QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification Number) | ||
(Address of principal executive offices) | (Zip Code) |
Title of each class | Trading Symbol(s) | Name of each exchange on which registered |
☒ | Accelerated filer | ☐ | Non-accelerated filer | ☐ | |||
Smaller reporting company | Emerging growth company |
February 29, 2020 | November 30, 2019 | ||||||
ASSETS | |||||||
Cash and cash equivalents | $ | $ | |||||
Cash and securities segregated and on deposit for regulatory purposes or deposited with clearing and depository organizations | |||||||
Financial instruments owned, at fair value (including securities pledged of $13,446,620 and $12,058,522): | |||||||
Loans to and investments in associated companies | |||||||
Securities borrowed | |||||||
Securities purchased under agreements to resell | |||||||
Securities received as collateral | |||||||
Receivables | |||||||
Property, equipment and leasehold improvements, net | |||||||
Intangible assets, net and goodwill | |||||||
Other assets | |||||||
Total assets (1) | $ | $ | |||||
LIABILITIES | |||||||
Short-term borrowings | $ | $ | |||||
Financial instruments sold, not yet purchased, at fair value | |||||||
Securities loaned | |||||||
Securities sold under agreements to repurchase | |||||||
Other secured financings | |||||||
Obligation to return securities received as collateral | |||||||
Lease liabilities | |||||||
Payables, expense accruals and other liabilities | |||||||
Long-term debt | |||||||
Total liabilities (1) | |||||||
Commitments and contingencies | |||||||
MEZZANINE EQUITY | |||||||
Redeemable noncontrolling interests | |||||||
Mandatorily redeemable convertible preferred shares | |||||||
EQUITY | |||||||
Common shares, par value $1 per share, authorized 600,000,000 shares; 277,109,287 and 291,644,153 shares issued and outstanding, after deducting 39,353,325 and 24,818,459 shares held in treasury | |||||||
Additional paid-in capital | |||||||
Accumulated other comprehensive income (loss) | ( | ) | ( | ) | |||
Retained earnings | |||||||
Total Jefferies Financial Group Inc. shareholders’ equity | |||||||
Noncontrolling interests | |||||||
Total equity | |||||||
Total | $ | $ |
(1) | Total assets include assets related to variable interest entities of $ |
For the Three Months Ended | |||||||
February 29, 2020 | February 28, 2019 | ||||||
Revenues: | |||||||
Commissions and other fees | $ | $ | |||||
Principal transactions | |||||||
Investment banking | |||||||
Interest income | |||||||
Manufacturing revenues | |||||||
Other | |||||||
Total revenues | |||||||
Interest expense of Jefferies Group | |||||||
Net revenues | |||||||
Expenses: | |||||||
Compensation and benefits | |||||||
Cost of sales | |||||||
Floor brokerage and clearing fees | |||||||
Interest expense | |||||||
Depreciation and amortization | |||||||
Selling, general and other expenses | |||||||
Total expenses | |||||||
Income before income taxes and income (loss) related to associated companies | |||||||
Income (loss) related to associated companies | ( | ) | |||||
Income before income taxes | |||||||
Income tax provision | |||||||
Net income | |||||||
Net (income) loss attributable to the noncontrolling interests | ( | ) | |||||
Net loss attributable to the redeemable noncontrolling interests | |||||||
Preferred stock dividends | ( | ) | ( | ) | |||
Net income attributable to Jefferies Financial Group Inc. common shareholders | $ | $ | |||||
Basic earnings per common share attributable to Jefferies Financial Group Inc. common shareholders: | |||||||
Net income | $ | $ | |||||
Diluted earnings per common share attributable to Jefferies Financial Group Inc. common shareholders: | |||||||
Net income | $ | $ | |||||
Amounts attributable to Jefferies Financial Group Inc. common shareholders: | |||||||
Net income | $ | $ |
For the Three Months Ended | |||||||
February 29, 2020 | February 28, 2019 | ||||||
Net income | $ | $ | |||||
Other comprehensive income (loss): | |||||||
Net unrealized holding gains (losses) on investments arising during the period, net of income tax provision (benefit) of $81 and $107 | |||||||
Less: reclassification adjustment for net (gains) losses included in net income, net of income tax provision (benefit) of $0 and $(377) | |||||||
Net change in unrealized holding gains (losses) on investments, net of income tax provision (benefit) of $81 and $484 | |||||||
Net unrealized foreign exchange gains (losses) arising during the period, net of income tax provision (benefit) of $(3,147) and $7,722 | ( | ) | |||||
Less: reclassification adjustment for foreign exchange (gains) losses included in net income, net of income tax provision (benefit) of $0 and $0 | |||||||
Net change in unrealized foreign exchange gains (losses), net of income tax provision (benefit) of $(3,147) and $7,722 | ( | ) | |||||
Net unrealized gains (losses) on instrument specific credit risk arising during the period, net of income tax provision (benefit) of $7,939 and $5,949 | |||||||
Less: reclassification adjustment for instrument specific credit risk (gains) losses included in net income, net of income tax provision (benefit) of $86 and $(99) | ( | ) | |||||
Net change in unrealized instrument specific credit risk gains (losses), net of income tax provision (benefit) of $7,853 and $6,048 | |||||||
Net unrealized gains (losses) on cash flow hedges arising during the period, net of income tax provision (benefit) of $0 and $(86) | ( | ) | |||||
Less: reclassification adjustment for cash flow hedges (gains) losses included in net income (loss), net of income tax provision (benefit) of $0 and $0 | |||||||
Net change in unrealized cash flow hedges gains (losses), net of income tax provision (benefit) of $0 and $(86) | ( | ) | |||||
Net pension gains (losses) arising during the period, net of income tax provision (benefit) of $0 and $0 | |||||||
Reclassification adjustment for pension (gains) losses included in net income, net of income tax provision (benefit) of $(224) and $(119) | |||||||
Net change in pension liability, net of income tax provision (benefit) of $224 and $119 | |||||||
Other comprehensive income, net of income taxes | |||||||
Comprehensive income | |||||||
Comprehensive (income) loss attributable to the noncontrolling interests | ( | ) | |||||
Comprehensive loss attributable to the redeemable noncontrolling interests | |||||||
Preferred stock dividends | ( | ) | ( | ) | |||
Comprehensive income attributable to Jefferies Financial Group Inc. common shareholders | $ | $ |
For the Three Months Ended | |||||||
February 29, 2020 | February 28, 2019 | ||||||
Net cash flows from operating activities: | |||||||
Net income | $ | $ | |||||
Adjustments to reconcile net income to net cash used for operations: | |||||||
Deferred income tax provision | |||||||
Depreciation and amortization of real estate, property, equipment and leasehold improvements | |||||||
Other amortization | ( | ) | |||||
Share-based compensation | |||||||
Provision for doubtful accounts | |||||||
(Income) loss related to associated companies | ( | ) | |||||
Distributions from associated companies | |||||||
Net losses related to property and equipment, and other assets | |||||||
Lease expense | — | ||||||
Lease payments | ( | ) | — | ||||
Net change in: | |||||||
Securities deposited with clearing and depository organizations | ( | ) | |||||
Financial instruments owned, at fair value | ( | ) | ( | ) | |||
Securities borrowed | ( | ) | |||||
Securities purchased under agreements to resell | ( | ) | ( | ) | |||
Receivables from brokers, dealers and clearing organizations | ( | ) | ( | ) | |||
Receivables from customers of securities operations | ( | ) | |||||
Other receivables | ( | ) | ( | ) | |||
Other assets | ( | ) | ( | ) | |||
Financial instruments sold, not yet purchased, at fair value | ( | ) | |||||
Securities loaned | |||||||
Securities sold under agreements to repurchase | |||||||
Payables to brokers, dealers and clearing organizations | |||||||
Payables to customers of securities operations | ( | ) | |||||
Trade payables, expense accruals and other liabilities | ( | ) | ( | ) | |||
Other | |||||||
Net cash used for operating activities | ( | ) | ( | ) | |||
Net cash flows from investing activities: | |||||||
Acquisitions of property, equipment and leasehold improvements, and other assets | ( | ) | ( | ) | |||
Proceeds from disposals of property and equipment, and other assets | |||||||
Advances on notes, loans and other receivables | ( | ) | ( | ) | |||
Collections on notes, loans and other receivables | |||||||
Loans to and investments in associated companies | ( | ) | ( | ) | |||
Capital distributions and loan repayments from associated companies | |||||||
Purchases of investments (other than short-term) | ( | ) | |||||
Proceeds from maturities of investments | |||||||
Proceeds from sales of investments | |||||||
Net cash provided by (used for) investing activities | ( | ) |
For the Three Months Ended | |||||||
February 29, 2020 | February 28, 2019 | ||||||
Net cash flows from financing activities: | |||||||
Issuance of debt, net of issuance costs | $ | $ | |||||
Repayment of debt | ( | ) | ( | ) | |||
Net change in other secured financings | ( | ) | ( | ) | |||
Net change in bank overdrafts | ( | ) | ( | ) | |||
Contributions from noncontrolling interests | |||||||
Purchase of common shares for treasury | ( | ) | ( | ) | |||
Dividends paid | ( | ) | ( | ) | |||
Other | |||||||
Net cash used for financing activities | ( | ) | ( | ) | |||
Effect of foreign exchange rate changes on cash, cash equivalents and restricted cash | ( | ) | |||||
Net increase (decrease) in cash, cash equivalents and restricted cash | ( | ) | |||||
Cash, cash equivalents and restricted cash at beginning of period | |||||||
Cash, cash equivalents and restricted cash at end of period | $ | $ |
February 29, 2020 | February 28, 2019 | ||||||
Cash and cash equivalents | $ | $ | |||||
Cash and securities segregated and on deposit for regulatory purposes or deposited with clearing and depository organizations | |||||||
Other assets | |||||||
Total cash, cash equivalents and restricted cash | $ | $ |
Jefferies Financial Group Inc. Common Shareholders | |||||||||||||||||||||||||||
Common Shares $1 Par Value | Additional Paid-In Capital | Accumulated Other Comprehensive Income (Loss) | Retained Earnings | Subtotal | Noncontrolling Interests | Total | |||||||||||||||||||||
Balance, December 1, 2019 | $ | $ | $ | ( | ) | $ | $ | $ | $ | ||||||||||||||||||
Net income | ( | ) | |||||||||||||||||||||||||
Other comprehensive income, net of taxes | |||||||||||||||||||||||||||
Contributions from noncontrolling interests | |||||||||||||||||||||||||||
Share-based compensation expense | |||||||||||||||||||||||||||
Change in fair value of redeemable noncontrolling interests | |||||||||||||||||||||||||||
Purchase of common shares for treasury | ( | ) | ( | ) | ( | ) | ( | ) | |||||||||||||||||||
Dividends ($0.15 per common share) | ( | ) | ( | ) | ( | ) | |||||||||||||||||||||
Other | |||||||||||||||||||||||||||
Balance, February 29, 2020 | $ | $ | $ | ( | ) | $ | $ | $ | $ |
Jefferies Financial Group Inc. Common Shareholders | |||||||||||||||||||||||||||
Common Shares $1 Par Value | Additional Paid-In Capital | Accumulated Other Comprehensive Income (Loss) | Retained Earnings | Subtotal | Noncontrolling Interests | Total | |||||||||||||||||||||
Balance, December 1, 2018 | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||
Net income | |||||||||||||||||||||||||||
Other comprehensive income, net of taxes | |||||||||||||||||||||||||||
Contributions from noncontrolling interests | — | ||||||||||||||||||||||||||
Distributions to noncontrolling interests | — | ( | ) | ( | ) | ||||||||||||||||||||||
Share-based compensation expense | |||||||||||||||||||||||||||
Change in fair value of redeemable noncontrolling interests | ( | ) | ( | ) | ( | ) | |||||||||||||||||||||
Purchase of common shares for treasury | ( | ) | ( | ) | ( | ) | ( | ) | |||||||||||||||||||
Dividends ($0.125 per common share) | ( | ) | ( | ) | ( | ) | |||||||||||||||||||||
Other | |||||||||||||||||||||||||||
Balance, February 28, 2019 | $ | $ | $ | $ | $ | $ | $ |
For the Three Months Ended | |||||||
February 29, 2020 | February 28, 2019 | ||||||
(In thousands) | |||||||
Cash paid during the year for: | |||||||
Interest | $ | $ | |||||
Income tax payments (refunds), net | $ | ( | ) | $ |
February 29, 2020 | |||||||||||||||||||
Level 1 | Level 2 | Level 3 | Counterparty and Cash Collateral Netting (1) | Total | |||||||||||||||
Assets: | |||||||||||||||||||
Financial instruments owned, at fair value: | |||||||||||||||||||
Corporate equity securities | $ | $ | $ | $ | — | $ | |||||||||||||
Corporate debt securities | — | ||||||||||||||||||
Collateralized debt obligations and collateralized loan obligations | — | ||||||||||||||||||
U.S. government and federal agency securities | — | ||||||||||||||||||
Municipal securities | — | ||||||||||||||||||
Sovereign obligations | — | ||||||||||||||||||
Residential mortgage-backed securities | — | ||||||||||||||||||
Commercial mortgage-backed securities | — | ||||||||||||||||||
Other asset-backed securities | — | ||||||||||||||||||
Loans and other receivables | — | ||||||||||||||||||
Derivatives | ( | ) | |||||||||||||||||
Investments at fair value | — | ||||||||||||||||||
FXCM term loan | — | ||||||||||||||||||
Total financial instruments owned, at fair value, excluding investments at fair value based on NAV | $ | $ | $ | $ | ( | ) | $ | ||||||||||||
Securities received as collateral | $ | $ | $ | $ | — | $ | |||||||||||||
Liabilities: | |||||||||||||||||||
Financial instruments sold, not yet purchased, at fair value: | |||||||||||||||||||
Corporate equity securities | $ | $ | $ | $ | — | $ | |||||||||||||
Corporate debt securities | — | ||||||||||||||||||
U.S. government and federal agency securities | — | ||||||||||||||||||
Sovereign obligations | — | ||||||||||||||||||
Commercial mortgage-backed securities | — | ||||||||||||||||||
Loans | — | ||||||||||||||||||
Derivatives | ( | ) | |||||||||||||||||
Total financial instruments sold, not yet purchased, at fair value | $ | $ | $ | $ | ( | ) | $ | ||||||||||||
Short-term borrowings | $ | $ | $ | $ | — | $ | |||||||||||||
Long-term debt | $ | $ | $ | $ | — | $ | |||||||||||||
Obligation to return securities received as collateral | $ | $ | $ | $ | — | $ |
November 30, 2019 | |||||||||||||||||||
Level 1 | Level 2 | Level 3 | Counterparty and Cash Collateral Netting (1) | Total | |||||||||||||||
Assets: | |||||||||||||||||||
Financial instruments owned, at fair value: | |||||||||||||||||||
Corporate equity securities | $ | $ | $ | $ | — | $ | |||||||||||||
Corporate debt securities | — | ||||||||||||||||||
Collateralized debt obligations and collateralized loan obligations | — | ||||||||||||||||||
U.S. government and federal agency securities | — | ||||||||||||||||||
Municipal securities | — | ||||||||||||||||||
Sovereign obligations | — | ||||||||||||||||||
Residential mortgage-backed securities | — | ||||||||||||||||||
Commercial mortgage-backed securities | — | ||||||||||||||||||
Other asset-backed securities | — | ||||||||||||||||||
Loans and other receivables | — | ||||||||||||||||||
Derivatives | ( | ) | |||||||||||||||||
Investments at fair value | — | ||||||||||||||||||
FXCM term loan | — | ||||||||||||||||||
Total financial instruments owned, at fair value, excluding investments at fair value based on NAV | $ | $ | $ | $ | ( | ) | $ | ||||||||||||
Securities purchased under agreements to resell | $ | $ | $ | $ | — | $ | |||||||||||||
Securities received as collateral | $ | $ | $ | $ | — | $ | |||||||||||||
Liabilities: | |||||||||||||||||||
Financial instruments sold, not yet purchased, at fair value: | |||||||||||||||||||
Corporate equity securities | $ | $ | $ | $ | — | $ | |||||||||||||
Corporate debt securities | — | ||||||||||||||||||
U.S. government and federal agency securities | — | ||||||||||||||||||
Sovereign obligations | — | ||||||||||||||||||
Commercial mortgage-backed securities | — | ||||||||||||||||||
Loans | — | ||||||||||||||||||
Derivatives | ( | ) | |||||||||||||||||
Total financial instruments sold, not yet purchased, at fair value | $ | $ | $ | $ | ( | ) | $ | ||||||||||||
Short-term borrowings | $ | $ | $ | $ | — | $ | |||||||||||||
Long-term debt | $ | $ | $ | $ | — | $ | |||||||||||||
Obligation to return securities received as collateral | $ | $ | $ | $ | — | $ |
(1) | Represents counterparty and cash collateral netting across the levels of the fair value hierarchy for positions with the same counterparty. |
• | Exchange-Traded Equity Securities: Exchange-traded equity securities are measured based on quoted closing exchange prices, which are generally obtained from external pricing services, and are categorized within Level 1 of the fair value hierarchy, otherwise they are categorized within Level 2 of the fair value hierarchy. To the extent these securities are actively traded, valuation adjustments are not applied. |
• | Non-Exchange-Traded Equity Securities: Non-exchange-traded equity securities are measured primarily using broker quotations, pricing data from external pricing services and prices observed from recently executed market transactions and |
• | Equity Warrants: Non-exchange-traded equity warrants are measured primarily using pricing data from external pricing services, prices observed from recently executed market transactions and broker quotations and are categorized within Level 2 of the fair value hierarchy. Where such information is not available, non-exchange-traded equity warrants are generally categorized within Level 3 of the fair value hierarchy and are measured using the Black-Scholes model with key inputs impacting the valuation including the underlying security price, implied volatility, dividend yield, interest rate curve, strike price and maturity date. |
• | Investment Grade Corporate Bonds: Investment grade corporate bonds are measured primarily using pricing data from external pricing services and broker quotations, where available, prices observed from recently executed market transactions and bond spreads or credit default swap spreads of the issuer adjusted for basis differences between the swap curve and the bond curve. Investment grade corporate bonds measured using these valuation methods are categorized within Level 2 of the fair value hierarchy. If broker quotes, pricing data or spread data is not available, alternative valuation techniques are used including cash flow models incorporating interest rate curves, single name or index credit default swap curves for comparable issuers and recovery rate assumptions. Investment grade corporate bonds measured using alternative valuation techniques are categorized within Level 2 or Level 3 of the fair value hierarchy and are a limited portion of our investment grade corporate bonds. |
• | High Yield Corporate and Convertible Bonds: A significant portion of our high yield corporate and convertible bonds are categorized within Level 2 of the fair value hierarchy and are measured primarily using broker quotations and pricing data from external pricing services, where available, and prices observed from recently executed market transactions of institutional size. Where pricing data is less observable, valuations are categorized within Level 3 of the fair value hierarchy and are based on pending transactions involving the issuer or comparable issuers, prices implied from an issuer's subsequent financing or recapitalization, models incorporating financial ratios and projected cash flows of the issuer and market prices for comparable issuers. |
• | U.S. Treasury Securities: U.S. Treasury securities are measured based on quoted market prices obtained from external pricing services and categorized within Level 1 of the fair value hierarchy. |
• | U.S. Agency Debt Securities: Callable and non-callable U.S. agency debt securities are measured primarily based on quoted market prices obtained from external pricing services and are generally categorized within Level 1 or Level 2 of the fair value hierarchy. |
• | Agency Residential Mortgage-Backed Securities: Agency residential mortgage-backed securities include mortgage pass-through securities (fixed and adjustable rate), collateralized mortgage obligations and principal-only and interest-only (including inverse interest-only) securities. Agency residential mortgage-backed securities are generally measured using recent transactions, pricing data from external pricing services or expected future cash flow techniques that incorporate prepayment models and other prepayment assumptions to amortize the underlying mortgage loan collateral and are categorized within Level 2 or Level 3 of the fair value hierarchy. We use prices observed from recently executed transactions to develop market-clearing spread and yield curve assumptions. Valuation inputs with regard to the underlying collateral incorporate factors such as weighted average coupon, loan-to-value, credit scores, geographic location, maximum and average loan size, originator, servicer and weighted average loan age. |
• | Non-Agency Residential Mortgage-Backed Securities: The fair value of non-agency residential mortgage-backed securities is determined primarily using discounted cash flow methodologies and securities are categorized within Level 2 or Level 3 of the fair value hierarchy based on the observability and significance of the pricing inputs used. Performance attributes of the underlying mortgage loans are evaluated to estimate pricing inputs, such as prepayment rates, default rates and the severity of credit losses. Attributes of the underlying mortgage loans that affect the pricing inputs include, but are not limited to, weighted average coupon; average and maximum loan size; loan-to-value; credit scores; documentation type; geographic location; weighted average loan age; originator; servicer; historical prepayment, default and loss severity experience of the mortgage loan pool; and delinquency rate. Yield curves used in the discounted cash flow models are based on observed market prices for comparable securities and published interest rate data to estimate market yields. In addition, broker quotes, where available, are also referenced to compare prices primarily on interest-only securities. |
• | Agency Commercial Mortgage-Backed Securities: Government National Mortgage Association ("GNMA") project loan bonds are measured based on inputs corroborated from and benchmarked to observed prices of recent securitization transactions of similar securities with adjustments incorporating an evaluation of various factors, including prepayment speeds, default rates and cash flow structures, as well as the likelihood of pricing levels in the current market environment. Federal National Mortgage Association ("FNMA") Delegated Underwriting and Servicing ("DUS") mortgage-backed securities are generally measured by using prices observed from recently executed market transactions to estimate market-clearing spread levels for purposes of estimating fair value. GNMA project loan bonds and FNMA DUS mortgage-backed securities are categorized within Level 2 of the fair value hierarchy. |
• | Non-Agency Commercial Mortgage-Backed Securities: Non-agency commercial mortgage-backed securities are measured using pricing data obtained from external pricing services, prices observed from recently executed market transactions or based on expected cash flow models that incorporate underlying loan collateral characteristics and performance. Non-agency commercial mortgage-backed securities are categorized within Level 2 or Level 3 of the fair value hierarchy depending on the observability of the underlying inputs. |
• | Corporate Loans: Corporate loans categorized within Level 2 of the fair value hierarchy are measured based on market consensus pricing service quotations. Where available, market price quotations from external pricing services are reviewed to ensure they are supported by transaction data. Corporate loans categorized within Level 3 of the fair value hierarchy are measured based on price quotations that are considered to be less transparent, market prices for debt securities of the same creditor and estimates of future cash flows incorporating assumptions regarding creditor default and recovery rates and consideration of the issuer's capital structure. |
• | Participation Certificates in Agency Residential Loans: Valuations of participation certificates in agency residential loans are based on observed market prices of recently executed purchases and sales of similar loans and data provider pricing. The loan participation certificates are categorized within Level 2 of the fair value hierarchy given the observability and volume of recently executed transactions and availability of data provider pricing. |
• | Project Loans and Participation Certificates in GNMA Project and Construction Loans: Valuations of participation certificates in GNMA project and construction loans are based on inputs corroborated from and benchmarked to observed prices of recent securitizations with similar underlying loan collateral to derive an implied spread. Securitization prices are adjusted to estimate the fair value of the loans to account for the arbitrage that is realized at the time of securitization. The measurements are categorized within Level 2 of the fair value hierarchy given the observability and volume of recently executed transactions. |
• | Consumer Loans and Funding Facilities: Consumer and small business whole loans and related funding facilities are valued based on observed market transactions and incorporating valuation inputs including, but not limited to, delinquency and default rates, prepayment rates, borrower characteristics, loan risk grades and loan age. These assets are categorized within Level 2 or Level 3 of the fair value hierarchy. |
• | Escrow and Claim Receivables: Escrow and claim receivables are categorized within Level 3 of the fair value hierarchy where fair value is estimated based on reference to market prices and implied yields of debt securities of the same or similar issuers. Escrow and claim receivables are categorized within Level 2 of the fair value hierarchy where fair value is based on recent observations in the same receivable. |
• | Listed Derivative Contracts: Listed derivative contracts that are actively traded are measured based on quoted exchange prices, broker quotes or vanilla option valuation models, such as Black-Scholes, using observable valuation inputs from the principal market or consensus pricing services. Exchange quotes and/or valuation inputs are generally obtained from external vendors and pricing services. Broker quotes are validated directly through observable and tradeable quotes. Listed derivative contracts that use unadjusted exchange close prices are generally categorized within Level 1 of the fair value hierarchy. All other listed derivative contracts are generally categorized within Level 2 of the fair value hierarchy. |
• | Over-the-Counter ("OTC") Derivative Contracts: OTC derivative contracts are generally valued using models, whose inputs reflect assumptions that we believe market participants would use in valuing the derivative in a current transaction. Where available, valuation inputs are calibrated from observable market data. For many OTC derivative contracts, the valuation models do not involve material subjectivity as the methodologies do not entail significant judgment and the inputs to valuation models do not involve a high degree of subjectivity as the valuation model inputs are readily observable or can be derived from actively quoted markets. OTC derivative contracts are primarily categorized within Level 2 of the fair value hierarchy given the observability and significance of the inputs to the valuation models. Where significant inputs to the valuation are unobservable, derivative instruments are categorized within Level 3 of the fair value hierarchy. |
• | Oil Futures Derivatives: Vitesse Energy Finance uses swaps and call and put options in order to reduce exposure to future oil price fluctuations. Vitesse Energy Finance accounts for the derivative instruments at fair value, which are classified as |
Fair Value (1) | Unfunded Commitments | ||||||
February 29, 2020 | |||||||
Equity Long/Short Hedge Funds (2) | $ | $ | |||||
Equity Funds (3) | |||||||
Commodity Fund (4) | |||||||
Multi-asset Funds (5) | |||||||
Other Funds (6) | |||||||
Total | $ | $ | |||||
November 30, 2019 | |||||||
Equity Long/Short Hedge Funds (2) | $ | $ | |||||
Equity Funds (3) | |||||||
Commodity Fund (4) | |||||||
Multi-asset Funds (5) | |||||||
Other Funds (6) | |||||||
Total | $ | $ |
(1) | Where fair value is calculated based on NAV, fair value has been derived from each of the funds' capital statements. |
(2) | This category includes investments in hedge funds that invest, long and short, primarily in both public and private equity securities in domestic and international markets. At February 29, 2020 and November 30, 2019, |
(3) | The investments in this category include investments in equity funds that invest in the equity of various U.S. and foreign private companies. These investments cannot be redeemed; instead distributions are received through the liquidation of the underlying assets of the funds, which are expected to be liquidated in approximately one to |
(4) | This category includes investments in a hedge fund that invests, long and short, primarily in commodities. Investments in this category are redeemable quarterly with |
(5) | This category includes investments in hedge funds that invest, long and short, primarily in multi-asset securities in domestic and international markets in both the public and private sectors. At February 29, 2020 and November 30, 2019, investments representing approximately |
(6) | This category includes investments in a fund that invests in loans secured by a first trust deed on property, domestic and international public high yield debt, private high yield investments, senior bank loans, public leveraged equities, distressed debt and private equity investments and there are no redemption provisions. This category also includes investments in a fund of funds that invests in various private equity funds that are managed by Jefferies Group and have no redemption provisions. Investments in the fund of funds are gradually being liquidated, however, the timing of when the proceeds will be received is uncertain. |
Three Months Ended February 29, 2020 | |||||||||||||||||||||||||||||||||||
Balance, November 30, 2019 | Total gains/ losses (realized and unrealized) (1) | Purchases | Sales | Settlements | Issuances | Net transfers into (out of) Level 3 | Balance, February 29, 2020 | Changes in unrealized gains/losses included in earnings relating to instruments still held at February 29, 2020 (1) | |||||||||||||||||||||||||||
Assets: | |||||||||||||||||||||||||||||||||||
Financial instruments owned, at fair value: | |||||||||||||||||||||||||||||||||||
Corporate equity securities | $ | $ | ( | ) | $ | $ | ( | ) | $ | $ | $ | $ | $ | ( | ) | ||||||||||||||||||||
Corporate debt securities | ( | ) | ( | ) | |||||||||||||||||||||||||||||||
CDOs and CLOs | ( | ) | ( | ) | ( | ) | ( | ) | |||||||||||||||||||||||||||
Residential mortgage-backed securities | ( | ) | ( | ) | ( | ) | ( | ) | |||||||||||||||||||||||||||
Commercial mortgage-backed securities | ( | ) | ( | ) | ( | ) | |||||||||||||||||||||||||||||
Other asset-backed securities | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | |||||||||||||||||||||||||
Loans and other receivables | ( | ) | ( | ) | ( | ) | ( | ) | |||||||||||||||||||||||||||
Investments at fair value | ( | ) | ( | ) | ( | ) | |||||||||||||||||||||||||||||
FXCM term loan | |||||||||||||||||||||||||||||||||||
Securities purchased under agreements to resell | ( | ) | |||||||||||||||||||||||||||||||||
Liabilities: | |||||||||||||||||||||||||||||||||||
Financial instruments sold, not yet purchased, at fair value: | |||||||||||||||||||||||||||||||||||
Corporate equity securities | $ | $ | $ | ( | ) | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
Corporate debt securities | ( | ) | ( | ) | ( | ) | |||||||||||||||||||||||||||||
Commercial mortgage-backed securities | |||||||||||||||||||||||||||||||||||
Loans | ( | ) | ( | ) | |||||||||||||||||||||||||||||||
Net derivatives (2) | ( | ) | ( | ) | |||||||||||||||||||||||||||||||
Long-term debt (1) | ( | ) | ( | ) | ( | ) |
(1) | Realized and unrealized gains/losses are primarily reported in Principal transactions revenues in the Consolidated Statements of Operations. Changes in instrument specific credit risk related to structured notes are included in the Consolidated Statements of Comprehensive Income (Loss), net of tax. Changes in unrealized gains/losses included in other comprehensive income (loss) for instruments still held at February 29, 2020 were gains of $ |
(2) | Net derivatives represent Financial instruments owned, at fair value - Derivatives and Financial instruments sold, not yet purchased, at fair value - Derivatives. |
• | Corporate equity securities of $ |
• | Other asset-backed securities of $ |
• | Net derivatives of $ |
• | Structured notes of $ |
Three Months Ended February 28, 2019 | |||||||||||||||||||||||||||||||||||
Balance, November 30, 2018 | Total gains/ losses (realized and unrealized) (1) | Purchases | Sales | Settlements | Issuances | Net transfers into (out of) Level 3 | Balance, February 28, 2019 | Changes in unrealized gains/ losses included in earnings relating to instruments still held at February 28, 2019 (1) | |||||||||||||||||||||||||||
Assets: | |||||||||||||||||||||||||||||||||||
Financial instruments owned, at fair value: | |||||||||||||||||||||||||||||||||||
Corporate equity securities | $ | $ | $ | $ | ( | ) | $ | ( | ) | $ | $ | ( | ) | $ | $ | ||||||||||||||||||||
Corporate debt securities | ( | ) | ( | ) | |||||||||||||||||||||||||||||||
CDOs and CLOs | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | |||||||||||||||||||||||||
Residential mortgage-backed securities | ( | ) | ( | ) | |||||||||||||||||||||||||||||||
Commercial mortgage-backed securities | ( | ) | |||||||||||||||||||||||||||||||||
Other asset-backed securities | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | |||||||||||||||||||||||||
Loans and other receivables | ( | ) | ( | ) | |||||||||||||||||||||||||||||||
Investments at fair value | ( | ) | ( | ) | |||||||||||||||||||||||||||||||
FXCM term loan | |||||||||||||||||||||||||||||||||||
Liabilities: | |||||||||||||||||||||||||||||||||||
Financial instruments sold, not yet purchased, at fair value: | |||||||||||||||||||||||||||||||||||
Corporate equity securities | $ | $ | ( | ) | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
Corporate debt securities | ( | ) | |||||||||||||||||||||||||||||||||
Commercial mortgage-backed securities | ( | ) | |||||||||||||||||||||||||||||||||
Loans | ( | ) | ( | ) | ( | ) | |||||||||||||||||||||||||||||
Net derivatives (2) | ( | ) | ( | ) | |||||||||||||||||||||||||||||||
Long-term debt (1) | ( | ) | ( | ) |
(1) | Realized and unrealized gains/losses are primarily reported in Principal transactions revenues in the Consolidated Statements of Operations. Changes in instrument specific credit risk related to structured notes are included in the Consolidated Statements of Comprehensive Income (Loss), net of tax. Changes in unrealized gains (losses) included in other comprehensive income (loss) for instruments still held at February 28, 2019 were gains of $ |
(2) | Net derivatives represent Financial instruments owned, at fair value - Derivatives and Financial instruments sold, not yet purchased, at fair value - Derivatives. |
• | Loans and other receivables of $ |
• | CDOs and CLOs of $ |
• | Structured notes of $ |
• | Structured notes of $ |
February 29, 2020 | ||||||||||||||||
Fair Value (in thousands) | Valuation Technique | Significant Unobservable Input(s) | Input/Range | Weighted Average | ||||||||||||
Financial instruments owned, at fair value | ||||||||||||||||
Corporate equity securities | $ | |||||||||||||||
Non-exchange-traded securities | Market approach | Price | $ | to | $ | $ | ||||||||||
Underlying stock price | $ | to | $ | $ | ||||||||||||
Corporate debt securities | $ | Market approach | Price | $ | to | $ | $ | |||||||||
Scenario analysis | Estimated recovery percentage | % | to | % | ||||||||||||
CDOs and CLOs | $ | Discounted cash flows | Constant prepayment rate | — | ||||||||||||
Constant default rate | % | to | % | |||||||||||||
Loss severity | % | to | % | |||||||||||||
Discount rate/yield | % | to | % | |||||||||||||
Scenario analysis | Estimated recovery percentage | % | to | % | ||||||||||||
Residential mortgage-backed securities | $ | Discounted cash flows | Cumulative loss rate | — | ||||||||||||
Duration (years) | — | |||||||||||||||
Discount rate/yield | — | |||||||||||||||
Commercial mortgage-backed securities | $ | Scenario analysis | Estimated recovery percentage | — | ||||||||||||
Other asset-backed securities | $ | Discounted cash flows | Cumulative loss rate | % | to | % | ||||||||||
Duration (years) | to | |||||||||||||||
Discount rate/yield | % | to | % | |||||||||||||
Market approach | Price | $ | — | |||||||||||||
Loans and other receivables | $ | Market approach | Price | $ | to | $ | $ | |||||||||
Scenario analysis | Estimated recovery percentage | % | to | % | ||||||||||||
Derivatives | $ | |||||||||||||||
Interest rate swaps | Market approach | Basis points upfront | to | |||||||||||||
Investments at fair value | $ | |||||||||||||||
Private equity securities | Market approach | Price | $ | to | $ | $ | ||||||||||
Scenario analysis | Discount rate/yield | % | to | % | ||||||||||||
Revenue growth | — | |||||||||||||||
Investment in FXCM | $ | |||||||||||||||
Term loan | Discounted cash flows | Term based on the pay off (years) | to | |||||||||||||
Financial instruments sold, not yet purchased, at fair value | ||||||||||||||||
Corporate equity securities | $ | Market approach | Transaction level | $ | — | |||||||||||
Loans | $ | Market approach | Price | $ | — | |||||||||||
Scenario analysis | Estimated recovery percentage | — | ||||||||||||||
Derivatives | $ | |||||||||||||||
Equity options | Volatility benchmarking | Volatility | % | to | % | |||||||||||
Interest rate swaps | Market approach | Basis points upfront | to | |||||||||||||
Cross currency swaps | Basis points upfront | — | ||||||||||||||
Unfunded commitments | Price | $ | — | |||||||||||||
Long-term debt | ||||||||||||||||
Structured notes | $ | Market approach | Price | $ | to | $ | $ | |||||||||
Price | € | to | € | € |
November 30, 2019 | ||||||||||||||||
Fair Value (in thousands) | Valuation Technique | Significant Unobservable Input(s) | Input/Range | Weighted Average | ||||||||||||
Financial instruments owned, at fair value | ||||||||||||||||
Corporate equity securities | $ | |||||||||||||||
Non-exchange-traded securities | Market approach | Price | $ | to | $ | $ | ||||||||||
Underlying stock price | $ | to | $ | $ | ||||||||||||
Corporate debt securities | $ | Scenario analysis | Estimated recovery percentage | % | to | % | ||||||||||
Volatility | — | |||||||||||||||
Credit spread | — | |||||||||||||||
Underlying stock price | £ | — | ||||||||||||||
CDOs and CLOs | $ | Discounted cash flows | Constant prepayment rate | — | ||||||||||||
Constant default rate | % | to | % | |||||||||||||
Loss severity | % | to | % | |||||||||||||
Discount rate/yield | % | to | % | |||||||||||||
Scenario analysis | Estimated recovery percentage | % | to | % | ||||||||||||
Residential mortgage-backed securities | $ | Discounted cash flows | Cumulative loss rate | — | ||||||||||||
Duration (years) | — | |||||||||||||||
Discount rate/yield | — | |||||||||||||||
Commercial mortgage-backed securities | $ | Discounted cash flows | Cumulative loss rate | — | ||||||||||||
Duration (years) | — | |||||||||||||||
Discount rate/yield | — | |||||||||||||||
Scenario analysis | Estimated recovery percentage | — | ||||||||||||||
Other asset-backed securities | $ | Discounted cash flows | Cumulative loss rate | % | to | % | ||||||||||
Duration (years) | to | |||||||||||||||
Discount rate/yield | % | to | % | |||||||||||||
Loans and other receivables | $ | Market approach | Price | $ | to | $ | $ | |||||||||
Scenario analysis | Estimated recovery percentage | % | to | % | ||||||||||||
Discounted cash flows | Term based on the pay off (years) | to | ||||||||||||||
Derivatives | $ | |||||||||||||||
Interest rate swaps | Market approach | Basis points upfront | to | |||||||||||||
Unfunded commitments | Price | $ | — | |||||||||||||
Equity options | Volatility benchmarking | Volatility | — | |||||||||||||
Investments at fair value | $ | |||||||||||||||
Private equity securities | Market approach | Price | $ | to | $ | $ | ||||||||||
Scenario analysis | Discount rate/yield | % | to | % | ||||||||||||
Revenue growth | — | |||||||||||||||
Investment in FXCM | $ | |||||||||||||||
Term loan | Discounted cash flows | Term based on the pay off (years) | to | |||||||||||||
Securities purchased under agreements to resell | $ | Market approach | Spread to 6 month LIBOR | — | ||||||||||||
Duration (years) | — | |||||||||||||||
Financial instruments sold, not yet purchased, at fair value | ||||||||||||||||
Corporate equity securities | $ | Market approach | Transaction level | $ | — | |||||||||||
Loans | $ | Market approach | Price | $ | to | $ | $ | |||||||||
Scenario analysis | Estimated recovery percentage | — | ||||||||||||||
Derivatives | $ | |||||||||||||||
Equity options | Volatility benchmarking | Volatility | % | to | % | |||||||||||
Interest rate swaps | Market approach | Basis points upfront | to | |||||||||||||
Cross currency swaps | Basis points upfront | — | ||||||||||||||
Unfunded commitments | Price | $ | — | |||||||||||||
Long-term debt | ||||||||||||||||
Structured notes | $ | Market approach | Price | $ | to | $ | $ | |||||||||
Price | € | to | € | € |
• | Corporate equity securities, corporate debt securities, loans and other receivables, certain derivatives, other asset-backed securities, private equity securities, securities purchased under agreements to resell and structured notes using a market approach valuation technique. A significant increase (decrease) in the transaction level of corporate equity securities would result in a significantly higher (lower) fair value measurement. A significant increase (decrease) in the price of the private equity securities, non-exchange-traded securities, unfunded commitments, corporate debt securities, other asset-backed securities, loans and other receivables or structured notes would result in a significantly higher (lower) fair value measurement. A significant increase (decrease) in the underlying stock price of corporate equity securities would result in a significantly higher (lower) fair value measurement. A significant increase (decrease) in the estimated recovery rates of the cash flow outcomes underlying the corporate debt securities would result in a significantly higher (lower) fair value measurement. A significant increase (decrease) in the yield or duration, in isolation, of securities purchased under agreements to resell would result in a significantly lower (higher) fair value measurement. Depending on whether we are a receiver or (payer) of basis points upfront, a significant increase in basis points would result in a significant increase (decrease) in the fair value measurement of cross currency and interest rate swaps. |
• | Loans and other receivables, commercial mortgage-backed securities, private equity securities, corporate debt securities and CDOs and CLOs using scenario analysis. A significant increase (decrease) in the possible recovery rates of the cash flow outcomes underlying the financial instrument would result in a significantly higher (lower) fair value measurement for the financial instrument. A significant increase (decrease) in the price of the underlying assets of the financial instruments would result in a significantly higher (lower) fair value measurement. A significant increase (decrease) in the volatility of the underlying stock price would result in a significantly higher (lower) fair value measurement. A significant increase (decrease) in the credit spread of the financial instrument would result in a significantly lower (higher) fair value measurement. A significant increase (decrease) in the discount rate/yield underlying the investment would result in a significantly lower (higher) fair value measurement. A significant increase (decrease) in the revenue growth underlying the investment would result in a significantly higher (lower) fair value measurement. |
• | CDOs and CLOs, residential mortgage-backed securities, commercial mortgage-backed securities, other asset-backed securities and loans and other receivables using a discounted cash flow valuation technique. A significant increase (decrease) in isolation in the constant default rate, loss severity or cumulative loss rate would result in a significantly lower (higher) fair value measurement. The impact of changes in the constant prepayment rate and duration would have differing impacts depending on the capital structure and type of security. A significant increase (decrease) in the discount rate/security yield would result in a significantly lower (higher) fair value measurement. |
• | Derivative equity options using volatility benchmarking. A significant increase (decrease) in volatility would result in a significantly higher (lower) fair value measurement. |
• | FXCM term loan using a discounted cash flow valuation technique. A significant increase (decrease) in term based on the time to pay off the loan would result in a lower (higher) fair value measurement. |
For the Three Months Ended | ||||||||
February 29, 2020 | February 28, 2019 | |||||||
Financial Instruments Owned, at fair value: | ||||||||
Loans and other receivables | $ | $ | ( | ) | ||||
Financial Instruments Sold, Not Yet Purchased, at fair value: | ||||||||
Loans | $ | ( | ) | $ | ||||
Loan commitments | $ | ( | ) | $ | ||||
Long-term Debt: | ||||||||
Changes in instrument specific credit risk (1) | $ | $ | ||||||
Other changes in fair value (2) | $ | ( | ) | $ | ( | ) | ||
Short-term borrowings: | ||||||||
Changes in instrument specific credit risk (1) | $ | $ | ||||||
Other changes in fair value (2) | $ | $ |
(1) | Changes in instrument specific credit risk related to structured notes are included in the Consolidated Statements of Comprehensive Income (Loss), net of tax. |
(2) |
February 29, 2020 | November 30, 2019 | ||||||
Financial Instruments Owned, at fair value: | |||||||
Loans and other receivables (1) | $ | $ | |||||
Loans and other receivables on nonaccrual status and/or 90 days or greater past due (1) (2) | $ | $ | |||||
Long-term debt and short-term borrowings | $ | $ |
(1) | Interest income is recognized separately from other changes in fair value and is included in Interest income in the Consolidated Statements of Operations. |
(2) |
Assets | Liabilities | ||||||||||||
Fair Value | Number of Contracts (2) | Fair Value | Number of Contracts (2) | ||||||||||
February 29, 2020 (1) | |||||||||||||
Derivatives designated as accounting hedges: | |||||||||||||
Interest rate contracts: | |||||||||||||
Cleared OTC | $ | $ | |||||||||||
Total derivatives designated as accounting hedges | |||||||||||||
Derivatives not designated as accounting hedges: | |||||||||||||
Interest rate contracts: | |||||||||||||
Exchange-traded | |||||||||||||
Cleared OTC | |||||||||||||
Bilateral OTC | |||||||||||||
Foreign exchange contracts: | |||||||||||||
Exchange-traded | |||||||||||||
Bilateral OTC | |||||||||||||
Equity contracts: | |||||||||||||
Exchange-traded | |||||||||||||
Bilateral OTC | |||||||||||||
Commodity contracts: | |||||||||||||
Exchange-traded | |||||||||||||
Bilateral OTC | |||||||||||||
Credit contracts: | |||||||||||||
Cleared OTC | |||||||||||||
Bilateral OTC | |||||||||||||
Total derivatives not designated as accounting hedges | |||||||||||||
Total gross derivative assets/liabilities: | |||||||||||||
Exchange-traded | |||||||||||||
Cleared OTC | |||||||||||||
Bilateral OTC | |||||||||||||
Amounts offset in Consolidated Statement of Financial Condition (3): | |||||||||||||
Exchange-traded | ( | ) | ( | ) | |||||||||
Cleared OTC | ( | ) | ( | ) | |||||||||
Bilateral OTC | ( | ) | ( | ) | |||||||||
Net amounts in the Consolidated Statement of Financial Condition (4) | $ | $ |
Assets | Liabilities | ||||||||||||
Fair Value | Number of Contracts (2) | Fair Value | Number of Contracts (2) | ||||||||||
November 30, 2019 (1) | |||||||||||||
Derivatives designated as accounting hedges: | |||||||||||||
Interest rate contracts: | |||||||||||||
Cleared OTC | $ | $ | |||||||||||
Total derivatives designated as accounting hedges | |||||||||||||
Derivatives not designated as accounting hedges: | |||||||||||||
Interest rate contracts: | |||||||||||||
Exchange-traded | |||||||||||||
Cleared OTC | |||||||||||||
Bilateral OTC | |||||||||||||
Foreign exchange contracts: | |||||||||||||
Exchange-traded | |||||||||||||
Bilateral OTC | |||||||||||||
Equity contracts: | |||||||||||||
Exchange-traded | |||||||||||||
Bilateral OTC | |||||||||||||
Commodity contracts: | |||||||||||||
Exchange-traded | |||||||||||||
Bilateral OTC | |||||||||||||
Credit contracts: | |||||||||||||
Cleared OTC | |||||||||||||
Bilateral OTC | |||||||||||||
Total derivatives not designated as accounting hedges | |||||||||||||
Total gross derivative assets/liabilities: | |||||||||||||
Exchange-traded | |||||||||||||
Cleared OTC | |||||||||||||
Bilateral OTC | |||||||||||||
Amounts offset in Consolidated Statement of Financial Condition (3): | |||||||||||||
Exchange-traded | ( | ) | ( | ) | |||||||||
Cleared OTC | ( | ) | ( | ) | |||||||||
Bilateral OTC | ( | ) | ( | ) | |||||||||
Net amounts in the Consolidated Statement of Financial Condition (4) | $ | $ |
(1) | Exchange-traded derivatives include derivatives executed on an organized exchange. Cleared OTC derivatives include derivatives executed bilaterally and subsequently novated to and cleared through central clearing counterparties. Bilateral OTC derivatives include derivatives executed and settled bilaterally without the use of an organized exchange or central clearing counterparty. |
(2) | Number of exchange-traded contracts may include open futures contracts. The unsettled fair value of these futures contracts is included in Receivables and Payables, expense accruals and other liabilities in the Consolidated Statements of Financial Condition. |
(3) | Amounts netted include both netting by counterparty and for cash collateral paid or received. |
(4) | We have not received or pledged additional collateral under master netting agreements and/or other credit support agreements that is eligible to be offset beyond what has been offset in the Consolidated Statements of Financial Condition. |
For the Three Months Ended | |||||||
February 29, 2020 | February 28, 2019 | ||||||
Interest rate swaps | $ | $ | |||||
Long-term debt | ( | ) | ( | ) | |||
Total | $ | ( | ) | $ | ( | ) |
For the Three Months Ended | |||||||
February 29, 2020 | February 28, 2019 | ||||||
Interest rate contracts | $ | ( | ) | $ | ( | ) | |
Foreign exchange contracts | ( | ) | ( | ) | |||
Equity contracts | ( | ) | |||||
Commodity contracts | ( | ) | |||||
Credit contracts | |||||||
Total | $ | $ | ( | ) |
OTC Derivative Assets (1) (2) (3) | |||||||||||||||||||
0-12 Months | 1-5 Years | Greater Than 5 Years | Cross- Maturity Netting (4) | Total | |||||||||||||||
Commodity swaps, options and forwards | $ | $ | $ | $ | $ | ||||||||||||||
Equity forwards, swaps and options | ( | ) | |||||||||||||||||
Credit default swaps | ( | ) | |||||||||||||||||
Total return swaps | ( | ) | |||||||||||||||||
Foreign currency forwards, swaps and options | ( | ) | |||||||||||||||||
Fixed income forwards | |||||||||||||||||||
Interest rate swaps, options and forwards | ( | ) | |||||||||||||||||
Total | $ | $ | $ | $ | ( | ) | |||||||||||||
Cross product counterparty netting | ( | ) | |||||||||||||||||
Total OTC derivative assets included in Financial instruments owned, at fair value | $ |
(1) | At February 29, 2020, we held net exchange-traded derivative assets, other derivative assets and other credit agreements with a fair value of $ |
(2) | OTC derivative assets in the table above are gross of collateral received. OTC derivative assets are recorded net of collateral received in the Consolidated Statements of Financial Condition. At February 29, 2020, cash collateral received was $ |
(3) | Derivative fair values include counterparty netting within product category. |
(4) | Amounts represent the netting of receivable balances with payable balances for the same counterparty within product category across maturity categories. |
OTC Derivative Liabilities (1) (2) (3) | |||||||||||||||||||
0-12 Months | 1-5 Years | Greater Than 5 Years | Cross-Maturity Netting (4) | Total | |||||||||||||||
Equity forwards, swaps and options | $ | $ | $ | $ | ( | ) | $ | ||||||||||||
Credit default swaps | ( | ) | |||||||||||||||||
Total return swaps | ( | ) | |||||||||||||||||
Foreign currency forwards, swaps and options | ( | ) | |||||||||||||||||
Fixed income forwards | |||||||||||||||||||
Interest rate swaps, options and forwards | ( | ) | |||||||||||||||||
Total | $ | $ | $ | $ | ( | ) | |||||||||||||
Cross product counterparty netting | ( | ) | |||||||||||||||||
Total OTC derivative liabilities included in Financial instruments sold, not yet purchased, at fair value | $ |
(1) | At February 29, 2020, we held net exchange-traded derivative liabilities, other derivative liabilities and other credit agreements with a fair value of $ |
(2) | OTC derivative liabilities in the table above are gross of collateral pledged. OTC derivative liabilities are recorded net of collateral pledged in the Consolidated Statements of Financial Condition. At February 29, 2020, cash collateral pledged was $ |
(3) | Derivative fair values include counterparty netting within product category. |
(4) |
Counterparty credit quality (1): | |||
A- or higher | $ | ||
BBB- to BBB+ | |||
BB+ or lower | |||
Unrated | |||
Total | $ |
(1) | We utilize internal credit ratings determined by the Jefferies Group's Risk Management department. Credit ratings determined by Jefferies Group Risk Management use methodologies that produce ratings generally consistent with those produced by external rating agencies. |
External Credit Rating | ||||||||||||||||
Investment Grade | Non-investment grade | Unrated | Total Notional | |||||||||||||
February 29, 2020 | ||||||||||||||||
Credit protection sold: | ||||||||||||||||
Index credit default swaps | $ | $ | $ | $ | ||||||||||||
Single name credit default swaps | $ | $ | $ | $ | ||||||||||||
November 30, 2019 | ||||||||||||||||
Credit protection sold: | ||||||||||||||||
Index credit default swaps | $ | $ | $ | $ | ||||||||||||
Single name credit default swaps | $ | $ | $ | $ |
February 29, 2020 | November 30, 2019 | ||||||
Derivative instrument liabilities with credit-risk-related contingent features | $ | $ | |||||
Collateral posted | $ | ( | ) | $ | ( | ) | |
Collateral received | $ | $ | |||||
Return of and additional collateral required in the event of a credit rating downgrade below investment grade (1) | $ | $ |
(1) | These potential outflows include initial margin received from counterparties at the execution of the derivative contract. The initial margin will be returned if counterparties elect to terminate the contract after a downgrade. |
Collateral Pledged | Securities Lending Arrangements | Repurchase Agreements | Obligation to Return Securities Received as Collateral | Total | ||||||||||||
February 29, 2020 | ||||||||||||||||
Corporate equity securities | $ | $ | $ | $ | ||||||||||||
Corporate debt securities | ||||||||||||||||
Mortgage-backed and asset-backed securities | ||||||||||||||||
U.S. government and federal agency securities | ||||||||||||||||
Municipal securities | ||||||||||||||||
Sovereign obligations | ||||||||||||||||
Loans and other receivables | ||||||||||||||||
Total | $ | $ | $ | $ | ||||||||||||
November 30, 2019 | ||||||||||||||||
Corporate equity securities | $ | $ | $ | $ | ||||||||||||
Corporate debt securities | ||||||||||||||||
Mortgage-backed and asset-backed securities | ||||||||||||||||
U.S. government and federal agency securities | ||||||||||||||||
Municipal securities | ||||||||||||||||
Sovereign obligations | ||||||||||||||||
Loans and other receivables | ||||||||||||||||
Total | $ | $ | $ | $ |
Contractual Maturity | ||||||||||||||||||||
Overnight and Continuous | Up to 30 Days | 31 to 90 Days | Greater than 90 Days | Total | ||||||||||||||||
February 29, 2020 | ||||||||||||||||||||
Securities lending arrangements | $ | $ | $ | $ | $ | |||||||||||||||
Repurchase agreements | ||||||||||||||||||||
Obligation to return securities received as collateral | ||||||||||||||||||||
Total | $ | $ | $ | $ | $ | |||||||||||||||
November 30, 2019 | ||||||||||||||||||||
Securities lending arrangements | $ | $ | $ | $ | $ | |||||||||||||||
Repurchase agreements | ||||||||||||||||||||
Obligation to return securities received as collateral | ||||||||||||||||||||
Total | $ | $ | $ | $ | $ |
(In thousands) | Gross Amounts | Netting in Consolidated Statements of Financial Condition | Net Amounts in Consolidated Statements of Financial Condition | Additional Amounts Available for Setoff (1) | Available Collateral (2) | Net Amount (3) | |||||||||||||||||
Assets at February 29, 2020 | |||||||||||||||||||||||
Securities borrowing arrangements | $ | $ | $ | $ | ( | ) | $ | ( | ) | $ | |||||||||||||
Reverse repurchase agreements | ( | ) | ( | ) | ( | ) | |||||||||||||||||
Securities received as collateral | — | — | — | ||||||||||||||||||||
Liabilities at February 29, 2020 | |||||||||||||||||||||||
Securities lending arrangements | $ | $ | $ | $ | ( | ) | $ | ( | ) | $ | |||||||||||||
Repurchase agreements | ( | ) | ( | ) | ( | ) | |||||||||||||||||
Obligation to return securities received as collateral | — | — | — | ||||||||||||||||||||
Assets at November 30, 2019 | |||||||||||||||||||||||
Securities borrowing arrangements | $ | $ | $ | $ | ( | ) | $ | ( | ) | $ | |||||||||||||
Reverse repurchase agreements | ( | ) | ( | ) | ( | ) | |||||||||||||||||
Securities received as collateral | — | — | — | ||||||||||||||||||||
Liabilities at November 30, 2019 | |||||||||||||||||||||||
Securities lending arrangements | $ | $ | $ | $ | ( | ) | $ | ( | ) | $ | |||||||||||||
Repurchase agreements | ( | ) | ( | ) | ( | ) | |||||||||||||||||
Obligation to return securities received as collateral | — | — | — |
(1) | Under master netting agreements with our counterparties, we have the legal right of offset with a counterparty, which incorporates all of the counterparty’s outstanding rights and obligations under the arrangement. These balances reflect additional credit risk mitigation that is available by a counterparty in the event of a counterparty’s default, but which are not netted in the Consolidated Statements of Financial Condition because other netting provisions of GAAP are not met. |
(2) | Includes securities received or paid under collateral arrangements with counterparties that could be liquidated in the event of a counterparty default and thus offset against a counterparty’s rights and obligations under the respective repurchase agreements or securities borrowing or lending arrangements. |
(3) | At February 29, 2020, amounts include $ |
For the Three Months Ended | ||||||||
February 29, 2020 | February 28, 2019 | |||||||
Transferred assets | $ | $ | ||||||
Proceeds on new securitizations | $ | $ | ||||||
Cash flows received on retained interests | $ | $ |
February 29, 2020 | November 30, 2019 | ||||||||||||||
Securitization Type | Total Assets | Retained Interests | Total Assets | Retained Interests | |||||||||||
U.S. government agency residential mortgage-backed securities | $ | $ | $ | $ | |||||||||||
U.S. government agency commercial mortgage-backed securities | $ | $ | $ | $ | |||||||||||
CLOs | $ | $ | $ | $ | |||||||||||
Consumer and other loans | $ | $ | $ | $ |
• | Purchases of securities in connection with our trading and secondary market-making activities; |
• | Retained interests held as a result of securitization activities, including the resecuritization of mortgage-backed and other asset-backed securities and the securitization of mortgage, corporate and consumer loans; |
• | Acting as placement agent and/or underwriter in connection with client-sponsored securitizations; |
• | Financing of agency and non-agency mortgage-backed and other asset-backed securities; |
• | Warehouse funding arrangements for client-sponsored consumer and mortgage loan vehicles and CLOs through participation agreements, forward sale agreements and revolving loan and note commitments; and |
• | Loans to, investments in and fees from various investment vehicles. |
February 29, 2020 | November 30, 2019 | ||||||
Securities purchased under agreements to resell (1) | $ | $ | |||||
Receivables | |||||||
Other | |||||||
Total assets | $ | $ | |||||
Other secured financings | $ | $ | |||||
Other (2) | |||||||
Total liabilities | $ | $ |
(1) | Securities purchased under agreements to resell represent amounts due under collateralized transactions on related consolidated entities, which are eliminated in consolidation. At February 29, 2020, approximately $ |
(2) | Includes $ |
Financial Statement Carrying Amount | Maximum Exposure to Loss | VIE Assets | |||||||||||||
Assets | Liabilities | ||||||||||||||
February 29, 2020 | |||||||||||||||
CLOs | $ | $ | $ | $ | |||||||||||
Consumer loan and other asset-backed vehicles | |||||||||||||||
Related party private equity vehicles | |||||||||||||||
Other investment vehicles | |||||||||||||||
Total | $ | $ | $ | $ | |||||||||||
November 30, 2019 | |||||||||||||||
CLOs | $ | $ | $ | $ | |||||||||||
Consumer loan and other asset-backed vehicles | |||||||||||||||
Related party private equity vehicles | |||||||||||||||
Other investment vehicles | |||||||||||||||
Total | $ | $ | $ | $ |
• | Forward sale agreements whereby we commit to sell, at a fixed price, corporate loans and ownership interests in an entity holding such corporate loans to CLOs; |
• | Warehouse funding arrangements in the form of participation interests in corporate loans held by CLOs and commitments to fund such participation interests; |
• | Trading positions in securities issued in a CLO transaction; and |
• | Investments in variable funding notes issued by CLOs. |
Loans to and investments in associated companies as of beginning of period | Income (losses) related to associated companies | Income (losses) primarily related to Jefferies Group's associated companies (1) | Contributions to (distributions from) associated companies, net | Other | Loans to and investments in associated companies as of end of period | ||||||||||||||||||
2020 | |||||||||||||||||||||||
Jefferies Finance | $ | $ | $ | $ | $ | $ | |||||||||||||||||
Berkadia | ( | ) | |||||||||||||||||||||
FXCM (2) | ( | ) | ( | ) | |||||||||||||||||||
Linkem (3) | ( | ) | ( | ) | ( | ) | |||||||||||||||||
Real estate associated companies (4) (5) | ( | ) | ( | ) | |||||||||||||||||||
Other (3) | ( | ) | |||||||||||||||||||||
Total | $ | $ | ( | ) | $ | $ | ( | ) | $ | $ | |||||||||||||
2019 | |||||||||||||||||||||||
Jefferies Finance | $ | $ | $ | ( | ) | $ | ( | ) | $ | $ | |||||||||||||
Berkadia | ( | ) | |||||||||||||||||||||
National Beef (6) | ( | ) | |||||||||||||||||||||
FXCM (2) | ( | ) | |||||||||||||||||||||
Linkem | ( | ) | |||||||||||||||||||||
HomeFed (4) | |||||||||||||||||||||||
Real estate associated companies | |||||||||||||||||||||||
Other | ( | ) | ( | ) | ( | ) | |||||||||||||||||
Total | $ | $ | $ | $ | ( | ) | $ | $ |
(1) | Primarily classified in Other revenues. |
(2) | As further described in Note 3, our investment in FXCM includes both our equity method investment in FXCM and our term loan with FXCM. Our equity method investment is included in Loans to and investments in associated companies and our term loan is included in Financial instruments owned, at fair value in the Consolidated Statements of Financial Condition. |
(3) | Loans to and investments in associated companies at February 29, 2020 and November 30, 2019 include loans and debt securities aggregating $ |
(4) | During the third quarter of 2019, we completed a merger with HomeFed by which we acquired the remaining common stock of HomeFed. From July 1, 2019, the results of HomeFed are reflected on a consolidated basis. From July 1, 2019, HomeFed's equity method investments are included in Real estate associated companies. |
(5) | Income (loss) related to Real estate associated companies for the three months ended February 29, 2020, includes a non-cash charge of $ |
(6) | On November 29, 2019, we sold our remaining equity interest in National Beef. |
For the Three Months Ended | |||||||
February 29, 2020 | February 28, 2019 | ||||||
National Beef | $ | $ | |||||
FXCM | ( | ) | ( | ) | |||
Linkem | ( | ) | ( | ) | |||
HomeFed | |||||||
Real estate associated companies | ( | ) | |||||
Other | ( | ) | ( | ) | |||
Total | $ | ( | ) | $ |
For the Three Months Ended | |||||||
February 29, 2020 | February 28, 2019 | ||||||
Jefferies Finance | $ | $ | ( | ) | |||
Berkadia | |||||||
Other | ( | ) | |||||
Total | $ | $ |
For the Three Months Ended | |||||||
February 29, 2020 | February 28, 2019 | ||||||
Origination and syndication fee revenues (1) | $ | $ | |||||
Origination fee expenses (1) | |||||||
CLO placement fee revenues (2) | |||||||
Underwriting fees (3) | |||||||
Service fees (4) |
(1) | Jefferies Group engages in debt underwriting transactions with Jefferies Finance related to the originations and syndications of loans by Jefferies Finance. In connection with such services, Jefferies Group earned fees, which are recognized in Investment banking revenues in the Consolidated Statements of Operations. In addition, Jefferies Group paid fees to Jefferies Finance in respect of certain loans originated by Jefferies Finance, which are recognized in Selling, general and other expenses in the Consolidated Statements of Operations. |
(2) | Jefferies Group acts as a placement agent for CLOs managed by Jefferies Finance, for which Jefferies Group recognized fees, which are included in Investment banking revenues in the Consolidated Statements of Operations. At February 29, 2020 and November 30, 2019, Jefferies Group held securities issued by CLOs managed by Jefferies Finance, which are included in Financial instruments owned, at fair value. |
(3) | Jefferies Group acted as underwriter in connection with terms loans issued by Jefferies Finance. |
(4) | Under a service agreement, Jefferies Group charged Jefferies Finance for services provided. |
For the Three Months Ended | |||||||
February 29, 2020 | February 28, 2019 | ||||||
Revenues | $ | $ | |||||
Income from continuing operations before extraordinary items | $ | $ | |||||
Net income | $ | $ |
February 29, 2020 | November 30, 2019 | ||||||
Indefinite-lived intangibles: | |||||||
Exchange and clearing organization membership interests and registrations | $ | $ | |||||
Amortizable intangibles: | |||||||
Customer and other relationships, net of accumulated amortization of $113,077 and $111,060 | |||||||
Trademarks and tradenames, net of accumulated amortization of $25,682 and $24,800 | |||||||
Other, net of accumulated amortization of $6,333 and $5,366 | |||||||
Total intangible assets, net | |||||||
Goodwill: | |||||||
Investment Banking and Capital Markets (1) (2) | |||||||
Asset Management (1) | |||||||
Real estate | |||||||
Other operations | |||||||
Total goodwill | |||||||
Total intangible assets, net and goodwill | $ | $ |
(1) | As discussed further in Note 23, during the three months ended February 29, 2020, we changed our internal structure with regard to our operating segments. As a result, we created a separate operating segment that consists of the asset management activity previously included within our Investment Banking, Capital Markets and Asset Management segment. In order to reallocate goodwill that was previously contained in our Investment Banking, Capital Markets and Asset Management segment to the newly created Investment Banking and Capital Markets segment and the Asset Management segment, we performed a fair value analysis of the components. |
(2) | The decrease in Investment Banking and Capital Markets goodwill during the three months ended February 29, 2020, primarily relates to translation adjustments. |
Remainder of current year | $ | ||
2021 | $ | ||
2022 | $ | ||
2023 | $ | ||
2024 | $ |
February 29, 2020 | November 30, 2019 | ||||||
Bank loans (1) | $ | $ | |||||
Equity-linked notes | |||||||
Total short-term borrowings | $ | $ |
(1) | These short-term borrowings are recorded at cost in the Consolidated Statements of Financial Condition, which is a reasonable approximation of their fair values due to their liquid and short-term nature. |
February 29, 2020 | November 30, 2019 | ||||||
Parent Company Debt: | |||||||
Senior Notes: | |||||||
5.50% Senior Notes due October 18, 2023, $750,000 principal | $ | $ | |||||
6.625% Senior Notes due October 23, 2043, $250,000 principal | |||||||
Total long-term debt – Parent Company | |||||||
Subsidiary Debt (non-recourse to Parent Company): | |||||||
Jefferies Group: | |||||||
2.375% Euro Medium Term Notes, due May 20, 2020, $551,425 and $550,875 principal | |||||||
6.875% Senior Notes, due April 15, 2021, $750,000 principal | |||||||
2.25% Euro Medium Term Notes, due July 13, 2022, $4,411 and $4,407 principal | |||||||
5.125% Senior Notes, due January 20, 2023, $600,000 principal | |||||||
1.00% Euro Medium Term Notes, due July 19, 2024, $551,425 and $550,875 principal | |||||||
4.85% Senior Notes, due January 15, 2027, $750,000 principal (1) | |||||||
6.45% Senior Debentures, due June 8, 2027, $350,000 principal | |||||||
4.15% Senior Notes, due January 23, 2030, $1,000,000 principal | |||||||
6.25% Senior Debentures, due January 15, 2036, $500,000 principal | |||||||
6.50% Senior Notes, due January 20, 2043, $400,000 principal | |||||||
Structured Notes (2) | |||||||
Jefferies Group Revolving Credit Facility | |||||||
Jefferies Group Secured Bank Loan | |||||||
HomeFed EB-5 Program debt | |||||||
Foursight Capital Credit Facilities | ( | ) | |||||
Vitesse Energy Finance Revolving Credit Facility | |||||||
Other | |||||||
Total long-term debt – subsidiaries | |||||||
Long-term debt | $ | $ |
(1) | Amount includes losses of $ |
(2) | These structured notes contain various interest rate payment terms and are accounted for at fair value, with changes in fair value resulting from a change in the instrument specific credit risk presented in Accumulated other comprehensive income (loss) and changes in fair value resulting from non-credit components recognized in Principal transactions revenues. |
Three Months Ended February 29, 2020 | ||||
Premises and equipment - ROU assets | $ | |||
Weighted average: | ||||
Remaining lease term (in years) | ||||
Discount rate | % |
Lease Liabilities | ||||
Remainder of 2020 | $ | |||
2021 | ||||
2022 | ||||
2023 | ||||
2024 | ||||
2025 and thereafter | ||||
Total undiscounted cash flows | ||||
Less: Difference between undiscounted and discounted cash flows | ( | ) | ||
Operating leases amount in the Consolidated Statement of Financial Condition | ||||
Finance leases amount in the Consolidated Statement of Financial Condition | ||||
Total amount in the Consolidated Statement of Financial Condition | $ |
Three Months Ended February 29, 2020 | ||||
Operating lease costs (1) | $ | |||
Variable lease costs (2) | ||||
Less: Sublease income | ( | ) | ||
Total lease cost, net | $ |
Three Months Ended February 29, 2020 | ||||
Cash outflows - lease liabilities | $ | |||
Non-cash - ROU assets recorded for new and modified leases | $ |
2020 | $ | |||
2021 | ||||
2022 | ||||
2023 | ||||
2024 | ||||
Thereafter | ||||
Less: sublease income | ( | ) | ||
$ |
February 29, 2020 | November 30, 2019 | ||||||
Net unrealized gains on available for sale securities | $ | $ | |||||
Net unrealized foreign exchange losses | ( | ) | ( | ) | |||
Net unrealized gains (losses) on instrument specific credit risk | ( | ) | |||||
Net minimum pension liability | ( | ) | ( | ) | |||
$ | ( | ) | $ | ( | ) |
Details about Accumulated Other Comprehensive Income (Loss) Components | Amount Reclassified from Accumulated Other Comprehensive Income (Loss) | Affected Line Item in the Consolidated Statements of Operations | ||||||||
For the Three Months Ended | ||||||||||
February 29, 2020 | February 28, 2019 | |||||||||
Net unrealized gains (losses) on available for sale securities, net of income tax provision (benefit) of $0 and $(377) | $ | $ | ( | ) | Other revenues | |||||
Net unrealized gains (losses) on instrument specific credit risk, net of income tax provision (benefit) of $86 and $(99) | ( | ) | Principal transactions revenues | |||||||
Amortization of defined benefit pension plan actuarial losses, net of income tax benefit of $(224) and $(119) | ( | ) | ( | ) | Selling, general and other expenses, which includes pension expense | |||||
Total reclassifications for the period, net of tax | $ | ( | ) | $ | ( | ) |
For the Three Months Ended | ||||||||
February 29, 2020 | February 28, 2019 | |||||||
Revenues from contracts with customers: | ||||||||
Commissions and other fees (1) | $ | $ | ||||||
Investment banking | ||||||||
Manufacturing revenues | ||||||||
Other | ||||||||
Total revenues from contracts with customers | ||||||||
Other sources of revenue: | ||||||||
Principal transactions | ||||||||
Interest income | ||||||||
Other | ( | ) | ||||||
Total revenues from other sources | ||||||||
Total revenues | $ | $ |
Reportable Segments | ||||||||||||||||||||||||
Investment Banking and Capital Markets | Asset Management | Merchant Banking | Corporate | Consolidation Adjustments | Total | |||||||||||||||||||
Three months ended February 29, 2020 | ||||||||||||||||||||||||
Major Business Activity: | ||||||||||||||||||||||||
Jefferies Group: | ||||||||||||||||||||||||
Equities (1) | $ | $ | $ | $ | $ | ( | ) | $ | ||||||||||||||||
Fixed Income (1) | ||||||||||||||||||||||||
Investment Banking - Underwriting | ||||||||||||||||||||||||
Investment Banking - Advisory | ||||||||||||||||||||||||
Asset Management | ||||||||||||||||||||||||
Manufacturing revenues | ||||||||||||||||||||||||
Oil and gas revenues | ||||||||||||||||||||||||
Other revenues | ||||||||||||||||||||||||
Total revenues from contracts with customers | $ | $ | $ | $ | $ | ( | ) | $ | ||||||||||||||||
Primary Geographic Region: | ||||||||||||||||||||||||
Americas | $ | $ | $ | $ | $ | ( | ) | $ | ||||||||||||||||
Europe, Middle East and Africa | ||||||||||||||||||||||||
Asia | ||||||||||||||||||||||||
Total revenues from contracts with customers | $ | $ | $ | $ | $ | ( | ) | $ | ||||||||||||||||
Three months ended February 28, 2019 | ||||||||||||||||||||||||
Major Business Activity: | ||||||||||||||||||||||||
Jefferies Group: | ||||||||||||||||||||||||
Equities (1) | $ | $ | $ | $ | $ | ( | ) | $ | ||||||||||||||||
Fixed Income (1) | ||||||||||||||||||||||||
Investment Banking - Underwriting | ||||||||||||||||||||||||
Investment Banking - Advisory | ||||||||||||||||||||||||
Asset Management | ||||||||||||||||||||||||
Manufacturing revenues | ||||||||||||||||||||||||
Oil and gas revenues | ||||||||||||||||||||||||
Other revenues | ||||||||||||||||||||||||
Total revenues from contracts with customers | $ | $ | $ | $ | $ | ( | ) | $ | ||||||||||||||||
Primary Geographic Region: | ||||||||||||||||||||||||
Americas | $ | $ | $ | $ | $ | ( | ) | $ | ||||||||||||||||
Europe, Middle East and Africa | ||||||||||||||||||||||||
Asia | ||||||||||||||||||||||||
Total revenues from contracts with customers | $ | $ | $ | $ | $ | ( | ) | $ |
(1) | Revenues from contracts with customers associated with the equities and fixed income businesses primarily represent commissions and other fee revenue. |
For the Three Months Ended | |||||||
February 29, 2020 | February 28, 2019 | ||||||
Numerator for earnings per share: | |||||||
Net income attributable to Jefferies Financial Group Inc. common shareholders | $ | $ | |||||
Allocation of earnings to participating securities (1) | ( | ) | ( | ) | |||
Net income attributable to Jefferies Financial Group Inc. common shareholders for basic earnings per share | |||||||
Adjustment to allocation of earnings to participating securities related to diluted shares (1) | ( | ) | ( | ) | |||
Mandatorily redeemable convertible preferred share dividends | |||||||
Net income attributable to Jefferies Financial Group Inc. common shareholders for diluted earnings per share | $ | $ | |||||
Denominator for earnings per share: | |||||||
Weighted average common shares outstanding | |||||||
Weighted average shares of restricted stock outstanding with future service required | ( | ) | ( | ) | |||
Weighted average RSUs outstanding with no future service required | |||||||
Denominator for basic earnings per share – weighted average shares | |||||||
Stock options | |||||||
Senior executive compensation plan awards | |||||||
Mandatorily redeemable convertible preferred shares | |||||||
Denominator for diluted earnings per share |
(1) | Represents dividends declared during the period on participating securities plus an allocation of undistributed earnings to participating securities. Net losses are not allocated to participating securities. Participating securities represent restricted stock and RSUs for which requisite service has not yet been rendered and amounted to weighted average shares of |
Expected Maturity Date | |||||||||||||||||||||||
2020 | 2021 | 2022 and 2023 | 2024 and 2025 | 2026 and Later | Maximum Payout | ||||||||||||||||||
Equity commitments (1) | $ | $ | $ | $ | $ | $ | |||||||||||||||||
Loan commitments (1) | |||||||||||||||||||||||
Underwriting commitments | |||||||||||||||||||||||
Forward starting reverse repos (2) | |||||||||||||||||||||||
Forward starting repos (2) | |||||||||||||||||||||||
Other unfunded commitments (1) | |||||||||||||||||||||||
$ | $ | $ | $ | $ | $ |
(1) | Equity commitments, loan commitments and other unfunded commitments are presented by contractual maturity date. The amounts are however mostly available on demand. |
(2) | At February 29, 2020, $ |
Expected Maturity Date | |||||||||||||||||||||||
Guarantee Type | 2020 | 2021 | 2022 and 2023 | 2024 and 2025 | 2026 and Later | Notional/ Maximum Payout | |||||||||||||||||
Derivative contracts – non-credit related | $ | $ | $ | $ | $ | $ | |||||||||||||||||
Written derivative contracts – credit related | |||||||||||||||||||||||
Total derivative contracts | $ | $ | $ | $ | $ | $ |
February 29, 2020 | November 30, 2019 | ||||||||||||||
Carrying Amount | Fair Value | Carrying Amount | Fair Value | ||||||||||||
Receivables: | |||||||||||||||
Notes and loans receivable (1) | $ | $ | $ | $ | |||||||||||
Financial Liabilities: | |||||||||||||||
Short-term borrowings (2) | $ | $ | $ | $ | |||||||||||
Long-term debt (3) | $ | $ | $ | $ |
(1) | Notes and loans receivable: The fair values are estimated principally based on a discounted future cash flows model using market interest rates for similar instruments. If measured at fair value in the financial statements, these financial instruments would be classified as Level 3 in the fair value hierarchy. |
(2) | Short-term borrowings: The fair values of short-term borrowings carried at cost are estimated to be the carrying amount due to their short maturities. If measured at fair value in the financial statements, these financial instruments would be classified as Level 3 in the fair value hierarchy. Short-term borrowings that are accounted for at fair value include equity-linked notes, which are generally categorized within Level 2 of the fair value hierarchy, as the fair value is based on the price of the underlying equity security. |
(3) | Long-term debt: The fair values are estimated using quoted prices, pricing information obtained from external data providers and, for certain variable rate debt, is estimated to be the carrying amount. If measured at fair value in the financial statements, these financial instruments would be classified as Level 2 and Level 3 in the fair value hierarchy. |
For the Three Months Ended | |||||||
February 29, 2020 | February 28, 2019 | ||||||
(In thousands) | |||||||
Net revenues: | |||||||
Reportable Segments: | |||||||
Investment Banking and Capital Markets | $ | $ | |||||
Asset Management | |||||||
Merchant Banking | |||||||
Corporate | |||||||
Total net revenues related to reportable segments | |||||||
Consolidation adjustments | |||||||
Total consolidated net revenues | $ | $ | |||||
Income (loss) before income taxes: | |||||||
Reportable Segments: | |||||||
Investment Banking and Capital Markets | $ | $ | |||||
Asset Management | ( | ) | |||||
Merchant Banking | ( | ) | |||||
Corporate | ( | ) | ( | ) | |||
Income before income taxes related to reportable segments | |||||||
Parent Company interest | ( | ) | ( | ) | |||
Consolidation adjustments | |||||||
Total consolidated income before income taxes | $ | $ | |||||
Depreciation and amortization expenses: | |||||||
Reportable Segments: | |||||||
Investment Banking and Capital Markets | $ | $ | |||||
Asset Management | |||||||
Merchant Banking | |||||||
Corporate | |||||||
Total consolidated depreciation and amortization expenses | $ | $ |
Item 2. | Management’s Discussion and Analysis of Financial Condition and Results of Operations. |
Investment Banking and Capital Markets | Asset Management | Merchant Banking | Corporate | Parent Company Interest | Consolidation Adjustments | Total | |||||||||||||||||||||
Net revenues | $ | 1,148,829 | $ | 20,329 | $ | 204,559 | $ | 9,792 | $ | — | $ | 2,819 | $ | 1,386,328 | |||||||||||||
Expenses: | |||||||||||||||||||||||||||
Compensation and benefits | 620,924 | 22,221 | 17,190 | 9,858 | — | — | 670,193 | ||||||||||||||||||||
Cost of sales (1) | 52,874 | 6,307 | 72,443 | — | — | — | 131,624 | ||||||||||||||||||||
Interest expense (2) | — | — | 8,773 | — | 12,781 | — | 21,554 | ||||||||||||||||||||
Depreciation and amortization | 19,116 | 625 | 18,841 | 888 | — | — | 39,470 | ||||||||||||||||||||
Selling, general and other expenses | 205,958 | 12,105 | 73,080 | 6,800 | — | (105 | ) | 297,838 | |||||||||||||||||||
Total expenses | 898,872 | 41,258 | 190,327 | 17,546 | 12,781 | (105 | ) | 1,160,679 | |||||||||||||||||||
Income (loss) before income taxes and loss related to associated companies | 249,957 | (20,929 | ) | 14,232 | (7,754 | ) | (12,781 | ) | 2,924 | 225,649 | |||||||||||||||||
Loss related to associated companies | — | — | (67,855 | ) | — | — | — | (67,855 | ) | ||||||||||||||||||
Income (loss) before income taxes | $ | 249,957 | $ | (20,929 | ) | $ | (53,623 | ) | $ | (7,754 | ) | $ | (12,781 | ) | $ | 2,924 | 157,794 | ||||||||||
Income tax provision | 45,773 | ||||||||||||||||||||||||||
Net income | $ | 112,021 |
(1) | Includes Floor brokerage and clearing fees. |
(2) | Interest expense within Merchant Banking of $8.8 million for the first quarter of 2020, primarily includes $7.4 million for Foursight Capital and $1.4 million for Vitesse Energy, LLC ("Vitesse Energy Finance"). |
Investment Banking and Capital Markets | Asset Management | Merchant Banking | Corporate | Parent Company Interest | Consolidation Adjustments | Total | |||||||||||||||||||||
Net revenues | $ | 658,247 | $ | 30,745 | $ | 132,692 | $ | 4,193 | $ | — | $ | 2,566 | $ | 828,443 | |||||||||||||
Expenses: | |||||||||||||||||||||||||||
Compensation and benefits | 361,314 | 16,854 | 13,903 | 17,521 | — | — | 409,592 | ||||||||||||||||||||
Cost of sales (1) | 47,136 | 4,732 | 66,921 | — | — | — | 118,789 | ||||||||||||||||||||
Interest expense (2) | — | — | 8,256 | — | 14,762 | — | 23,018 | ||||||||||||||||||||
Depreciation and amortization | 17,330 | 455 | 15,294 | 855 | — | — | 33,934 | ||||||||||||||||||||
Selling, general and other expenses | 177,350 | 7,740 | 29,022 | 7,160 | — | (166 | ) | 221,106 | |||||||||||||||||||
Total expenses | 603,130 | 29,781 | 133,396 | 25,536 | 14,762 | (166 | ) | 806,439 | |||||||||||||||||||
Income (loss) before income taxes and income related to associated companies | 55,117 | 964 | (704 | ) | (21,343 | ) | (14,762 | ) | 2,732 | 22,004 | |||||||||||||||||
Income related to associated companies | — | 220 | 27,093 | — | — | — | 27,313 | ||||||||||||||||||||
Income (loss) before income taxes | $ | 55,117 | $ | 1,184 | $ | 26,389 | $ | (21,343 | ) | $ | (14,762 | ) | $ | 2,732 | 49,317 | ||||||||||||
Income tax provision | 2,302 | ||||||||||||||||||||||||||
Net income | $ | 47,015 |
(1) | Includes Floor brokerage and clearing fees. |
(2) | Interest expense within Merchant Banking of $8.3 million for the first quarter of 2019, primarily includes $7.0 million for Foursight Capital and $1.1 million for Vitesse Energy Finance. |
• | Pre-tax income of $235.4 million from the Jefferies Group reflecting record total net revenues of $1,170.7 million; and |
• | Pre-tax loss of $53.6 million related to our Merchant Banking businesses reflecting: |
◦ | Non-cash charge of $55.6 million to write-off the value of HomeFed LLC's ("HomeFed") RedSky JZ Fulton Mall joint venture investment related to a softening of the Brooklyn real estate market; |
◦ | Non-cash charge of $33.0 million to write-down the value of our investment in JETX Energy, LLC ("JETX Energy") to reflect the impact of oil price declines during the quarter; and |
◦ | A gain of $61.5 million from effective short-term hedges against mark-to-market and fair value decreases in some of our other investments within Merchant Banking. |
• | Pre-tax income of $62.6 million from the Jefferies Group reflecting an extremely challenging environment throughout December 2018 and the government shutdown during December 2018 and January 2019; |
• | A $36.0 million mark-to-market increase in the value of our investment in Spectrum Brands Holdings, Inc. ("Spectrum Brands"); and |
• | $27.1 million of income from associated companies in respect of our 31% investment in National Beef Packing Company, LLC ("National Beef"). |
For the Three Months Ended | ||||||||
February 29, 2020 | February 28, 2019 | |||||||
Net revenues | $ | 1,148,829 | $ | 658,247 | ||||
Expenses: | ||||||||
Compensation and benefits | 620,924 | 361,314 | ||||||
Floor brokerage and clearing fees | 52,874 | 47,136 | ||||||
Depreciation and amortization | 19,116 | 17,330 | ||||||
Selling, general and other expenses | 205,958 | 177,350 | ||||||
Total expenses | 898,872 | 603,130 | ||||||
Income before income taxes | $ | 249,957 | $ | 55,117 |
For the Three Months Ended | ||||||||
February 29, 2020 | February 28, 2019 | |||||||
Advisory | $ | 343,158 | $ | 180,482 | ||||
Equity underwriting | 131,692 | 51,337 | ||||||
Debt underwriting | 117,152 | 53,777 | ||||||
Total underwriting | 248,844 | 105,114 | ||||||
Other investment banking | (14,529 | ) | (7,642 | ) | ||||
Total investment banking | 577,473 | 277,954 | ||||||
Equities | 245,641 | 174,539 | ||||||
Fixed income | 248,182 | 196,759 | ||||||
Total capital markets | 493,823 | 371,298 | ||||||
Other | 77,533 | 8,995 | ||||||
Total Investment Banking and Capital Markets (1) (2) | $ | 1,148,829 | $ | 658,247 |
(1) | Includes net interest revenues of $2.9 million and $4.6 million for the first quarter of 2020 and 2019, respectively. |
(2) | Allocated net interest is not separately disaggregated in presenting our Investment Banking and Capital Markets reportable segment within our Net Revenues by Source. This presentation is aligned to our Investment Banking and Capital Markets internal performance measurement. |
• | advisory services with respect to mergers and acquisitions and restructurings and recapitalizations; |
• | underwriting services, which include underwriting and placement services related to corporate debt, municipal bonds, mortgage-backed and asset-backed securities and equity and equity-linked securities and loan syndication; |
• | our share of net earnings from Jefferies Group's corporate lending joint venture, Jefferies Finance LLC ("Jefferies Finance"); and |
• | securities and loans received or acquired in connection with our investment banking activities. |
Deals Completed | Aggregate Value | ||||||||||||
For the Three Months Ended | For the Three Months Ended | ||||||||||||
February 29, 2020 | February 28, 2019 | February 29, 2020 | February 28, 2019 | ||||||||||
Advisory transactions (1) | 66 | 44 | $ | 57.7 | $ | 52.2 | |||||||
Public and private debt financings | 152 | 114 | $ | 69.6 | $ | 27.3 | |||||||
Public and private equity and convertible offerings (2) | 56 | 21 | $ | 11.8 | $ | 3.0 |
(1) | The number of advisory deals completed includes three and four restructuring and recapitalization transactions during the first quarter of 2020 and 2019, respectively. |
(2) | We acted as sole or joint bookrunner on 56 and 21 offerings during the first quarter of 2020 and 2019, respectively. |
• | services provided to our clients from which we earn commissions or spread revenue by executing, settling and clearing transactions for clients; |
• | advisory services offered to clients; |
• | financing, securities lending and other prime brokerage services offered to clients; and |
• | wealth management services, which include providing clients access to all of our institutional execution capabilities. |
• | executing transactions for clients and making markets in securitized products, investment grade, high-yield, emerging markets, municipal and sovereign securities and bank loans, as well as foreign exchange execution on behalf of clients; and |
• | interest rate derivatives and credit derivatives. |
• | Berkadia Commercial Mortgage Holding LLC ("Berkadia") and other investments (other than Jefferies Finance); |
• | principal investments in private equity and hedge funds managed by third parties or related parties and that are not part of our Leucadia Asset Management ("LAM") platform; and |
• | investments held as part of employee benefit plans, including deferred compensation plans (for which we incur an equal and offsetting compensation expenses). |
For the Three Months Ended | |||||||
February 29, 2020 | February 28, 2019 | ||||||
Net revenues | $ | 20,329 | $ | 30,745 | |||
Expenses: | |||||||
Compensation and benefits | 22,221 | 16,854 | |||||
Floor brokerage and clearing fees | 6,307 | 4,732 | |||||
Depreciation and amortization | 625 | 455 | |||||
Selling, general and other expenses | 12,105 | 7,740 | |||||
Total expenses | 41,258 | 29,781 | |||||
Income (loss) before income taxes and income related to associated companies | (20,929 | ) | 964 | ||||
Income related to associated companies | — | 220 | |||||
Income (loss) before income taxes | $ | (20,929 | ) | $ | 1,184 |
• | management and performance fees from funds and accounts managed by us; |
• | revenue from strategic partners pursuant to agreements which entitle us to portions of our partners’ revenues and/or profits; and |
• | investment income from our investments managed by our asset management business and other strategic partners. |
For the Three Months Ended | |||||||
February 29, 2020 | February 28, 2019 | ||||||
Asset management fees: | |||||||
Equities | $ | 2,938 | $ | 2,740 | |||
Multi-asset | 3,153 | 5,578 | |||||
Total asset management fees | 6,091 | 8,318 | |||||
Revenues from arrangements with strategic partners (1) | 7,316 | 362 | |||||
Total asset management fees and revenues | 13,407 | 8,680 | |||||
Investment return (2) (3) | 17,614 | 33,675 | |||||
Allocated net interest (2) (4) | (10,692 | ) | (11,610 | ) | |||
Total Asset Management | $ | 20,329 | $ | 30,745 |
(1) | These amounts include our share of fees received by third party asset management companies with which we have revenue and profit share arrangements. |
(2) | Net revenues attributed to the Investment return in our Asset Management segment have been disaggregated to separately present Investment return and Allocated net interest (see footnote 4 below). This disaggregation is intended to increase transparency and to make clearer actual Investment return. We believe that aggregating Investment return and Allocated net |
(3) | Includes net interest expense of $6.4 million and $1.2 million for the first quarter of 2020 and 2019, respectively. |
(4) | Allocated net interest represents the allocation of long-term debt interest expense to our Asset Management reportable segment, net of interest income on Cash and cash equivalents and other sources of liquidity. For discussion of sources of liquidity, refer to the "Liquidity and Capital Resources" section herein. |
February 29, 2020 | November 30, 2019 | |||||||
Assets under management (1): | ||||||||
Equities | $ | 518 | $ | 228 | ||||
Multi-asset | 622 | 988 | ||||||
Total | $ | 1,140 | $ | 1,216 |
(1) | Assets under management include third-party net assets actively managed by us, including hedge funds and certain managed accounts. The amounts at February 29, 2020 and November 30, 2019 also include $147 million and $150 million, respectively, of assets under management in a strategy, which represents a net asset value equivalent of an asset management strategy where we earn performance fees. We may consolidate certain funds and for such consolidated funds, assets under management includes the pro-rata portion of third-party net assets in consolidated funds based on the percentage ownership of third-party investors in the consolidated fund. The above amounts do not include assets under management at non-consolidated strategic partners or investments. |
For the Three Months Ended | |||||||
February 29, 2020 | February 28, 2019 | ||||||
Assets under management: | |||||||
Balance, beginning of period | $ | 1,216 | $ | 2,197 | |||
Net cash flow in (out) | (21 | ) | (294 | ) | |||
Net market appreciation (depreciation) | (55 | ) | (8 | ) | |||
Balance, end of period | $ | 1,140 | $ | 1,895 |
February 29, 2020 | November 30, 2019 | |||||||
Jefferies Financial Group Inc., as manager: | ||||||||
Fund investments (1) | $ | 244,158 | $ | 240,804 | ||||
Separately managed accounts (2) | 438,904 | 489,617 | ||||||
Total | 683,062 | 730,421 | ||||||
Third-party, as manager: | ||||||||
Fund investments | 615,919 | 306,554 | ||||||
Separately managed accounts (2) | 262,100 | 266,484 | ||||||
Investments in asset managers | 115,064 | 114,161 | ||||||
Total | 993,083 | 687,199 | ||||||
Total asset management investments (3) | $ | 1,676,145 | $ | 1,417,620 |
(1) | Due to the level or nature of an investment in a fund, we may consolidate that fund; and accordingly, the assets and liabilities of the fund are included in the representative line items in our consolidated financial statements. At February 29, 2020 and November 30, 2019, $22.1 million and $22.6 million, respectively, represents net investments in funds that have been consolidated in our financial statements. |
(2) | Where we have investments in a separately managed account, the assets and liabilities of such account are presented on our balance sheet within each respective line item. |
(3) | Of the $1,676.1 million total invested in the funds at February 29, 2020, $1,380.1 million was sourced from the proceeds of long-term and permanent capital. At February 29, 2020 and November 30, 2019, Jefferies Group has borrowed $296.0 million and $135.0 million, respectively, under a credit facility agreement ("Jefferies Group Credit Facility") with JPMorgan Chase Bank, N.A., which is secured by our investment in a fund managed by us, with a carrying value of $221.9 million and $218.1 million at February 29, 2020 and November 30, 2019, respectively. |
Three Months Ended February 29, 2020 | Three Months Ended February 28, 2019 | |||
Consolidated Businesses | Oil and Gas | Oil and Gas | ||
HomeFed | - | |||
Idaho Timber | Idaho Timber | |||
Associated Companies | Linkem | Linkem | ||
FXCM Equity Investment | FXCM Equity Investment | |||
- | National Beef | |||
- | HomeFed | |||
Other Investments | The We Company | The We Company | ||
FXCM Term Loan | FXCM Term Loan | |||
- | Spectrum Brands |
For the Three Months Ended | |||||||
February 29, 2020 | February 28, 2019 | ||||||
Net revenues | $ | 204,559 | $ | 132,692 | |||
Expenses: | |||||||
Compensation and benefits | 17,190 | 13,903 | |||||
Cost of sales | 72,443 | 66,921 | |||||
Interest expense | 8,773 | 8,256 | |||||
Depreciation and amortization | 18,841 | 15,294 | |||||
Selling, general and other expenses | 73,080 | 29,022 | |||||
Total expenses | 190,327 | 133,396 | |||||
Income (loss) before income taxes and income (loss) related to associated companies | 14,232 | (704 | ) | ||||
Income (loss) related to associated companies | (67,855 | ) | 27,093 | ||||
Income (loss) before income taxes | $ | (53,623 | ) | $ | 26,389 |
For the Three Months Ended | |||||||
February 29, 2020 | February 28, 2019 | ||||||
Oil and gas | $ | 62,856 | $ | 5,471 | |||
Idaho Timber | 77,639 | 75,446 | |||||
Real estate | 12,230 | 51 | |||||
FXCM | 2,508 | 450 | |||||
Spectrum Brands | — | 39,150 | |||||
Other | 49,326 | 12,124 | |||||
Total net revenues | $ | 204,559 | $ | 132,692 |
For the Three Months Ended | |||||||
February 29, 2020 | February 28, 2019 | ||||||
Oil and gas | $ | 71,594 | $ | 31,791 | |||
Idaho Timber | 72,930 | 70,864 | |||||
Real estate | 10,780 | — | |||||
Other | 35,023 | 30,741 | |||||
Total expenses | $ | 190,327 | $ | 133,396 |
For the Three Months Ended | |||||||
February 29, 2020 | February 28, 2019 | ||||||
National Beef | $ | — | $ | 27,105 | |||
FXCM | (1,638 | ) | (2,716 | ) | |||
Linkem | (13,185 | ) | (1,621 | ) | |||
Real estate associated companies | (53,014 | ) | 2,596 | ||||
Other | (18 | ) | 1,729 | ||||
Total income (loss) related to associated companies | $ | (67,855 | ) | $ | 27,093 |
For the Three Months Ended | |||||||
February 29, 2020 | February 28, 2019 | ||||||
Oil and gas | $ | (8,738 | ) | $ | (26,320 | ) | |
Idaho Timber | 4,709 | 4,582 | |||||
Real estate | 1,450 | 51 | |||||
FXCM | 2,508 | 450 | |||||
Spectrum Brands | — | 39,150 | |||||
Other | 14,303 | (18,617 | ) | ||||
Income (loss) before income taxes and income (loss) related to associated companies | 14,232 | (704 | ) | ||||
Income (loss) related to associated companies | (67,855 | ) | 27,093 | ||||
Income (loss) before income taxes | $ | (53,623 | ) | $ | 26,389 |
For the Three Months Ended | |||||||
February 29, 2020 | February 28, 2019 | ||||||
Net revenues | $ | 9,792 | $ | 4,193 | |||
Expenses: | |||||||
Compensation and benefits | 9,858 | 17,521 | |||||
Depreciation and amortization | 888 | 855 | |||||
Selling, general and other expenses | 6,800 | 7,160 | |||||
Total expenses | 17,546 | 25,536 | |||||
Loss before income taxes | $ | (7,754 | ) | $ | (21,343 | ) |
February 29, 2020 | |||||||||||||||||||||||
Investment Banking and Capital Markets | Asset Management | Merchant Banking | Corporate | Consolidation Adjustments | Total | ||||||||||||||||||
Assets | |||||||||||||||||||||||
Cash and cash equivalents | $ | 4,891,465 | $ | 23,382 | $ | 163,793 | $ | 1,632,019 | $ | — | $ | 6,710,659 | |||||||||||
Cash and securities segregated and on deposit for regulatory purposes or deposited with clearing and depository organizations | 742,134 | — | — | — | — | 742,134 | |||||||||||||||||
Financial instruments owned, at fair value | 15,212,184 | 2,771,424 | 373,379 | 39,994 | — | 18,396,981 | |||||||||||||||||
Loans to and investments in associated companies | 940,442 | 92,113 | 530,073 | — | — | 1,562,628 | |||||||||||||||||
Securities borrowed | 6,708,788 | — | — | — | — | 6,708,788 | |||||||||||||||||
Securities purchased under agreements to resell | 4,907,031 | — | — | — | — | 4,907,031 | |||||||||||||||||
Securities received as collateral | 15,004 | 15,004 | |||||||||||||||||||||
Receivables | 5,830,927 | 490,488 | 848,288 | 64,326 | — | 7,234,029 | |||||||||||||||||
Property, equipment and leasehold improvements, net | 869,831 | 4,977 | 34,743 | 19,092 | — | 928,643 | |||||||||||||||||
Intangible assets, net and goodwill | 1,722,872 | 143,609 | 51,587 | — | — | 1,918,068 | |||||||||||||||||
Other assets | 1,151,019 | 15,935 | 1,291,516 | 311,553 | (115,865 | ) | 2,654,158 | ||||||||||||||||
Total Assets | 42,991,697 | 3,541,928 | 3,293,379 | 2,066,984 | (115,865 | ) | 51,778,123 | ||||||||||||||||
Liabilities | |||||||||||||||||||||||
Long-term debt (1) (2) | 6,332,633 | 830,979 | 296,187 | 991,705 | — | 8,451,504 | |||||||||||||||||
Other liabilities | 31,082,086 | 1,651,030 | 940,820 | 232,884 | (115,865 | ) | 33,790,955 | ||||||||||||||||
Total liabilities | 37,414,719 | 2,482,009 | 1,237,007 | 1,224,589 | (115,865 | ) | 42,242,459 | ||||||||||||||||
Redeemable noncontrolling interests | — | — | 24,759 | — | — | 24,759 | |||||||||||||||||
Mandatorily redeemable convertible preferred shares | — | — | — | 125,000 | — | 125,000 | |||||||||||||||||
Noncontrolling interests | 19,351 | — | 17,599 | — | — | 36,950 | |||||||||||||||||
Total Jefferies Financial Group Inc. shareholders' equity | $ | 5,557,627 | $ | 1,059,919 | $ | 2,014,014 | $ | 717,395 | $ | — | $ | 9,348,955 |
(1) | Jefferies Group long-term debt of $7.2 billion at February 29, 2020, is allocated to Investment Banking and Capital Markets and Asset Management segments based on an internal management view only and may not be reflective of what long-term debt would be on a stand-alone segment basis. |
(2) | Long-term debt within Merchant Banking of $296.2 million at February 29, 2020, primarily includes $183.4 million for real estate businesses and $113.1 million for Vitesse Energy Finance. At February 29, 2020, Vitesse Energy Finance had $114.0 million drawn out of the maximum $170.0 million borrowing base on its credit facility and Foursight Capital had $0.0 million drawn out of the maximum $175.0 million credit commitment on its credit facilities. See Note 11 in our consolidated financial statements for additional information. |
November 30, 2019 | |||||||||||||||||||||||
Investment Banking and Capital Markets | Asset Management | Merchant Banking | Corporate | Consolidation Adjustments | Total | ||||||||||||||||||
Assets | |||||||||||||||||||||||
Cash and cash equivalents | $ | 5,561,281 | $ | 25,255 | $ | 111,552 | $ | 1,980,733 | $ | — | $ | 7,678,821 | |||||||||||
Cash and securities segregated and on deposit for regulatory purposes or deposited with clearing and depository organizations | 796,797 | — | — | — | — | 796,797 | |||||||||||||||||
Financial instruments owned, at fair value | 13,735,641 | 2,681,034 | 363,237 | 115,829 | — | 16,895,741 | |||||||||||||||||
Loans to and investments in associated companies | 944,509 | 83,258 | 625,190 | — | — | 1,652,957 | |||||||||||||||||
Securities borrowed | 7,624,642 | — | — | — | — | 7,624,642 | |||||||||||||||||
Securities purchased under agreements to resell | 4,299,598 | — | — | — | — | 4,299,598 | |||||||||||||||||
Securities received as collateral | 9,500 | 9,500 | |||||||||||||||||||||
Receivables | 4,560,760 | 369,410 | 813,675 | 261 | — | 5,744,106 | |||||||||||||||||
Property, equipment and leasehold improvements, net | 350,071 | 796 | 20,632 | 13,530 | — | 385,029 | |||||||||||||||||
Intangible assets, net and goodwill | 1,726,736 | 143,616 | 52,582 | — | — | 1,922,934 | |||||||||||||||||
Other assets | 913,688 | 10,347 | 1,298,803 | 321,766 | (94,495 | ) | 2,450,109 | ||||||||||||||||
Total Assets | 40,523,223 | 3,313,716 | 3,285,671 | 2,432,119 | (94,495 | ) | 49,460,234 | ||||||||||||||||
Liabilities | |||||||||||||||||||||||
Long-term debt (1) (2) | 6,289,015 | 714,343 | 342,325 | 991,378 | — | 8,337,061 | |||||||||||||||||
Other liabilities | 28,658,041 | 1,761,674 | 754,560 | 290,104 | (94,495 | ) | 31,369,884 | ||||||||||||||||
Total liabilities | 34,947,056 | 2,476,017 | 1,096,885 | 1,281,482 | (94,495 | ) | 39,706,945 | ||||||||||||||||
Redeemable noncontrolling interests | — | — | 26,605 | — | — | 26,605 | |||||||||||||||||
Mandatorily redeemable convertible preferred shares | — | — | — | 125,000 | — | 125,000 | |||||||||||||||||
Noncontrolling interests | 4,275 | — | 17,704 | — | — | 21,979 | |||||||||||||||||
Total Jefferies Financial Group Inc. shareholders' equity | $ | 5,571,892 | $ | 837,699 | $ | 2,144,477 | $ | 1,025,637 | $ | — | $ | 9,579,705 |
(2) | Long-term debt within Merchant Banking of $342.3 million at November 30, 2019, primarily includes $140.7 million for real estate businesses, $103.1 million for Vitesse Energy Finance and $98.3 million for Foursight Capital. At November 30, 2019, Vitesse Energy Finance had $104.0 million drawn out of the maximum $170.0 million borrowing base on its credit facility and Foursight Capital had $98.7 million drawn out of the maximum $175.0 million credit commitment on its credit facilities. See Note 11 in our consolidated financial statements for additional information. |
February 29, 2020 | November 30, 2019 | ||||||
Jefferies Group | $ | 6,369,309 | $ | 6,181,683 | |||
Assets held on behalf of Asset Management (excluding Jefferies Group) | 248,237 | 227,908 | |||||
Merchant Banking: | |||||||
Oil and gas | 576,863 | 585,493 | |||||
Real estate | 571,843 | 645,328 | |||||
Linkem | 181,190 | 194,847 | |||||
FXCM | 130,069 | 129,343 | |||||
Idaho Timber | 79,301 | 77,914 | |||||
The We Company | 53,798 | 53,798 | |||||
Investments in other public companies | 161,697 | 178,593 | |||||
Other | 259,253 | 279,161 | |||||
Total Merchant Banking | 2,014,014 | 2,144,477 | |||||
Corporate liquidity and other assets, net of Corporate liabilities including long-term debt | 717,395 | 1,025,637 | |||||
Total Capital | $ | 9,348,955 | $ | 9,579,705 |
• | Investment Banking and Capital Markets includes our investment banking, capital markets and other related services. Investment banking provides underwriting and financial advisory services to our clients across most industry sectors in the Americas, Europe and Asia. Our capital markets businesses operate across the spectrum of equities and fixed income products. Related services include, among other things, prime brokerage and equity finance, research and strategy, corporate lending and real estate finance. Our Investment Banking and Capital Markets businesses are conducted by Jefferies Group, our wholly-owned subsidiary, which is the largest independent U.S. headquartered global full-service, integrated investment banking and securities firm. |
• | Asset Management provides investment management services to investors in the U.S. and overseas and invests capital in hedge funds, separately managed accounts and third-party asset managers. Under the Leucadia Asset Management ("LAM") umbrella, we manage, invest in and provide services to a diverse group of alternative asset management platforms across a spectrum of investment strategies and asset classes. LAM offers institutional clients an innovative range of investment strategies through its affiliated managers. |
• | Merchant Banking: |
◦ | Our oil and gas business consists of Vitesse Energy Finance and JETX Energy. Vitesse Energy Finance is our 97% owned consolidated subsidiary that acquires and invests in non-operated oil and gas working interests and royalties predominantly in the Bakken Shale oil field in North Dakota. JETX Energy is our 98% owned consolidated subsidiary that currently has non-operated working interests and acreage in east Texas. |
◦ | Our real estate assets primarily consist of our 100% ownership of HomeFed, a developer and owner of residential and mixed-use real estate properties in California, New York, Florida, Virginia and South Carolina. HomeFed's key assets include Otay Ranch, a master planned community that is under development in Chula Vista, CA, made up of approximately 4,450 acres of land entitled for 13,050 total units; and Renaissance Plaza, a mixed-use asset in Brooklyn, NY, comprised of an office building, hotel and garage. |
◦ | We own approximately 42% of the common shares of Linkem, as well as convertible preferred shares which, if converted, would increase our ownership to approximately 54% of Linkem’s common equity at February 29, 2020. Linkem provides residential broadband services in Italy using LTE technologies deployed over the 3.5 GHz spectrum band. Linkem is accounted for under the equity method. |
◦ | Our investment in FXCM and associated companies consist of a senior secured term loan due February 15, 2021, ($71.6 million principal outstanding at February 29, 2020); a 50% voting interest in FXCM and rights to a majority of all distributions in respect of the equity in FXCM. FXCM is a provider of online foreign exchange trading, contract for difference trading, spread betting and related services. |
◦ | Idaho Timber is our consolidated subsidiary engaged in the manufacture and distribution of various wood products. |
◦ | We invested $9.0 million in 2013 in The We Company, which creates collaborative office communities. Currently we own less than 1% of the company. Our interest in The We Company is reflected in Financial instruments owned, at fair value in our financial statements. |
• | Corporate liquidity and other assets, net of Corporate liabilities, primarily consist of cash and cash equivalents, financial instruments owned and the deferred tax asset (exclusive of Jefferies Group's deferred tax asset), net of long-term debt, trade payables and accruals, as well as our outstanding mandatorily redeemable convertible preferred shares. |
Rating | Outlook | |
Moody’s Investors Service | Baa3 | Stable |
Standard and Poor’s | BBB | Stable |
Fitch Ratings | BBB | Stable |
Leverage target (dollars in thousands): | February 29, 2020 | |||
Total Jefferies Financial Group Inc. shareholders' equity | $ | 9,348,955 | ||
Less, investment in Jefferies Group | (6,369,309 | ) | ||
Equity excluding Jefferies Group | 2,979,646 | |||
Less, our two largest investments: | ||||
Vitesse Energy Finance | (556,402 | ) | ||
HomeFed | (491,236 | ) | ||
Equity in a stressed scenario | 1,932,008 | |||
Less, net deferred tax asset excluding Jefferies Group's amount | (217,693 | ) | ||
Equity in a stressed scenario less net deferred tax asset | $ | 1,714,315 | ||
Parent company debt, net of cash in excess of liquidity reserve | $ | (302,317 | ) | |
Parent company debt (see Note 11 to the consolidated financial statements) | $ | 991,705 | ||
Ratio of parent company debt to stressed equity: | ||||
Maximum | 0.50 | x | ||
Actual debt, net of excess liquidity | (0.16 | ) | x | |
Actual debt, net of excess liquidity and excluding net deferred tax asset | (0.18 | ) | x | |
Actual debt (gross) | 0.51 | x | ||
Actual debt, gross and excluding net deferred tax asset | 0.58 | x |
Liquidity reserve (in thousands): | February 29, 2020 | ||
Minimum reserve under liquidity target | $ | 592,500 | |
Additional reserve under parent company debt to stressed equity | $ | 25,701 | |
Actual liquidity | $ | 1,886,522 |
Three Months Ended February 29, 2020 | Three Months Ended February 28, 2019 | ||||||
Cash, cash equivalents and restricted cash at beginning of period | $ | 8,480,435 | $ | 6,012,662 | |||
Net cash used for operating activities | (918,083 | ) | (783,955 | ) | |||
Net cash provided by (used for) investing activities | (49,310 | ) | 1,074,852 | ||||
Net cash used for financing activities | (316,165 | ) | (38,337 | ) | |||
Effect of foreign exchange rate changes on cash, cash equivalents and restricted cash | (2,927 | ) | 13,194 | ||||
Cash, cash equivalents and restricted cash at end of period | $ | 7,193,950 | $ | 6,278,416 |
Three Months Ended February 29, 2020 | Year Ended November 30, 2019 | ||||||
Securities purchased under agreements to resell: | |||||||
Period end | $ | 4,907 | $ | 4,300 | |||
Month end average | 9,541 | 7,762 | |||||
Maximum month end | 12,061 | 11,589 | |||||
Securities sold under agreements to repurchase: | |||||||
Period end | $ | 8,406 | $ | 7,505 | |||
Month end average | 15,148 | 14,686 | |||||
Maximum month end | 18,979 | 19,654 |
• | Repayment of all unsecured debt maturing within one year and no incremental unsecured debt issuance; |
• | Maturity rolloff of outstanding letters of credit with no further issuance and replacement with cash collateral; |
• | Higher margin requirements than currently exist on assets on securities financing activity, including repurchase agreements; |
• | Liquidity outflows related to possible credit downgrade; |
• | Lower availability of secured funding; |
• | Client cash withdrawals; |
• | The anticipated funding of outstanding investment and loan commitments; and |
• | Certain accrued expenses and other liabilities and fixed costs. |
• | Illiquid assets such as equipment, goodwill, net intangible assets, exchange memberships, deferred tax assets and certain investments; |
• | A portion of securities inventory that is not expected to be financed on a secured basis in a credit stressed environment (i.e., margin requirements); and |
• | Drawdowns of unfunded commitments. |
February 29, 2020 | Average Balance First Quarter 2020 (1) | November 30, 2019 | |||||||||
Cash and cash equivalents: | |||||||||||
Cash in banks | $ | 1,380,410 | $ | 2,309,925 | $ | 983,816 | |||||
Money market investments (2) | 3,520,382 | 2,364,585 | 4,584,087 | ||||||||
Total cash and cash equivalents | 4,900,792 | 4,674,510 | 5,567,903 | ||||||||
Other sources of liquidity: | |||||||||||
Debt securities owned and securities purchased under agreements to resell (3) | 638,442 | 788,292 | 972,624 | ||||||||
Other (4) | 831,700 | 721,180 | 377,296 | ||||||||
Total other sources | 1,470,142 | 1,509,472 | 1,349,920 | ||||||||
Total cash and cash equivalents and other liquidity sources | $ | 6,370,934 | $ | 6,183,982 | $ | 6,917,823 |
(1) | Average balances are calculated based on weekly balances. |
(2) | At February 29, 2020 and November 30, 2019, $3,423.0 million and $4,496.7 million, respectively, was invested in U.S. government money funds that invest at least 99.5% of its total assets in cash, securities issued by the U.S. government and U.S. government-sponsored entities, and repurchase agreements that are fully collateralized by cash or government securities. The remaining $97.4 million and $87.4 million at February 29, 2020 and November 30, 2019, respectively, are invested in AAA rated prime money funds. The average balance of U.S. government money funds for the quarter ended February 29, 2020 was $2,035.4 million. |
(3) | Consists of high quality sovereign government securities and reverse repurchase agreements collateralized by U.S. government securities and other high quality sovereign government securities; deposits with a central bank within the European Economic Area, Canada, Australia, Japan, Switzerland or the U.S.; and securities issued by a designated multilateral development bank and reverse repurchase agreements with underlying collateral comprised of these securities. |
(4) | Other includes unencumbered inventory representing an estimate of the amount of additional secured financing that could be reasonably expected to be obtained from financial instruments owned that are currently not pledged after considering reasonable financing haircuts. |
February 29, 2020 | November 30, 2019 | ||||||||||||||
Liquid Financial Instruments | Unencumbered Liquid Financial Instruments (2) | Liquid Financial Instruments | Unencumbered Liquid Financial Instruments (2) | ||||||||||||
Corporate equity securities | $ | 3,451,826 | $ | 301,520 | $ | 2,403,589 | $ | 256,624 | |||||||
Corporate debt securities | 2,071,179 | 47,331 | 1,893,605 | 29,412 | |||||||||||
U.S. government, agency and municipal securities | 2,335,187 | 137,400 | 2,894,264 | 151,414 | |||||||||||
Other sovereign obligations | 2,751,554 | 1,075,977 | 2,633,636 | 969,800 | |||||||||||
Agency mortgage-backed securities (1) | 1,581,852 | — | 1,757,077 | — | |||||||||||
Loans and other receivables | 497,702 | — | 655,120 | — | |||||||||||
Total | $ | 12,689,300 | $ | 1,562,228 | $ | 12,237,291 | $ | 1,407,250 |
(1) | Consists solely of agency mortgage-backed securities issued by Freddie Mac, Fannie Mae and Ginnie Mae. These securities include pass-through securities, securities backed by adjustable rate mortgages, collateralized mortgage obligations, commercial mortgage-backed securities and interest- and principal-only securities. |
(2) | Unencumbered liquid balances represent assets that can be sold or used as collateral for a loan, but have not been. |
• | Credit Facility. One of Jefferies Group's subsidiaries has the Jefferies Group Credit Facility with JPMorgan Chase Bank, N.A. for a committed amount of $296.0 million. Interest is based on an annual alternative base rate or an adjusted London Interbank Offered Rate ("LIBOR"), as defined in the Jefferies Group Credit Facility. The Jefferies Group Credit Facility contains certain covenants that, among other things, require Jefferies Group LLC to maintain a specified level of tangible net worth. The covenants also require the borrower to maintain specified leverage amounts and impose certain restrictions on the borrower’s future indebtedness. At February 29, 2020, we were in compliance with all debt covenants under the Jefferies Group Credit Facility. |
• | Intraday Credit Facility. The Bank of New York Mellon has agreed to make revolving intraday credit advances ("Jefferies Group Intraday Credit Facility") for an aggregate committed amount of $150.0 million. The Jefferies Group Intraday Credit Facility is structured so that advances are generally repaid before the end of each business day. However, if an advance is not repaid by the end of any business day, the advance is converted to an overnight loan. Intraday loans accrue interest at a rate of 0.12%. Interest is charged based on the number of minutes in a day the advance is outstanding. Overnight loans are charged interest at the base rate plus 3% on a daily basis. The base rate is the higher of the federal funds rate plus 0.50% or the prime rate in effect at that time. The Jefferies Group Intraday Credit Facility contains financial covenants, which include a minimum regulatory net capital requirement for Jefferies Group's U.S. broker-dealer, Jefferies LLC. At February 29, 2020, we were in compliance with all debt covenants under the Jefferies Group Intraday Credit Facility. |
Rating | Outlook | |
Moody’s Investors Service | Baa3 | Stable |
Standard and Poor’s | BBB | Stable |
Fitch Ratings | BBB | Stable |
• | The description of our business and risk factors contained in our Annual Report on Form 10-K for the fiscal year ended November 30, 2019 and filed with the SEC on January 29, 2020 (the "2019 10-K") and in Part II, Item 1A herein; |
• | The discussion and analysis of financial condition and result of operations contained in this report under the caption "Management's Discussion and Analysis of Financial Condition and Results of Operations" herein; |
• | The notes to the consolidated financial statements in this report; and |
• | Cautionary statements we make in our public documents, reports and announcements. |
Daily VaR (1) Value-at-Risk in Trading Portfolios | ||||||||||||||||||||||||||||||||
(In millions) | ||||||||||||||||||||||||||||||||
Risk Categories | VaR at February 29, 2020 | Daily VaR for the Three Months Ended February 29, 2020 | VaR at November 30, 2019 | Daily VaR for the Three Months Ended November 30, 2019 | ||||||||||||||||||||||||||||
Average | High | Low | Average | High | Low | |||||||||||||||||||||||||||
Interest Rates | $ | 5.91 | $ | 4.81 | $ | 7.01 | $ | 3.93 | $ | 4.81 | $ | 4.76 | $ | 5.85 | $ | 3.76 | ||||||||||||||||
Equity Prices | 6.13 | 6.79 | 8.54 | 4.34 | 5.07 | 6.71 | 10.33 | 4.86 | ||||||||||||||||||||||||
Currency Rates | 0.39 | 0.29 | 0.69 | 0.13 | 0.32 | 0.29 | 0.48 | 0.15 | ||||||||||||||||||||||||
Commodity Prices | 0.66 | 0.84 | 1.30 | 0.49 | 0.64 | 0.96 | 2.43 | 0.64 | ||||||||||||||||||||||||
Diversification Effect (2) | (6.44 | ) | (5.34 | ) | N/A | N/A | (6.14 | ) | (5.01 | ) | N/A | N/A | ||||||||||||||||||||
Firmwide | $ | 6.65 | $ | 7.39 | $ | 10.51 | $ | 5.02 | $ | 4.70 | $ | 7.71 | $ | 12.17 | $ | 4.70 |
(1) | For the VaR numbers reported above, a one day time horizon, with a one year look-back period, and a 95% confidence level were used. |
(2) | The diversification effect is not applicable for the maximum and minimum VaR values as Jefferies Group's firmwide VaR and VaR values for the four risk categories might have occurred on different days during the period. |
10% Sensitivity | |||
Investments in funds (1) | $ | 89,014 | |
Private investments | 25,070 | ||
Corporate debt securities in default | 10,820 | ||
Trade claims | 2,863 |
(1) | Includes investments in hedge funds, fund of funds and private equity funds. For additional information on these investments, see Note 3 in our consolidated financial statements. |
• | Loans and lending arising in connection with our investment banking and capital markets activities, which reflects our exposure at risk on a default event with no recovery of loans. Current exposure represents loans that have been drawn by the borrower and lending commitments that are outstanding. In addition, credit exposures on forward settling traded loans are included within our loans and lending exposures for consistency with the balance sheet categorization of these items. Loans and lending also arise in connection with our portion of Jefferies Group's Secured Revolving Credit Facility that is with Jefferies Group and Massachusetts Mutual Life Insurance Company, to be funded equally, to support loan underwritings by Jefferies Finance. See Note 8 for additional information on this facility. In addition, Jefferies Group has loans outstanding to certain of its officers and employees (none of whom are executive officers or directors). See Note 22 for additional information on these employee loans. |
• | Securities and margin financing transactions, which reflect our credit exposure arising from reverse repurchase agreements, repurchase agreements and securities lending agreements to the extent the fair value of the underlying collateral differs from the contractual agreement amount and from margin provided to customers. |
• | Over-the-counter derivatives, which are reported net by counterparty when a legal right of setoff exists under an enforceable master netting agreement. Over-the-counter derivative exposure is based on a contract at fair value, net of cash collateral received or posted under credit support agreements. In addition, credit exposures on forward settling trades are included within our derivative credit exposures. |
• | Cash and cash equivalents, which includes both interest-bearing and non-interest-bearing deposits at banks. |
• | Client on-boarding and approving counterparty credit limits; |
• | Negotiating, approving and monitoring credit terms in legal and master documentation; |
• | Determining the analytical standards and risk parameters for ongoing management and monitoring credit risk books; |
• | Actively managing daily exposure, exceptions and breaches; and |
• | Monitoring daily margin call activity and counterparty performance. |
Counterparty Credit Exposure by Credit Rating | |||||||||||||||||||||||||||||||||||||||||||||||
Loans and Lending | Securities and Margin Finance | OTC Derivatives | Total | Cash and Cash Equivalents | Total with Cash and Cash Equivalents | ||||||||||||||||||||||||||||||||||||||||||
At | At | At | At | At | At | ||||||||||||||||||||||||||||||||||||||||||
February 29, 2020 | November 30, 2019 | February 29, 2020 | November 30, 2019 | February 29, 2020 | November 30, 2019 | February 29, 2020 | November 30, 2019 | February 29, 2020 | November 30, 2019 | February 29, 2020 | November 30, 2019 | ||||||||||||||||||||||||||||||||||||
AAA Range | $ | — | $ | — | $ | 0.7 | $ | 1.5 | $ | — | $ | — | $ | 0.7 | $ | 1.5 | $ | 3,520.4 | $ | 4,584.1 | $ | 3,521.1 | $ | 4,585.6 | |||||||||||||||||||||||
AA Range | 45.4 | 45.2 | 83.7 | 43.0 | 0.8 | 3.7 | 129.9 | 91.9 | 5.0 | 5.3 | 134.9 | 97.2 | |||||||||||||||||||||||||||||||||||
A Range | 0.1 | 1.1 | 568.3 | 531.9 | 185.0 | 152.4 | 753.4 | 685.4 | 1,372.9 | 976.3 | 2,126.3 | 1,661.7 | |||||||||||||||||||||||||||||||||||
BBB Range | 250.2 | 250.2 | 125.1 | 140.9 | 19.1 | 48.3 | 394.4 | 439.4 | 1.8 | 1.6 | 396.2 | 441.0 | |||||||||||||||||||||||||||||||||||
BB or Lower | 15.0 | 15.0 | 21.3 | 6.6 | 231.0 | 154.1 | 267.3 | 175.7 | 0.1 | — | 267.4 | 175.7 | |||||||||||||||||||||||||||||||||||
Unrated | 90.9 | 94.2 | — | — | 13.1 | 6.8 | 104.0 | 101.0 | 0.6 | 0.6 | 104.6 | 101.6 | |||||||||||||||||||||||||||||||||||
Total | $ | 401.6 | $ | 405.7 | $ | 799.1 | $ | 723.9 | $ | 449.0 | $ | 365.3 | $ | 1,649.7 | $ | 1,494.9 | $ | 4,900.8 | $ | 5,567.9 | $ | 6,550.5 | $ | 7,062.8 |
Counterparty Credit Exposure by Region | |||||||||||||||||||||||||||||||||||||||||||||||
Loans and Lending | Securities and Margin Finance | OTC Derivatives | Total | Cash and Cash Equivalents | Total with Cash and Cash Equivalents | ||||||||||||||||||||||||||||||||||||||||||
At | At | At | At | At | At | ||||||||||||||||||||||||||||||||||||||||||
February 29, 2020 | November 30, 2019 | February 29, 2020 | November 30, 2019 | February 29, 2020 | November 30, 2019 | February 29, 2020 | November 30, 2019 | February 29, 2020 | November 30, 2019 | February 29, 2020 | November 30, 2019 | ||||||||||||||||||||||||||||||||||||
Asia/Latin America/Other | $ | 15.0 | $ | 15.0 | $ | 50.6 | $ | 50.5 | $ | 0.7 | $ | 0.3 | $ | 66.3 | $ | 65.8 | $ | 142.9 | $ | 100.4 | $ | 209.2 | $ | 166.2 | |||||||||||||||||||||||
Europe | 0.1 | — | 379.1 | 324.1 | 72.0 | 101.1 | 451.2 | 425.2 | 170.0 | 74.1 | 621.2 | 499.3 | |||||||||||||||||||||||||||||||||||
North America | 386.5 | 390.7 | 369.4 | 349.3 | 376.3 | 263.9 | 1,132.2 | 1,003.9 | 4,587.9 | 5,393.4 | 5,720.1 | 6,397.3 | |||||||||||||||||||||||||||||||||||
Total | $ | 401.6 | $ | 405.7 | $ | 799.1 | $ | 723.9 | $ | 449.0 | $ | 365.3 | $ | 1,649.7 | $ | 1,494.9 | $ | 4,900.8 | $ | 5,567.9 | $ | 6,550.5 | $ | 7,062.8 |
Counterparty Credit Exposure by Industry | |||||||||||||||||||||||||||||||||||||||||||||||
Loans and Lending | Securities and Margin Finance | OTC Derivatives | Total | Cash and Cash Equivalents | Total with Cash and Cash Equivalents | ||||||||||||||||||||||||||||||||||||||||||
At | At | At | At | At | At | ||||||||||||||||||||||||||||||||||||||||||
February 29, 2020 | November 30, 2019 | February 29, 2020 | November 30, 2019 | February 29, 2020 | November 30, 2019 | February 29, 2020 | November 30, 2019 | February 29, 2020 | November 30, 2019 | February 29, 2020 | November 30, 2019 | ||||||||||||||||||||||||||||||||||||
Asset Managers | $ | 0.1 | $ | — | $ | 1.5 | $ | 1.7 | $ | 0.4 | $ | — | $ | 2.0 | $ | 1.7 | $ | 3,520.4 | $ | 4,584.1 | $ | 3,522.4 | $ | 4,585.8 | |||||||||||||||||||||||
Banks, Broker-dealers | 250.4 | 250.7 | 589.9 | 526.7 | 215.0 | 206.8 | 1,055.3 | 984.2 | 1,380.4 | 983.8 | 2,435.7 | 1,968.0 | |||||||||||||||||||||||||||||||||||
Corporates | 81.6 | 81.3 | — | — | 212.4 | 154.4 | 294.0 | 235.7 | — | — | 294.0 | 235.7 | |||||||||||||||||||||||||||||||||||
Other | 69.5 | 73.7 | 207.7 | 195.5 | 21.2 | 4.1 | 298.4 | 273.3 | — | — | 298.4 | 273.3 | |||||||||||||||||||||||||||||||||||
Total | $ | 401.6 | $ | 405.7 | $ | 799.1 | $ | 723.9 | $ | 449.0 | $ | 365.3 | $ | 1,649.7 | $ | 1,494.9 | $ | 4,900.8 | $ | 5,567.9 | $ | 6,550.5 | $ | 7,062.8 |
February 29, 2020 | |||||||||||||||||||||||||||||||||||
Issuer Risk | Counterparty Risk | Issuer and Counterparty Risk | |||||||||||||||||||||||||||||||||
Fair Value of Long Debt Securities | Fair Value of Short Debt Securities | Net Derivative Notional Exposure | Loans and Lending | Securities and Margin Finance | OTC Derivatives | Cash and Cash Equivalents | Excluding Cash and Cash Equivalents | Including Cash and Cash Equivalents | |||||||||||||||||||||||||||
United Kingdom | $ | 703.8 | $ | (388.6 | ) | $ | (60.9 | ) | $ | 0.1 | $ | 76.8 | $ | 25.3 | $ | 146.8 | $ | 356.5 | $ | 503.3 | |||||||||||||||
Italy | 1,281.6 | (840.5 | ) | (52.8 | ) | — | — | 0.4 | — | 388.7 | 388.7 | ||||||||||||||||||||||||
Japan | 358.4 | (275.1 | ) | 138.4 | — | 22.9 | — | 16.0 | 244.6 | 260.6 | |||||||||||||||||||||||||
Australia | 33.8 | (29.0 | ) | 194.3 | — | 9.2 | 0.6 | 11.6 | 208.9 | 220.5 | |||||||||||||||||||||||||
Netherlands | 371.2 | (207.0 | ) | 2.4 | — | 34.2 | 0.4 | — | 201.2 | 201.2 | |||||||||||||||||||||||||
Canada | 516.2 | (463.9 | ) | (13.1 | ) | — | 7.4 | 109.5 | 1.6 | 156.1 | 157.7 | ||||||||||||||||||||||||
Hong Kong | 53.6 | (12.2 | ) | — | — | 1.4 | — | 84.6 | 42.8 | 127.4 | |||||||||||||||||||||||||
Belgium | 246.8 | (138.5 | ) | 3.2 | — | 0.2 | — | — | 111.7 | 111.7 | |||||||||||||||||||||||||
China | 463.3 | (339.2 | ) | (22.5 | ) | — | — | — | — | 101.6 | 101.6 | ||||||||||||||||||||||||
Spain | 292.5 | (201.2 | ) | 0.6 | — | 3.1 | — | — | 95.0 | 95.0 | |||||||||||||||||||||||||
Total | $ | 4,321.2 | $ | (2,895.2 | ) | $ | 189.6 | $ | 0.1 | $ | 155.2 | $ | 136.2 | $ | 260.6 | $ | 1,907.1 | $ | 2,167.7 |
November 30, 2019 | |||||||||||||||||||||||||||||||||||
Issuer Risk | Counterparty Risk | Issuer and Counterparty Risk | |||||||||||||||||||||||||||||||||
Fair Value of Long Debt Securities | Fair Value of Short Debt Securities | Net Derivative Notional Exposure | Loans and Lending | Securities and Margin Finance | OTC Derivatives | Cash and Cash Equivalents | Excluding Cash and Cash Equivalents | Including Cash and Cash Equivalents | |||||||||||||||||||||||||||
Netherlands | $ | 946.0 | $ | (329.7 | ) | $ | (100.1 | ) | $ | — | $ | 42.6 | $ | 0.5 | $ | — | $ | 559.3 | $ | 559.3 | |||||||||||||||
United Kingdom | 416.1 | (199.9 | ) | (124.4 | ) | — | 60.7 | 37.6 | 54.1 | 190.1 | 244.2 | ||||||||||||||||||||||||
Italy | 1,262.3 | (1,192.4 | ) | 105.4 | — | — | 0.4 | — | 175.7 | 175.7 | |||||||||||||||||||||||||
France | 423.4 | (296.2 | ) | (93.1 | ) | — | 94.2 | 40.9 | — | 169.2 | 169.2 | ||||||||||||||||||||||||
Canada | 380.4 | (362.2 | ) | 7.4 | — | 0.3 | 81.2 | 1.9 | 107.1 | 109.0 | |||||||||||||||||||||||||
Spain | 249.2 | (137.3 | ) | (25.7 | ) | — | 3.3 | — | — | 89.5 | 89.5 | ||||||||||||||||||||||||
Japan | 76.0 | (171.6 | ) | 133.8 | — | 24.7 | — | 13.2 | 62.9 | 76.1 | |||||||||||||||||||||||||
China | 283.3 | (236.9 | ) | 25.6 | — | — | — | — | 72.0 | 72.0 | |||||||||||||||||||||||||
Mexico | 112.0 | (68.3 | ) | 13.0 | — | — | — | — | 56.7 | 56.7 | |||||||||||||||||||||||||
Germany | 238.2 | (321.3 | ) | 19.3 | — | 88.3 | 14.4 | 13.6 | 38.9 | 52.5 | |||||||||||||||||||||||||
Total | $ | 4,386.9 | $ | (3,315.8 | ) | $ | (38.8 | ) | $ | — | $ | 314.1 | $ | 175.0 | $ | 82.8 | $ | 1,521.4 | $ | 1,604.2 |
• | Employees contracting COVID-19 |
• | Reductions in our operating effectiveness as our employees work from home or disaster-recovery locations |
• | Unavailability of key personnel necessary to conduct our business activities |
• | Unprecedented volatility in global financial markets |
• | Reductions in revenue across our operating businesses |
• | Delay in planned entry into, or expansion of, investments or projects in China and surrounding areas |
• | Closure of our offices or the offices of our clients |
• | De-globalization |
(a) Total Number of Shares Purchased (1) | (b) Average Price Paid per Share | (c) Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs (2) | (d) Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs (2) | ||||||||||
December 1, 2019 to December 31, 2019 | 1,709,367 | $ | 20.95 | 1,660,650 | $ | 172,724 | |||||||
January 1, 2020 to January 31, 2020 | 5,358,558 | $ | 21.95 | 5,324,521 | $ | 309,684 | |||||||
February 1, 2020 to February 29, 2020 (3) | 7,670,046 | $ | 22.67 | 7,670,046 | $ | 139,711 | |||||||
Total | 14,737,971 | 14,655,217 |
(1) | Includes an aggregate 82,754 shares repurchased other than as part of our publicly announced Board authorized repurchase program. We repurchased these securities in connection with our share compensation plans which allow participants to use shares to satisfy certain tax liabilities arising from the vesting of restricted shares and the distribution of restricted share units. The total number of shares purchased does not include unvested shares forfeited back to us pursuant to the terms of our share compensation plans. |
(2) | In January 2020, the Board of Directors approved an additional $250.0 million share repurchase authorization. At February 29, 2020, $139.7 million remains available for future purchases. The approximate dollar value of shares that may be purchased under the plans or programs in the table above related to these shares is based on the month end closing price of Jefferies common shares. In March 2020, having completed the repurchase of shares under the previous authorization, the Board of Directors approved an additional share repurchase authorization of $100 million. Subsequent to February 29, 2020, we purchased a total of 8,358,899 of our common shares for $144.3 million, or an average price per share of $17.26. |
(3) | Includes 931,200 shares that settled in March 2020. |
Item 6. | Exhibits. |
31.1 | |
31.2 | |
32.1 | |
32.2 | |
101 | Financial statements from the Quarterly Report on Form 10-Q of Jefferies Financial Group Inc. for the quarter ended February 29, 2020, formatted in Inline Extensible Business Reporting Language (iXBRL): (i) the Consolidated Statements of Financial Condition, (ii) the Consolidated Statements of Operations, (iii) the Consolidated Statements of Comprehensive Income (Loss), (iv) the Consolidated Statements of Cash Flows, (v) the Consolidated Statements of Changes in Equity and (vi) the Notes to Consolidated Financial Statements. |
104 | Cover Page Interactive Data File, formatted in iXBRL (included in Exhibit 101) |
JEFFERIES FINANCIAL GROUP INC. | |||
(Registrant) | |||
Date: April 8, 2020 | By: | /s/ John M. Dalton | |
Name: John M. Dalton | |||
Title: Vice President and Controller | |||
(Duly Authorized Officer and Chief Accounting Officer) |
1. | I have reviewed this quarterly report on Form 10-Q of Jefferies Financial Group Inc.; |
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. | The registrant's other certifying officer and I are 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. | The registrant's other certifying officer and 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: April 8, 2020 | By: | /s/ Richard B. Handler |
Richard B. Handler | ||
Chief Executive Officer |
1. | I have reviewed this quarterly report on Form 10-Q of Jefferies Financial Group Inc.; |
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. | The registrant's other certifying officer and I are 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. | The registrant's other certifying officer and 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: April 8, 2020 | By: | /s/ Teresa S. Gendron | |
Teresa S. Gendron | |||
Chief Financial Officer | |||
Date: April 8, 2020 | By: | /s/ Richard B. Handler | |
Richard B. Handler | |||
Chief Executive Officer |
Date: April 8, 2020 | By: | /s/ Teresa S. Gendron | |
Teresa S. Gendron | |||
Chief Financial Officer |
Fair Value Disclosures (Investment in FXCM Narrative) (Details) - Investment in FXCM $ in Millions |
Feb. 29, 2020
USD ($)
|
---|---|
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Senior secured term loan receivable, principal outstanding | $ 71.6 |
Equity method investment, ownership percentage | 50.00% |
Loans to and Investments In Associated Companies (Berkadia) (Narrative) (Details) - USD ($) $ in Millions |
12 Months Ended | |
---|---|---|
Dec. 31, 2009 |
Feb. 29, 2020 |
|
Berkadia | ||
Investments In Associated Companies [Line Items] | ||
Surety policy issued | $ 1,500.0 | |
Reimbursement of losses incurred, maximum percentage | 50.00% | |
Commercial paper | $ 1,470.0 | |
Berkadia | ||
Investments In Associated Companies [Line Items] | ||
Capital contributed | $ 217.2 | |
Equity method investment, ownership percentage | 50.00% | |
Percentage of profits received from joint venture | 45.00% | |
Reimbursement of losses incurred, maximum percentage | 50.00% |
Collateralized Transactions (Narrative) (Details) - USD ($) $ in Thousands |
Feb. 29, 2020 |
Nov. 30, 2019 |
---|---|---|
Banking and Thrift [Abstract] | ||
Fair value of securities received as collateral that may be sold or repledged | $ 27,600,000 | $ 28,700,000 |
Cash and securities segregated and on deposit for regulatory purposes or deposited with clearing and depository organizations | $ 742,134 | $ 796,797 |
Other Fair Value Information (Details) - USD ($) $ in Thousands |
Feb. 29, 2020 |
Nov. 30, 2019 |
---|---|---|
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Short-term borrowings | $ 623,156 | $ 548,490 |
Long-term debt | 8,451,504 | 8,337,061 |
Carrying Amount | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Notes and loans receivable | 798,548 | 775,501 |
Short-term borrowings | 623,156 | 548,490 |
Long-term debt | 7,096,790 | 7,121,776 |
Fair Value | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Notes and loans receivable | 781,367 | 784,053 |
Short-term borrowings | 623,156 | 548,490 |
Long-term debt | $ 7,699,370 | $ 7,569,837 |
Derivative Financial Instruments (Credit Related Derivative Contracts) (Details) - USD ($) $ in Millions |
Feb. 29, 2020 |
Nov. 30, 2019 |
---|---|---|
Index credit default swaps | ||
Derivative [Line Items] | ||
Notional amount | $ 293.0 | $ 35.0 |
Single name credit default swaps | ||
Derivative [Line Items] | ||
Notional amount | 25.7 | 33.9 |
Investment Grade | Index credit default swaps | ||
Derivative [Line Items] | ||
Notional amount | 2.0 | 3.0 |
Investment Grade | Single name credit default swaps | ||
Derivative [Line Items] | ||
Notional amount | 17.8 | 3.4 |
Non-investment grade | Index credit default swaps | ||
Derivative [Line Items] | ||
Notional amount | 291.0 | 32.0 |
Non-investment grade | Single name credit default swaps | ||
Derivative [Line Items] | ||
Notional amount | 7.9 | 29.0 |
Unrated | Index credit default swaps | ||
Derivative [Line Items] | ||
Notional amount | 0.0 | 0.0 |
Unrated | Single name credit default swaps | ||
Derivative [Line Items] | ||
Notional amount | $ 0.0 | $ 1.5 |
Loans to and Investments In Associated Companies (Real Estate Associated Companies) (Narrative) (Details) $ in Millions |
3 Months Ended |
---|---|
Feb. 29, 2020
USD ($)
ft²
Taxlot
Sites
Seat
| |
Brooklyn Renaissance Plaza and Hotel | |
Investments In Associated Companies [Line Items] | |
Weighted average useful life | 38 years |
RedSky JZ Fulton Mall | |
Investments In Associated Companies [Line Items] | |
Equity method investment, other than temporary impairment | $ | $ 55.6 |
54 Madison | |
Investments In Associated Companies [Line Items] | |
Equity method investment, ownership percentage | 48.10% |
Number of seats in investment committee retained by Company | Seat | 2 |
Number of seats in investment committee | Seat | 4 |
HomeFed | Brooklyn Renaissance Plaza and Hotel | Hotel | |
Investments In Associated Companies [Line Items] | |
Equity method investment, ownership percentage | 25.80% |
HomeFed | Brooklyn Renaissance Plaza and Hotel | Office Building | |
Investments In Associated Companies [Line Items] | |
Equity method investment, ownership percentage | 61.25% |
HomeFed | RedSky JZ Fulton Mall | |
Investments In Associated Companies [Line Items] | |
Number of separate tax lots | Taxlot | 14 |
Number of premier development sites | Sites | 2 |
Area of property (up to) | ft² | 540,000 |
Equity method investment, other than temporary impairment | $ | $ 55.6 |
HomeFed | RedSky JZ Fulton Mall | Development site | |
Investments In Associated Companies [Line Items] | |
Equity method investment, ownership percentage | 49.00% |
Intangible Assets, Net and Goodwill |
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Goodwill and Intangible Assets Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Intangible Assets, Net and Goodwill | Intangible Assets, Net and Goodwill A summary of Intangible assets, net and goodwill is as follows (in thousands):
Estimated fair values were determined based on valuation techniques that we believe market participants would use and included price-to-earnings, price-to-book multiples and discounted cash flow techniques. Based on the relative fair values of each of the components, $143.0 million of the total $1,699.8 million goodwill within the historical Investment Banking, Capital Markets and Asset Management segment was allocated to the new Asset Management segment. In order to compare results with prior periods, we have recast November 30, 2019 goodwill in the same manner. We performed an impairment test immediately before and after the reallocation of goodwill between the new segments and the results of the impairment test did not indicate any goodwill impairment.
Amortization expense on intangible assets included in Income from continuing operations was $3.8 million and $3.3 million for the three months ended February 29, 2020 and February 28, 2019, respectively. The estimated aggregate future amortization expense for the intangible assets for each of the next five years is as follows (in thousands):
|
Nature of Operations |
3 Months Ended |
---|---|
Feb. 29, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Nature of Operations | Nature of Operations Jefferies Financial Group Inc. ("Jefferies," "we," "our" or the "Company") is a diversified financial services company engaged in investment banking and capital markets, asset management and direct investing. Jefferies Group LLC ("Jefferies Group"), our largest subsidiary, is the largest independent full-service global investment banking firm headquartered in the U.S. Jefferies Group operates in two business segments: Investment Banking and Capital Markets and Asset Management. Investment Banking and Capital Markets includes investment banking, capital markets and other related services. Investment banking provides underwriting and financial advisory services to clients across most industry sectors in the Americas, Europe and Asia. Capital markets businesses operate across the spectrum of equities, fixed income and foreign exchange products. Related services include, among other things, prime brokerage and equity finance, research and strategy, corporate lending and real estate finance. Our Asset Management segment includes both the operations of Leucadia Asset Management ("LAM") as well as the asset management operations within Jefferies Group. Within Asset Management, we manage, invest in and provide services to a diverse group of alternative asset management platforms across a spectrum of investment strategies and asset classes. Asset Management offers institutional clients an innovative range of investment strategies through its affiliated managers. Merchant Banking is where we own a portfolio of businesses and investments, including Linkem (fixed wireless broadband services in Italy); Vitesse Energy, LLC ("Vitesse Energy Finance") and JETX Energy, LLC ("JETX Energy") (oil and gas production and development); real estate, primarily including HomeFed LLC ("HomeFed"); Idaho Timber (manufacturing); FXCM Group, LLC ("FXCM") (provider of online foreign exchange trading services); and The We Company (global network of workspaces). Our Merchant Banking businesses and investments also included National Beef Packing Company, LLC ("National Beef") (beef processing), prior to its sale in November 2019 and Spectrum Brands Holdings, Inc. ("Spectrum Brands") (consumer products), prior to its distribution to shareholders in October 2019. The structure of each of our investments was tailored to the unique opportunity each transaction presented. Our investments may be reflected in our consolidated results as consolidated subsidiaries, equity investments, securities or in other ways, depending on the structure of our specific holdings. We own approximately 42% of the common shares of Linkem, as well as convertible preferred shares which, if converted, would increase our ownership to approximately 54% of Linkem's common equity at February 29, 2020. Linkem provides residential broadband services in Italy using LTE technologies deployed over the 3.5 GHz spectrum band. Linkem is accounted for under the equity method. Vitesse Energy Finance is our 97% owned consolidated subsidiary that acquires and invests in non-operated working interests and royalties predominantly in the Bakken Shale oil field in North Dakota. JETX Energy is our 98% owned consolidated subsidiary that currently has non-operated working interests and acreage in east Texas. HomeFed is our consolidated subsidiary that owns and develops residential and mixed use real estate properties. Prior to July 1, 2019, we owned approximately 70% of HomeFed and accounted for it under the equity method. On July 1, 2019, we completed a merger with HomeFed by which we acquired the remaining common stock of HomeFed. From July 1, 2019, the results of HomeFed are reflected on a consolidated basis. Idaho Timber is our consolidated subsidiary engaged in the manufacture and distribution of various wood products. Our investment in FXCM and associated companies consist of a senior secured term loan due February 15, 2021, ($71.6 million principal outstanding at February 29, 2020); a 50% voting interest in FXCM and rights to a majority of all distributions in respect of the equity of FXCM. We invested $9.0 million in 2013 in The We Company, which creates collaborative office communities, and have received $31.0 million in cash to date. We own less than 1% of The We Company. Our interest in The We Company is reflected in Financial instruments owned, at fair value in our financial statements.
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Collateralized Transactions |
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Banking and Thrift [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Collateralized Transactions | Collateralized Transactions Our repurchase agreements and securities borrowing and lending arrangements are generally recorded at cost in the Consolidated Statements of Financial Condition, which is a reasonable approximation of their fair values due to their short-term nature. We enter into secured borrowing and lending arrangements to obtain collateral necessary to effect settlement, finance inventory positions, meet customer needs or re-lend as part of dealer operations. We monitor the fair value of the securities loaned and borrowed on a daily basis as compared with the related payable or receivable, and request additional collateral or returns excess collateral, as appropriate. We pledge financial instruments as collateral under repurchase agreements, securities lending agreements and other secured arrangements, including clearing arrangements. Our agreements with counterparties generally contain contractual provisions allowing the counterparty the right to sell or repledge the collateral. Pledged securities owned that can be sold or repledged by the counterparty are included in Financial instruments owned, at fair value and noted parenthetically as Securities pledged in the Consolidated Statements of Financial Condition. In instances where we receive securities as collateral in connection with securities-for-securities transactions in which we are the lender of securities and are permitted to sell or repledge the securities received as collateral, the fair value of the collateral received and the related obligation to return the collateral is reported in the Consolidated Statements of Financial Condition. The following tables set forth the carrying value of securities lending arrangements, repurchase agreements and obligation to return securities received as collateral by class of collateral pledged and remaining contractual maturity (in thousands):
We receive securities as collateral under resale agreements, securities borrowing transactions and customer margin loans. We also receive securities as collateral in connection with securities-for-securities transactions in which we are the lender of securities. In many instances, we are permitted by contract to rehypothecate the securities received as collateral. These securities may be used to secure repurchase agreements, enter into securities lending transactions, satisfy margin requirements on derivative transactions or cover short positions. At February 29, 2020 and November 30, 2019, the approximate fair value of securities received as collateral by us that may be sold or repledged was $27.6 billion and $28.7 billion, respectively. At February 29, 2020 and November 30, 2019, a substantial portion of the securities received have been sold or repledged. Offsetting of Securities Financing Agreements To manage our exposure to credit risk associated with securities financing transactions, we may enter into master netting agreements and collateral arrangements with counterparties. Generally, transactions are executed under standard industry agreements, including, but not limited to, master securities lending agreements (securities lending transactions) and master repurchase agreements (repurchase transactions). The following table provides information regarding repurchase agreements, securities borrowing and lending arrangements and securities received as collateral and obligation to return securities received as collateral that are recognized in the Consolidated Statements of Financial Condition and (1) the extent to which, under enforceable master netting arrangements, such balances are presented net in the Consolidated Statements of Financial Condition as appropriate under GAAP and (2) the extent to which other rights of setoff associated with these arrangements exist and could have an effect on our consolidated financial position.
Cash and Securities Segregated and on Deposit for Regulatory Purposes or Deposited with Clearing and Depository Organizations Cash and securities deposited with clearing and depository organizations and segregated in accordance with regulatory regulations totaled $742.1 million and $796.8 million at February 29, 2020 and November 30, 2019, respectively. Segregated cash and securities consist of deposits in accordance with Rule 15c3-3 of the Securities Exchange Act of 1934, which subjects Jefferies LLC as a broker-dealer carrying customer accounts to requirements related to maintaining cash or qualified securities in segregated special reserve bank accounts for the exclusive benefit of its customers.
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Basis of Presentation and Significant Accounting Policies (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Feb. 29, 2020 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accounting Policies [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Supplemental cash flow information | Supplemental Cash Flow Information
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Related Party Transactions |
3 Months Ended |
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Feb. 29, 2020 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | Related Party Transactions Jefferies Capital Partners Related Funds. Jefferies Group has equity investments in the JCP Manager and in private equity funds (including JCP Fund V), which are managed by a team led by our President and a Director ("Private Equity Related Funds"). Reflected in the Consolidated Statements of Financial Condition at February 29, 2020 and November 30, 2019 are Jefferies Group's equity investments in Private Equity Related Funds of $23.8 million and $23.0 million, respectively. Net gains (losses) from Jefferies Group's investment in JCP Fund V aggregating $1.5 million and $(3.2) million for the three months ended February 29, 2020 and February 28, 2019, respectively, were recorded in Principal transactions revenues. Gains (losses) for other funds were not material. For further information regarding our commitments and funded amounts to the Private Equity Related Funds, see Notes 7 and 19. Berkadia Commercial Mortgage, LLC. At February 29, 2020 and November 30, 2019, Jefferies Group has commitments to purchase $328.3 million and $360.4 million, respectively, in agency commercial mortgage-backed securities from Berkadia. FXCM. Jefferies Group entered into a foreign exchange prime brokerage agreement with FXCM in 2017. In connection with the foreign exchange contracts entered into under this agreement, Jefferies Group had $12.7 million and $9.9 million at February 29, 2020 and November 30, 2019, respectively, included in Payables, expense accruals and other liabilities and $0.7 million at February 29, 2020 in Financial instruments sold, not yet purchased, at fair value, in the Consolidated Statements of Financial Condition. Officers, Directors and Employees. We have $43.3 million and $44.8 million of loans outstanding to certain officers and employees (none of whom are an executive officer or director of the Company) at February 29, 2020 and November 30, 2019, respectively. Receivables from and payables to customers include balances arising from officers', directors' and employees' individual security transactions. These transactions are subject to the same regulations as all customer transactions and are provided on substantially the same terms. Jefferies Finance. During November 2019, we purchased $65.3 million of loan receivables from Jefferies Finance which settled during the three months ended February 29, 2020. See Note 8 for additional information on transactions with Jefferies Finance.
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Mezzanine Equity |
3 Months Ended |
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Feb. 29, 2020 | |
Temporary Equity Disclosure [Abstract] | |
Mezzanine Equity | Mezzanine Equity Redeemable Noncontrolling Interests At February 29, 2020 and November 30, 2019, redeemable noncontrolling interests include other redeemable noncontrolling interests of $24.8 million and $26.6 million, respectively, primarily related to our oil and gas exploration and development businesses. Mandatorily Redeemable Convertible Preferred Shares In connection with our acquisition of Jefferies Group in March 2013, we issued a new series of 3.25% Cumulative Convertible Preferred Shares ("Preferred Shares") ($125.0 million at mandatory redemption value) in exchange for Jefferies Group's outstanding 3.25% Series A-1 Cumulative Convertible Preferred Stock. The Preferred Shares have a 3.25% annual, cumulative cash dividend and are currently convertible into 4,440,863 common shares, an effective conversion price of $28.15 per share. The holders of the Preferred Shares are also entitled to an additional quarterly payment in the event we declare and pay a dividend on our common stock in an amount greater than $0.0625 per common share per quarter. The additional quarterly payment would be paid to the holders of Preferred Shares on an as converted basis and on a per share basis would equal the quarterly dividend declared and paid to a holder of a share of common stock in excess of $0.0625 per share. In the first quarter of 2020, we increased our quarterly dividend from $0.125 to $0.15 per common share. This increased the preferred stock dividend from $1.3 million for the three months ended February 28, 2019 to $1.4 million for the three months ended February 29, 2020. Based on our current quarterly dividend of $0.15 per common share, the effective rate on these Preferred Shares is approximately 4.5%. The Preferred Shares are callable beginning in 2023 at a price of $1,000 per share plus accrued interest and are mandatorily redeemable in 2038.
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Cover - shares |
3 Months Ended | |
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Feb. 29, 2020 |
Apr. 01, 2020 |
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Cover [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Feb. 29, 2020 | |
Document Transition Report | false | |
Entity File Number | 1-5721 | |
Entity Registrant Name | JEFFERIES FINANCIAL GROUP INC. | |
Entity Incorporation, State or Country Code | NY | |
Entity Tax Identification Number | 13-2615557 | |
Entity Address, Address Line One | 520 Madison Avenue | |
Entity Address, City or Town | New York, | |
Entity Address, State or Province | NY | |
Entity Address, Postal Zip Code | 10022 | |
City Area Code | 212 | |
Local Phone Number | 460-1900 | |
Title of 12(b) Security | Common Shares, par value $1 per share | |
Trading Symbol | JEF | |
Security Exchange Name | NYSE | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 268,829,938 | |
Entity Central Index Key | 0000096223 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --11-30 | |
Document Fiscal Year Focus | 2020 | |
Document Fiscal Period Focus | Q1 |
Consolidated Statements of Comprehensive Income (Loss) - USD ($) $ in Thousands |
3 Months Ended | |
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Feb. 29, 2020 |
Feb. 28, 2019 |
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Statement of Comprehensive Income [Abstract] | ||
Net income | $ 112,021 | $ 47,015 |
Other comprehensive income (loss): | ||
Net unrealized holding gains (losses) on investments arising during the period, net of income tax provision (benefit) of $81 and $107 | 237 | 317 |
Less: reclassification adjustment for net (gains) losses included in net income, net of income tax provision (benefit) of $0 and $(377) | 0 | 1,129 |
Net change in unrealized holding gains (losses) on investments, net of income tax provision (benefit) of $81 and $484 | 237 | 1,446 |
Net unrealized foreign exchange gains (losses) arising during the period, net of income tax provision (benefit) of $(3,147) and $7,722 | (9,233) | 30,954 |
Less: reclassification adjustment for foreign exchange (gains) losses included in net income, net of income tax provision (benefit) of $0 and $0 | 0 | 0 |
Net change in unrealized foreign exchange gains (losses), net of income tax provision (benefit) of $(3,147) and $7,722 | (9,233) | 30,954 |
Net unrealized gains (losses) on instrument specific credit risk arising during the period, net of income tax provision (benefit) of $7,939 and $5,949 | 23,248 | 17,535 |
Less: reclassification adjustment for instrument specific credit risk (gains) losses included in net income, net of income tax provision (benefit) of $86 and $(99) | (252) | 294 |
Net change in unrealized instrument specific credit risk gains (losses), net of income tax provision (benefit) of $7,853 and $6,048 | 22,996 | 17,829 |
Net unrealized gains (losses) on cash flow hedges arising during the period, net of income tax provision (benefit) of $0 and $(86) | 0 | (251) |
Less: reclassification adjustment for cash flow hedges (gains) losses included in net income (loss), net of income tax provision (benefit) of $0 and $0 | 0 | 0 |
Net change in unrealized cash flow hedges gains (losses), net of income tax provision (benefit) of $0 and $(86) | 0 | (251) |
Net pension gains (losses) arising during the period, net of income tax provision (benefit) of $0 and $0 | 0 | 0 |
Reclassification adjustment for pension (gains) losses included in net income, net of income tax provision (benefit) of $(224) and $(119) | 639 | 355 |
Net change in pension liability, net of income tax provision (benefit) of $224 and $119 | 639 | 355 |
Other comprehensive income, net of income taxes | 14,639 | 50,333 |
Comprehensive income | 126,660 | 97,348 |
Comprehensive (income) loss attributable to the noncontrolling interests | (2,129) | 1,066 |
Comprehensive loss attributable to the redeemable noncontrolling interests | 282 | 138 |
Preferred stock dividends | (1,422) | (1,276) |
Comprehensive income attributable to Jefferies Financial Group Inc. common shareholders | $ 127,649 | $ 95,144 |
Income Taxes |
3 Months Ended |
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Feb. 29, 2020 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes The aggregate amount of gross unrecognized tax benefits related to uncertain tax positions was $346.9 million (including $70.7 million for interest) at February 29, 2020, of which $208.1 million related to Jefferies Group, and was $327.3 million (including $67.2 million for interest) at November 30, 2019, of which $181.2 million related to Jefferies Group. If recognized, such amounts would lower our effective tax rate. We recognize interest and penalties, if any, related to unrecognized tax benefits in income tax expense. No material penalties were accrued for the three months ended February 29, 2020 and February 28, 2019. The net deferred tax asset was $447.2 million and $462.5 million at February 29, 2020 and November 30, 2019, respectively. The deferred tax asset is predominately attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases, the largest component of which relates to compensation and benefits. The statute of limitations with respect to our federal income tax returns has expired for all years through 2015. We are currently under examination by various major tax jurisdictions. Prior to becoming a wholly-owned subsidiary, Jefferies Group filed a consolidated U.S. federal income tax return with its qualifying subsidiaries and was subject to income tax in various states, municipalities and foreign jurisdictions and Jefferies Group is also currently under examination by various major tax jurisdictions. We do not expect that resolution of these examinations will have a significant effect on the Consolidated Statements of Financial Condition, but could have a significant impact on the Consolidated Statements of Operations for the period in which resolution occurs. Our provision for income taxes for the three months ended February 29, 2020 was $45.8 million, representing an effective tax rate of 29.0%. Our provision for income taxes for the three months ended February 28, 2019 was $2.3 million, representing an effective tax rate of 4.7%. Our provision for income taxes for the three months ended February 28, 2019 was reduced by $6.7 million related to completing our accounting for tax reform enacted in 2017.
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Consolidated Statements of Changes In Equity - USD ($) $ in Thousands |
Total |
Common Shares $1 Par Value |
Additional Paid-In Capital |
Accumulated Other Comprehensive Income (Loss) |
Retained Earnings |
Subtotal |
Noncontrolling Interests |
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Beginning Balance at Nov. 30, 2018 | $ 10,079,257 | $ 307,515 | $ 3,854,847 | $ 288,286 | $ 5,610,218 | $ 10,060,866 | $ 18,391 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net income | 45,877 | 44,811 | 44,811 | 1,066 | |||
Other comprehensive loss, net of taxes | 50,333 | 50,333 | 50,333 | ||||
Contributions from noncontrolling interests | 4,705 | 4,705 | |||||
Distributions to noncontrolling interests | (981) | (981) | |||||
Share-based compensation expense | 11,813 | 11,813 | 11,813 | ||||
Change in fair value of redeemable noncontrolling interests | (536) | (536) | (536) | ||||
Purchase of common shares for treasury | (197,093) | (9,728) | (187,365) | (197,093) | |||
Dividends | (40,094) | (40,094) | (40,094) | ||||
Other | 2,852 | 526 | 2,326 | 2,852 | 0 | ||
Ending Balance at Feb. 28, 2019 | 9,956,133 | 298,313 | 3,681,085 | 338,619 | 5,614,935 | 9,932,952 | 23,181 |
Beginning Balance at Nov. 30, 2019 | 9,601,684 | 291,644 | 3,627,711 | (273,039) | 5,933,389 | 9,579,705 | 21,979 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net income | 110,881 | 113,010 | 113,010 | (2,129) | |||
Other comprehensive loss, net of taxes | 14,639 | 14,639 | 14,639 | ||||
Contributions from noncontrolling interests | 17,100 | 0 | 17,100 | ||||
Share-based compensation expense | 9,947 | 9,947 | 9,947 | ||||
Change in fair value of redeemable noncontrolling interests | 1,564 | 1,564 | 1,564 | ||||
Purchase of common shares for treasury | (327,501) | (14,738) | (312,763) | (327,501) | |||
Dividends | (45,786) | (45,786) | (45,786) | ||||
Other | 3,377 | 203 | 3,174 | 3,377 | 0 | ||
Ending Balance at Feb. 29, 2020 | $ 9,385,905 | $ 277,109 | $ 3,329,633 | $ (258,400) | $ 6,000,613 | $ 9,348,955 | $ 36,950 |
Leases (Tables) |
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Leases [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Lease Costs | We enter into lease and sublease agreements primarily for office space across our geographic locations. Finance lease ROU assets and finance lease liabilities are not material. Information related to leases in the Consolidated Statement of Financial Condition is as follows (in thousands, except lease term and discount rate):
Consolidated Statement of Cash Flows supplemental information is as follows (in thousands):
The following table presents our lease costs (in thousands):
(1) Includes short-term leases, which are not material. (2) Includes property taxes, insurance costs, common area maintenance, utilities, and other costs that are not fixed. The amount also includes rent increases resulting from inflation indices and periodic market rent reviews. |
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Maturity Of Operating Lease Liability | The following table presents the maturities of our operating lease liabilities and a reconciliation to the Lease liabilities included in the Consolidated Statement of Financial Condition at February 29, 2020 (in thousands):
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Schedule of Future Minimum Rental Payments for Operating Leases | Minimum Future Lease Commitments (under Previous GAAP). As lessee, we lease certain premises and equipment under non-cancelable agreements expiring at various dates through 2039 which are operating leases. At November 30, 2019, future minimum annual lease payments under such leases (net of sublease income) were as follows (in thousands):
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Loans to and Investments In Associated Companies (Tables) |
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Equity Method Investments and Joint Ventures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Loans to and Investments in Associated Companies | A summary of Loans to and investments in associated companies accounted for under the equity method of accounting during the three months ended February 29, 2020 and February 28, 2019 is as follows (in thousands):
Income (losses) related to associated companies includes the following (in thousands):
Income (losses) primarily related to Jefferies Group's associated companies (primarily classified in Other revenues) includes the following (in thousands):
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Schedule of Equity Method Investments | The following table provides required summarized data for certain equity method investments. The table includes Jefferies Finance, Berkadia and Fiesta Restaurant Group, Inc. for the three months ended February 29, 2020 and February 28, 2019, and National Beef for the three months ended February 28, 2019 (in thousands):
The following summarizes activity related to our other transactions with Jefferies Finance (in millions):
(4) Under a service agreement, Jefferies Group charged Jefferies Finance for services provided.
|
Leases (Lease Costs) (Details) $ in Thousands |
3 Months Ended |
---|---|
Feb. 29, 2020
USD ($)
| |
Leases [Abstract] | |
Operating lease costs | $ 19,249 |
Variable lease costs | 3,515 |
Less: Sublease income | (1,848) |
Total lease cost, net | $ 20,916 |
Derivative Financial Instruments (Counterparty Credit Quality With Respect To Fair Value Of OTC Derivatives Assets) (Details) $ in Thousands |
Feb. 29, 2020
USD ($)
|
---|---|
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
A- or higher | $ 261,971 |
BBB- to BBB | 49,721 |
BB or lower | 295,398 |
Unrated | 196,473 |
Total OTC derivative assets included in Financial instruments owned, at fair value | $ 803,563 |
Intangible Assets, Net and Goodwill (Narrative) (Details) - USD ($) $ in Millions |
3 Months Ended | |
---|---|---|
Feb. 29, 2020 |
Feb. 28, 2019 |
|
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Amortization expense on intangible assets | $ 3.8 | $ 3.3 |
Fair Value Disclosures (Quantitative Information About Significant Unobservable Inputs Used In Level 3 Fair Value Measurements) (Details) $ in Thousands |
3 Months Ended | 12 Months Ended | |||||||||
---|---|---|---|---|---|---|---|---|---|---|---|
Feb. 29, 2020
USD ($)
|
Nov. 30, 2019
USD ($)
|
Feb. 29, 2020 |
Feb. 29, 2020
$ / shares
|
Feb. 29, 2020
€ / Bond
|
Feb. 29, 2020
$ / Bond
|
Nov. 30, 2019 |
Nov. 30, 2019
$ / shares
|
Nov. 30, 2019
gbpPerShare
|
Nov. 30, 2019
€ / Bond
|
Nov. 30, 2019
$ / Bond
|
|
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Financial instruments owned, at fair value | $ 17,498,867 | $ 16,308,807 | |||||||||
Derivative assets | 637,768 | 418,408 | |||||||||
Financial instruments sold, not yet purchased, at fair value | 9,879,387 | 10,532,460 | |||||||||
Derivative liability | 697,612 | 527,205 | |||||||||
Long-term debt, fair value | 1,354,714 | 1,215,285 | |||||||||
Corporate debt securities | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Financial instruments owned, at fair value | 2,866,145 | 2,479,735 | |||||||||
Financial instruments sold, not yet purchased, at fair value | 1,773,257 | 1,471,482 | |||||||||
CDOs and CLOs | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Financial instruments owned, at fair value | 127,109 | 153,013 | |||||||||
Residential mortgage-backed securities | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Financial instruments owned, at fair value | 1,097,665 | 1,086,806 | |||||||||
Commercial mortgage-backed securities | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Financial instruments owned, at fair value | 445,933 | 430,170 | |||||||||
Financial instruments sold, not yet purchased, at fair value | 35 | 35 | |||||||||
Other asset-backed securities | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Financial instruments owned, at fair value | 301,912 | 346,410 | |||||||||
Loans and other receivables | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Financial instruments owned, at fair value | 2,794,346 | 2,574,631 | |||||||||
Corporate equity securities | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Financial instruments owned, at fair value | 3,767,274 | 2,783,993 | |||||||||
Financial instruments sold, not yet purchased, at fair value | 2,132,054 | 2,767,526 | |||||||||
Loans | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Financial instruments sold, not yet purchased, at fair value | 1,820,886 | 1,609,691 | |||||||||
Level 3 | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Financial instruments owned, at fair value | 594,316 | 554,618 | |||||||||
Derivative assets | 22,216 | 13,826 | |||||||||
Financial instruments sold, not yet purchased, at fair value | 147,023 | 106,382 | |||||||||
Derivative liability | 134,087 | 92,057 | |||||||||
Long-term debt, fair value | 543,463 | 480,069 | |||||||||
Level 3 | Price | Market approach | Minimum | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Long-term debt, measurement input | 72 | 90 | 74 | 84 | |||||||
Level 3 | Price | Market approach | Maximum | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Long-term debt, measurement input | 105 | 102 | 103 | 108 | |||||||
Level 3 | Price | Market approach | Weighted Average | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Long-term debt, measurement input | 91 | 94 | 91 | 96 | |||||||
Level 3 | Non-exchange-traded securities | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Financial instruments owned, at fair value | 78,543 | 29,017 | |||||||||
Level 3 | Non-exchange-traded securities | Price | Market approach | Minimum | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Financial instrument owned, measurement input | $ / shares | 1 | 1 | |||||||||
Level 3 | Non-exchange-traded securities | Price | Market approach | Maximum | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Financial instrument owned, measurement input | $ / shares | 213 | 140 | |||||||||
Level 3 | Non-exchange-traded securities | Price | Market approach | Weighted Average | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Financial instrument owned, measurement input | $ / shares | 105 | 55 | |||||||||
Level 3 | Non-exchange-traded securities | Underlying stock price | Market approach | Minimum | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Financial instrument owned, measurement input | $ / shares | 3 | 3 | |||||||||
Level 3 | Non-exchange-traded securities | Underlying stock price | Market approach | Maximum | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Financial instrument owned, measurement input | $ / shares | 5 | 5 | |||||||||
Level 3 | Non-exchange-traded securities | Underlying stock price | Market approach | Weighted Average | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Financial instrument owned, measurement input | $ / shares | 4 | 4 | |||||||||
Level 3 | Corporate debt securities | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Financial instruments owned, at fair value | 25,090 | 7,490 | |||||||||
Financial instruments sold, not yet purchased, at fair value | 767 | 340 | |||||||||
Level 3 | Corporate debt securities | Price | Market approach | Minimum | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Financial instrument owned, measurement input | 69 | ||||||||||
Level 3 | Corporate debt securities | Price | Market approach | Maximum | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Financial instrument owned, measurement input | 78 | ||||||||||
Level 3 | Corporate debt securities | Price | Market approach | Weighted Average | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Financial instrument owned, measurement input | 69 | ||||||||||
Level 3 | Corporate debt securities | Underlying stock price | Scenario analysis | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Financial instrument owned, measurement input | gbpPerShare | 0.4 | ||||||||||
Level 3 | Corporate debt securities | Estimated recovery percentage | Scenario analysis | Minimum | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Financial instrument owned, measurement input | 0.22 | 0.23 | |||||||||
Level 3 | Corporate debt securities | Estimated recovery percentage | Scenario analysis | Maximum | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Financial instrument owned, measurement input | 0.85 | 0.85 | |||||||||
Level 3 | Corporate debt securities | Estimated recovery percentage | Scenario analysis | Weighted Average | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Financial instrument owned, measurement input | 0.41 | 0.46 | |||||||||
Level 3 | Corporate debt securities | Volatility | Scenario analysis | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Financial instrument owned, measurement input | 0.44 | ||||||||||
Level 3 | Corporate debt securities | Credit spread | Scenario analysis | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Financial instrument owned, measurement input | 750 | ||||||||||
Level 3 | CDOs and CLOs | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Financial instruments owned, at fair value | 29,784 | 28,788 | |||||||||
Level 3 | CDOs and CLOs | Estimated recovery percentage | Scenario analysis | Minimum | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Financial instrument owned, measurement input | 0.0325 | 0.0325 | |||||||||
Level 3 | CDOs and CLOs | Estimated recovery percentage | Scenario analysis | Maximum | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Financial instrument owned, measurement input | 0.365 | 0.365 | |||||||||
Level 3 | CDOs and CLOs | Estimated recovery percentage | Scenario analysis | Weighted Average | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Financial instrument owned, measurement input | 0.25 | 0.25 | |||||||||
Level 3 | CDOs and CLOs | Constant prepayment rate | Discounted cash flows | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Financial instrument owned, measurement input | 0.20 | 0.20 | |||||||||
Level 3 | CDOs and CLOs | Constant default rate | Discounted cash flows | Minimum | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Financial instrument owned, measurement input | 0.01 | 0.01 | |||||||||
Level 3 | CDOs and CLOs | Constant default rate | Discounted cash flows | Maximum | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Financial instrument owned, measurement input | 0.02 | 0.02 | |||||||||
Level 3 | CDOs and CLOs | Constant default rate | Discounted cash flows | Weighted Average | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Financial instrument owned, measurement input | 0.02 | 0.02 | |||||||||
Level 3 | CDOs and CLOs | Loss severity | Discounted cash flows | Minimum | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Financial instrument owned, measurement input | 0.25 | 0.25 | |||||||||
Level 3 | CDOs and CLOs | Loss severity | Discounted cash flows | Maximum | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Financial instrument owned, measurement input | 0.70 | 0.37 | |||||||||
Level 3 | CDOs and CLOs | Loss severity | Discounted cash flows | Weighted Average | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Financial instrument owned, measurement input | 0.28 | 0.29 | |||||||||
Level 3 | CDOs and CLOs | Discount rate/yield | Discounted cash flows | Minimum | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Financial instrument owned, measurement input | 0.13 | 0.12 | |||||||||
Level 3 | CDOs and CLOs | Discount rate/yield | Discounted cash flows | Maximum | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Financial instrument owned, measurement input | 0.30 | 0.21 | |||||||||
Level 3 | CDOs and CLOs | Discount rate/yield | Discounted cash flows | Weighted Average | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Financial instrument owned, measurement input | 0.17 | 0.15 | |||||||||
Level 3 | Residential mortgage-backed securities | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Financial instruments owned, at fair value | $ 16,970 | $ 17,740 | |||||||||
Level 3 | Residential mortgage-backed securities | Discount rate/yield | Discounted cash flows | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Financial instrument owned, measurement input | 0.03 | 0.03 | |||||||||
Level 3 | Residential mortgage-backed securities | Cumulative loss rate | Discounted cash flows | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Financial instrument owned, measurement input | 0.02 | 0.02 | |||||||||
Level 3 | Residential mortgage-backed securities | Duration (years) | Discounted cash flows | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Financial instrument owned, measurement input, term | 6 years | 6 years 3 months 18 days | |||||||||
Level 3 | Commercial mortgage-backed securities | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Financial instruments owned, at fair value | $ 4,264 | $ 6,110 | |||||||||
Financial instruments sold, not yet purchased, at fair value | 35 | $ 35 | |||||||||
Level 3 | Commercial mortgage-backed securities | Estimated recovery percentage | Scenario analysis | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Financial instrument owned, measurement input | 0.44 | 0.44 | |||||||||
Level 3 | Commercial mortgage-backed securities | Discount rate/yield | Discounted cash flows | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Financial instrument owned, measurement input | 0.85 | ||||||||||
Level 3 | Commercial mortgage-backed securities | Cumulative loss rate | Discounted cash flows | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Financial instrument owned, measurement input | 0.073 | ||||||||||
Level 3 | Commercial mortgage-backed securities | Duration (years) | Discounted cash flows | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Financial instrument owned, measurement input, term | 2 months 12 days | ||||||||||
Level 3 | Other asset-backed securities | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Financial instruments owned, at fair value | $ 41,903 | $ 42,563 | |||||||||
Level 3 | Other asset-backed securities | Price | Market approach | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Financial instrument owned, measurement input | $ / Bond | 100 | ||||||||||
Level 3 | Other asset-backed securities | Discount rate/yield | Discounted cash flows | Minimum | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Financial instrument owned, measurement input | 0.07 | 0.07 | |||||||||
Level 3 | Other asset-backed securities | Discount rate/yield | Discounted cash flows | Maximum | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Financial instrument owned, measurement input | 0.14 | 0.15 | |||||||||
Level 3 | Other asset-backed securities | Discount rate/yield | Discounted cash flows | Weighted Average | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Financial instrument owned, measurement input | 0.11 | 0.11 | |||||||||
Level 3 | Other asset-backed securities | Cumulative loss rate | Discounted cash flows | Minimum | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Financial instrument owned, measurement input | 0.07 | 0.07 | |||||||||
Level 3 | Other asset-backed securities | Cumulative loss rate | Discounted cash flows | Maximum | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Financial instrument owned, measurement input | 0.31 | 0.31 | |||||||||
Level 3 | Other asset-backed securities | Cumulative loss rate | Discounted cash flows | Weighted Average | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Financial instrument owned, measurement input | 0.14 | 0.16 | |||||||||
Level 3 | Other asset-backed securities | Duration (years) | Discounted cash flows | Minimum | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Financial instrument owned, measurement input, term | 6 months | 6 months | |||||||||
Level 3 | Other asset-backed securities | Duration (years) | Discounted cash flows | Maximum | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Financial instrument owned, measurement input, term | 2 years 9 months 18 days | 3 years | |||||||||
Level 3 | Other asset-backed securities | Duration (years) | Discounted cash flows | Weighted Average | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Financial instrument owned, measurement input, term | 1 year 7 months 6 days | 1 year 6 months | |||||||||
Level 3 | Loans and other receivables | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Financial instruments owned, at fair value | $ 103,243 | $ 114,080 | |||||||||
Level 3 | Loans and other receivables | Market Approach and Scenario Analysis | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Financial instruments owned, at fair value | 52,815 | $ 112,574 | |||||||||
Level 3 | Loans and other receivables | Price | Market approach | Minimum | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Financial instrument owned, measurement input | $ / Bond | 29 | 36 | |||||||||
Level 3 | Loans and other receivables | Price | Market approach | Maximum | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Financial instrument owned, measurement input | $ / Bond | 101 | 100 | |||||||||
Level 3 | Loans and other receivables | Price | Market approach | Weighted Average | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Financial instrument owned, measurement input | $ / Bond | 89 | 90 | |||||||||
Level 3 | Loans and other receivables | Estimated recovery percentage | Scenario analysis | Minimum | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Financial instrument owned, measurement input | 0.63 | 0.87 | |||||||||
Level 3 | Loans and other receivables | Estimated recovery percentage | Scenario analysis | Maximum | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Financial instrument owned, measurement input | 1 | 1.04 | |||||||||
Level 3 | Loans and other receivables | Estimated recovery percentage | Scenario analysis | Weighted Average | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Financial instrument owned, measurement input | 0.79 | 0.99 | |||||||||
Level 3 | Loans and other receivables | Term based on the pay off (years) | Discounted cash flows | Minimum | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Financial instrument owned, measurement input, term | 0 months | ||||||||||
Level 3 | Loans and other receivables | Term based on the pay off (years) | Discounted cash flows | Maximum | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Financial instrument owned, measurement input, term | 1 month 6 days | ||||||||||
Level 3 | Loans and other receivables | Term based on the pay off (years) | Discounted cash flows | Weighted Average | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Financial instrument owned, measurement input, term | 1 month 6 days | ||||||||||
Level 3 | Interest rate swaps | Basis points upfront | Market approach | Minimum | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Derivative asset, measurement input | 0 | 0 | |||||||||
Derivative liability, measurement input | 0 | 0 | |||||||||
Level 3 | Interest rate swaps | Basis points upfront | Market approach | Maximum | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Derivative asset, measurement input | 12 | 16 | |||||||||
Derivative liability, measurement input | 18 | 22 | |||||||||
Level 3 | Interest rate swaps | Basis points upfront | Market approach | Weighted Average | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Derivative asset, measurement input | 6 | 6 | |||||||||
Derivative liability, measurement input | 9 | 13 | |||||||||
Level 3 | Unfunded commitments | Price | Market approach | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Derivative asset, measurement input | $ / Bond | 88 | ||||||||||
Derivative liability, measurement input | $ / Bond | 83 | 88 | |||||||||
Level 3 | Equity options | Volatility | Volatility benchmarking | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Derivative asset, measurement input | 0.45 | ||||||||||
Level 3 | Equity options | Volatility | Volatility benchmarking | Minimum | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Derivative liability, measurement input | 0.21 | 0.21 | |||||||||
Level 3 | Equity options | Volatility | Volatility benchmarking | Maximum | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Derivative liability, measurement input | 0.60 | 0.61 | |||||||||
Level 3 | Equity options | Volatility | Volatility benchmarking | Weighted Average | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Derivative liability, measurement input | 0.42 | 0.43 | |||||||||
Level 3 | Private equity securities | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Financial instruments owned, at fair value | 103,216 | $ 157,504 | |||||||||
Level 3 | Private equity securities | Price | Market approach | Minimum | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Financial instrument owned, measurement input | $ / shares | 8 | 8 | |||||||||
Level 3 | Private equity securities | Price | Market approach | Maximum | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Financial instrument owned, measurement input | $ / shares | 168 | 250 | |||||||||
Level 3 | Private equity securities | Price | Market approach | Weighted Average | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Financial instrument owned, measurement input | $ / shares | 57 | 80 | |||||||||
Level 3 | Private equity securities | Discount rate/yield | Scenario analysis | Minimum | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Financial instrument owned, measurement input | 0.19 | 0.19 | |||||||||
Level 3 | Private equity securities | Discount rate/yield | Scenario analysis | Maximum | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Financial instrument owned, measurement input | 0.21 | 0.21 | |||||||||
Level 3 | Private equity securities | Discount rate/yield | Scenario analysis | Weighted Average | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Financial instrument owned, measurement input | 0.20 | 0.20 | |||||||||
Level 3 | Private equity securities | Revenue growth | Scenario analysis | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Financial instrument owned, measurement input | 0 | 0 | |||||||||
Level 3 | FXCM term loan | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Financial instruments owned, at fair value | $ 61,628 | $ 59,120 | |||||||||
Level 3 | FXCM term loan | Term based on the pay off (years) | Discounted cash flows | Minimum | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Financial instrument owned, measurement input, term | 0 months | 0 months | |||||||||
Level 3 | FXCM term loan | Term based on the pay off (years) | Discounted cash flows | Maximum | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Financial instrument owned, measurement input, term | 1 year | 1 year 2 months 12 days | |||||||||
Level 3 | FXCM term loan | Term based on the pay off (years) | Discounted cash flows | Weighted Average | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Financial instrument owned, measurement input, term | 1 year | 1 year 2 months 12 days | |||||||||
Level 3 | Securities purchased under agreements to resell | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Securities purchased under agreements to resell | $ 25,000 | ||||||||||
Level 3 | Securities purchased under agreements to resell | Duration (years) | Market approach | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Securities purchased under agreements to resell, measurement input, term | 1 year 6 months | ||||||||||
Level 3 | Securities purchased under agreements to resell | Spread to 6 month LIBOR | Market approach | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Securities purchased under agreements to resell, measurement input | 500 | ||||||||||
Level 3 | Corporate equity securities | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Financial instruments owned, at fair value | $ 103,683 | $ 58,426 | |||||||||
Financial instruments sold, not yet purchased, at fair value | 4,275 | 4,487 | |||||||||
Level 3 | Corporate equity securities | Transaction level | Market approach | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Financial instruments sold, not yet purchased, measurement input | $ / shares | 1 | 1 | |||||||||
Level 3 | Loans | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Financial instruments sold, not yet purchased, at fair value | 7,859 | 9,463 | |||||||||
Debt instrument, fair value | $ 5,074 | $ 9,463 | |||||||||
Level 3 | Loans | Price | Market approach | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Debt instrument, measurement input | $ / Bond | 50 | ||||||||||
Level 3 | Loans | Price | Market approach | Minimum | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Debt instrument, measurement input | $ / Bond | 50 | ||||||||||
Level 3 | Loans | Price | Market approach | Maximum | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Debt instrument, measurement input | $ / Bond | 100 | ||||||||||
Level 3 | Loans | Price | Market approach | Weighted Average | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Debt instrument, measurement input | $ / Bond | 88 | ||||||||||
Level 3 | Loans | Estimated recovery percentage | Scenario analysis | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Debt instrument, measurement input | 0.63 | 0.01 | |||||||||
Level 3 | Cross currency swaps | Basis points upfront | Market approach | |||||||||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||||||||||
Derivative liability, measurement input | 2 | 2 |
Revenues from Contracts with Customers (Disaggregation of Revenue) (Details) - USD ($) $ in Thousands |
3 Months Ended | |
---|---|---|
Feb. 29, 2020 |
Feb. 28, 2019 |
|
Disaggregation of Revenue [Line Items] | ||
Revenue from contracts with customers | $ 912,816 | $ 570,000 |
Americas | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contracts with customers | 786,311 | 449,105 |
Europe, Middle East and Africa | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contracts with customers | 83,321 | 103,727 |
Asia | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contracts with customers | 43,184 | 17,168 |
Reportable Segments | Investment Banking and Capital Markets | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contracts with customers | 771,537 | 440,738 |
Reportable Segments | Investment Banking and Capital Markets | Americas | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contracts with customers | 649,069 | 323,389 |
Reportable Segments | Investment Banking and Capital Markets | Europe, Middle East and Africa | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contracts with customers | 79,438 | 100,205 |
Reportable Segments | Investment Banking and Capital Markets | Asia | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contracts with customers | 43,030 | 17,144 |
Reportable Segments | Asset Management | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contracts with customers | 6,091 | 8,318 |
Reportable Segments | Asset Management | Americas | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contracts with customers | 2,568 | 5,030 |
Reportable Segments | Asset Management | Europe, Middle East and Africa | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contracts with customers | 3,523 | 3,288 |
Reportable Segments | Asset Management | Asia | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contracts with customers | 0 | 0 |
Reportable Segments | Merchant Banking | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contracts with customers | 135,293 | 121,136 |
Reportable Segments | Merchant Banking | Americas | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contracts with customers | 134,779 | 120,878 |
Reportable Segments | Merchant Banking | Europe, Middle East and Africa | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contracts with customers | 360 | 234 |
Reportable Segments | Merchant Banking | Asia | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contracts with customers | 154 | 24 |
Reportable Segments | Corporate | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contracts with customers | 0 | 0 |
Reportable Segments | Corporate | Americas | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contracts with customers | 0 | 0 |
Reportable Segments | Corporate | Europe, Middle East and Africa | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contracts with customers | 0 | 0 |
Reportable Segments | Corporate | Asia | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contracts with customers | 0 | 0 |
Consolidation adjustments | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contracts with customers | (105) | (192) |
Consolidation adjustments | Americas | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contracts with customers | (105) | (192) |
Consolidation adjustments | Europe, Middle East and Africa | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contracts with customers | 0 | 0 |
Consolidation adjustments | Asia | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contracts with customers | 0 | 0 |
Equities | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contracts with customers | 176,144 | 151,882 |
Equities | Reportable Segments | Investment Banking and Capital Markets | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contracts with customers | 176,249 | 152,074 |
Equities | Reportable Segments | Asset Management | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contracts with customers | 0 | 0 |
Equities | Reportable Segments | Merchant Banking | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contracts with customers | 0 | 0 |
Equities | Reportable Segments | Corporate | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contracts with customers | 0 | 0 |
Equities | Consolidation adjustments | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contracts with customers | (105) | (192) |
Fixed Income | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contracts with customers | 3,286 | 3,068 |
Fixed Income | Reportable Segments | Investment Banking and Capital Markets | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contracts with customers | 3,286 | 3,068 |
Fixed Income | Reportable Segments | Asset Management | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contracts with customers | 0 | 0 |
Fixed Income | Reportable Segments | Merchant Banking | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contracts with customers | 0 | 0 |
Fixed Income | Reportable Segments | Corporate | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contracts with customers | 0 | 0 |
Fixed Income | Consolidation adjustments | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contracts with customers | 0 | 0 |
Investment Banking - Underwriting | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contracts with customers | 248,844 | 105,114 |
Investment Banking - Underwriting | Reportable Segments | Investment Banking and Capital Markets | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contracts with customers | 248,844 | 105,114 |
Investment Banking - Underwriting | Reportable Segments | Asset Management | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contracts with customers | 0 | 0 |
Investment Banking - Underwriting | Reportable Segments | Merchant Banking | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contracts with customers | 0 | 0 |
Investment Banking - Underwriting | Reportable Segments | Corporate | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contracts with customers | 0 | 0 |
Investment Banking - Underwriting | Consolidation adjustments | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contracts with customers | 0 | 0 |
Investment Banking - Advisory | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contracts with customers | 343,158 | 180,482 |
Investment Banking - Advisory | Reportable Segments | Investment Banking and Capital Markets | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contracts with customers | 343,158 | 180,482 |
Investment Banking - Advisory | Reportable Segments | Asset Management | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contracts with customers | 0 | 0 |
Investment Banking - Advisory | Reportable Segments | Merchant Banking | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contracts with customers | 0 | 0 |
Investment Banking - Advisory | Reportable Segments | Corporate | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contracts with customers | 0 | 0 |
Investment Banking - Advisory | Consolidation adjustments | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contracts with customers | 0 | 0 |
Asset Management | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contracts with customers | 6,091 | 8,318 |
Asset Management | Reportable Segments | Investment Banking and Capital Markets | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contracts with customers | 0 | 0 |
Asset Management | Reportable Segments | Asset Management | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contracts with customers | 6,091 | 8,318 |
Asset Management | Reportable Segments | Merchant Banking | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contracts with customers | 0 | 0 |
Asset Management | Reportable Segments | Corporate | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contracts with customers | 0 | 0 |
Asset Management | Consolidation adjustments | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contracts with customers | 0 | 0 |
Manufacturing revenues | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contracts with customers | 77,607 | 75,425 |
Manufacturing revenues | Reportable Segments | Investment Banking and Capital Markets | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contracts with customers | 0 | 0 |
Manufacturing revenues | Reportable Segments | Asset Management | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contracts with customers | 0 | 0 |
Manufacturing revenues | Reportable Segments | Merchant Banking | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contracts with customers | 77,607 | 75,425 |
Manufacturing revenues | Reportable Segments | Corporate | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contracts with customers | 0 | 0 |
Manufacturing revenues | Consolidation adjustments | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contracts with customers | 0 | 0 |
Oil and gas revenues | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contracts with customers | 42,214 | 36,365 |
Oil and gas revenues | Reportable Segments | Investment Banking and Capital Markets | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contracts with customers | 0 | 0 |
Oil and gas revenues | Reportable Segments | Asset Management | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contracts with customers | 0 | 0 |
Oil and gas revenues | Reportable Segments | Merchant Banking | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contracts with customers | 42,214 | 36,365 |
Oil and gas revenues | Reportable Segments | Corporate | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contracts with customers | 0 | 0 |
Oil and gas revenues | Consolidation adjustments | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contracts with customers | 0 | 0 |
Other revenues | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contracts with customers | 15,472 | 9,346 |
Other revenues | Reportable Segments | Investment Banking and Capital Markets | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contracts with customers | 0 | 0 |
Other revenues | Reportable Segments | Asset Management | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contracts with customers | 0 | 0 |
Other revenues | Reportable Segments | Merchant Banking | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contracts with customers | 15,472 | 9,346 |
Other revenues | Reportable Segments | Corporate | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contracts with customers | 0 | 0 |
Other revenues | Consolidation adjustments | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contracts with customers | $ 0 | $ 0 |
Fair Value Disclosures (Financial Instruments Not Measured at Fair Value) (Details) - USD ($) $ in Thousands |
Feb. 29, 2020 |
Nov. 30, 2019 |
---|---|---|
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash and securities segregated under federal and other regulations | $ 742,134 | $ 796,797 |
US treasury securities | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash and securities segregated under federal and other regulations | $ 331,500 | $ 35,000 |
Compensation Plans (Details) - USD ($) shares in Thousands, $ in Thousands |
3 Months Ended | ||
---|---|---|---|
Feb. 29, 2020 |
Feb. 29, 2020 |
Feb. 28, 2019 |
|
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Share-based compensation | $ 9,947 | $ 11,813 | |
Tax benefit for issuance of share-based awards | 2,600 | $ 3,000 | |
Total unrecognized compensation costs related to nonvested share-based compensation plans | $ 70,800 | $ 70,800 | |
Total unrecognized compensation costs related to nonvested share-based compensation plans, period for recognition | 2 years 3 months 18 days | ||
Other shares issuable (in shares) | 1,004 | 1,004 | |
Potential maximum increase to common shares outstanding from restricted stock and other shares (in shares) | 23,271 | 23,271 | |
Restricted cash awards, cost expected to be recognized | $ 681,000 | $ 681,000 | |
Restricted cash awards, cost expected to be recognized, period | 3 years | ||
Sign-on and retention awards | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting period for award granted | 4 years | ||
Award amortization period | 4 years | ||
Restricted stock with future service required | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Non-option equity instruments, outstanding (in shares) | 1,823 | 1,823 | |
Restricted stock units with future service required | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Non-option equity instruments, outstanding (in shares) | 4,096 | 4,096 | |
Restricted stock units with no future service required | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Non-option equity instruments, outstanding (in shares) | 18,171 | 18,171 |
Long-Term Debt (Narrative) (Details) |
3 Months Ended | |
---|---|---|
Feb. 29, 2020
USD ($)
Contract
|
Nov. 30, 2019
USD ($)
|
|
Structured notes | Jefferies Group | ||
Debt Instrument [Line Items] | ||
Debt issued during period, principal amount, net of retirements | $ 136,200,000 | |
Jefferies Group Revolving Credit Facility | Jefferies Group | ||
Debt Instrument [Line Items] | ||
Debt principal amount | 190,000,000.0 | |
Bank loan obligations | Jefferies Group | ||
Debt Instrument [Line Items] | ||
Debt principal amount | $ 50,000,000.0 | |
Foursight Capital Credit Facilities | ||
Debt Instrument [Line Items] | ||
Number of warehouse credit commitments | Contract | 2 | |
Maximum borrowing capacity | $ 175,000,000.0 | |
Vitesse Energy Finance Revolving Credit Facility | ||
Debt Instrument [Line Items] | ||
Maximum borrowing capacity | 170,000,000.0 | |
Long-term debt, gross | $ 114,000,000.0 | $ 104,000,000.0 |
Percentage of proved reserve value of oil and gas properties (minimum) | 85.00% | |
LIBOR | Bank loan obligations | Jefferies Group | ||
Debt Instrument [Line Items] | ||
Basis spread on variable rate | 1.25% | |
Line of credit | Foursight Capital Credit Facilities | ||
Debt Instrument [Line Items] | ||
Long-term debt, gross | $ 0.0 | $ 98,700,000 |
Consolidated Statements of Cash Flows (Parenthetical) - USD ($) $ in Thousands |
Feb. 29, 2020 |
Feb. 28, 2019 |
---|---|---|
Statement of Cash Flows [Abstract] | ||
Cash and cash equivalents | $ 6,710,659 | $ 5,517,121 |
Cash and securities segregated and on deposit for regulatory purposes or deposited with clearing and depository organizations | 410,632 | 728,406 |
Other assets | 72,659 | 32,889 |
Total cash, cash equivalents and restricted cash | $ 7,193,950 | $ 6,278,416 |
Leases |
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Feb. 29, 2020 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Leases [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Leases | Leases We enter into lease and sublease agreements primarily for office space across our geographic locations. Finance lease ROU assets and finance lease liabilities are not material. Information related to leases in the Consolidated Statement of Financial Condition is as follows (in thousands, except lease term and discount rate):
The following table presents the maturities of our operating lease liabilities and a reconciliation to the Lease liabilities included in the Consolidated Statement of Financial Condition at February 29, 2020 (in thousands):
In addition to the table above, at February 29, 2020, we entered into lease agreements that were signed but had not yet commenced. These operating leases will commence in 2020 with lease terms up to seven years. Lease payments for these agreements will be $1.5 million for the period from lease commencement to the end of the lease terms. The following table presents our lease costs (in thousands):
(1) Includes short-term leases, which are not material. (2) Includes property taxes, insurance costs, common area maintenance, utilities, and other costs that are not fixed. The amount also includes rent increases resulting from inflation indices and periodic market rent reviews. Consolidated Statement of Cash Flows supplemental information is as follows (in thousands):
Minimum Future Lease Commitments (under Previous GAAP). As lessee, we lease certain premises and equipment under non-cancelable agreements expiring at various dates through 2039 which are operating leases. At November 30, 2019, future minimum annual lease payments under such leases (net of sublease income) were as follows (in thousands):
Rental expense, net of sublease rental income, was $65.6 million, $55.7 million, and $60.2 million for the twelve months ended November 30, 2019, the eleven months ended November 30, 2018 and the twelve months ended December 31, 2017, respectively.
|
Revenues from Contracts with Customers |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Revenue from Contract with Customer [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Revenues from Contracts with Customers | Revenues from Contracts with Customers The following table presents our total revenues separated for our revenues from contracts with customers and our other sources of revenues (in thousands):
(1) During the third quarter of 2019, we have reclassified the presentation of certain other fees, primarily related to prime brokerage services offered to clients. These fees were previously presented as Other revenues in the Consolidated Statements of Operations and are now presented within Commissions and other fees. There is no impact on Total revenues as a result of this change in presentation. Previously reported results are presented on a comparable basis. Revenues from contracts with customers are recognized when, or as, we satisfy our performance obligations by transferring the promised goods or services to the 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 our 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 we determine the customer obtains control over the promised good or service. The amount of revenue recognized reflects the consideration we expect to be entitled to in exchange for those promised goods or services (the "transaction price"). In determining the transaction price, we consider 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, we consider the range of possible outcomes, the predictive value of our past experiences, the time period of when uncertainties expect to be resolved and the amount of consideration that is susceptible to factors outside of our influence, such as market volatility or the judgment and actions of third parties. The following provides detailed information on the recognition of our revenues from contracts with customers: Commissions and Other Fees. We earn commission and other fee revenues by executing, settling and clearing transactions for clients primarily in equity, equity-related and futures products. 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 revenues associated with combined trade execution and clearing services, as well as trade execution services on a standalone basis, are recognized at a point in time on trade-date. Commission revenues are generally paid on settlement date and we record a receivable between trade-date and payment on settlement date. We permit institutional customers to allocate a portion of their gross commissions to pay for research products and other services provided by third parties. The amounts allocated for those purposes are commonly referred to as soft dollar arrangements. We act as an agent in the soft dollar arrangements as the customer controls the use of the soft dollars and directs our payments to third-party service providers on our behalf. Accordingly, amounts allocated to soft dollar arrangements are netted against commission revenues in the Consolidated Statements of Operations. We earn account advisory and distribution fees in connection with wealth management services. Account advisory fees are recognized over time using the time-elapsed method as we determined that the customer simultaneously receives and consumes the benefits of investment advisory services as they are provided. Account advisory fees may be paid in advance of a specified service period or in arrears at the end of the specified service period (e.g., quarterly). Account advisory fees paid in advance are initially deferred within Payables, expense accruals and other liabilities in the Consolidated Statements of Financial Condition. Distribution fees are variable and recognized when the uncertainties with respect to the amounts are resolved. Investment Banking. We provide our clients with a full range of financial advisory and underwriting services. Revenues from financial advisory services primarily consist of fees generated in connection with merger, acquisition and restructuring transactions. Advisory fees from mergers and acquisitions engagements are recognized at a point in time when the related transaction is completed, as the performance obligation is to successfully broker a specific transaction. Fees received prior to the completion of the transaction are deferred within Payables, expense accruals and other liabilities in the Consolidated Statements of Financial Condition. Advisory fees from restructuring engagements are recognized over time using a time elapsed measure of progress as our clients simultaneously receive and consume the benefits of those services as they are provided. A significant portion of the fees we receive for our advisory services are considered variable as they are contingent upon a future event (e.g., completion of a transaction or third-party emergence from bankruptcy) and are excluded from the transaction price until the uncertainty associated with the variable consideration is subsequently resolved, which is expected to occur upon achievement of the specified milestone. Payment for advisory services are generally due promptly upon completion of a specified milestone or, for retainer fees, periodically over the course of the engagement. We recognize a receivable between the date of completion of the milestone and payment by the customer. Expenses associated with investment banking advisory engagements are deferred only to the extent they are explicitly reimbursable by the client and the related revenue is recognized at a point in time. All other investment banking advisory related expenses, including expenses incurred related to restructuring assignments, are expensed as incurred. All investment banking advisory expenses are recognized within their respective expense category in the Consolidated Statements of Operations and any expenses reimbursed by our clients are recognized as Investment banking revenues. Underwriting services include underwriting and placement agent services in both the equity and debt capital markets, including private equity placements, initial public offerings, follow-on offerings and equity-linked convertible securities transactions and structuring, underwriting and distributing public and private debt, including investment grade debt, high yield bonds, leveraged loans, municipal bonds and mortgage-backed and asset-backed securities. Underwriting and placement agent revenues are recognized at a point in time on trade-date, as the client obtains the control and benefit of the underwriting offering at that point. Costs associated with underwriting transactions are deferred until the related revenue is recognized or the engagement is otherwise concluded, and are recorded on a gross basis within underwriting costs in the Consolidated Statements of Operations as we are acting as a principal in the arrangement. Any expenses reimbursed by our clients are recognized as Investment banking revenues. Asset Management Fees. We earn management and performance fees in connection with investment advisory services provided to various funds and accounts, which are satisfied over time and measured using a time elapsed measure of progress as the customer receives the benefits of the services evenly throughout the term of the contract. Management and performance fees are considered variable as they are subject to fluctuation (e.g., changes in assets under management, market performance) and/or are contingent on a future event during the measurement period (e.g., meeting a specified benchmark) and are recognized only to the extent it is probable that a significant reversal in the amount of cumulative revenue recognized will not occur when the uncertainty is resolved. Management fees are generally based on month-end assets under management or an agreed upon notional amount and are included in the transaction price at the end of each month when the assets under management or notional amount is known. Performance fees are received when the return on assets under management for a specified performance period exceed certain benchmark returns, "high-water marks" or other performance targets. The performance period related to our performance fees is annual or semi-annual. Accordingly, performance fee revenue will generally be recognized only at the end of the performance period to the extent that the benchmark return has been met. Manufacturing Revenues. Idaho Timber's primary business consists of the sale of lumber that is manufactured or remanufactured at one of its locations. Agreements with customers for these sales specify the type, quantity and price of products to be delivered as well as the delivery date and payment terms. The transaction price is fixed at the time of sale and revenue is generally recognized when the customer takes control of the product. Disaggregation of Revenue The following presents our revenues from contracts with customers disaggregated by major business activity and primary geographic regions (in thousands):
Information on Remaining Performance Obligations and Revenue Recognized from Past Performance We do not disclose information about remaining performance obligations pertaining to contracts that have an original expected duration of one year or less. The transaction price allocated to remaining unsatisfied or partially unsatisfied performance obligations with an original expected duration exceeding one year was not material at February 29, 2020. Investment banking advisory fees that are contingent upon completion of a specific milestone and fees associated with certain distribution services are also excluded as the fees are considered variable and not included in the transaction price at February 29, 2020. During the three months ended February 29, 2020 and February 28, 2019, we recognized $6.4 million and $14.7 million, respectively, of revenues related to performance obligations satisfied (or partially satisfied) in previous periods, mainly due to resolving uncertainties in variable consideration that was constrained in prior periods. In addition, during the three months ended February 29, 2020 and February 28, 2019, we recognized $5.6 million and $4.9 million, respectively, of revenues primarily associated with distribution services, a portion of which relates to prior periods. Contract Balances The timing of revenue recognition may differ from the timing of payment by customers. We record a receivable when revenue is recognized prior to payment and we have an unconditional right to payment. Alternatively, when payment precedes the provision of the related services, we record deferred revenue until the performance obligations are satisfied. We had receivables related to revenues from contracts with customers of $278.4 million and $263.7 million at February 29, 2020 and November 30, 2019, respectively. We had no significant impairments related to these receivables during the three months ended February 29, 2020 and February 28, 2019. Our deferred revenue primarily relates to retainer and milestone fees received in investment banking advisory engagements where the performance obligation has not yet been satisfied. Deferred revenues were $15.5 million and $12.8 million at February 29, 2020 and November 30, 2019, respectively, which are recorded as Payables, expense accruals and other liabilities in the Consolidated Statements of Financial Condition. During the three months ended February 29, 2020, we recognized $5.6 million of deferred revenue from the balance at November 30, 2019. During the three months ended February 28, 2019, we recognized $7.6 million of deferred revenue from the balance at November 30, 2018. Contract Costs We capitalize costs to fulfill contracts associated with investment banking advisory engagements where the revenue is recognized at a point in time and the costs are determined to be recoverable. Capitalized costs to fulfill a contract are recognized at the point in time that the related revenue is recognized. At February 29, 2020 and November 30, 2019, capitalized costs to fulfill a contract were $3.9 million and $4.8 million, respectively, which are recorded in Receivables in the Consolidated Statements of Financial Condition. We recognized expenses of $1.9 million and $2.1 million, during the three months ended February 29, 2020 and February 28, 2019, respectively, related to costs to fulfill a contract that were capitalized as of the beginning of the period. There were no significant impairment charges recognized in relation to these capitalized costs during the three months ended February 29, 2020 and February 28, 2019.
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Consolidated Statements of Operations - USD ($) $ in Thousands |
3 Months Ended | |
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Feb. 29, 2020 |
Feb. 28, 2019 |
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Revenues: | ||
Revenues | $ 1,692,264 | $ 1,195,012 |
Interest expense | 21,554 | 23,018 |
Net revenues | 1,386,328 | 828,443 |
Expenses: | ||
Compensation and benefits | 670,193 | 409,592 |
Cost of sales | 72,443 | 66,921 |
Floor brokerage and clearing fees | 59,181 | 51,868 |
Depreciation and amortization | 39,470 | 33,934 |
Selling, general and other expenses | 297,838 | 221,106 |
Total expenses | 1,160,679 | 806,439 |
Income before income taxes and income (loss) related to associated companies | 225,649 | 22,004 |
Income (loss) related to associated companies | (67,855) | 27,313 |
Income before income taxes | 157,794 | 49,317 |
Income tax provision | 45,773 | 2,302 |
Net income | 112,021 | 47,015 |
Net (income) loss attributable to the noncontrolling interests | 2,129 | (1,066) |
Net loss attributable to the redeemable noncontrolling interests | 282 | 138 |
Preferred stock dividends | (1,422) | (1,276) |
Net income attributable to Jefferies Financial Group Inc. common shareholders | $ 113,010 | $ 44,811 |
Basic earnings per common share attributable to Jefferies Financial Group Inc. common shareholders: | ||
Net income (in dollars per share) | $ 0.37 | $ 0.14 |
Diluted earnings per common share attributable to Jefferies Financial Group Inc. common shareholders: | ||
Net income (in dollars per share) | $ 0.37 | $ 0.14 |
Amounts attributable to Jefferies Financial Group Inc. common shareholders: | ||
Net income attributable to Jefferies Financial Group Inc. common shareholders | $ 113,010 | $ 44,811 |
Commissions and other fees | ||
Revenues: | ||
Revenues | 179,430 | 154,950 |
Principal transactions | ||
Revenues: | ||
Revenues | 404,864 | 246,182 |
Investment banking | ||
Revenues: | ||
Revenues | 592,002 | 285,596 |
Interest income | ||
Revenues: | ||
Revenues | 326,366 | 386,844 |
Manufacturing revenues | ||
Revenues: | ||
Revenues | 77,607 | 75,425 |
Other | ||
Revenues: | ||
Revenues | 111,995 | 46,015 |
Jefferies Group | ||
Revenues: | ||
Interest expense | $ 305,936 | $ 366,569 |
Accumulated Other Comprehensive Income (Loss) (Tables) |
3 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary Of Accumulated Other Comprehensive Income, Net Of Taxes | A summary of accumulated other comprehensive income (loss), net of taxes is as follows (in thousands):
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Schedule Of Accumulated Other Comprehensive Income Reclassifications | Amounts reclassified out of accumulated other comprehensive income (loss) to net income are as follows (in thousands):
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Intangible Assets, Net and Goodwill (Tables) |
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Goodwill and Intangible Assets Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule Of Intangible Assets, Net And Goodwill | A summary of Intangible assets, net and goodwill is as follows (in thousands):
Estimated fair values were determined based on valuation techniques that we believe market participants would use and included price-to-earnings, price-to-book multiples and discounted cash flow techniques. Based on the relative fair values of each of the components, $143.0 million of the total $1,699.8 million goodwill within the historical Investment Banking, Capital Markets and Asset Management segment was allocated to the new Asset Management segment. In order to compare results with prior periods, we have recast November 30, 2019 goodwill in the same manner. We performed an impairment test immediately before and after the reallocation of goodwill between the new segments and the results of the impairment test did not indicate any goodwill impairment.
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Schedule Of Estimated Aggregate Future Amortization Expense | The estimated aggregate future amortization expense for the intangible assets for each of the next five years is as follows (in thousands):
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Intangible Assets, Net and Goodwill (Schedule of Intangible Assets, Net And Goodwill) (Details) - USD ($) $ in Thousands |
Feb. 29, 2020 |
Nov. 30, 2019 |
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Finite-Lived Intangible Assets [Line Items] | ||
Amortizable intangibles | $ 178,773 | $ 182,954 |
Goodwill | 1,739,295 | 1,739,980 |
Total intangible assets, net and goodwill | 1,918,068 | 1,922,934 |
Real estate | ||
Finite-Lived Intangible Assets [Line Items] | ||
Goodwill | 36,711 | 36,711 |
Other operations | ||
Finite-Lived Intangible Assets [Line Items] | ||
Goodwill | 3,459 | 3,459 |
Investment Banking and Capital Markets | ||
Finite-Lived Intangible Assets [Line Items] | ||
Goodwill | 1,556,125 | 1,556,810 |
Asset Management | ||
Finite-Lived Intangible Assets [Line Items] | ||
Goodwill | 143,000 | 143,000 |
Historical Investment Banking, Capital Markets and Asset Management Segment | ||
Finite-Lived Intangible Assets [Line Items] | ||
Goodwill | 1,699,800 | |
Customer and other relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Amortizable intangibles | 57,426 | 59,575 |
Intangible assets, accumulated amortization | 113,077 | 111,060 |
Trademarks and tradename | ||
Finite-Lived Intangible Assets [Line Items] | ||
Amortizable intangibles | 102,729 | 103,790 |
Intangible assets, accumulated amortization | 25,682 | 24,800 |
Other | ||
Finite-Lived Intangible Assets [Line Items] | ||
Amortizable intangibles | 10,349 | 11,316 |
Intangible assets, accumulated amortization | 6,333 | 5,366 |
Exchange and clearing organization membership interests and registrations | ||
Finite-Lived Intangible Assets [Line Items] | ||
Indefinite lived intangibles | $ 8,269 | $ 8,273 |
Fair Value Disclosures (Analysis of Level 3 Assets and Liabilities Narrative) (Details) - USD ($) $ in Thousands |
3 Months Ended | ||
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Feb. 29, 2020 |
Feb. 28, 2019 |
Nov. 30, 2019 |
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Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Transfers of assets from Level 2 to Level 3 | $ 85,300 | $ 60,400 | |
Transfers of assets from Level 3 to Level 2 | 16,800 | 41,200 | |
Transfers of liabilities from Level 2 to Level 3 | 102,500 | 36,600 | |
Transfers of liabilities from Level 3 to Level 2 | 107,400 | 12,900 | |
Net gains (losses) on Level 3 assets (realized and unrealized) | (42,800) | (5,100) | |
Net gains (losses) on Level 3 liabilities (realized and unrealized) | 26,400 | 22,500 | |
Excluded assets from unobservable quantitative information | 157,900 | $ 79,900 | |
Excluded liabilities from unobservable quantitative information | 3,600 | $ 400 | |
Loans and other receivables | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Transfers of assets from Level 2 to Level 3 | 6,000 | 25,800 | |
Transfers of assets from Level 3 to Level 2 | 4,900 | 6,500 | |
Net gains (losses) on Level 3 assets (realized and unrealized) | (4,307) | 814 | |
Other asset-backed securities | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Transfers of assets from Level 2 to Level 3 | 10,800 | ||
Transfers of assets from Level 3 to Level 2 | 6,300 | 12,600 | |
Net gains (losses) on Level 3 assets (realized and unrealized) | (4,159) | (2,290) | |
Corporate debt securities | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Transfers of assets from Level 2 to Level 3 | 16,500 | ||
Net gains (losses) on Level 3 assets (realized and unrealized) | 1,269 | 466 | |
Net gains (losses) on Level 3 liabilities (realized and unrealized) | 189 | 241 | |
Corporate equity securities | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Transfers of assets from Level 2 to Level 3 | 55,400 | ||
Transfers of assets from Level 3 to Level 2 | 2,700 | ||
Net gains (losses) on Level 3 assets (realized and unrealized) | (8,280) | 4,488 | |
Net gains (losses) on Level 3 liabilities (realized and unrealized) | (291) | 2 | |
Investments at fair value | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Net gains (losses) on Level 3 assets (realized and unrealized) | (27,333) | (2,923) | |
Net derivatives | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Transfers of liabilities from Level 2 to Level 3 | 83,000 | 13,900 | |
Transfers of liabilities from Level 3 to Level 2 | 37,300 | ||
Net gains (losses) on Level 3 liabilities (realized and unrealized) | 17,528 | 5,348 | |
Structured notes | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Transfers of liabilities from Level 2 to Level 3 | 13,100 | 22,200 | |
Transfers of liabilities from Level 3 to Level 2 | 69,100 | 9,400 | |
Collateralized debt obligations and collateralized loan obligations | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Transfers of assets from Level 2 to Level 3 | 14,100 | ||
Transfers of assets from Level 3 to Level 2 | 15,700 | ||
Net gains (losses) on Level 3 assets (realized and unrealized) | $ (1,940) | $ (6,726) |
Revenues from Contracts with Customers (Schedule of Components of Revenue) (Details) - USD ($) $ in Thousands |
3 Months Ended | |
---|---|---|
Feb. 29, 2020 |
Feb. 28, 2019 |
|
Disaggregation of Revenue [Line Items] | ||
Revenue from contracts with customers | $ 912,816 | $ 570,000 |
Revenue from other sources | 779,448 | 625,012 |
Total revenues | 1,692,264 | 1,195,012 |
Commissions and other fees | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contracts with customers | 179,430 | 154,950 |
Total revenues | 179,430 | 154,950 |
Investment banking | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contracts with customers | 592,002 | 285,596 |
Total revenues | 592,002 | 285,596 |
Manufacturing revenues | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contracts with customers | 77,607 | 75,425 |
Total revenues | 77,607 | 75,425 |
Other | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contracts with customers | 63,777 | 54,029 |
Principal transactions | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from other sources | 404,864 | 246,182 |
Total revenues | 404,864 | 246,182 |
Interest income | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from other sources | 326,366 | 386,844 |
Total revenues | 326,366 | 386,844 |
Other | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from other sources | $ 48,218 | $ (8,014) |
Fair Value Disclosures (Fair Value Option Election Narrative) (Details) - USD ($) $ in Millions |
3 Months Ended | ||||
---|---|---|---|---|---|
Feb. 28, 2019 |
Feb. 29, 2020 |
Nov. 30, 2019 |
Sep. 16, 2019 |
Nov. 30, 2018 |
|
Fair Value, Option, Quantitative Disclosures [Line Items] | |||||
Loans and other receivables on nonaccrual status and/or 90 days or greater past due | $ 230.2 | $ 127.0 | |||
Loans and other receivables 90 days or greater past due | $ 35.4 | $ 24.8 | |||
Spectrum Brands | |||||
Fair Value, Option, Quantitative Disclosures [Line Items] | |||||
Shares owned, number | 7,514,477 | ||||
Ownership percentage | 15.00% | ||||
Changes in fair value of investments reflected as principal transactions | $ 36.0 | ||||
Dividends payable | $ 451.1 |
Mezzanine Equity (Details) - USD ($) $ / shares in Units, $ in Thousands |
1 Months Ended | 3 Months Ended | ||
---|---|---|---|---|
Mar. 31, 2013 |
Feb. 29, 2020 |
Feb. 28, 2019 |
Nov. 30, 2019 |
|
Purchase Requirement [Line Items] | ||||
Redeemable noncontrolling interests | $ 24,800 | $ 26,600 | ||
Mandatorily redeemable convertible preferred shares redemption value | $ 125,000 | $ 125,000 | ||
Dividends per common share (in dollars per share) | $ 0.15 | $ 0.125 | ||
Increase of preferred stock dividend | $ 1,422 | $ 1,276 | ||
Cumulative convertible preferred shares | ||||
Purchase Requirement [Line Items] | ||||
Dividend rate on preferred stock | 3.25% | 3.25% | ||
Mandatorily redeemable convertible preferred shares redemption value | $ 125,000 | |||
Mandatorily redeemable preferred stock, number of shares in conversion (in shares) | 4,440,863 | |||
Mandatorily redeemable preferred stock, effective conversion price per share (in dollars per share) | $ 28.15 | |||
Minimum dividend considered for additional quarterly payments (in dollars per share) | $ 0.0625 | |||
Increase of preferred stock dividend | $ 1,400 | $ 1,300 | ||
Preferred stock, effective dividend rate, percentage | 4.50% | |||
Mandatorily redeemable preferred shares callable price per share (in dollars per share) | $ 1,000 | |||
Jefferies Group | ||||
Purchase Requirement [Line Items] | ||||
Dividend rate on preferred stock | 3.25% |
Long-Term Debt (Schedule of Debt) (Details) - USD ($) $ in Thousands |
3 Months Ended | ||
---|---|---|---|
Feb. 29, 2020 |
Feb. 28, 2019 |
Nov. 30, 2019 |
|
Debt Instrument [Line Items] | |||
Long-term debt | $ 8,451,504 | $ 8,337,061 | |
Losses associated with an interest rate swap based on its designation as a fair value hedge | 402 | $ 969 | |
Parent Company | |||
Debt Instrument [Line Items] | |||
Long-term debt | 991,705 | 991,378 | |
Parent Company | 5.50% Senior Notes due October 18, 2023 | |||
Debt Instrument [Line Items] | |||
Long-term debt | $ 744,919 | $ 744,606 | |
Interest rate | 5.50% | 5.50% | |
Principal outstanding | $ 750,000 | $ 750,000 | |
Parent Company | 6.625% Senior Notes due October 23, 2043 | |||
Debt Instrument [Line Items] | |||
Long-term debt | $ 246,786 | $ 246,772 | |
Interest rate | 6.625% | 6.625% | |
Principal outstanding | $ 250,000 | $ 250,000 | |
Subsidiaries | |||
Debt Instrument [Line Items] | |||
Long-term debt | 7,459,799 | 7,345,683 | |
Subsidiaries | 2.375% Euro Medium Term Notes, due May 20, 2020 | |||
Debt Instrument [Line Items] | |||
Long-term debt | $ 551,306 | $ 550,622 | |
Interest rate | 2.375% | 2.375% | |
Principal outstanding | $ 551,425 | $ 550,875 | |
Subsidiaries | 6.875% Senior Notes, due April 15, 2021 | |||
Debt Instrument [Line Items] | |||
Long-term debt | $ 770,351 | $ 774,738 | |
Interest rate | 6.875% | 6.875% | |
Principal outstanding | $ 750,000 | $ 750,000 | |
Subsidiaries | 2.25% Euro Medium Term Notes, due July 13, 2022 | |||
Debt Instrument [Line Items] | |||
Long-term debt | $ 4,226 | $ 4,204 | |
Interest rate | 2.25% | 2.25% | |
Principal outstanding | $ 4,411 | $ 4,407 | |
Subsidiaries | 5.125% Senior Notes, due January 20, 2023 | |||
Debt Instrument [Line Items] | |||
Long-term debt | $ 609,276 | $ 610,023 | |
Interest rate | 5.125% | 5.125% | |
Principal outstanding | $ 600,000 | $ 600,000 | |
Subsidiaries | 1.00% Euro Medium Term Notes, due July 19, 2024 | |||
Debt Instrument [Line Items] | |||
Long-term debt | $ 549,534 | $ 548,880 | |
Interest rate | 1.00% | 1.00% | |
Principal outstanding | $ 551,425 | $ 550,875 | |
Subsidiaries | 4.85% Senior Notes, due January 15, 2027 | |||
Debt Instrument [Line Items] | |||
Long-term debt | $ 793,931 | $ 768,931 | |
Interest rate | 4.85% | 4.85% | |
Principal outstanding | $ 750,000 | $ 750,000 | |
Subsidiaries | 6.45% Senior Debentures, due June 8, 2027 | |||
Debt Instrument [Line Items] | |||
Long-term debt | $ 370,846 | $ 371,426 | |
Interest rate | 6.45% | 6.45% | |
Principal outstanding | $ 350,000 | $ 350,000 | |
Subsidiaries | 4.15% Senior Notes, due January 23, 2030 | |||
Debt Instrument [Line Items] | |||
Long-term debt | $ 988,886 | $ 988,662 | |
Interest rate | 4.15% | 4.15% | |
Principal outstanding | $ 1,000,000 | $ 1,000,000 | |
Subsidiaries | 6.25% Senior Debentures, due January 15, 2036 | |||
Debt Instrument [Line Items] | |||
Long-term debt | $ 511,156 | $ 511,260 | |
Interest rate | 6.25% | 6.25% | |
Principal outstanding | $ 500,000 | $ 500,000 | |
Subsidiaries | 6.50% Senior Notes, due January 20, 2043 | |||
Debt Instrument [Line Items] | |||
Long-term debt | $ 420,137 | $ 420,239 | |
Interest rate | 6.50% | 6.50% | |
Principal outstanding | $ 400,000 | $ 400,000 | |
Subsidiaries | Structured notes | |||
Debt Instrument [Line Items] | |||
Long-term debt | 1,354,714 | 1,215,285 | |
Subsidiaries | HomeFed EB-5 Program debt | |||
Debt Instrument [Line Items] | |||
Long-term debt | 183,390 | 140,739 | |
Subsidiaries | Foursight Capital Credit Facilities | |||
Debt Instrument [Line Items] | |||
Long-term debt | (324) | 98,260 | |
Subsidiaries | Vitesse Energy Finance Revolving Credit Facility | |||
Debt Instrument [Line Items] | |||
Long-term debt | 113,121 | 103,050 | |
Subsidiaries | Other | |||
Debt Instrument [Line Items] | |||
Long-term debt | 0 | 276 | |
Jefferies Group | Subsidiaries | Jefferies Group Revolving Credit Facility | |||
Debt Instrument [Line Items] | |||
Long-term debt | 189,249 | 189,088 | |
Jefferies Group | Subsidiaries | Bank loans | |||
Debt Instrument [Line Items] | |||
Long-term debt | 50,000 | $ 50,000 | |
Interest rate swaps | Subsidiaries | 4.85% Senior Notes, due January 15, 2027 | |||
Debt Instrument [Line Items] | |||
Losses associated with an interest rate swap based on its designation as a fair value hedge | $ 24,900 | $ 15,600 |
Leases (Additional Information) (Details) - USD ($) $ in Millions |
11 Months Ended | 12 Months Ended | ||
---|---|---|---|---|
Nov. 30, 2018 |
Nov. 30, 2019 |
Dec. 31, 2017 |
Feb. 29, 2020 |
|
Leases [Abstract] | ||||
Operating lease not yet commenced, term | 7 years | |||
Operating lease not yet commenced, expected payment | $ 1.5 | |||
Rental expense, net of sublease rental income | $ 55.7 | $ 65.6 | $ 60.2 |
Derivative Financial Instruments (Remaining Contract Maturity Of Fair Value Of OTC Derivative Assets And Liabilities) (Details) $ in Thousands |
Feb. 29, 2020
USD ($)
|
---|---|
OTC Derivative Assets | |
0-12 Months | $ 378,490 |
1-5 Years | 265,330 |
Greater Than 5 Years | 243,819 |
Cross- maturity netting | (68,677) |
Total OTC derivative assets, net of cross-maturity netting | 818,962 |
Cross product counterparty netting | (15,399) |
Total OTC derivative assets included in Financial instruments owned, at fair value | 803,563 |
OTC Derivative Liabilities | |
0-12 Months | 293,626 |
1-5 Years | 376,062 |
Greater Than 5 Years | 191,973 |
Cross-maturity netting | (68,677) |
Total | 792,984 |
Cross product counterparty netting | (15,399) |
Total OTC derivative liabilities included in Financial instruments sold, not yet purchased, at fair value | 777,585 |
Exchange traded derivative assets and other credit agreements | 74,500 |
Cash collateral received | 240,300 |
Exchange traded derivative liabilities and other credit agreements | 292,100 |
Cash collateral pledged | 372,100 |
Commodity swaps, options and forwards | |
OTC Derivative Assets | |
0-12 Months | 33,852 |
1-5 Years | 6,307 |
Greater Than 5 Years | 0 |
Cross- maturity netting | 0 |
Total OTC derivative assets, net of cross-maturity netting | 40,159 |
Equity forwards, swaps and options | |
OTC Derivative Assets | |
0-12 Months | 28,521 |
1-5 Years | 7,516 |
Greater Than 5 Years | 6,959 |
Cross- maturity netting | (12,901) |
Total OTC derivative assets, net of cross-maturity netting | 30,095 |
OTC Derivative Liabilities | |
0-12 Months | 35,005 |
1-5 Years | 193,428 |
Greater Than 5 Years | 80,442 |
Cross-maturity netting | (12,901) |
Total | 295,974 |
Credit default swaps | |
OTC Derivative Assets | |
0-12 Months | 31 |
1-5 Years | 4,079 |
Greater Than 5 Years | 0 |
Cross- maturity netting | (38) |
Total OTC derivative assets, net of cross-maturity netting | 4,072 |
OTC Derivative Liabilities | |
0-12 Months | 1,401 |
1-5 Years | 2,539 |
Greater Than 5 Years | 0 |
Cross-maturity netting | (38) |
Total | 3,902 |
Total return swaps | |
OTC Derivative Assets | |
0-12 Months | 160,829 |
1-5 Years | 37,825 |
Greater Than 5 Years | 0 |
Cross- maturity netting | (11,543) |
Total OTC derivative assets, net of cross-maturity netting | 187,111 |
OTC Derivative Liabilities | |
0-12 Months | 140,657 |
1-5 Years | 71,668 |
Greater Than 5 Years | 0 |
Cross-maturity netting | (11,543) |
Total | 200,782 |
Foreign currency forwards, swaps and options | |
OTC Derivative Assets | |
0-12 Months | 66,282 |
1-5 Years | 3,757 |
Greater Than 5 Years | 3 |
Cross- maturity netting | (3,005) |
Total OTC derivative assets, net of cross-maturity netting | 67,037 |
OTC Derivative Liabilities | |
0-12 Months | 70,063 |
1-5 Years | 2,861 |
Greater Than 5 Years | 0 |
Cross-maturity netting | (3,005) |
Total | 69,919 |
Fixed income forwards | |
OTC Derivative Assets | |
0-12 Months | 8,847 |
1-5 Years | 0 |
Greater Than 5 Years | 0 |
Cross- maturity netting | 0 |
Total OTC derivative assets, net of cross-maturity netting | 8,847 |
OTC Derivative Liabilities | |
0-12 Months | 581 |
1-5 Years | 0 |
Greater Than 5 Years | 0 |
Cross-maturity netting | 0 |
Total | 581 |
Interest rate swaps, options and forwards | |
OTC Derivative Assets | |
0-12 Months | 80,128 |
1-5 Years | 205,846 |
Greater Than 5 Years | 236,857 |
Cross- maturity netting | (41,190) |
Total OTC derivative assets, net of cross-maturity netting | 481,641 |
OTC Derivative Liabilities | |
0-12 Months | 45,919 |
1-5 Years | 105,566 |
Greater Than 5 Years | 111,531 |
Cross-maturity netting | (41,190) |
Total | $ 221,826 |
Segment Information (Tables) |
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Feb. 29, 2020 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule Of Segment Reporting Information, By Segment | Certain information concerning our segments is presented in the following table. Consolidated subsidiaries are reflected as of the date a majority controlling interest was acquired.
|
Fair Value Disclosures (Investments at Fair Value) (Details) - USD ($) $ in Thousands |
3 Months Ended | 12 Months Ended | |||
---|---|---|---|---|---|
Feb. 29, 2020 |
Nov. 30, 2019 |
Feb. 29, 2020 |
Nov. 30, 2019 |
Dec. 31, 2013 |
|
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items] | |||||
Unfunded Commitments | $ 13,957 | $ 14,621 | $ 13,957 | $ 14,621 | |
Financial instruments owned, at fair value (including securities pledged of $13,446,620 and $12,058,522): | 18,396,981 | 16,895,741 | 18,396,981 | 16,895,741 | |
Equity Long/Short Hedge Funds | |||||
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items] | |||||
Unfunded Commitments | $ 0 | $ 0 | $ 0 | $ 0 | |
Equity Long/Short Hedge Funds | 60 days prior written notice | |||||
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items] | |||||
Percentage of investments redeemable | 6.00% | 6.00% | 6.00% | 6.00% | |
Notice period redemption of investments prior written notice period | 60 days | 60 days | |||
Equity Funds | |||||
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items] | |||||
Unfunded Commitments | $ 13,957 | $ 14,621 | $ 13,957 | $ 14,621 | |
Equity Funds | Minimum | |||||
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items] | |||||
Estimated period for the liquidation of the underlying assets | 1 year | 1 year | |||
Equity Funds | Maximum | |||||
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items] | |||||
Estimated period for the liquidation of the underlying assets | 9 years | 9 years | |||
Commodity Fund | |||||
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items] | |||||
Unfunded Commitments | $ 0 | $ 0 | $ 0 | $ 0 | |
Notice period redemption of investments prior written notice period | 60 days | 60 days | |||
Multi-asset Funds | |||||
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items] | |||||
Unfunded Commitments | $ 0 | $ 0 | $ 0 | $ 0 | |
Multi-asset Funds | 30 days prior written notice | |||||
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items] | |||||
Percentage of investments redeemable | 2.00% | 5.00% | 2.00% | 5.00% | |
Notice period redemption of investments prior written notice period | 30 days | 30 days | |||
Other Funds | |||||
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items] | |||||
Unfunded Commitments | $ 0 | $ 0 | $ 0 | $ 0 | |
Fair value measured at NAV | |||||
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items] | |||||
Fair value | 898,114 | 586,934 | 898,114 | 586,934 | |
Fair value measured at NAV | Equity Long/Short Hedge Funds | |||||
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items] | |||||
Fair value | 303,941 | 291,593 | 303,941 | 291,593 | |
Fair value measured at NAV | Equity Funds | |||||
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items] | |||||
Fair value | 36,754 | 44,576 | 36,754 | 44,576 | |
Fair value measured at NAV | Commodity Fund | |||||
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items] | |||||
Fair value | 14,650 | 16,025 | 14,650 | 16,025 | |
Fair value measured at NAV | Multi-asset Funds | |||||
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items] | |||||
Fair value | 542,609 | 234,583 | 542,609 | 234,583 | |
Fair value measured at NAV | Other Funds | |||||
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items] | |||||
Fair value | 160 | 157 | 160 | 157 | |
The We company | |||||
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items] | |||||
Payments to acquire investments | $ 9,000 | ||||
Financial instruments owned, at fair value (including securities pledged of $13,446,620 and $12,058,522): | $ 53,800 | $ 53,800 | $ 53,800 | $ 53,800 | |
The We company | Maximum | |||||
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items] | |||||
Ownership percentage | 1.00% | 1.00% |
Variable Interest Entities (Narrative) (Details) - USD ($) $ in Thousands |
3 Months Ended | |||
---|---|---|---|---|
Feb. 29, 2020 |
Nov. 30, 2019 |
Feb. 28, 2019 |
Nov. 30, 2018 |
|
Variable Interest Entity [Line Items] | ||||
Nonconsolidated VIEs, assets carrying amount | $ 1,216,900 | $ 1,107,900 | ||
Investment in associated company | 1,562,628 | 1,652,957 | $ 2,381,026 | $ 2,417,332 |
Related party private equity vehicles | ||||
Variable Interest Entity [Line Items] | ||||
Nonconsolidated VIEs, assets carrying amount | 23,800 | 23,000 | ||
Other investment vehicles | ||||
Variable Interest Entity [Line Items] | ||||
Carrying amount of equity investment | 843,100 | 574,000 | ||
Unfunded equity commitment related to investments | 190,600 | 192,100 | ||
Nonconsolidated VIEs, assets carrying amount | 843,100 | 574,000 | ||
Agency mortgage-backed securities | ||||
Variable Interest Entity [Line Items] | ||||
Nonconsolidated VIEs, assets carrying amount | 1,487,000 | 1,453,500 | ||
Non agency mortgage- and asset-backed securities | ||||
Variable Interest Entity [Line Items] | ||||
Nonconsolidated VIEs, assets carrying amount | 130,300 | 134,800 | ||
JCP Entities | Related party private equity vehicles | ||||
Variable Interest Entity [Line Items] | ||||
Equity commitments | 133,000 | 133,000 | ||
Funded equity commitments | 121,900 | 121,700 | ||
Carrying amount of equity investment | 23,800 | $ 23,000 | ||
Investment in FXCM | ||||
Variable Interest Entity [Line Items] | ||||
Fair value of senior secured term loan receivable | 61,600 | |||
Investment in associated company | 68,400 | |||
Senior secured term loan receivable and investments in associated companies | 130,000 | |||
Variable interest entities, primary beneficiary | ||||
Variable Interest Entity [Line Items] | ||||
Automobile loan receivables securitized | $ 197,900 |
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