22. Segment Data

In its operation of the business, management, including our chief operating decision maker, who is our Chief Executive Officer, reviews certain financial information, including segmented internal profit and loss statements prepared on a basis prior to the impact of consolidating securitization VIEs under ASC 810. The segment information within this note is reported on that basis.

The table below presents our results of operations for the three months ended June 30, 2016 by business segment (amounts in thousands):


			Investing								Investing
	Lending		and Servicing		Property						and Servicing
	Segment		Segment		Segment		Corporate		Subtotal		VIEs		Total
Revenues:
Interest income from loans	$	119,296	$	3,261	$	—	$	—	$	122,557	$	—	$	122,557
Interest income from investment securities		11,046		32,435		—		—		43,481		(28,180)		15,301
Servicing fees		206		37,249		—		—		37,455		(14,143)		23,312
Rental income		—		8,223		29,620		—		37,843		—		37,843
Other revenues		58		1,076		18		—		1,152		(173)		979
Total revenues		130,606		82,244		29,638		—		242,488		(42,496)		199,992
Costs and expenses:
Management fees		395		12		—		23,304		23,711		56		23,767
Interest expense		22,572		3,328		5,678		26,057		57,635		—		57,635
General and administrative		4,540		26,721		837		3,130		35,228		181		35,409
Acquisition and investment pursuit costs		942		780		166		1,000		2,888		—		2,888
Costs of rental operations		—		3,661		12,191		—		15,852		—		15,852
Depreciation and amortization		—		3,730		15,343		—		19,073		—		19,073
Loan loss allowance, net		2,029		—		—		—		2,029		—		2,029
Total costs and expenses		30,478		38,232		34,215		53,491		156,416		237		156,653
Income (loss) before other (loss) income, income taxes and non-controlling interests		100,128		44,012		(4,577)		(53,491)		86,072		(42,733)		43,339
Other income (loss):
Change in net assets related to consolidated VIEs		—		—		—		—		—		50,707		50,707
Change in fair value of servicing rights		—		(11,034)		—		—		(11,034)		(1,157)		(12,191)
Change in fair value of investment securities, net		(30)		7,459		—		—		7,429		(6,110)		1,319
Change in fair value of mortgage loans held-for-sale, net		—		13,235		—		—		13,235		—		13,235
Earnings from unconsolidated entities		1,224		1,286		2,429		—		4,939		(460)		4,479
(Loss) gain on sale of investments and other assets, net		(90)		—		—		—		(90)		—		(90)
Gain (loss) on derivative financial instruments, net		15,868		(3,945)		8,330		—		20,253		—		20,253
Foreign currency (loss) gain, net		(17,840)		870		(18)		—		(16,988)		—		(16,988)
Other income, net		—		34		8,680		—		8,714		—		8,714
Total other (loss) income		(868)		7,905		19,421		—		26,458		42,980		69,438
Income (loss) before income taxes		99,260		51,917		14,844		(53,491)		112,530		247		112,777
Income tax provision		—		(706)		—		—		(706)		—		(706)
Net income (loss)		99,260		51,211		14,844		(53,491)		111,824		247		112,071
Net income attributable to non-controlling interests		(348)		(3)		—		—		(351)		(247)		(598)
Net income (loss) attributable to Starwood Property Trust, Inc.	$	98,912	$	51,208	$	14,844	$	(53,491)	$	111,473	$	—	$	111,473

The table below presents our results of operations for the three months ended June 30, 2015 by business segment (amounts in thousands):


			Investing								Investing
	Lending		and Servicing		Property						and Servicing
	Segment		Segment		Segment		Corporate		Subtotal		VIEs		Total
Revenues:
Interest income from loans	$	113,928	$	4,364	$	—	$	—	$	118,292	$	—	$	118,292
Interest income from investment securities		17,050		47,272		—		—		64,322		(40,512)		23,810
Servicing fees		98		54,349		—		—		54,447		(24,293)		30,154
Rental income		—		1,478		3,536		—		5,014		—		5,014
Other revenues		334		1,301		—		—		1,635		(245)		1,390
Total revenues		131,410		108,764		3,536		—		243,710		(65,050)		178,660
Costs and expenses:
Management fees		367		18		—		26,385		26,770		51		26,821
Interest expense		20,197		2,751		877		25,974		49,799		—		49,799
General and administrative		6,083		32,626		174		2,343		41,226		178		41,404
Acquisition and investment pursuit costs		224		505		4,262		(124)		4,867		—		4,867
Costs of rental operations		—		878		333		—		1,211		—		1,211
Depreciation and amortization		—		4,213		1,615		—		5,828		—		5,828
Loan loss allowance, net		2,661		—		—		—		2,661		—		2,661
Total costs and expenses		29,532		40,991		7,261		54,578		132,362		229		132,591
Income (loss) before other (loss) income, income taxes and non-controlling interests		101,878		67,773		(3,725)		(54,578)		111,348		(65,279)		46,069
Other income (loss):
Change in net assets related to consolidated VIEs		—		—		—		—		—		55,873		55,873
Change in fair value of servicing rights		—		(8,381)		—		—		(8,381)		5,729		(2,652)
Change in fair value of investment securities, net		510		(3,191)		—		—		(2,681)		4,127		1,446
Change in fair value of mortgage loans held-for-sale, net		—		10,831		—		—		10,831		—		10,831
Earnings from unconsolidated entities		1,361		5,328		2,554		—		9,243		(292)		8,951
Gain on sale of investments and other assets, net		209		—		—		—		209		—		209
(Loss) gain on derivative financial instruments, net		(23,954)		4,274		150		—		(19,530)		—		(19,530)
Foreign currency gain (loss), net		21,181		(120)		(207)		—		20,854		—		20,854
Loss on extinguishment of debt		—		—		—		(629)		(629)		—		(629)
Other income, net		—		10		—		—		10		—		10
Total other (loss) income		(693)		8,751		2,497		(629)		9,926		65,437		75,363
Income (loss) before income taxes		101,185		76,524		(1,228)		(55,207)		121,274		158		121,432
Income tax provision		—		(3,792)		—		—		(3,792)		—		(3,792)
Net income (loss)		101,185		72,732		(1,228)		(55,207)		117,482		158		117,640
Net income attributable to non-controlling interests		(334)		—		—		—		(334)		(158)		(492)
Net income (loss) attributable to Starwood Property Trust, Inc.	$	100,851	$	72,732	$	(1,228)	$	(55,207)	$	117,148	$	—	$	117,148

The table below presents our results of operations for the six months ended June 30, 2016 by business segment (amounts in thousands):


			Investing								Investing
	Lending		and Servicing		Property						and Servicing
	Segment		Segment		Segment		Corporate		Subtotal		VIEs		Total
Revenues:
Interest income from loans	$	233,954	$	6,135	$	—	$	—	$	240,089	$	—	$	240,089
Interest income from investment securities		20,674		80,061		—		—		100,735		(66,031)		34,704
Servicing fees		365		73,467		—		—		73,832		(25,829)		48,003
Rental income		—		14,698		55,822		—		70,520		—		70,520
Other revenues		81		2,418		24		—		2,523		(354)		2,169
Total revenues		255,074		176,779		55,846		—		487,699		(92,214)		395,485
Costs and expenses:
Management fees		770		30		—		47,832		48,632		98		48,730
Interest expense		44,907		6,566		10,627		52,055		114,155		—		114,155
General and administrative		8,462		52,015		1,392		5,980		67,849		358		68,207
Acquisition and investment pursuit costs		1,280		1,135		758		1,000		4,173		—		4,173
Costs of rental operations		—		6,723		21,784		—		28,507		—		28,507
Depreciation and amortization		—		6,781		31,052		—		37,833		—		37,833
Loan loss allowance, net		1,268		—		—		—		1,268		—		1,268
Other expense		—		100		—		—		100		—		100
Total costs and expenses		56,687		73,350		65,613		106,867		302,517		456		302,973
Income (loss) before other (loss) income, income taxes and non-controlling interests		198,387		103,429		(9,767)		(106,867)		185,182		(92,670)		92,512
Other income (loss):
Change in net assets related to consolidated VIEs		—		—		—		—		—		46,540		46,540
Change in fair value of servicing rights		—		(19,704)		—		—		(19,704)		774		(18,930)
Change in fair value of investment securities, net		(244)		(44,069)		—		—		(44,313)		46,385		2,072
Change in fair value of mortgage loans held-for-sale, net		—		20,126		—		—		20,126		—		20,126
Earnings from unconsolidated entities		1,692		2,663		4,858		—		9,213		(669)		8,544
Gain on sale of investments and other assets, net		155		—		—		—		155		—		155
Gain (loss) on derivative financial instruments, net		12,842		(15,190)		(2,117)		—		(4,465)		—		(4,465)
Foreign currency (loss) gain, net		(19,662)		2,330		(34)		—		(17,366)		—		(17,366)
Other income, net		—		77		9,102		1,550		10,729		—		10,729
Total other (loss) income		(5,217)		(53,767)		11,809		1,550		(45,625)		93,030		47,405
Income (loss) before income taxes		193,170		49,662		2,042		(105,317)		139,557		360		139,917
Income tax provision		(75)		(725)		—		—		(800)		—		(800)
Net income (loss)		193,095		48,937		2,042		(105,317)		138,757		360		139,117
Net (income) loss attributable to non-controlling interests		(698)		71		—		—		(627)		(360)		(987)
Net income (loss) attributable to Starwood Property Trust, Inc.	$	192,397	$	49,008	$	2,042	$	(105,317)	$	138,130	$	—	$	138,130

The table below presents our results of operations for the six months ended June 30, 2015 by business segment (amounts in thousands):


			Investing								Investing
	Lending		and Servicing		Property						and Servicing
	Segment		Segment		Segment		Corporate		Subtotal		VIEs		Total
Revenues:
Interest income from loans	$	227,400	$	9,321	$	—	$	—	$	236,721	$	—	$	236,721
Interest income from investment securities		39,346		71,968		—		—		111,314		(59,760)		51,554
Servicing fees		182		105,297		—		—		105,479		(47,068)		58,411
Rental income		—		4,150		3,536		—		7,686		—		7,686
Other revenues		413		3,231		—		—		3,644		(507)		3,137
Total revenues		267,341		193,967		3,536		—		464,844		(107,335)		357,509
Costs and expenses:
Management fees		755		36		—		53,897		54,688		101		54,789
Interest expense		41,720		4,870		877		52,866		100,333		—		100,333
General and administrative		10,941		61,815		176		3,372		76,304		364		76,668
Acquisition and investment pursuit costs		997		718		4,262		76		6,053		—		6,053
Costs of rental operations		—		2,576		333		—		2,909		—		2,909
Depreciation and amortization		—		8,298		1,615		—		9,913		—		9,913
Loan loss allowance, net		2,978		—		—		—		2,978		—		2,978
Other expense		—		375		—		—		375		—		375
Total costs and expenses		57,391		78,688		7,263		110,211		253,553		465		254,018
Income (loss) before other income, income taxes and non-controlling interests		209,950		115,279		(3,727)		(110,211)		211,291		(107,800)		103,491
Other income (loss):
Change in net assets related to consolidated VIEs		—		—		—		—		—		103,734		103,734
Change in fair value of servicing rights		—		(13,256)		—		—		(13,256)		9,062		(4,194)
Change in fair value of investment securities, net		171		5,122		—		—		5,293		(4,346)		947
Change in fair value of mortgage loans held-for-sale, net		—		31,962		—		—		31,962		—		31,962
Earnings from unconsolidated entities		2,216		8,052		5,195		—		15,463		(422)		15,041
Gain on sale of investments and other assets, net		307		17,100		—		—		17,407		—		17,407
Gain (loss) on derivative financial instruments, net		8,909		(3,733)		(83)		—		5,093		—		5,093
Foreign currency loss, net		(8,155)		(1,291)		(7)		—		(9,453)		—		(9,453)
Loss on extinguishment of debt		—		—		—		(5,921)		(5,921)		—		(5,921)
Other income, net		—		41		—		14		55		—		55
Total other income (loss)		3,448		43,997		5,105		(5,907)		46,643		108,028		154,671
Income (loss) before income taxes		213,398		159,276		1,378		(116,118)		257,934		228		258,162
Income tax benefit (provision)		30		(19,773)		—		—		(19,743)		—		(19,743)
Net income (loss)		213,428		139,503		1,378		(116,118)		238,191		228		238,419
Net income attributable to non-controlling interests		(680)		—		—		—		(680)		(228)		(908)
Net income (loss) attributable to Starwood Property Trust, Inc.	$	212,748	$	139,503	$	1,378	$	(116,118)	$	237,511	$	—	$	237,511

The table below presents our condensed consolidated balance sheet as of June 30, 2016 by business segment (amounts in thousands):


			Investing								Investing
	Lending		and Servicing		Property						and Servicing
	Segment		Segment		Segment		Corporate		Subtotal		VIEs		Total
Assets:
Cash and cash equivalents	$	127,803	$	69,803	$	18,723	$	187,335	$	403,664	$	1,156	$	404,820
Restricted cash		17,359		16,092		7,680		—		41,131		—		41,131
Loans held-for-investment, net		5,687,399		6,053		—		—		5,693,452		—		5,693,452
Loans held-for-sale		—		237,106		—		—		237,106		—		237,106
Loans transferred as secured borrowings		93,268		—		—		—		93,268		—		93,268
Investment securities		784,463		1,050,909		—		—		1,835,372		(936,569)		898,803
Properties, net		—		220,340		1,012,515		—		1,232,855		—		1,232,855
Intangible assets		—		154,975		51,650		—		206,625		(29,572)		177,053
Investment in unconsolidated entities		30,873		55,432		122,130		—		208,435		(7,894)		200,541
Goodwill		—		140,437		—		—		140,437		—		140,437
Derivative assets		32,446		2,736		7,510		—		42,692		—		42,692
Accrued interest receivable		29,028		1,008		—		—		30,036		—		30,036
Other assets		12,234		74,481		32,544		1,163		120,422		(2,372)		118,050
VIE assets, at fair value		—		—		—		—		—		80,076,117		80,076,117
Total Assets	$	6,814,873	$	2,029,372	$	1,252,752	$	188,498	$	10,285,495	$	79,100,866	$	89,386,361
Liabilities and Equity
Liabilities:
Accounts payable, accrued expenses and other liabilities	$	9,352	$	58,583	$	48,600	$	23,295	$	139,830	$	782	$	140,612
Related-party payable		—		555		—		19,763		20,318		—		20,318
Dividends payable		—		—		—		115,013		115,013		—		115,013
Derivative liabilities		13,706		4,163		1		—		17,870		—		17,870
Secured financing agreements, net		2,600,851		503,864		725,856		645,650		4,476,221		—		4,476,221
Convertible senior notes, net		—		—		—		1,334,424		1,334,424		—		1,334,424
Secured borrowings on transferred loans		94,668		—		—		—		94,668		—		94,668
VIE liabilities, at fair value		—		—		—		—		—		79,087,142		79,087,142
Total Liabilities		2,718,577		567,165		774,457		2,138,145		6,198,344		79,087,924		85,286,268
Equity:
Starwood Property Trust, Inc. Stockholders’ Equity:
Common stock		—		—		—		2,427		2,427		—		2,427
Additional paid-in capital		2,062,358		1,183,776		467,993		506,760		4,220,887		—		4,220,887
Treasury stock		—		—		—		(92,104)		(92,104)		—		(92,104)
Accumulated other comprehensive income (loss)		39,472		(6,973)		128		—		32,627		—		32,627
Retained earnings (accumulated deficit)		1,983,102		270,081		10,174		(2,366,730)		(103,373)		—		(103,373)
Total Starwood Property Trust, Inc. Stockholders’ Equity		4,084,932		1,446,884		478,295		(1,949,647)		4,060,464		—		4,060,464
Non-controlling interests in consolidated subsidiaries		11,364		15,323		—		—		26,687		12,942		39,629
Total Equity		4,096,296		1,462,207		478,295		(1,949,647)		4,087,151		12,942		4,100,093
Total Liabilities and Equity	$	6,814,873	$	2,029,372	$	1,252,752	$	188,498	$	10,285,495	$	79,100,866	$	89,386,361

The table below presents our condensed consolidated balance sheet as of December 31, 2015 by business segment (amounts in thousands):


			Investing								Investing
	Lending		and Servicing		Property						and Servicing
	Segment		Segment		Segment		Corporate		Subtotal		VIEs		Total
Assets:
Cash and cash equivalents	$	83,836	$	62,649	$	2,944	$	218,408	$	367,837	$	978	$	368,815
Restricted cash		9,775		8,826		4,468		—		23,069		—		23,069
Loans held-for-investment, net		5,973,079		—		—		—		5,973,079		—		5,973,079
Loans held-for-sale		—		203,865		—		—		203,865		—		203,865
Loans transferred as secured borrowings		86,573		—		—		—		86,573		—		86,573
Investment securities		511,966		1,038,200		—		—		1,550,166		(825,219)		724,947
Properties, net		—		150,497		768,728		—		919,225		—		919,225
Intangible assets		—		152,278		61,121		—		213,399		(11,829)		201,570
Investment in unconsolidated entities		30,827		53,145		122,454		—		206,426		(7,225)		199,201
Goodwill		—		140,437		—		—		140,437		—		140,437
Derivative assets		33,412		2,087		9,592		—		45,091		—		45,091
Accrued interest receivable		34,028		286		—		—		34,314		—		34,314
Other assets		7,938		71,505		23,657		1,436		104,536		(2,057)		102,479
VIE assets, at fair value		—		—		—		—		—		76,675,689		76,675,689
Total Assets	$	6,771,434	$	1,883,775	$	992,964	$	219,844	$	9,868,017	$	75,830,337	$	85,698,354
Liabilities and Equity
Liabilities:
Accounts payable, accrued expenses and other liabilities	$	18,822	$	90,399	$	25,427	$	21,468	$	156,116	$	689	$	156,805
Related-party payable		—		423		—		40,532		40,955		—		40,955
Dividends payable		—		—		—		114,947		114,947		—		114,947
Derivative liabilities		5,190		6		—		—		5,196		—		5,196
Secured financing agreements, net		2,341,897		422,260		568,738		647,804		3,980,699		—		3,980,699
Convertible senior notes, net		—		—		—		1,323,795		1,323,795		—		1,323,795
Secured borrowings on transferred loans		88,000		—		—		—		88,000		—		88,000
VIE liabilities, at fair value		—		—		—		—		—		75,817,014		75,817,014
Total Liabilities		2,453,909		513,088		594,165		2,148,546		5,709,708		75,817,703		81,527,411
Equity:
Starwood Property Trust, Inc. Stockholders’ Equity:
Common stock		—		—		—		2,410		2,410		—		2,410
Additional paid-in capital		2,477,987		1,146,926		394,465		173,466		4,192,844		—		4,192,844
Treasury stock		—		—		—		(72,381)		(72,381)		—		(72,381)
Accumulated other comprehensive income (loss)		37,242		(3,714)		(3,799)		—		29,729		—		29,729
Retained earnings (accumulated deficit)		1,790,705		221,073		8,133		(2,032,197)		(12,286)		—		(12,286)
Total Starwood Property Trust, Inc. Stockholders’ Equity		4,305,934		1,364,285		398,799		(1,928,702)		4,140,316		—		4,140,316
Non-controlling interests in consolidated subsidiaries		11,591		6,402		—		—		17,993		12,634		30,627
Total Equity		4,317,525		1,370,687		398,799		(1,928,702)		4,158,309		12,634		4,170,943
Total Liabilities and Equity	$	6,771,434	$	1,883,775	$	992,964	$	219,844	$	9,868,017	$	75,830,337	$	85,698,354