holding Company for the quarterly period ended March 31, 2012, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), Robert L. Levy, as President and Chief Operating Officer of our Company, and Michael P. Larsen, as Chief Financial Officer of our Company, hereby certify, pursuant to 18 U.S.C. Section 1350, that:
|
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(1)
|
The Report fully complies with the requirements of Section 13(a) or 15(d), as applicable, of the Securities Exchange Act of 1934; and
|
||||
(2)
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of our Company.
|
||||
By:
|
/s/ Robert L. Levy
|
By:
|
/s/ Michael P. Larsen
|
||
Robert L. Levy
President and Chief Operating Officer
(Principal Executive Officer)
May 21, 2012
|
Michael P. Larsen
Chief Financial Officer
(Principal Financial Officer)
May 21, 2012
|
Financial Risk Management and Derivatives
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3 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2012
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Financial Risk Management and Derivatives | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Financial Risk Management and Derivatives |
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Fair Value Measurement
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3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2012
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Fair Value Measurement | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Measurement |
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