UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D. C. 20549

FORM 10-Q

(Mark One)

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2024

OR 

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from                      to                     

Commission File Number 1-12043

OPPENHEIMER HOLDINGS INC.

(Exact name of registrant as specified in its charter)

Delaware	98-0080034
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

85 Broad Street

New York, NY 10004

(Address of principal executive offices) (Zip Code)

(212) 668-8000

(Registrant's telephone number, including area code)

(Former name, former address and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol	Name of each exchange on which registered
Class A non-voting common stock	OPY	The New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  ☒    No  ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).    Yes  ☒    No  ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer", "accelerated filer", "smaller reporting company", and "emerging growth company" in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer	☐	Accelerated Filer	☒
Non-accelerated filer	☐	Smaller reporting company	☐
Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).     Yes  ☐    No  ☒

The number of shares of the Company's Class A non-voting common stock and Class B voting common stock (being the only classes of common stock of the Company) outstanding on July 26, 2024 was 10,232,649 and 99,665 shares, respectively.

OPPENHEIMER HOLDINGS INC.

INDEX TO QUARTERLY REPORT ON FORM 10-Q

		Page No.
PART I	FINANCIAL INFORMATION
Item 1.	Financial Statements (unaudited)
	Condensed Consolidated Balance Sheets as of June 30, 2024 and December 31, 2023	3
	Condensed Consolidated Income Statements for the three and six months ended June 30, 2024 and 2023	4
	Condensed Consolidated Statements of Comprehensive Income for the three and six months ended June 30, 2024 and 2023	5
	Condensed Consolidated Statements of Changes in Stockholders' Equity and Redeemable Noncontrolling Interests for the three and six months ended June 30, 2024 and 2023	5
	Condensed Consolidated Statements of Cash Flows for the six months ended June 30, 2024 and 2023	6
	Notes to Condensed Consolidated Financial Statements	7
Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	37
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	51
Item 4.	Controls and Procedures	52
PART II	OTHER INFORMATION
Item 1.	Legal Proceedings	53
Item 1A.	Risk Factors	55
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	55
Item 5.	Other Information	55
Item 6.	Exhibits	56
	Signatures	57

PART I. FINANCIAL INFORMATION

Item 1. FINANCIAL STATEMENTS (UNAUDITED)

OPPENHEIMER HOLDINGS INC.

CONDENSED CONSOLIDATED BALANCE SHEETS (unaudited)

(Expressed in thousands, except number of shares and per share amounts)	June 30, 2024		December 31, 2023
ASSETS
Cash and cash equivalents	$	33,214	$	28,835
Deposits with clearing organizations	108,415		78,706
Receivable from brokers, dealers and clearing organizations	297,031		284,696
Receivable from customers, net of allowance for credit losses of $220 ($345 in 2023)	1,161,685		1,059,892
Income tax receivable	6,009		7,199
Securities purchased under agreements to resell	4,079		5,842
Securities owned, including amounts pledged of $867,341 ($689,381 in 2023), at fair value	1,043,256		795,312
Notes receivable, net	63,342		62,640
Furniture, equipment and leasehold improvements, net of accumulated depreciation of $87,808 ($82,732 in 2023)	40,163		43,874
Right-of-use lease assets, net of accumulated amortization of $107,581 ($99,716 in 2023)	132,441		140,554
Corporate-owned life insurance	94,646		88,989
Goodwill	142,162		142,162
Intangible assets	34,187		34,340
Other assets	101,908		101,775
Total assets	$	3,262,538	$	2,874,816
LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities
Drafts payable	$	21,762	$	9,002
Bank call loans	218,800		—
Payable to brokers, dealers and clearing organizations	278,226		361,890
Payable to customers	325,886		369,287
Securities sold under agreements to repurchase	822,785		640,382
Securities sold but not yet purchased, at fair value	177,251		31,676
Accrued compensation	209,502		256,244
Accounts payable and other liabilities	69,187		82,810
Lease liabilities	172,604		183,273
Senior secured notes, net of debt issuance costs of $283 ($392 in 2023)	112,767		112,658
Deferred tax liabilities, net of deferred tax assets of $44,087 ($45,961 in 2023)	41,708		38,355
Total liabilities	2,450,478		2,085,577
Commitments and contingencies (Note 14)
Stockholders' equity
Common stock ($0.001 par value per share): Class A: shares authorized: 50,000,000; shares issued and outstanding: 10,227,845 and 10,186,783 as of June 30, 2024 and December 31, 2023, respectively Class B: shares authorized, issued and outstanding: 99,665 as of June 30, 2024 and December 31, 2023	10		10
Additional paid-in capital	23,365		31,774
Retained earnings	788,739		756,468
Accumulated other comprehensive income (loss)	(54)		914
Total Oppenheimer Holdings Inc. stockholders' equity	812,060		789,166
Noncontrolling interest (Note 2)	—		73
Total Stockholders' equity	812,060		789,239
Total Liabilities and Stockholders' Equity	$	3,262,538	$	2,874,816

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

3

OPPENHEIMER HOLDINGS INC.

CONDENSED CONSOLIDATED INCOME STATEMENTS (unaudited)

	For the Three Months Ended June 30,				For the Six Months Ended June 30,
(Expressed in thousands, except number of shares and per share amounts)	2024		2023		2024		2023
REVENUE
Commissions	$	97,055	$	88,544	$	192,905	$	175,241
Advisory fees	117,197		101,015		232,044		201,559
Investment banking	29,119		19,978		79,656		57,943
Bank deposit sweep income	34,846		44,060		71,531		92,969
Interest	34,805		27,320		61,571		52,261
Principal transactions, net	10,074		16,253		28,308		29,743
Other	7,493		9,019		17,712		18,152
Total revenue	330,589		306,189		683,727		627,868
EXPENSES
Compensation and related expenses	220,727		187,224		442,440		393,516
Communications and technology	24,682		22,783		49,258		45,223
Occupancy and equipment costs	15,516		16,440		31,364		32,341
Clearing and exchange fees	6,780		5,927		12,622		12,190
Interest	21,980		17,467		42,528		30,609
Other	25,039		68,047		52,195		106,639
Total expenses	314,724		317,888		630,407		620,518
Pre-tax income (loss)	15,865		(11,699)		53,320		7,350
Income tax provision (benefit)	5,599		(2,131)		17,310		2,454
Net income (loss)	$	10,266	$	(9,568)	$	36,010	$	4,896
Net loss attributable to noncontrolling interest, net of tax	—		(168)		(310)		(321)
Net income (loss) attributable to Oppenheimer Holdings Inc.	$	10,266	$	(9,400)	$	36,320	$	5,217
Earnings (loss) per share attributable to Oppenheimer Holdings Inc.
Basic	$	0.99	$	(0.85)	$	3.49	$	0.47
Diluted	$	0.92	$	(0.85)	$	3.29	$	0.44
Weighted average shares outstanding
Basic	10,327,818		11,016,430		10,367,636		11,054,306
Diluted	11,111,903		11,016,430		11,083,422		11,911,379
Period end shares outstanding	10,327,510		10,984,240		10,327,510		10,984,240

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

4

OPPENHEIMER HOLDINGS INC.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (unaudited)

	For the Three Months Ended June 30,				For the Six Months Ended June 30,
(Expressed in thousands)	2024		2023		2024		2023
Net income (loss)	$	10,266	$	(9,568)	$	36,010	$	4,896
Other comprehensive loss, net of tax
Currency translation adjustment	(580)		(663)		(967)		(1,160)
Comprehensive income (loss)	$	9,686	$	(10,231)	35,043		3,736
Less net loss attributable to noncontrolling interests	—		(168)		(310)		(321)
Comprehensive income (loss) attributable to Oppenheimer Holdings Inc.	$	9,686	$	(10,063)	$	35,353	$	4,057

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

5

OPPENHEIMER HOLDINGS INC.

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY AND REDEEMABLE NONCONTROLLING INTERESTS (unaudited)

	For the Three Months Ended June 30,				For the Six Months Ended June 30,
(Expressed in thousands, except per share amount)	2024		2023		2024		2023
Common stock ($0.001 par value per share)
Beginning Balance	$	10	$	11	$	10	$	11
Issuance of Class A non-voting common stock	—		—		—		—
Repurchase of Class A non-voting common stock for cancellation	—		—		—		—
Ending Balance	10		11		10		11
Additional paid-in capital
Balance at beginning of period	20,040		22,374		31,774		28,628
Issuance of Class A non-voting common stock	171		184		8,409		5,672
Repurchase of Class A non-voting common stock for cancellation	—		—		(8,384)		(3,687)
Share-based expense	3,325		3,349		6,470		6,642
Vested employee share plan awards	(171)		(259)		(15,168)		(11,578)
Change in redemption value of redeemable noncontrolling interests	—		(72)		264		(101)
Balance at end of period	23,365		25,576		23,365		25,576
Retained earnings
Balance at beginning of period	780,946		777,121		756,468		764,178
Repurchase of Class A non-voting common stock for cancellation	(924)		(3,599)		(924)		(3,599)
Net income (loss) (1)	10,266		(9,400)		36,320		5,217
Dividends paid	(1,549)		(1,651)		(3,125)		(3,325)
Balance at end of period	788,739		762,471		788,739		762,471
Accumulated other comprehensive income
Balance at beginning of period	526		919		914		1,416
Currency translation adjustment	(580)		(663)		(968)		(1,160)
Balance at end of period	(54)		256		(54)		256
Total Oppenheimer Holdings Inc. stockholders' equity	$	812,060	$	788,314	$	812,060	$	788,314
Noncontrolling interest
Balance at beginning of period	—		433		73		722
Capital addition to noncontrolling interest	—		171		237		171
Net loss attributable to noncontrolling interest	—		(168)		(310)		(321)
Change in redemption value of redeemable noncontrolling interests	—		(328)		—		(464)
Balance at end of period	—		108		—		108
Total stockholders' equity	$	812,060	$	788,422	$	812,060	$	788,422
Redeemable Noncontrolling Interests
Balance at beginning of period	—		25,557		—		25,466
Redemption of redeemable noncontrolling interests	—		(9)		—		(83)
Change in redemption value of redeemable noncontrolling interests	—		400		—		565
Balance at end of period	$	—	$	25,948	$	—	$	25,948
Dividends paid per share	$	0.15	$	0.15	$	0.30	$	0.30
(1) Attributable to Oppenheimer Holdings Inc.

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

OPPENHEIMER HOLDINGS INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited)

FOR THE SIX MONTHS ENDED JUNE 30,

(Expressed in thousands)	2024		2023
Cash flows from operating activities
Net income	$	36,010	$	4,896
Adjustments to reconcile net income to net cash used in operating activities
Non-cash items included in net income:
Depreciation and amortization of furniture, equipment and leasehold improvements	5,378		3,897
Deferred income taxes	3,507		2,485
Amortization of intangible assets	153		—
Amortization of notes receivable	8,894		7,570
Amortization of debt issuance costs	109		110
Write-off of debt issuance costs	—		5
Provision for credit losses	(125)		(1)
Share-based compensation	14,435		7,773
Amortization of right-of-use lease assets	12,940		13,945
Gain on repurchase of senior secured notes	—		(51)
Decrease (increase) in operating assets:
Deposits with clearing organizations	(29,709)		1,397
Receivable from brokers, dealers and clearing organizations	(12,335)		(128,143)
Receivable from customers	(101,668)		136,326
Income tax receivable	1,190		(17,196)
Securities purchased under agreements to resell	1,763		—
Securities owned	(247,944)		(425,589)
Notes receivable	(9,596)		(10,948)
Corporate-owned life insurance	(5,657)		(8,466)
Other assets	(1,353)		351
Increase (decrease) in operating liabilities:
Drafts payable	12,760		21,734
Payable to brokers, dealers and clearing organizations	(83,664)		(128,603)
Payable to customers	(43,401)		(55,307)
Securities sold under agreements to repurchase	182,403		484,306
Securities sold but not yet purchased	145,575		18,333
Accrued compensation	(54,706)		(50,792)
Income tax payable	—		(4,130)
Accounts payable and other liabilities	(29,273)		(24,713)
Cash used in operating activities	(194,314)		(150,811)
Cash flows from investing activities
Purchase of furniture, equipment and leasehold improvements	(1,667)		(9,734)
Proceeds from the settlement of Company-owned life insurance	252		555
Cash used in investing activities	(1,415)		(9,179)
Cash flows from financing activities
Cash dividends paid on Class A non-voting and Class B voting common stock	(3,125)		(3,325)
Repurchase of Class A non-voting common stock for cancellation	(9,309)		(7,285)
Payments for employee taxes withheld related to vested share-based awards	(6,758)		(5,907)
Addition to noncontrolling interests	—		171
Redemption of redeemable noncontrolling interests	500		(83)
Repurchase of senior secured notes	—		(1,000)
Increase in bank call loans	218,800		94,400
Cash provided by financing activities	200,108		76,971
Net increase (decrease) in cash, cash equivalents and restricted cash	4,379		(83,019)
Cash, cash equivalents and restricted cash, beginning of period	28,835		137,967
Cash, cash equivalents and restricted cash, end of period	$	33,214	$	54,948
Reconciliation of cash and cash equivalents and restricted cash within the condensed consolidated balance sheets:	2024		2023
Cash and cash equivalents	$	33,214	$	29,145
Restricted cash	—		25,803
Total cash and cash equivalents and restricted cash	$	33,214	$	54,948
Schedule of non-cash financing activities
Employee share plan issuance	$	13,539	$	9,062
Supplemental disclosure of cash flow information
Cash paid during the period for interest	$	41,870	$	30,113
Cash paid during the period for income taxes, net	$	12,539	$	20,322

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

6

OPPENHEIMER HOLDINGS INC.
Notes to Condensed Consolidated Financial Statements (unaudited)

1.    Organization

Oppenheimer Holdings Inc. ("OPY" or the "Parent") is incorporated under the laws of the State of Delaware. The condensed consolidated financial statements include the accounts of OPY and its consolidated subsidiaries (together, the "Company"). Oppenheimer Holdings Inc., through its operating subsidiaries, is a leading middle market investment bank and full service broker-dealer that is engaged in a broad range of activities in the financial services industry, including retail securities brokerage, institutional sales and trading, investment banking (corporate and public finance), equity and fixed income research, market-making, trust services, and investment advisory and asset management services.

The Company is headquartered in New York and has 88 retail branch offices in 25 states located throughout the United States and offices in Puerto Rico, Tel Aviv, Israel, Hong Kong, China, London, England, St. Helier, Isle of Jersey, Portugal and Geneva, Switzerland. The principal subsidiaries of OPY are Oppenheimer & Co. Inc. ("Oppenheimer"), a registered broker-dealer in securities and investment adviser under the Investment Advisers Act of 1940; Oppenheimer Asset Management Inc. ("OAM") and its wholly-owned subsidiary, Oppenheimer Investment Management LLC, both registered investment advisers under the Investment Advisers Act of 1940; Oppenheimer Trust Company of Delaware ("Oppenheimer Trust"), a limited purpose trust company that provides fiduciary services such as trust and estate administration and investment management; OPY Credit Corp., which conducts secondary trading activities related to the purchase and sale of loans, primarily on a riskless principal basis; Oppenheimer Europe Ltd., based in the United Kingdom, with offices in the Isle of Jersey, Portugal, and Switzerland, which provides institutional equities and fixed income brokerage and corporate finance and is regulated by the Financial Conduct Authority; and Oppenheimer Investments Asia Limited, based in Hong Kong, China, which provides fixed income and equities brokerage services to institutional investors and is regulated by the Securities and Futures Commission.

Oppenheimer owns Freedom Investments, Inc. ("Freedom"), a registered broker dealer in securities, which provides discount brokerage services on a limited basis, and Oppenheimer Israel (OPCO) Ltd., based in Tel Aviv, Israel, which provides investment services in the State of Israel and operates subject to the authority of the Israel Securities Authority.

2.    Summary of significant accounting policies and estimates

Basis of Presentation

The accompanying condensed consolidated financial statements of the Company have been prepared pursuant to the rules and regulations of the U.S. Securities and Exchange Commission (the "SEC") regarding interim financial reporting. Accordingly, they do not include all of the information and notes required by accounting principles generally accepted in the United States of America ("U.S. GAAP") and should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Company's Annual Report on Form 10-K for the year ended December 31, 2023 (the "Form 10-K"). The accompanying condensed consolidated balance sheet data was derived from the same sources as the audited consolidated financial statements but does not include all disclosures required by U.S. GAAP for annual financial statement purposes. The accompanying condensed consolidated financial statements reflect all adjustments that are, in the opinion of management, necessary for a fair presentation of the financial position, results of operations and cash flows for the interim periods presented. Certain reclassifications have been made to prior periods to place them on a basis comparable with current period presentation. Preparing financial statements requires management to make estimates and assumptions that affect the amounts that are reported in the financial statements and the accompanying disclosures. Although these estimates are based on management's knowledge of current events and actions that the Company may undertake in the future, actual results may differ materially from the estimates. The condensed consolidated results of operations for the three and six months ended June 30, 2024 are not necessarily indicative of the results to be expected for any future interim or annual period.

Oppenheimer Acquisition Corp. I

On October 26, 2021, OPY Acquisition Corp. I (“OHAA”), a special purpose acquisition company, consummated its $126.5 million initial public offering (the “OHAA IPO”). OPY Acquisition LLC I (the “Sponsor”), a Delaware series limited liability company and the Company’s subsidiary was the sponsor of and consolidated OHAA. Upon IPO completion, funds totaling $127.8 million, including proceeds from the OHAA IPO of $126.5 million and $1.3 million investment from the Sponsor, were held in a trust account until the earlier of (i) the completion of a Business Combination or (ii) ten business days after April 29, 2023, 18 months from the closing of the OHAA IPO (“Combination Period”), pursuant to OHAA's certificate of incorporation.

7

OPPENHEIMER HOLDINGS INC.
Notes to Condensed Consolidated Financial Statements (unaudited)

On October 26, 2023, OHAA’s stockholders approved an amendment to its certificate of incorporation to extend the deadline by which it must complete its initial business combination from October 30, 2023 to June 30, 2024 on a month-to-month basis.

In the fourth quarter of 2023, after careful consideration of the special purpose acquisition company market and after having completed an extensive search, OHAA determined it would be unable to deliver and fund a high quality value enhancing transaction to stockholders despite the extension. Therefore, on December 18, 2023, OHAA determined not to further extend the term it has to complete an initial business combination and instead announced its intention to dissolve and liquidate. On December 28, 2023, all OHAA Class A ordinary shares were cancelled with shareholders receiving their respective share redemption amounts. Accordingly, there were no “Redeemable non-controlling interests” or restricted cash balances associated with the publicly held OHAA Class A ordinary shares recorded on the Company’s consolidated balance sheet as of December 31, 2023. OHAA was dissolved in March 2024.

Oppenheimer Principal Investments LLC

Oppenheimer Principal Investments LLC ("OPI") is a Delaware special purpose "Series" limited liability company formed in December 2020 and designed to retain and reward talented employees of the Company, primarily in connection with the deployment of Company capital into successful private market investments, and also in connection with the Company's receipt of non-cash compensation from investment banking assignments. OPI is designed to promote alignment of Company, client and employee interests as they relate to profitable investment opportunities. This program acts as an incentive for senior employees to identify attractive private investments for the Company and its clients, and as a retention tool for key employees of the Company. OPI treats its members as partners for tax purposes generally and with respect to the separate Series formed to participate in (i) the incentive fees generated by successful client investments in the Company's Private Market Opportunities program, or (ii) principal investments made by the Company or a portion of the gains thereon, either through the outright purchase of an investment or consideration earned in lieu of an investment banking fee or other transaction fee. Employees who become members of a Series receive a "profit interest", as that term is used in Internal Revenue Service (“IRS”) regulations, and receive an allocation of capital appreciation of the investment held by the particular Series that exceeds a threshold amount established for each Series. Participating employees are also subject to vesting and forfeiture requirements for each Series investment. Vested profit interests are accounted for as compensation expense under FASB Topic ASC 710. Additionally, the Company’s policy is to consolidate those entities where it owns the majority voting interests. The Company owns the majority voting interest of OPI through Oppenheimer Alternative Investment Management (“OAIM”), the managing member of OPI and a subsidiary of OAM. Pursuant to the Company’s policy for consolidation, the Company consolidates OPI.

Non-controlling Interests

Non-controlling interests represent ownership interests in the Sponsor of OHAA. For the six months ended June 30, 2024 and June 30, 2023, the net loss (net of taxes) attributed to noncontrolling interests was $310,000 and $321,000, respectively.

3.    Financial Instruments - Credit Losses

Under ASC 326, "Financial Instruments - Credit Losses", the Company can elect to use an approach to measure the allowance for credit losses using the fair value of collateral where the borrower is required to, and reasonably expected to, continually adjust and replenish the amount of collateral securing the instrument to reflect changes in the fair value of such collateral. The Company has elected to use this approach for securities borrowed, margin loans, and reverse repurchase agreements. No material historical losses have been reported on these assets. See note 9 for details.

As of June 30, 2024, the Company had $63.3 million of notes receivable ($62.6 million as of December 31, 2023). Notes receivable represent recruiting and retention payments generally in the form of upfront loans to financial advisors and key revenue producers as part of the Company's overall growth strategy. These notes generally amortize over a service period of 3 to 10 years from the initial date of the note or based on productivity levels of employees. All such notes are contingent on the employees' continued employment with the Company. The unforgiven portion of the notes becomes due on demand in the event the employee departs during the service period. At that point, any uncollected portion of the notes is reclassified into a defaulted notes category.

8

OPPENHEIMER HOLDINGS INC.
Notes to Condensed Consolidated Financial Statements (unaudited)

The allowance for uncollectibles is a valuation account that is deducted from the amortized cost basis of the defaulted notes balance to present the net amount expected to be collected. Balances are charged-off against the allowance when management deems the amount to be uncollectible.

The Company reserves 100% of the uncollected balance of defaulted notes which are five years and older and applies an expected loss rate to the remaining balance. The expected loss rate is based on historical collection rates of defaulted notes. The expected loss rate is adjusted for changes in environmental and market conditions such as changes in unemployment rates, changes in interest rates and other relevant factors. For the three and six months ended June 30, 2024, no adjustments were made to the expected loss rates. The Company will continuously monitor the effect of these factors on the expected loss rate and adjust it as necessary.

The allowance is measured on a pool basis as the Company has determined that the entire defaulted portion of notes receivable has similar risk characteristics.

As of June 30, 2024, the uncollected balance of defaulted notes was $6.6 million and the allowance for uncollectibles was $3.9 million. The allowance for uncollectibles consisted of $2.0 million related to defaulted notes balances (five years and older) and $1.9 million (under five years).

The following table presents the disaggregation of defaulted notes by year of default as of June 30, 2024:

(Expressed in thousands)
	As of June 30, 2024
2024	$	251
2023	2,157
2022	141
2021	1,644
2020	423
2019 and prior	1,985
Total	$	6,601

The following table presents activity in the allowance for uncollectibles of defaulted notes for the three and six months ended June 30, 2024 and 2023:

(Expressed in thousands)
	For the Three Months Ended June 30,				For the Six Months Ended June 30,
	2024		2023		2024		2023
Beginning balance	$	4,091	$	4,051	$	3,869	$	4,327
Additions and other adjustments	(238)		(237)		(16)		(513)
Ending balance	$	3,853	$	3,814	$	3,853	$	3,814

4.    Leases

The Company has operating leases for office space and equipment expiring at various dates through 2034. The Company leases its corporate headquarters at 85 Broad Street, New York, New York which houses its executive management team and many administrative functions for the Firm as well as its research, trading, investment banking, and asset management divisions and an office in Troy, Michigan, which among other things, houses its payroll and human resources departments. In addition, the Company has 88 retail branch offices in the United States as well as offices in London, England, St. Helier, Isle of Jersey, Geneva, Switzerland, Tel Aviv, Israel and Hong Kong, China.

9

OPPENHEIMER HOLDINGS INC.
Notes to Condensed Consolidated Financial Statements (unaudited)

The Company is constantly assessing its needs for office space and, on a rolling basis, has many leases that expire in any given year.

Substantially all of the leases are held by the Company's subsidiary, Viner Finance Inc., which is a wholly owned subsidiary of the Company.

Leases with an initial term of 12 months or less are not recorded on the balance sheet; the Company recognizes lease expense for these leases on a straight-line basis over the lease term. Most leases include an option to renew and the exercise of lease renewal options is at the Company's sole discretion. The Company did not include the renewal options as part of the right of use assets and liabilities.

The depreciable life of assets and leasehold improvements is limited by the expected lease term. The Company's lease agreements do not contain any material residual value guarantees or material restrictive covenants.

As of June 30, 2024, the Company had right-of-use operating lease assets of $132.4 million (net of accumulated amortization of $107.6 million) which are comprised of real estate leases of $129.9 million (net of accumulated amortization of $104.8 million) and equipment leases of $2.5 million (net of accumulated amortization of $2.8 million). As of June 30, 2024, the Company had operating lease liabilities of $172.6 million which are comprised of real estate lease liabilities of $170.1 million and equipment lease liabilities of $2.5 million. The Company had no finance leases as of June 30, 2024.

As most of the Company's leases do not provide an implicit rate, the Company uses the incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. The Company used the incremental borrowing rate on January 1, 2019 for operating leases that commenced prior to that date. The Company used the incremental borrowing rate as of the lease commencement date for the operating leases that commenced subsequent to January 1, 2019.

The following table presents the weighted average lease term and weighted average discount rate for the Company's operating leases as of June 30, 2024 and December 31, 2023, respectively:

	As of
	June 30, 2024	December 31, 2023
Weighted average remaining lease term (in years)	6.05	6.35
Weighted average discount rate	7.75%	7.72%

The following table presents operating lease costs recognized for the three and six months ended June 30, 2024 and June 30, 2023, respectively, which are included in occupancy and equipment costs on the condensed consolidated income statements:    

(Expressed in thousands)
	For the Three Months Ended June 30,				For the Six Months Ended June 30,
	2024		2023		2024		2023
Operating lease costs:
Real estate leases - Right-of-use lease asset amortization	$	6,031	$	6,686	$	12,077	$	13,125
Real estate leases - Interest expense	3,228		3,398		6,551		6,607
Equipment leases - Right-of-use lease asset amortization	432		431		863		853
Equipment leases - Interest expense	44		47		90		93

10

OPPENHEIMER HOLDINGS INC.
Notes to Condensed Consolidated Financial Statements (unaudited)

The maturities of lease liabilities as of June 30, 2024 and December 31, 2023 are as follows:    

(Expressed in thousands)
	As of
	June 30, 2024		December 31, 2023
2024	$	22,059	$	43,885
2025	40,203		38,759
2026	38,015		36,757
2027	35,641		34,823
2028	22,388		21,660
After 2028	59,577		58,081
Total lease payments	$	217,883	$	233,965
Less interest	(45,279)		(50,692)
Present value of lease liabilities	$	172,604	$	183,273

As of June 30, 2024, the Company had $25.2 million of additional real estate operating leases that have not yet commenced ($5.8 million as of December 31, 2023).

5.    Revenue from contracts with customers

Revenue from contracts with customers is recognized when, or as, the Company satisfies its performance obligations by transferring the promised goods or services to customers. A good or service is transferred to a customer when, or as, the customer obtains control of that good or service. A performance obligation may be satisfied over time or at a point in time. Revenue from a performance obligation satisfied over time is recognized by measuring the Company's progress in satisfying the performance obligation in a manner that depicts the transfer of the goods or services to the customer. Revenue from a performance obligation satisfied at a point in time is recognized at the point in time that the Company determines the customer obtains control over the promised good or service.

The amount of revenue recognized reflects the consideration to which the Company expects to be entitled in exchange for those promised goods or services (i.e., the "transaction price"). In determining the transaction price, the Company considers multiple factors, including the effects of variable consideration. Variable consideration is included in the transaction price only to the extent it is probable that a significant reversal in the amount of cumulative revenue recognized will not occur when the uncertainties with respect to the amount are resolved. In determining when to include variable consideration in the transaction price, the Company considers the range of possible outcomes, the predictive value of its past experiences, the time period during which uncertainties are expected to be resolved and the amount of consideration that is susceptible to factors outside of the Company's influence, such as market volatility or the judgment and actions of third parties.

The Company earns revenue from contracts with customers and other sources (principal transactions, interest and other). The following provides detailed information on the recognition of the Company's revenue from contracts with customers:

Commissions

Commissions from Sales and Trading — The Company earns commission revenue by executing, settling and clearing transactions with clients primarily in exchange-traded and over-the-counter corporate equity and debt securities, money market instruments and exchange-traded options and futures contracts. A substantial portion of the Company's revenue is derived from commissions from private clients through accounts with transaction-based pricing. Trade execution and clearing services, when provided together, represent a single performance obligation as the services are not separately identifiable in the context of the contract. Commission revenue associated with combined trade execution and clearing services, as well as trade execution services on a standalone basis, is recognized at a point in time on trade date when the performance obligation is satisfied.

Commission revenue is generally paid on settlement date, which is generally one business day after trade date. The Company records a receivable on the trade date and receives a payment on the settlement date.

11

OPPENHEIMER HOLDINGS INC.
Notes to Condensed Consolidated Financial Statements (unaudited)

Mutual Fund Income — The Company earns mutual fund income for sales and distribution of mutual fund shares, which consists of a fixed fee amount and a variable amount. The Company recognizes mutual fund income at a point in time on the trade date when the performance obligation is satisfied which is when the mutual fund interest is sold to the investor. The ongoing distribution fees for distributing investment products from mutual fund companies are generally considered variable consideration because they are based on the value of AUM and are uncertain on trade date. The Company recognizes distribution fees over the investment period as the amounts become known and the portion recognized in the current period may relate to distribution services performed in prior periods. Mutual fund income is generally received within 90 days.

Advisory Fees

The Company earns management and performance (or incentive) fees in connection with the advisory and asset management services it provides to various types of funds, asset-based programs and investment vehicles through its subsidiaries. Management fees are generally based on the account value at the valuation date per the respective asset management agreements and are recognized over time as the customer receives the benefits of the services evenly throughout the term of the contract. Performance fees are recognized when the return on client AUM exceeds a specified benchmark return or other performance targets over a 12-month measurement period are met. Performance fees are considered variable as they are subject to fluctuation and/or are contingent on a future event over the measurement period and are not subject to adjustment once the measurement period ends. Such fees are computed as of the fund's year-end when the measurement period ends and generally are recorded as earned in the fourth quarter of the Company's fiscal year. Both management and performance fees are generally received within 90 days.

Investment Banking

The Company earns underwriting revenues by providing capital raising solutions for corporate clients through initial public offerings, follow-on offerings, equity-linked offerings, private investments in public entities, and private placements. Underwriting revenues are recognized at a point in time on trade date, as the client obtains the control and benefit of the capital markets offering at that time. These fees are generally received within 90 days after the transactions are completed. Transaction-related expenses, primarily consisting of legal, travel and other costs directly associated with the transaction, are deferred and recognized in the same period as the related investment banking transaction revenue. Underwriting revenues and related expenses are presented gross on the consolidated income statements.

Revenue from financial advisory services includes fees generated in connection with mergers, acquisitions and restructuring transactions. Such revenue and fees are primarily recorded at a point in time when services for the performance obligations have been completed and income is reasonably determinable, generally as set forth under the terms of the engagement. Payment for advisory services is generally due upon a completion of the transaction or milestone. Retainer fees and fees earned from certain advisory services are recognized ratably over the service period as the customer receives the benefit of the services throughout the term of the contracts, and such fees are collected based on the terms of the contracts.

Bank Deposit Sweep Income

Bank deposit sweep income consists of revenue earned from the FDIC-insured bank deposit program. Under this program, client funds are swept into deposit accounts at participating banks and are eligible for FDIC deposit insurance up to FDIC standard maximum deposit insurance amounts. Fees are earned over time and are generally received within 30 days.

Disaggregation of Revenue

The following presents the Company's revenue from contracts with customers disaggregated by major business activity and other sources of revenue for the three and six months ended June 30, 2024 and 2023:

12

OPPENHEIMER HOLDINGS INC.
Notes to Condensed Consolidated Financial Statements (unaudited)

(Expressed in thousands)	For the Three Months Ended June 30, 2024
	Reportable Segments
	Private Client		Asset Management		Capital Markets		Corporate/Other		Total
Revenue from contracts with customers:
Commissions from sales and trading	$	44,766	$	—	$	44,174	$	3	$	88,943
Mutual fund and insurance income	8,106		—		1		5		8,112
Advisory fees	90,947		26,241		—		9		117,197
Investment banking - capital markets	2,807		—		14,022		(1)		16,828
Investment banking - advisory	—		—		12,291		—		12,291
Bank deposit sweep income	34,847		—		—		(1)		34,846
Other	3,168		(1)		580		1,942		5,689
Total revenue from contracts with customers	184,641		26,240		71,068		1,957		283,906
Other sources of revenue:
Interest	21,626		—		11,410		1,769		34,805
Principal transactions, net	376		—		9,566		132		10,074
Other	2,058		(415)		97		64		1,804
Total other sources of revenue	24,060		(415)		21,073		1,965		46,683
Total revenue	$	208,701	$	25,825	$	92,141	$	3,922	$	330,589

(Expressed in thousands)	For the Three Months Ended June 30, 2023
	Reportable Segments
	Private Client		Asset Management		Capital Markets		Corporate/Other		Total
Revenue from contracts with customers:
Commissions from sales and trading	$	37,666	$	—	$	43,154	$	8	$	80,828
Mutual fund and insurance income	7,711		—		1		4		7,716
Advisory fees	78,811		22,196		—		8		101,015
Investment banking - capital markets	1,688		—		7,345		—		9,033
Investment banking - advisory	—		—		10,945		—		10,945
Bank deposit sweep income	44,060		—		—		—		44,060
Other	3,284		—		594		21		3,899
Total revenue from contracts with customers	173,220		22,196		62,039		41		257,496
Other sources of revenue:
Interest	22,403		—		4,109		808		27,320
Principal transactions, net	1,072		—		13,410		1,771		16,253
Other	4,550		2		24		544		5,120
Total other sources of revenue	28,025		2		17,543		3,123		48,693
Total revenue	$	201,245	$	22,198	$	79,582	$	3,164	$	306,189

13

OPPENHEIMER HOLDINGS INC.
Notes to Condensed Consolidated Financial Statements (unaudited)

(Expressed in thousands)	For the Six Months Ended June 30, 2024
	Reportable Segments
	Private Client		Asset Management		Capital Markets		Corporate/Other		Total
Revenue from contracts with customers:
Commissions from sales and trading	$	89,696	$	—	$	87,219	$	8	$	176,923
Mutual fund and insurance income	15,970		—		2		10		15,982
Advisory fees	179,823		52,201		—		20		232,044
Investment banking - capital markets	5,828		—		29,649		(1)		35,476
Investment banking - advisory	21		—		44,159		—		44,180
Bank deposit sweep income	71,532		—		—		(1)		71,531
Other	6,584		(1)		900		2,922		10,405
Total revenue from contracts with customers	369,454		52,200		161,929		2,958		586,541
Other sources of revenue:
Interest	41,822		—		15,713		4,036		61,571
Principal transactions, net	2,112		—		26,299		(103)		28,308
Other	8,346		(1,447)		283		125		7,307
Total other sources of revenue	52,280		(1,447)		42,295		4,058		97,186
Total revenue	$	421,734	$	50,753	$	204,224	$	7,016	$	683,727

(Expressed in thousands)	For the Six Months Ended June 30, 2023
	Reportable Segments
	Private Client		Asset Management		Capital Markets		Corporate/Other		Total
Revenue from contracts with customers:
Commissions from sales and trading	$	76,590	$	—	$	83,201	$	14	$	159,805
Mutual fund and insurance income	15,423		—		5		8		15,436
Advisory fees	155,394		46,150		—		15		201,559
Investment banking - capital markets	3,475		—		15,586		—		19,061
Investment banking - advisory	—		—		38,882		—		38,882
Bank deposit sweep income	92,969		—		—		—		92,969
Other	7,277		—		1,100		118		8,495
Total revenue from contracts with customers	351,128		46,150		138,774		155		536,207
Other sources of revenue:
Interest	42,982		—		7,138		2,141		52,261
Principal transactions, net	2,121		—		23,814		3,808		29,743
Other	8,435		7		138		1,077		9,657
Total other sources of revenue	53,538		7		31,090		7,026		91,661
Total revenue	$	404,666	$	46,157	$	169,864	$	7,181	$	627,868

Contract Assets and Liabilities

The timing of the Company's revenue recognition may differ from the timing of payment by its customers. The Company records contract assets when payment is due from a client conditioned on future performance or the occurrence of other events. Alternatively, when payment precedes the provision of the related services, the Company records deferred revenue until the performance obligations are satisfied.

14

OPPENHEIMER HOLDINGS INC.
Notes to Condensed Consolidated Financial Statements (unaudited)

The Company had receivables related to revenue from contracts with customers of $37.3 million and $39.9 million at June 30, 2024 and December 31, 2023, respectively. The Company had no significant impairments related to these receivables during the three months ended June 30, 2024.

Deferred revenue relates to IRA fees received annually in advance on customers' IRA accounts managed by the Company, software license fees received upfront from customers and retainer fees and other fees earned from certain advisory transactions where the performance obligations have not yet been satisfied. Total deferred revenue was $2.5 million and $1.1 million at June 30, 2024 and December 31, 2023, respectively.

The following presents the Company's receivables and deferred revenue balances from contracts with customers, which are included in other assets and other liabilities, respectively, on the consolidated balance sheet:

(Expressed in thousands)	As of
	June 30, 2024		December 31, 2023
Receivables
Commission (1)	$	4,286	$	4,554
Mutual fund income (2)	5,663		5,365
Advisory fees (3)	3,437		5,746
Bank deposit sweep income (4)	4,868		5,223
Investment banking fees (5)	11,856		12,847
Other	7,159		6,126
Total receivables	$	37,269	$	39,861
Deferred revenue (payables):
Investment Banking fees (6)	$	810	$	1,118
Software license fees (7)	456		—
IRA fees (8)	1,220		—
	$	2,486	$	1,118

(1)Commission recorded on trade date but not yet settled.

(2)Mutual fund income earned but not yet received.

(3)Management and performance fees earned but not yet received.

(4)Fees earned from FDIC-insured bank deposit program but not yet received.

(5)Underwriting revenue and advisory fees earned but not yet received..

(6)Retainer fees and fees received from certain advisory transactions where the performance obligations have not yet been satisfied.

(7)Software license fees received upfront from customers and recognized ratably over the contract period

(8)Fee received in advance on an annual basis.

6.    Earnings per share

Basic earnings per share is computed by dividing net income over the weighted average number of shares of Class A Stock and Class B Stock outstanding. Diluted earnings per share includes the weighted average number of shares of Class A Stock and Class B Stock outstanding and options to purchase Class A Stock and unvested restricted stock awards of Class A Stock using the treasury stock method.

15

OPPENHEIMER HOLDINGS INC.
Notes to Condensed Consolidated Financial Statements (unaudited)

Earnings per share have been calculated as follows:

(Expressed in thousands, except number of shares and per share amounts)
	For the Three Months Ended June 30,				For the Six Months Ended June 30,
	2024		2023		2024		2023
Basic weighted average number of shares outstanding	10,327,818		11,016,430		10,367,636		11,054,306
Net dilutive effect of share-based awards, treasury stock method (1)	784,085		—		715,786		857,073
Diluted weighted average number of shares outstanding	11,111,903		11,016,430		11,083,422		11,911,379
Net income attributable to Oppenheimer Holdings Inc.	$	10,266	$	(9,400)	$	36,320	$	5,217
Earnings per share attributable to Oppenheimer Holdings Inc.
Basic	$	0.99	$	(0.85)	$	3.49	$	0.47
Diluted	$	0.92	$	(0.85)	$	3.29	$	0.44

(1) For the three months ended June 30, 2024, there were no shares of Class A Stock with an anti-dilutive effect granted under share-based compensation arrangements. For the six months ended June 30, 2024, the diluted net income per share computation did not include the anti-dilutive effect of 1,000 shares of Class A Stock granted under share-based compensation arrangements. For the three months ended June 30, 2023, the diluted net income per share computation did not include the anti-dilutive effect of 1,138,992 shares of Class A Stock granted under share-based compensation arrangements. For the six months ended June 30, 2023, the diluted net income per share computation did not include the anti-dilutive effect of 281,810 shares of Class A Stock granted under share-based compensation arrangements.

7.    Receivable from and payable to brokers, dealers and clearing organizations

(Expressed in thousands)
	As of
	June 30, 2024		December 31, 2023
Receivable from brokers, dealers and clearing organizations consisting of:
Securities borrowed	$	134,454	$	158,612
Receivable from brokers	57,699		65,639
Clearing organizations and other (1)	84,824		30,789
Securities failed to deliver	20,054		29,656
Total	$	297,031	$	284,696
Payable to brokers, dealers and clearing organizations consisting of:
Securities loaned