Derivative Financial Instruments

12 Months Ended

Dec. 31, 2014

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Derivative Financial Instruments

8. DERIVATIVE FINANCIAL INSTRUMENTS

We may, from time to time, enter into derivative contracts to achieve certain risk management objectives. Currently, we use derivative financial instruments to manage, or hedge, the variability in the carrying value of certain of our net investments in consolidated, foreign currency-denominated subsidiaries caused by the fluctuations in foreign currency exchange rates. Historically, our consolidated subsidiary, CT Legacy Partners, also used derivative financial instruments to manage, or hedge, the cash flow variability caused by the fluctuations in interest rates.

As of and during the year ended December 31, 2014, we had a net investment hedge on one Canadian dollar-denominated subsidiary which consisted of two Canadian dollar forward contracts. These foreign currency contracts had an aggregate notional value of $42.5 million, and their fair value of $1.1 million has been included as part of accrued interest receivable, prepaid expenses, and other assets on our consolidated balance sheet. The following table summarizes the notional and fair value amounts of our derivative financial instruments as of December 31, 2014 and 2013 ($ in thousands):

	December 31, 2014				December 31, 2013
	Notional Amount		Fair Value		Notional Amount		Fair Value
Foreign Currency Contracts	$	42,525	$	1,138	$	—	$	—
	$	42,525	$	1,138	$	—	$	—

The following table summarizes the impact of our derivative financial instruments to our consolidated statement of operations and consolidated statement of comprehensive income for the year ended December 31, 2014, 2013, and 2012 ($ in thousands):

	For the year ended December 31,
	2014		2013		2012
Net investment hedges – Foreign currency contracts
Gain recognized in other comprehensive income	$	1,138	$	—	$	—
Gain reclassified from AOCI into net income	$	—	$	—	$	—
Gain recognized in net income	$	—	$	—	$	—
Freestanding derivatives – Interest rate contracts(1)
Loss recognized in other comprehensive income	$	—	$	—	$	(10,449	)
Loss reclassified from AOCI into net income	$	—	$	—	$	(15,066	)
Gain recognized in net income	$	—	$	136	$	—

(1) The interest rate derivatives represent five interest rate swaps that our consolidated subsidiary, CT Legacy Partners was party to during 2013. In June 2013, CT Legacy Partners terminated these interest rate swaps and recorded a gain of $136,000 which was included as a component of interest expense on our consolidated statements of operations for the year ended December 31, 2013. CT Legacy Partners is no longer party to any derivative financial instruments as of December 31, 2014.