SEGMENT REPORTING

6 Months Ended

Jun. 30, 2021

Segment Reporting [Abstract]

SEGMENT REPORTING

SEGMENT REPORTING

At June 30, 2021, New Residential’s reportable segments include (i) Origination, (ii) Servicing, (iii) MSR Related Investments, (iv) Residential Securities and Loans, (v) Consumer Loans and (vi) Corporate. The Corporate segment primarily consists of general and administrative expenses, management fees and incentive compensation related to the Management Agreement, corporate cash and related interest income, unsecured senior notes (Note 11) and related interest expense.

The following tables summarize segment financial information, which in total reconciles to the same data for New Residential as a whole:

	Servicing and Origination										Residential Securities and Loans
	Origination		Servicing		MSR Related Investments		Elimination(A)		Total Servicing and Origination		Real Estate Securities		Residential Mortgage Loans		Consumer Loans		Corporate		Total
Three Months Ended June 30, 2021
Interest income	$	31,262	$	251	$	65,980	$	—	$	97,493	$	97,960	$	33,294	$	24,930	$	—	253,677
Servicing revenue, net	(5,077)		112,464		(138,945)		(54,953)		(86,511)		—		—		—		—		(86,511)
Gain on originated mortgage loans, held-for-sale, net	268,539		1,849		25,758		(22,449)		273,697		(3,638)		16,826		—		—		286,885
Total revenues	294,724		114,564		(47,207)		(77,402)		284,679		94,322		50,120		24,930		—		454,051
Interest expense	18,960		66		44,538		—		63,564		13,630		17,463		2,873		9,009		106,539
G&A and other	200,551		82,164		109,869		(54,953)		337,631		1,034		20,968		2,912		28,848		391,393
Total operating expenses	219,511		82,230		154,407		(54,953)		401,195		14,664		38,431		5,785		37,857		497,932
Change in fair value of investments	—		—		(38,798)		—		(38,798)		119,565		121,242		(1,626)		—		200,383
Gain (loss) on settlement of investments, net	—		—		1,568		—		1,568		(76,270)		(1,254)		—		(348)		(76,304)
Other income (loss), net	138		—		7,659		—		7,797		—		18,206		2,367		1,673		30,043
Total other income (loss)	138		—		(29,571)		—		(29,433)		43,295		138,194		741		1,325		154,122
Impairment	—		—		—		—		—		(1,756)		(32,652)		—		—		(34,408)
Income (loss) before income taxes	75,351		32,334		(231,185)		(22,449)		(145,949)		124,709		182,535		19,886		(36,532)		144,649
Income tax expense (benefit)	19,029		8,101		(45,516)		—		(18,386)		—		17,288		21		—		(1,077)
Net income (loss)	56,322		24,233		(185,669)		(22,449)		(127,563)		124,709		165,247		19,865		(36,532)		145,726
Noncontrolling interests in income (loss) of consolidated subsidiaries	3,225		—		(1,825)		—		1,400		—		—		8,653		—		10,053
Dividends on preferred stock	—		—		—		—		—		—		—		—		14,358		14,358
Net income (loss) attributable to common stockholders	$	53,097	$	24,233	$	(183,844)	$	(22,449)	$	(128,963)	$	124,709	$	165,247	$	11,212	$	(50,890)	$	121,315

	Servicing and Origination										Residential Securities and Loans
	Origination		Servicing		MSR Related Investments		Elimination(A)		Total Servicing and Origination		Real Estate Securities		Residential Mortgage Loans		Consumer Loans		Corporate		Total
Six Months Ended June 30, 2021
Interest income	$	54,114	$	725	$	144,751	$	—	$	199,590	$	187,810	$	69,616	$	50,396	$	—	$	507,412
Servicing revenue, net	(13,187)		225,979		327,642		(113,397)		427,037		—		—		—		—		427,037
Gain on originated mortgage loans, held-for-sale, net	652,962		2,658		60,913		(65,948)		650,585		9,760		29,974		—		—		690,319
Total revenues	693,889		229,362		533,306		(179,345)		1,277,212		197,570		99,590		50,396		—		1,624,768
Interest expense	37,023		136		96,370		—		133,529		29,350		38,739		5,891		17,935		225,444
G&A and other	390,477		166,403		229,802		(113,397)		673,285		2,190		38,654		5,948		55,983		776,060
Total operating expenses	427,500		166,539		326,172		(113,397)		806,814		31,540		77,393		11,839		73,918		1,001,504
Change in fair value of investments	—		—		(66,400)		—		(66,400)		(172,569)		181,416		(7,630)		—		(65,183)
Gain (loss) on settlement of investments, net	—		—		(11,495)		—		(11,495)		(104,626)		28,187		—		(348)		(88,282)
Other income (loss), net	197		1,102		15,033		—		16,332		(1,686)		4,580		160		1,044		20,430
Total other income (loss)	197		1,102		(62,862)		—		(61,563)		(278,881)		214,183		(7,470)		696		(133,035)
Impairment	—		—		—		—		—		(2,650)		(51,365)		—		—		(54,015)
Income (loss) before income taxes	266,586		63,925		144,272		(65,948)		408,835		(110,201)		287,745		31,087		(73,222)		544,244
Income tax expense (benefit)	55,415		16,016		(6,920)		—		64,511		—		32,591		80		—		97,182
Net income (loss)	211,171		47,909		151,192		(65,948)		344,324		(110,201)		255,154		31,007		(73,222)		447,062
Noncontrolling interests in income (loss) of consolidated subsidiaries	6,750		—		(517)		—		6,233		—		—		13,214		—		19,447
Dividends on preferred stock	—		—		—		—		—		—		—		—		28,716		28,716
Net income (loss) attributable to common stockholders	$	204,421	$	47,909	$	151,709	$	(65,948)	$	338,091	$	(110,201)	$	255,154	$	17,793	$	(101,938)	$	398,899

	Servicing and Origination										Residential Securities and Loans
	Origination		Servicing		MSR Related Investments		Elimination(A)		Total Servicing and Origination		Real Estate Securities		Residential Mortgage Loans		Consumer Loans		Corporate		Total
June 30, 2021
Investments	$	4,599,186	$	—	$	5,671,450	$	—	$	10,270,636	$	14,956,889	$	3,376,192	$	592,126	$	—	$	29,195,843
Cash and cash equivalents	157,495		71,241		455,441		—		684,177		218,813		11,552		9,141		32,559		956,242
Restricted cash	17,673		52,466		120,784		—		190,923		20,033		913		26,632		—		238,501
Other assets	733,794		206,855		3,610,420		—		4,551,069		1,999,153		174,444		60,031		45,646		6,830,343
Goodwill	11,836		12,540		5,092		—		29,468		—		—		—		—		29,468
Total assets	$	5,519,984	$	343,102	$	9,863,187	$	—	$	15,726,273	$	17,194,888	$	3,563,101	$	687,930	$	78,205	$	37,250,397
Debt	$	4,309,548	$	—	$	5,580,897	$	—	$	9,890,445	$	15,611,309	$	2,552,050	$	541,064	$	542,405	$	29,137,273
Other liabilities	349,274		58,794		1,225,843		—		1,633,911		13,092		169,441		770		129,759		1,946,973
Total liabilities	4,658,822		58,794		6,806,740		—		11,524,356		15,624,401		2,721,491		541,834		672,164		31,084,246
Total equity	861,162		284,308		3,056,447		—		4,201,917		1,570,487		841,610		146,096		(593,959)		6,166,151
Noncontrolling interests in equity of consolidated subsidiaries	16,593		—		35,066		—		51,659		—		—		42,441		—		94,100
Total New Residential stockholders’ equity	$	844,569	$	284,308	$	3,021,381	$	—	$	4,150,258	$	1,570,487	$	841,610	$	103,655	$	(593,959)	$	6,072,051
Investments in equity method investees	$	—	$	—	$	107,251	$	—	$	107,251	$	—	$	—	$	—	$	—	$	107,251

	Servicing and Origination										Residential Securities and Loans
	Origination		Servicing		MSR Related Investments		Elimination(A)		Total Servicing and Origination		Real Estate Securities		Residential Mortgage Loans		Consumer Loans		Corporate		Total
Three Months Ended June 30, 2020
Interest income	$	8,963	$	1,115	$	108,386	$	—	$	118,464	$	33,663	$	47,284	$	32,787	$	—	$	232,198
Servicing revenue, net	(1,998)		96,885		(115,083)		(70,263)		(90,459)		—		—		—		—		(90,459)
Gain on originated mortgage loans, held-for-sale, net	281,937		343		28,114		(3,561)		306,833		—		(1,849)		—		—		304,984
Total revenues	288,902		98,343		21,417		(73,824)		334,838		33,663		45,435		32,787		—		446,723
Interest expense	5,667		111		60,594		—		66,372		17,679		17,471		6,215		8,666		116,403
G&A and other	102,462		73,907		156,700		(70,263)		262,806		344		19,278		3,703		28,985		315,116
Total operating expenses	108,129		74,018		217,294		(70,263)		329,178		18,023		36,749		9,918		37,651		431,519
Change in fair value of investments	—		—		(107,620)		—		(107,620)		79,704		99,998		34,167		—		106,249
Gain (loss) on settlement of investments, net	—		—		(1,726)		—		(1,726)		(31,864)		(41,376)		—		—		(74,966)
Other income (loss), net	390		—		18,702		—		19,092		(3)		(21,946)		(4,183)		381		(6,659)
Total other income (loss)	390		—		(90,644)		—		(90,254)		47,837		36,676		29,984		381		24,624
Impairment	—		—		(91)		—		(91)		(25,134)		3,515		—		—		(21,710)
Income (loss) before income taxes(B)	181,163		24,325		(286,430)		(3,561)		(84,503)		88,611		41,847		52,853		(37,270)		61,538
Income tax expense (benefit)	50,285		6,752		(42,561)		—		14,476		—		2,917		16		—		17,409
Net income (loss)	130,878		17,573		(243,869)		(3,561)		(98,979)		88,611		38,930		52,837		(37,270)		44,129
Noncontrolling interests in income (loss) of consolidated subsidiaries	4,419		—		8,591		—		13,010		—		—		25,630		—		38,640
Dividends on preferred stock	—		—		—		—		—		—		—		—		14,357		14,357
Net income (loss) attributable to common stockholders	$	126,459	$	17,573	$	(252,460)	$	(3,561)	$	(111,989)	$	88,611	$	38,930	$	27,207	$	(51,627)	$	(8,868)

	Servicing and Origination										Residential Securities and Loans
	Origination		Servicing		MSR Related Investments		Elimination(A)		Total Servicing and Origination		Real Estate Securities		Residential Mortgage Loans		Consumer Loans		Corporate		Total
Six Months Ended June 30, 2020
Interest income	$	25,698	$	8,602	$	207,739	$	—	$	242,039	$	217,668	$	107,205	$	67,659	$	—	$	634,571
Servicing revenue, net	(3,076)		183,627		(465,670)		(94,455)		(379,574)		—		—		—		—		(379,574)
Gain on originated mortgage loans, held-for-sale, net	440,152		602		44,081		(12,936)		471,899		—		6,662		—		—		478,561
Total revenues	462,774		192,831		(213,850)		(107,391)		334,364		217,668		113,867		67,659		—		733,558
Interest expense	19,094		307		118,377		—		137,778		125,688		48,244		12,882		8,666		333,258
G&A and other	202,674		138,259		258,674		(94,455)		505,152		7,198		36,034		7,586		55,966		611,936
Total operating expenses	221,768		138,566		377,051		(94,455)		642,930		132,886		84,278		20,468		64,632		945,194
Change in fair value of investments	—		—		(241,961)		—		(241,961)		(47,070)		(165,246)		(5,750)		—		(460,027)
Gain (loss) on settlement of investments, net	—		—		(5,007)		—		(5,007)		(871,116)		1,585		—		—		(874,538)
Other income (loss), net	374		499		(586)		—		287		(16)		8,066		(5,017)		(46,769)		(43,449)
Total other income (loss)	374		499		(247,554)		—		(246,681)		(918,202)		(155,595)		(10,767)		(46,769)		(1,378,014)
Impairment	—		—		(91)		—		(91)		19,015		104,011		—		—		122,935
Income (loss) before income taxes(B)	241,380		54,764		(838,364)		(12,936)		(555,156)		(852,435)		(230,017)		36,424		(111,401)		(1,712,585)
Income tax expense (benefit)	66,999		15,201		(159,506)		—		(77,306)		—		(72,284)		131		—		(149,459)
Net income (loss)	174,381		39,563		(678,858)		(12,936)		(477,850)		(852,435)		(157,733)		36,293		(111,401)		(1,563,126)
Noncontrolling interests in income (loss) of consolidated subsidiaries	5,702		—		(2,656)		—		3,046		—		—		19,432		—		22,478
Dividends on preferred stock	—		—		—		—		—		—		—		—		25,579		25,579
Net income (loss) attributable to common stockholders	$	168,679	$	39,563	$	(676,202)	$	(12,936)	$	(480,896)	$	(852,435)	$	(157,733)	$	16,861	$	(136,980)	$	(1,611,183)

(A)Elimination of intercompany transactions primarily relate to servicing fees, loan sales, and MSR recaptures.

(B)Beginning in Q3 2020, New Residential revised its methodology of allocating tax expense within the Servicing and Origination segments. Specifically, taxes are now allocated based on intercompany legal entity agreements rather than based on a more general pro rata approach, which better reflects the operating performance of each respective segment. The revised methodology has been applied consistently for all periods presented.