XML 101 R57.htm IDEA: XBRL DOCUMENT v3.19.3
Segment Information (Tables)
 9 Months Ended
Sep. 30, 2019
Segment Reporting [Abstract]  
Business Segment Financial Information
The following tables present financial information by segment for the three and nine months ended September 30, 2019 and 2018.
Table 24.1 – Business Segment Financial Information
 
 
Three Months Ended September 30, 2019
(In Thousands)
 
Investment Portfolio
 
Mortgage Banking
 
 Corporate/
Other
 
 Total
Interest income
 
$
132,894

 
$
12,491

 
$
4,732

 
$
150,117

Interest expense
 
(94,519
)
 
(6,657
)
 
(15,428
)
 
(116,604
)
Net interest income (loss)
 
38,375


5,834


(10,696
)
 
33,513

Non-interest income
 
 
 
 
 
 
 
 
Mortgage banking activities, net
 
—

 
9,515

 
—

 
9,515

Investment fair value changes, net
 
11,896

 
—

 
(452
)
 
11,444

Other income (expense), net
 
2,313

 
(252
)
 
(236
)
 
1,825

Realized gains, net
 
4,714

 
—

 
—

 
4,714

Total non-interest income, net
 
18,923


9,263


(688
)
 
27,498

Direct operating expenses
 
(2,191
)
 
(11,907
)
 
(12,717
)
 
(26,815
)
(Provision for) benefit from income taxes
 
(89
)
 
203

 
—

 
114

Segment Contribution
 
$
55,018


$
3,393


$
(24,101
)
 
 
Net Income
 
 
 
 
 
 
 
$
34,310

Non-cash amortization income (expense), net
 
$
2,456

 
$
(2,028
)
 
$
(1,148
)
 
$
(720
)
 
 
Three Months Ended September 30, 2018
(In Thousands)
 
Investment Portfolio
 
Mortgage Banking
 
 Corporate/
Other
 
 Total
Interest income
 
$
79,556

 
$
14,427

 
$
5,414

 
$
99,397

Interest expense
 
(40,852
)
 
(7,537
)
 
(15,962
)
 
(64,351
)
Net interest income (loss)
 
38,704

 
6,890

 
(10,548
)
 
35,046

Non-interest income
 
 
 
 
 
 
 
 
Mortgage banking activities, net
 
—

 
11,224

 
—

 
11,224

Investment fair value changes, net
 
10,566

 
—

 
(234
)
 
10,332

Other income, net
 
3,334

 
—

 
119

 
3,453

Realized gains, net
 
7,275

 
—

 
—

 
7,275

Total non-interest income, net
 
21,175

 
11,224

 
(115
)
 
32,284

Direct operating expenses
 
(2,659
)
 
(6,570
)
 
(12,261
)
 
(21,490
)
Provision for income taxes
 
(2,840
)
 
(2,079
)
 
—

 
(4,919
)
Segment Contribution
 
$
54,380

 
$
9,465

 
$
(22,924
)
 
 
Net Income
 
 
 
 
 
 
 
$
40,921

Non-cash amortization income (expense), net
 
$
4,019

 
$
(54
)
 
$
(1,176
)
 
$
2,789

 
 
Nine Months Ended September 30, 2019
(In Thousands)
 
Investment Portfolio
 
Mortgage Banking
 
 Corporate/
Other
 
 Total
Interest income
 
$
380,394

 
$
34,220

 
$
15,086

 
$
429,700

Interest expense
 
(266,318
)
 
(18,816
)
 
(46,966
)
 
(332,100
)
Net interest income (loss)
 
114,076

 
15,404

 
(31,880
)
 
97,600

Non-interest income
 
 
 
 
 
 
 
 
Mortgage banking activities, net
 
—

 
40,984

 
—

 
40,984

Investment fair value changes, net
 
35,749

 
—

 
(1,008
)
 
34,741

Other income, net
 
6,408

 
(575
)
 
1,986

 
7,819

Realized gains, net
 
18,227

 
—

 
—

 
18,227

Total non-interest income, net
 
60,384

 
40,409

 
978

 
101,771

Direct operating expenses
 
(7,110
)
 
(31,582
)
 
(37,537
)
 
(76,229
)
Provision for income taxes
 
(1,327
)
 
(1,775
)
 
—

 
(3,102
)
Segment Contribution
 
$
166,023

 
$
22,456

 
$
(68,439
)
 
 
Net Income
 
 
 
 
 
 
 
$
120,040

Non-cash amortization income (expense), net
 
$
7,446

 
$
(4,765
)
 
$
(3,573
)
 
$
(892
)

 
 
Nine Months Ended September 30, 2018
(In Thousands)
 
Investment Portfolio
 
Mortgage Banking
 
 Corporate/
Other
 
 Total
Interest income
 
$
202,882

 
$
40,408

 
$
15,702

 
$
258,992

Interest expense
 
(87,719
)
 
(21,303
)
 
(45,056
)
 
(154,078
)
Net interest income (loss)
 
115,163

 
19,105

 
(29,354
)
 
104,914

Non-interest income
 
 
 
 
 
 
 
 
Mortgage banking activities, net
 
—

 
48,396

 
—

 
48,396

Investment fair value changes, net
 
13,756

 
—

 
(926
)
 
12,830

Other income, net
 
8,774

 
—

 
119

 
8,893

Realized gains, net
 
21,352

 
—

 
—

 
21,352

Total non-interest income, net
 
43,882

 
48,396

 
(807
)
 
91,471

Direct operating expenses
 
(6,524
)
 
(20,941
)
 
(36,064
)
 
(63,529
)
Provision for income taxes
 
(4,858
)
 
(7,485
)
 
—

 
(12,343
)
Segment Contribution
 
$
147,663

 
$
39,075

 
$
(66,225
)
 
 
Net Income
 
 
 
 
 
 
 
$
120,513

Non-cash amortization income (expense), net
 
$
13,290

 
$
(99
)
 
$
(3,021
)
 
$
10,170
Components of Corporate and Other
The following table presents the components of Corporate/Other for the three and nine months ended September 30, 2019 and 2018.
Table 24.2 – Components of Corporate/Other
 
 
Three Months Ended September 30,
 
 
2019
 
2018
(In Thousands)
 
Legacy Consolidated VIEs (1)
 
Other
 
Total
 
Legacy Consolidated VIEs (1)
 
Other
 
 Total
Interest income
 
$
4,295

 
$
437

 
$
4,732

 
$
5,174

 
$
240

 
$
5,414

Interest expense
 
(3,452
)
 
(11,976
)
 
(15,428
)
 
(4,257
)
 
(11,705
)
 
(15,962
)
Net interest income (loss)
 
843

 
(11,539
)
 
(10,696
)
 
917

 
(11,465
)
 
(10,548
)
Non-interest income
 
 
 
 
 
 
 
 
 
 
 
 
Investment fair value changes, net
 
(407
)
 
(45
)
 
(452
)
 
(248
)
 
14

 
(234
)
Other income
 
—

 
(236
)
 
(236
)
 
—

 
119

 
119

Total non-interest income, net
 
(407
)
 
(281
)
 
(688
)
 
(248
)
 
133

 
(115
)
Direct operating expenses
 
—

 
(12,717
)
 
(12,717
)
 
—

 
(12,261
)
 
(12,261
)
Total
 
$
436

 
$
(24,537
)
 
$
(24,101
)
 
$
669

 
$
(23,593
)
 
$
(22,924
)
 
 
Nine Months Ended September 30,
 
 
2019
 
2018
(In Thousands)
 
Legacy Consolidated
VIEs (1)
 
Other
 
Total
 
Legacy Consolidated
VIEs (1)
 
Other
 
 Total
Interest income
 
$
13,924

 
$
1,162

 
$
15,086

 
$
15,003

 
$
699

 
$
15,702

Interest expense
 
(11,548
)
 
(35,418
)
 
(46,966
)
 
(12,324
)
 
(32,732
)
 
(45,056
)
Net interest income (loss)
 
2,376

 
(34,256
)
 
(31,880
)
 
2,679

 
(32,033
)
 
(29,354
)
Non-interest income
 
 
 
 
 
 
 
 
 
 
 
 
Investment fair value changes, net
 
(904
)
 
(104
)
 
(1,008
)
 
(976
)
 
50

 
(926
)
Other income
 
—

 
1,986

 
1,986

 
—

 
119

 
119

Total non-interest income, net
 
(904
)
 
1,882

 
978

 
(976
)
 
169

 
(807
)
Direct operating expenses
 
—

 
(37,537
)
 
(37,537
)
 
—

 
(36,064
)
 
(36,064
)
Total
 
$
1,472

 
$
(69,911
)
 
$
(68,439
)
 
$
1,703

 
$
(67,928
)
 
$
(66,225
)
(1)
Legacy consolidated VIEs represent Legacy Sequoia entities that are consolidated for GAAP financial reporting purposes. See Note 4 for further discussion on VIEs.
Supplemental Information by Segment
The following table presents supplemental information by segment at September 30, 2019 and December 31, 2018.
Table 24.3 – Supplemental Segment Information
(In Thousands)
 
Investment Portfolio
 
Mortgage Banking
 
Corporate/
Other
 
Total
September 30, 2019
 
 
 
 
 
 
 
 
Residential loans
 
$
7,326,757

 
$
925,887

 
$
429,159

 
$
8,681,803

Business purpose residential loans
 
225,601

 
110,434

 
—

 
336,035

Multifamily loans
 
3,791,622

 
—

 
—

 
3,791,622

Real estate securities
 
1,285,426

 
—

 
—

 
1,285,426

Other investments
 
346,136

 
1,571

 
—

 
347,707

Goodwill and intangible assets
 
—

 
49,121

 
—

 
49,121

Total assets
 
13,347,460

 
1,166,639

 
962,184

 
15,476,283

 
 
 
 
 
 
 
 
 
December 31, 2018
 
 
 
 
 
 
 
 
Residential loans
 
$
5,685,983

 
$
1,048,801

 
$
519,958

 
$
7,254,742

Business purpose residential loans
 
112,798

 
28,460

 
—

 
141,258

Multifamily loans
 
2,144,598

 
—

 
—

 
2,144,598

Real estate securities
 
1,452,494

 
—

 
—

 
1,452,494

Other investments
 
427,764

 
—

 
10,754

 
438,518

Total assets
 
10,093,993

 
1,103,090

 
740,323

 
11,937,406