10-Q

/ 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

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

For the quarterly period ended March 31, 2020

or

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

For the transition period from                      to                     

Commission File Number: 001-32026

COHEN & COMPANY INC.

(Exact name of registrant as specified in its charter)

Maryland	16-1685692
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)
Cira Centre 2929 Arch Street,  Suite 1703 Philadelphia,  Pennsylvania	19104
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code: (215) 701-9555

Not applicable

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

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

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

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

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

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

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

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

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, par value $0.01 per share	COHN	The NYSE American Stock Exchange

As of May 5, 2020, there were 1,246,710, shares of common stock ($0.01 par value per share) of Cohen & Company Inc. (“Common Stock”) outstanding. 

Cohen & Company Inc.

FORM 10-Q

INDEX TO QUARTERLY REPORT ON FORM 10-Q

March 31, 2020

		Page
PART I. FINANCIAL INFORMATION
Item 1.	Financial Statements (Unaudited)	6
	Consolidated Balance Sheets—March 31, 2020 and December 31, 2019	6
	Consolidated Statements of Operations and Comprehensive Income (Loss)—Three Months Ended March 31, 2020 and 2019	7
	Consolidated Statements of Changes in Equity—Three Months Ended March 31, 2020 and 2019	8
	Consolidated Statements of Cash Flows—Three Months Ended March 31, 2020 and 2019	9
	Notes to Consolidated Financial Statements (Unaudited)	10
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	54
Item 3.	Quantitative and Qualitative Disclosures about Market Risk	75
Item 4.	Controls and Procedures	78
Part II. OTHER INFORMATION
Item 1.	Legal Proceedings	79
Item 1A.	Risk Factors	79
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	80
Item 6.	Exhibits	82
Signatures		83

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Forward-Looking Statements

This Quarterly Report on Form 10-Q contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended or the Securities Act, and Section 21E of the Securities Exchange Act of 1934, as amended or the Exchange Act. Forward-looking statements discuss matters that are not historical facts. Because they discuss future events or conditions, forward-looking statements may include words such as “anticipate,” “believe,” “estimate,” “intend,” “could,” “should,” “would,” “may,” “seek,” “plan,” “might,” “will,” “expect,” “predict,” “project,” “forecast,” “potential,” “continue,” negatives thereof or similar expressions. Forward-looking statements speak only as of the date they are made, are based on various underlying assumptions and current expectations about the future and are not guarantees. Such statements involve known and unknown risks, uncertainties, and other factors that may cause our actual results, level of activity, performance, or achievement to be materially different from the results of operations or plans expressed or implied by such forward-looking statements.

These forward-looking statements are found at various places throughout this Quarterly Report on Form 10-Q and include information concerning possible or assumed future results of our operations, including statements about the following subjects:

· integration of operations;

· business strategies;

· growth opportunities;

· competitive position;

· market outlook;

· expected financial position;

· expected results of operations;

· future cash flows;

· financing plans;

· plans and objectives of management;

· tax treatment of the business combinations;

· fair value of assets; and

· any other statements regarding future growth, future cash needs, future operations, business plans, future financial results, and any other statements that are not historical facts.

These forward-looking statements represent our intentions, plans, expectations, assumptions, and beliefs about future events and are subject to risks, uncertainties, and other factors. Many of those factors are outside of our control and could cause actual results to differ materially from the results expressed or implied by those forward-looking statements. In light of these risks, uncertainties, and assumptions, the events described in the forward-looking statements might not occur or might occur to a different extent or at a different time than we have described. You should consider the areas of risk and uncertainty described above and discussed under “Item 1A — Risk Factors” included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2019. Actual results may differ materially as a result of various factors, some of which are outside our control, including the following:

· a decline in general economic conditions or the global financial markets;

· losses or reductions in business volume due to impact of the COVID-19 pandemic;

· losses caused by financial or other problems experienced by third parties;

· losses due to unidentified or unanticipated risks;

· losses (whether realized or unrealized) on our principal investments;

· a lack of liquidity, i.e., ready access to funds for use in our businesses, including the availability of securities financing from our clearing agency and the Fixed Income Clearing Corporation the (“FICC”); or the availability of financing at prohibitive  rates;

· the ability to attract and retain personnel;

· the ability to meet regulatory capital requirements administered by federal agencies;

· an inability to generate incremental income from acquired, newly established or expanded businesses;

· unanticipated market closures due to inclement weather or other disasters;

· the volume of trading in securities including collateralized securities transactions;

· the liquidity in capital markets;

· the creditworthiness of our correspondents, trading counterparties, and banking and margin customers;

· changing interest rates and their impacts on U.S. residential mortgage volumes;

· competitive conditions in each of our business segments;

· the availability of borrowings under credit lines, credit agreements, warehouse agreements, and our credit facilities;

· our continued membership in the FICC;

· the potential misconduct or errors by our employees or by entities with whom we conduct business; and

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· the potential for litigation and other regulatory liability.

You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this Quarterly Report on Form 10-Q. All subsequent written and oral forward-looking statements concerning other matters addressed in this Quarterly Report on Form 10-Q and attributable to us or any person acting on our behalf are expressly qualified in their entirety by the cautionary statements contained or referred to in this Quarterly Report on Form 10-Q. Except to the extent required by law, we undertake no obligation to update or revise any forward-looking statements, whether as a result of new information, future events, a change in events, conditions, circumstances, or assumptions underlying such statements, or otherwise.

4

Certain Terms Used in this Quarterly Report on Form 10-Q

In this Quarterly Report on Form 10-Q, unless otherwise noted or as the context otherwise requires, the “Company,” “we,” “us,” and “our” refer to Cohen & Company Inc. (formerly Institutional Financial Markets, Inc.), a Maryland corporation, and its subsidiaries on a consolidated basis; and “Cohen & Company, LLC” (formerly IFMI, LLC) or the “Operating LLC” refer to the main operating subsidiary of the Company. 

“JVB Holdings” refers to JVB Financial Holdings, L.P., a wholly owned subsidiary of the Operating LLC; “JVB” refers to J.V.B. Financial Group, LLC, a wholly owned broker-dealer subsidiary of JVB Holdings; “CCFL” refers to Cohen & Company Financial Limited (formerly known as EuroDekania Management LTD), a wholly owned subsidiary of the Operating LLC regulated by the Financial Conduct Authority (formerly known as the Financial Services Authority) in the United Kingdom (the “FCA”); “CCFEL” refers to Cohen & Company Financial (Europe) Limited, a wholly owned subsidiary of the Operating LLC regulated by the Central Bank of Ireland ( the “CBI”) and “EuroDekania” refers to EuroDekania (Cayman) Ltd., a Cayman Islands exempted company that was externally managed by CCFL.

“Securities Act”  refers to the Securities Act of 1933, as amended; and “Exchange Act” refers to the Securities Exchange Act of 1934, as amended.

5

PART I. FINANCIAL INFORMATION

ITEM 1.FINANCIAL STATEMENTS.

COHEN & COMPANY INC.

CONSOLIDATED BALANCE SHEETS

(Dollars in Thousands)

(

	March 31, 2020
	(unaudited)		December 31, 2019
Assets
Cash and cash equivalents	$	85,454	$	8,304
Receivables from brokers, dealers, and clearing agencies		77,604		96,132
Due from related parties		411		466
Other receivables		17,007		46,625
Investments-trading		375,745		307,852
Other investments, at fair value		10,057		14,864
Receivables under resale agreements		6,014,438		7,500,002
Investment in equity method affiliates		5,789		3,799
Goodwill		109		7,992
Right-of-use asset - operating leases		6,867		7,155
Other assets		3,059		8,433
Total assets	$	6,596,540	$	8,001,624
Liabilities
Payables to brokers, dealers, and clearing agencies	$	201,242	$	241,261
Accounts payable and other liabilities		81,781		20,295
Accrued compensation		8,360		4,046
Trading securities sold, not yet purchased		114,767		77,947
Securities sold under agreements to repurchase		6,066,372		7,534,443
Deferred income taxes		943		1,339
Lease liability - operating leases		7,391		7,693
Redeemable financial instruments		16,907		16,983
Debt		61,864		48,861
Total liabilities		6,559,627		7,952,868
Commitments and contingencies (See note 21)
Stockholders' Equity:
Voting Non-Convertible Preferred Stock, $0.001 par value per share, 60,000,000 shares authorized, 27,413,098 and 4,983,557shares issued and outstanding, respectively		27		27
Common Stock, $0.01 par value per share, 100,000,000 shares authorized, 1,246,710 and 1,193,624 shares issued and outstanding, respectively, including 86,566 and 73,715 unvested or restricted share awards, respectively		12		12
Additional paid-in capital		68,622		68,714
Accumulated other comprehensive loss		(936)		(915)
Accumulated deficit		(37,683)		(34,519)
Total stockholders' equity		30,042		33,319
Non-controlling interest		6,871		15,437
Total equity		36,913		48,756
Total liabilities and equity	$	6,596,540	$	8,001,624

See accompanying notes to unaudited consolidated financial statements.

6

COHEN & COMPANY INC.

CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)

(Dollars in Thousands, except share or per share information)

(Unaudited)

	Three Months Ended March 31,
	2020		2019
Revenues
Net trading	$	18,561	$	8,724
Asset management		1,615		2,002
Principal transactions and other income		(2,406)		414
Total revenues		17,770		11,140
Operating expenses
Compensation and benefits		14,134		6,364
Business development, occupancy, equipment		756		811
Subscriptions, clearing, and execution		2,580		2,273
Professional fee and other operating		1,782		1,679
Depreciation and amortization		80		81
Impairment of goodwill		7,883		-
Total operating expenses		27,215		11,208
Operating income (loss)		(9,445)		(68)
Non-operating income (expense)
Interest expense, net		(2,605)		(1,854)
Income (loss) from equity method affiliates		(107)		(8)
Income (loss) before income tax expense (benefit)		(12,157)		(1,930)
Income tax expense (benefit)		(372)		(106)
Net income (loss)		(11,785)		(1,824)
Less: Net income (loss) attributable to the non-controlling interest		(8,683)		(622)
Net income (loss) attributable to Cohen & Company Inc.	$	(3,102)	$	(1,202)
Income (loss) per share data (see note 20)
Income (loss) per common share-basic:
Basic income (loss) per common share	$	(2.70)	$	(1.06)
Weighted average shares outstanding-basic		1,146,879		1,133,166
Income (loss) per common share-diluted:
Diluted income (loss) per common share	$	(2.70)	$	(1.06)
Weighted average shares outstanding-diluted		3,940,677		1,665,575
Dividends declared per common share	$	-	$	0.20
Comprehensive income (loss)
Net income (loss)	$	(11,785)	$	(1,824)
Other comprehensive income (loss) item:
Foreign currency translation adjustments, net of tax of $0		(100)		9
Other comprehensive income (loss), net of tax of $0		(100)		9
Comprehensive income (loss)		(11,885)		(1,815)
Less: comprehensive income (loss) attributable to the non-controlling interest		(8,754)		(619)
Comprehensive income (loss) attributable to Cohen & Company Inc.	$	(3,131)	$	(1,196)

See accompanying notes to unaudited consolidated financial statements.

7

COHEN & COMPANY INC.

CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY

(Dollars in Thousands, except share or per share information)

(Unaudited)

	Cohen & Company Inc.
		Three Months Ended March 31, 2020
			Preferred Stock		Common Stock	Additional Paid-In Capital			Retained Earnings (Accumulated Deficit)		Accumulated Other Comprehensive Income (Loss)		Total Stockholders' Equity		Non-controlling Interest		Total Equity
December 31, 2019		$	27	$	12	$	68,714	$	(34,519)	$	(915)	$	33,319	$	15,437	$	48,756
Net loss			-		-		-		(3,102)		-		(3,102)		(8,683)		(11,785)
Other comprehensive income			-		-		-		-		(29)		(29)		(71)		(100)
Acquisition / (surrender) of additional units of consolidated subsidiary, net			-		-		(123)		-		8		(115)		115		-
Equity-based compensation and vesting of shares			-		-		46		-		-		46		112		158
Shares withheld for employee taxes			-		-		(15)		-		-		(15)		(39)		(54)
Dividends/Distributions			-		-		-		(62)		-		(62)		-		(62)
March 31, 2020		$	27	$	12	$	68,622	$	(37,683)	$	(936)		30,042	$	6,871	$	36,913

	Cohen & Company Inc.
	Three Months Ended March 31, 2019
			Preferred Stock		Common Stock	Additional Paid-In Capital			Retained Earnings (Accumulated Deficit)		Accumulated Other Comprehensive Income (Loss)		Total Stockholders' Equity		Non-controlling Interest		Total Equity
December 31, 2018		$	5	$	12	$	68,591	$	(31,926)	$	(908)	$	35,774	$	6,664	$	42,438
Net loss			-		-		-		(1,202)		-		(1,202)		(622)		(1,824)
Other comprehensive income			-		-		-		-		6		6		3		9
Cumulative effect adjustment - adoption of ASU 2016-02			-		-		-		(20)		-		(20)		-		(20)
Acquisition / (surrender) of additional units of consolidated subsidiary, net			-		-		133		-		(14)		119		(119)		-
Equity-based compensation and vesting of shares			-		-		117		-		-		117		55		172
Shares withheld for employee taxes			-		-		(87)		-		-		(87)		(41)		(128)
Purchase and retirement of Common Stock			-		-		(65)		-		-		(65)		-		(65)
Investment in non-controlling interest			-		-		-		-		-		-		2,550		2,550
Dividends/Distributions			-		-		-		(290)		-		(290)		(106)		(396)
March 31, 2019		$	5	$	12	$	68,689	$	(33,438)	$	(916)	$	34,352	$	8,384	$	42,736

See accompanying notes to unaudited consolidated financial statements.

8

COHEN & COMPANY INC.

Consolidated Statements of Cash Flows

(Dollars in Thousands)

(Unaudited)

	Three Months Ended March 31,
	2020		2019
Operating activities
Net income (loss)	$	(11,785)	$	(1,824)
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
Equity-based compensation		158		172
Accretion of income on other investments, at fair value		(78)		(106)
Realized loss (gain) on other investments, at fair value		(40)		(419)
(Income) / loss from equity method affiliates		107		8
Change in unrealized (gain) loss on other investments, at fair value		2,735		171
Depreciation and amortization		80		81
Impairment of goodwill		7,883		-
Amortization of discount on debt		166		122
Deferred tax provision (benefit)		(396)		(114)
Change in operating assets and liabilities, net:
(Increase) decrease in other receivables		29,618		3,894
(Increase) decrease in investments-trading		(67,893)		15,762
(Increase) decrease in other assets		5,645		258
(Increase) decrease in receivables under resale agreement		1,485,564		3,121,841
Change in receivables from / payables to related parties, net		55		168
Increase (decrease) in accrued compensation		4,314		(3,310)
Increase (decrease) in accounts payable and other liabilities		61,079		233
Increase (decrease) in trading securities sold, not yet purchased		36,820		(21,877)
Change in receivables from / payables to brokers, dealers, and clearing agencies		(21,491)		(13,279)
Increase (decrease) in securities sold under agreements to repurchase		(1,468,071)		(3,111,051)
Net cash provided by (used in) operating activities		64,470		(9,270)
Investing activities
Purchase of investments-other investments, at fair value		(119)		(408)
Sales and returns of principal-other investments, at fair value		2,309		5,091
Investment in equity method affiliate		(2,097)		(3,775)
Purchase of furniture, equipment, and leasehold improvements		(63)		(20)
Net cash provided by (used in) investing activities		30		888
Financing activities
Proceeds from draws on revolving credit facility		17,500		-
Proceeds from non-convertible debt		4,500		-
Repayment of debt		(9,163)		-
Proceeds from redeemable financial instruments		-		1,268
Cash used to net share settle equity awards		(54)		(128)
Purchase and retirement of Common Stock		-		(65)
Proceeds from non-controlling interest investment		-		2,550
Cohen & Company Inc. dividends		(62)		(61)
Net cash provided by (used in) financing activities		12,721		3,564
Effect of exchange rate on cash		(71)		(5)
Net increase (decrease) in cash and cash equivalents		77,150		(4,823)
Cash and cash equivalents, beginning of period		8,304		14,106
Cash and cash equivalents, end of period	$	85,454	$	9,283

See accompanying notes to unaudited consolidated financial statements.

9

COHEN & COMPANY INC.

Notes to Consolidated Financial Statements

(Dollars in Thousands, except share and per share information)

(Unaudited)

1. ORGANIZATION AND NATURE OF OPERATIONS

Organizational History

Cohen Brothers, LLC (“Cohen Brothers”) was formed on October 7, 2004 by Cohen Bros. Financial, LLC (“CBF”). Cohen Brothers was established to acquire the net assets of CBF’s subsidiaries (the “Formation Transaction”): Cohen Bros. & Company, Inc.; Cohen Frères SAS; Dekania Investors, LLC; Emporia Capital Management, LLC; and the majority interest in Cohen Bros. & Toroian Investment Management, Inc. The Formation Transaction was accomplished through a series of transactions occurring between March 4, 2005 and May 31, 2005.

From its formation until December 16, 2009, Cohen Brothers operated as a privately-owned limited liability company. On December 16, 2009, Cohen Brothers completed its merger (the “Merger”) with a subsidiary of Alesco Financial Inc. (“AFN”), a publicly traded real estate investment trust.

As a result of the Merger, AFN contributed substantially all of its assets into Cohen Brothers in exchange for newly issued units of membership interests directly from Cohen Brothers. In addition, AFN received additional Cohen Brothers membership interests directly from its members in exchange for AFN common stock. In accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”), the Merger was accounted for as a reverse acquisition, and Cohen Brothers was deemed to be the accounting acquirer. As a result, all of AFN’s assets and liabilities were required to be revalued at fair value as of the acquisition date. The remaining units of membership interests of Cohen Brothers that were not held by AFN were included as a component of non-controlling interest in the consolidated balance sheets.

Subsequent to the Merger, AFN was renamed Cohen & Company Inc. In January 2011, it was renamed again as Institutional Financial Markets, Inc. (“IFMI”) and on September 1, 2017 it was renamed again as Cohen & Company Inc.  Effective January 1, 2010, the Company ceased to qualify as a REIT. 

The Company

The Company is a financial services company specializing in fixed income markets. As of March 31, 2020, the Company had $2.65 billion in assets under management (“AUM”) of which 79.0%, or $2.10 billion, was in collateralized debt obligations (“CDOs”). The remaining portion of AUM is from a diversified mix of Investment Vehicles (as defined herein).

In these financial statements, the “Company” refers to Cohen & Company Inc. and its subsidiaries on a consolidated basis. Cohen & Company, LLC or the “Operating LLC” refers to the main operating subsidiary of the Company.  “Cohen Brothers” refers to the pre-Merger Cohen Brothers, LLC and its subsidiaries. “AFN” refers to the pre-merger Alesco Financial Inc. and its subsidiaries. When the term “Cohen & Company Inc.” is used, it is referring to the parent company itself. “JVB Holdings” refers to J.V.B. Financial Holdings, LLC; “JVB” refers to J.V.B. Financial Group LLC, a broker-dealer subsidiary; “CCFL” refers to Cohen & Company Financial Limited (formerly known as EuroDekania Management LTD), a subsidiary regulated by the Financial Conduct Authority (formerly known as Financial Services Authority) in the United Kingdom; “CCFEL” refers to Cohen & Company Financial (Europe) Limited, a subsidiary regulated by the Central Bank of Ireland in Ireland; and “EuroDekania” refers to EuroDekania (Cayman) Ltd., a Cayman Islands exempted company that is externally managed by CCFL.

The Company’s business is organized into the following three business segments.

Capital Markets: The Company’s Capital Markets business segment consists primarily of fixed income sales, trading, matched book repurchase agreement (“repo”) financing, new issue placements in corporate and securitized products, and advisory services. The Company’s fixed income sales and trading group provides trade execution to corporate investors, institutional investors, mortgage originators, and other smaller broker-dealers. The Company specializes in a variety of products, including but not limited to: corporate bonds, asset backed securities (“ABS”), mortgage backed securities (“MBS”), residential mortgage backed securities (“RMBS”), CDOs, collateralized loan obligations (“CLOs”), collateralized bond obligations (“CBOs”), collateralized mortgage obligations (“CMOs”), municipal securities, to-be-announced securities (“TBAs”) and other forward agency MBS contracts, Small Business Administration (“SBA”) loans, U.S. government bonds, U.S. government agency securities, brokered deposits and certificates of deposit (“CDs”) for small banks, and hybrid capital of financial institutions including trust preferred securities (“TruPS”), whole loans, residential transition loans, (“RTLs”), and other structured financial instruments. The Company also offers execution and brokerage services for equity products. The Company operates its capital markets activities primarily through its subsidiaries: JVB in the United States, and CCFL and CCFEL in Europe.

10

Asset Management: The Company’s Asset Management business segment manages assets within CDOs, managed accounts, joint ventures, and investment funds (collectively referred to as “Investment Vehicles”). A CDO is a form of secured borrowing. The borrowing is secured by different types of fixed income assets such as corporate or mortgage loans or bonds. The borrowing is in the form of a securitization, which means that the lenders are actually investing in notes backed by the assets. In the event of default, the lenders will have recourse only to the assets securing the loan. The Company’s Asset Management business segment includes its fee-based asset management operations, which include ongoing base and incentive management fees.

Principal Investing: The Company’s Principal Investing business segment is comprised of investments that the Company has made for the purpose of earning an investment return rather than investments made to support the Company’s trading, matched book repo, or other Capital Markets business segment activities.  These investments are included in the Company’s other investments, at fair value and investments in equity method affiliates in the Company’s consolidated balance sheets.

The Company generates its revenue by business segment primarily through the following activities.

Capital Markets

· Trading activities of the Company, which include execution and brokerage services, riskless trading activities as well as gains and losses (unrealized and realized) and income and expense earned on securities and derivatives classified as trading;

· Net interest income on the Company’s matched book repo financing activities; and

· New issue and advisory revenue comprised primarily of (i) new issue revenue associated with originating, arranging, or placing newly created financial instruments and (ii) revenue from advisory services.

Asset Management

· Asset management fees for the Company’s on-going asset management services provided to certain Investment Vehicles, which may include fees both senior and subordinate to the securities in the Investment Vehicle, and incentive management fees earned based on the performance of the various Investment Vehicles.

Principal Investing

· Gains and losses (unrealized and realized) and income and expense earned on securities classified as other investments, at fair value.

2. BASIS OF PRESENTATION

The financial statements of the Company included herein were prepared in conformity with U.S. GAAP for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. The information furnished includes all adjustments and accruals of a normal recurring nature, which, in the opinion of management, are necessary for a fair presentation of results for the interim month periods. All intercompany accounts and transactions have been eliminated in consolidation. The results for the three months ended March 31, 2020 and 2019 are not necessarily indicative of the results for the entire year or any subsequent interim period. These financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2019.  

Capitalized terms used herein without definition have the meanings ascribed to them in the Annual Report on Form 10-K for the year ended December 31, 2019.  

Effective June 1, 2019, the Company changed its accounting policy regarding the netting of reverse repurchase agreement and repurchase agreement transactions and updated prior periods’ balances to be consistent with this new accounting policy.  See note 10. 

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3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

A. Adoption of New Accounting Standards

In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842). Under the new guidance (subsequently updated with ASU 2018-01, ASU 2018-10, ASU 2018-11,  ASU 2018-20, and ASU  2019-01), lessees will be required to recognize the following for all leases with the exception of short-term leases:  (i) a lease liability, which is a lessee’s obligation to make lease payments arising from a lease, measured on a discounted basis, and (ii) a right-of-use asset, which is an asset that represents the lessee’s right to use, or control the use of, a specified asset for the lease term.  Lessor accounting is largely unchanged.  The Company adopted the provisions of the new guidance effective January 1, 2019.  The Company recorded the following:  (a) a right of use asset of $8,416, (b) a lease commitment liability of $8,860, (c) a reduction in retained earnings from cumulative effect of adoption of $20, (d) an increase in other receivables of $18, and (e) a reduction in other liabilities of $406.  See note 13.  

In June 2016, the FASB issued ASU 2016-13, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments.  Under this guidance (subsequently updated with ASU 2018-19, ASU 2019-05, ASU 2019-11 and ASU 2020-02), the measurement of all expected credit losses for financial assets held at the reporting date is to be based on historical experience, current conditions, and reasonable and supportable forecasts. Financial institutions and other organizations will now use forward-looking information to better inform their credit loss estimates. Many of the loss estimation techniques applied today will still be permitted, although the inputs to those techniques will change to reflect the full amount of expected credit losses. In addition, the ASU amends the accounting for credit losses on available-for-sale debt securities and purchased financial assets with credit deterioration. The Company’s adoption of the provisions of ASU 2016-13, effective January 1, 2020 did not have a material effect on the Company’s consolidated financial statements.

In January 2017, the FASB issued ASU 2017-04, Intangibles  – Goodwill and Other (Topic 350):  Simplifying the Test for GoodwillImpairment.The amendments in this ASU eliminate Step 2 from the goodwill impairment test. The annual or interim goodwill impairment test is performed by comparing the fair value of a reporting unit with its carrying amount.  An impairment charge should be recognized for the amount by which the carrying amount exceeds the reporting unit’s fair value; however, the loss recognized should not exceed the total amount of goodwill allocated to that reporting unit.  The Company adopted the provisions of ASU 2017-04, effective January 1, 2020.  The Company recorded an impairment of goodwill for the three months ended March 31, 2020.  See note 12.  This impairment charge was not the result of the adoption of ASU 2017-04. 

In June 2018, the FASB issued ASU 2018-07, Compensation – Stock Compensation (Topic 718):  Improvements toNonemployee Share-Based Payment Accounting.  The amendments in this ASU expand the scope of Topic 718, which previously only included share-based payments to employees, to include share-based payments issued to nonemployees for goods or services.  Consequently, the accounting for share-based payments to nonemployees and employees will be substantially aligned. The Company’s adoption of the provisions of ASU 2018-07, effective January 1, 2019 did not have an effect on the Company’s consolidated financial statements.

In March 2017, the FASB issued ASU 2017-08, Receivables – Nonrefundable Fees and Other Costs, Premium Amortization onPurchased Callable Debt Securities (Sub-Topic 310-20).  The amendments in this ASU shorten the amortization period for certain callable debt securities held at a premium.  Specifically, the amendments require the premium to be amortized to the earliest call date.  The amendments do not require an accounting change for securities held at a discount; the discount continues to be amortized to maturity.  The Company’s adoption of the provisions of ASU 2017-08, effective January 1, 2019 did not have an effect on theCompany’s consolidated financial statements.

In August 2017, the FASB issued ASU 2017-12, Derivative and Hedging – Targeted Improvements to Accounting for HedgingActivities (Topic 815).   The amendments in this ASU refine and expand hedge accounting for both financial and commodity risks and contain provisions to create more transparency and clarify how economic results are presented. The Company’s adoption of the provisions of ASU 2017-12, effective January 1, 2019 did not have an effect on the Company’s consolidated financial statements.

In February 2018, the FASB issued ASU 2018-02, Income Statement – Reporting Comprehensive Income (Topic 220): Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income.  The amendments in this ASU provide the option to reclassify stranded tax effects within accumulated other comprehensive income (“AOCI”) to retained earnings in each period in which the effect of the change in the U.S. federal corporate income tax rate in the Tax Act (or portion thereof) is recorded. The Company’s adoption of the provisions of ASU 2018-02, effective January 1, 2019 did not have an effect on the Company’s consolidated financial statements.

In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement(Topic 820): Disclosure Framework –Changes to the Disclosure Requirements for Fair Value Measurement.  The ASU modifies the disclosure requirements in Topic 820, by removing certain disclosure requirements related to the valuation hierarchy, modifying existing disclosure requirements related to measurement uncertainty and adding new disclosure requirements such as disclosing the changes in unrealized gains and losses for the period

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included in other comprehensive income for recurring level 3 fair value measurements held at the end of the reporting period and disclosing the range and weighted average of significant unobservable inputs used to develop level 3 fair value measurements. This ASU is effective for public companies for annual reporting periods and interim periods within those annual periods beginning after December 15, 2019. The Company’s adoption of the provisions of ASU 2018-13, effective January 1, 2020 did not have an effect on the Company’s consolidated financial statements.

In October 2018, the FASB issued ASU 2018-17, Consolidation (Topic 810):  Target Improvements to Related Party Guidancefor Variable Interest Entities.  The ASU made targeted changes to the related party consolidation guidance. The new guidance changes how entities evaluate decision-making fees under the variable interest entity guidance. To determine whether decision-making fees represent a variable interest, an entity will need to consider indirect interests held through related parties under common control on a proportionate basis under the new guidance, rather than in their entirety, as has been the case under current guidance. The guidance is effective in annual periods beginning after December 15, 2019 and interim periods within those fiscal years. The Company’s adoption of the provisions of ASU 2018-17, effective January 1, 2020 did not have an effect on the Company’s consolidated financial statements.

In November 2018, the FASB issued ASU 2018-18, Collaborative Arrangements (Topic 808): Clarifying the InteractionBetween Topic 808 and Topic 606.  The ASU provides more comparability in the presentation of revenue for certain transactions between collaborative arrangement participants. It accomplishes this by allowing organizations to only present units of account in collaborative arrangements that are within the scope of the revenue recognition standard together with revenue accounted for under the revenue recognition standard.  The parts of the collaborative arrangement that are not in the scope of the revenue recognition standard should be presented separately from revenue accounted for under the revenue recognition.  The Company’s adoption of the provisions of ASU 2018-18, effective January 1, 2020 did not have an effect on the Company’s consolidated financial statements.

In November 2019, the FASB issued ASU 2019-08, Compensation – Stock Compensation (Topic (718) and Revenue from Contracts with Customers (Topic 606): Codification Improvements– Share-Based Consideration Payable to a Customer.  This ASU requires companies to measure and classify (on the balance sheet) share-based payments to customers by applying the guidance in Topic 718, Compensation—Stock Compensation.  As a result, the amount recorded as a reduction in revenue would be measured based on the grant-date fair value of the share-based payment. The Company’s adoption of the provisions of ASU 2018-18, effective January 1, 2020 did not have an effect on the Company’s consolidated financial statements.

In March 2020, the FASB issued ASU 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting. This ASU provides temporary optional guidance to ease the burden in accounting for reference rate reform by providing optional expedients and exceptions for applying generally accepted accounting principles to contract modifications and hedging relationships, subject to meeting certain criteria, that reference LIBOR or another reference rate expected to be discontinued.  The ASU is intended to help stakeholders during the global market wide reference rate transition period and will be in effect for a limited time through December 31, 2022. The Company’s adoption of the provisions of ASU 2020-04, effective March 12, 2020 did not have an effect on the Company’s consolidated financial statements.

B. Recent Accounting Developments

In December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740):  Simplifying the Accounting for Income Taxes. This ASU is intended to simplify accounting for income taxes. It removes specific exceptions to the general principles in Topic 740 and amends existing guidance to improve consistent application.  This ASU is effective for fiscal years beginning after December 15, 2020 and interim period with those fiscal years The Company is currently evaluating the new guidance to determine the impact it may have on its consolidated financial statements.

In January 2020, the FASB issued ASU 2020-01,  Investments—Equity Securities (Topic 321), Investments—Equity Method and Joint Ventures (Topic 323), and Derivatives and Hedging (Topic 815)—Clarifying the Interactions between Topic 321, Topic 323, and Topic 815.  This ASU clarifies certain accounting certain topics impacted by Topic 321 Investments-Equity Securities. These topics include measuring equity securities using the measurement alternative, how the measurement alternative should be applied to equity method accounting, and certain forward contracts and purchased options which would be accounted for under the equity method of accounting upon settlement or exercise. This ASUis effective for public business entities for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2020. The Company is currently evaluating the new guidance to determine the impact it may have on its consolidated financial statements.

C. Fair Value of Financial Instruments

The following methods and assumptions were used by the Company in estimating the fair value of its financial instruments. These determinations were based on available market information and appropriate valuation methodologies. Considerable judgment is required to interpret market data to develop the estimates and, therefore, these estimates may not necessarily be indicative of the

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amount the Company could realize in a current market exchange. The use of different market assumptions and/or estimation methodologies may have a material effect on the estimated fair value amounts. Refer to note 8 for a discussion of the valuation hierarchy with respect to investments-trading; other investments, at fair value; and derivatives held by the Company.

Cash equivalents: Cash equivalents are carried at historical cost, which is assumed to approximate fair value. The estimated fair value measurement of cash equivalents is classified within level 1 of the valuation hierarchy.

Investments-trading: These amounts are carried at fair value. The fair value is based on either quoted market prices of an active exchange, independent broker market quotations, market price quotations from third- party pricing services, or valuation models when quotations are not available.

Other investments, at fair value: These amounts are carried at fair value. The fair value is based on quoted market prices of an active exchange, independent broker market quotations, or valuation models when quotations are not available.  In the case of investments in alternative investment funds, fair value is generally based on the reported net asset value of the underlying fund.

Receivables under resale agreements: Receivables under resale agreements are carried at their contracted resale price, have short-term maturities, and are repriced frequently or bear market interest rates and, accordingly, these contracts are at amounts that approximate fair value. The estimated fair value measurements of receivables under resale agreements are based on observations of actual market activity and are generally classified within level 2 of the valuation hierarchy.

Trading securities sold, not yet purchased: These amounts are carried at fair value. The fair value is based on quoted market prices of an active exchange, independent market quotations, market price quotations from third party pricing services, or valuation models when quotations are not available.

Securities sold under agreements to repurchase: The liabilities for securities sold under agreements to repurchase are carried at their contracted repurchase price, have short-term maturities, and are repriced frequently or bear market interest rates andaccordingly, these contracts are carried at amounts that approximate fair value. The estimated fair value measurements of securities sold under agreements to repurchase are based on observations of actual market activity and are generally classified within level 2 of the valuation hierarchy.

Redeemable financial instruments:  The liabilities for redeemable financial instruments are carried at their redemption value, which approximates fair value. The estimated fair value measurement of the redeemable financial instruments is classified within level 3 of the valuation hierarchy. 

Debt: These amounts are carried at outstanding principal less unamortized discount and deferred financing costs. However, a substantial portion of the debt was assumed in the Merger and recorded at fair value as of that date. As of March 31, 2020, and December 31, 2019, the fair value of the Company’s debt was estimated to be $61,501 and $58,635, respectively. The estimated fair value measurements of the debt are generally based on discounted cash flow models prepared by the Company’s management primarily using discount rates for similar instruments issued to companies with similar credit risks to the Company and are generally classified within level 3 of the value hierarchy.

Derivatives: These amounts are carried at fair value. Derivatives may be included as a component of investments-trading; trading securities sold, not yet purchased; and other investments, at fair value. See notes 8 and 9. The fair value is generally based on quoted market prices on an exchange that is deemed to be active for derivative instruments such as foreign currency forward contracts and Eurodollar futures.  For derivative instruments, such as TBAs and other extended settlement trades, the fair value is generally based on market price quotations from third party pricing services.

4. OTHER RECENT BUSINESS TRANSACTIONS OR EVENTS

ViaNova Capital Group LLC

In 2018, the Company formed a wholly-owned subsidiary, ViaNova Capital Group LLC (“ViaNova”), for the purpose of building a residential transition loan (“RTL”) business.  RTLs are small balance commercial loans that are secured by first lien mortgages used by professional investors and real estate developers to finance the purchase and rehabilitation of residential properties. 

On November 20, 2018, ViaNova entered into a Warehousing Credit and Security Agreement with LegacyTexas Bank (the “LegacyTexas Credit Facility”) with an effective date of November 16, 2018.  The LegacyTexas Credit Facility was amended on May 4,  2019 andagain on September 25, 2019 and October 28, 2019.  The LegacyTexas Credit Facilitysupported the buying, aggregating, and distributing of RTLs performed by the business of ViaNova.

On March 19, 2020, ViaNova received a notice of default from LegacyTexas Bank regarding the LegacyTexas Credit Facility, stating that ViaNova’s unrestricted cash balance was less than the amount required.  Also, on March 19, 2020, ViaNova received notice from LegacyTexas Bank that the Bank had suspended funding all “Alternative” loans for all of their clients, including the RTL loans that are the subject of the LegacyTexasCreditFacility with LegacyTexas Bank.  Since March 19, 2020 ViaNova has repaid all outstanding indebtedness under the LegacyTexas Credit Facility.  ViaNova stopped acquiring new RTLs and does not intend to

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acquire any new RTLs in the future.  As of March 31, 2020, the Company had four RTLs and several interest strips representing a par value of $3,034 and a fair value of $2,956, including the fair value of interest strips held.  These RTLsand interest strips are included as a component of investments-trading (see note 7).  The Company intends to opportunistically sell these RTLs if possible or allow them to mature.  The latest maturity date of the RTLs is January 9, 2021.

COVID 19 / Impairment of Goodwill

In March 2020, the World Health Organization declared the outbreak of a novel coronavirus (COVID-19) as a pandemic, which continues to spread throughout the United States. The spread of COVID-19 has caused significant volatility in domestic and international markets. There is on-going uncertainty around the breadth and duration of business disruptions related to COVID-19, as well as its impact on the U.S. and international economies.  While the Company cannot fully assess the impact COVID-19 will have on all of its operations at this time, there are certain impacts that the Company has identified:

· The unprecedented volatility of the financial markets experienced in March 2020, has caused the Company to operate JVB at a lower level of leverage than prior to the pandemic.  Specifically, JVB has reduced the size of its GCF repo operations and the volume of its TBA trading.  The Company determined that at its pre-pandemic levels in these businesses, it was exposed to a higher level of counterparty credit risk than it should have and was experiencing too much volatility in its available liquidity to conservatively meet capital requirements and margin calls in these businesses.  The Company expects JVB to operate at lower volumes in both these businesses for an indefinite period of time, which could unfavorably impact the operating profitability of JVB. 

· The financial market volatility, as well as the reduction in volumes in the GCF repo and TBA businesses, that resulted from COVID-19 required the Company to reassess the goodwill it had recorded related to JVB under the guidance of ASC 350.  The Company determined that the fair value of JVB was less than the carrying value (including the goodwill).  As a result, the Company recorded an impairment loss of $7,883 in the three months ended March 31, 2020.  See note 12. 

· The Company expects that its asset management segment will also be adversely impacted by the pandemic.  While it is difficult to determine the extent of the impact at this time, the Company expects that raising capital for new funds may become more challenging.  In addition, lower returns earned by funds will adversely impact the Company’s asset management fees and investors’ need for liquidity may result in reductions in AUM. 

· JVB’s mortgage group’s operations are centered on serving the financial needs of mortgage originators and institutions that invest in mortgage backed securities.  Prolonged high unemployment will most likely impact mortgage originations and demand for and supply of mortgage backed securities, which may have a significant unfavorable impact on the revenue earned by JVB’s mortgage group. 

The Company will likely be impacted by the pandemic in other ways which the Company cannot yet determine.  The Company will continue to monitor market conditions and respond accordingly. 

Subsequent to March 31, the Company has applied for and received a $2.2 million loan under the Paycheck Protection Program (PPP) of the Coronavirus Aid, Relief, and Economic Security (CARES) Act. See note 26. 

The 2020 Senior Notes

On January 31, 2020, the Operating LLC entered into a Note Purchase Agreement with JKD Capital Partners I LTD, a New York corporation (“JKD Investor”), and RN Capital Solutions LLC, a Delaware limited liability company (“RNCS”).  The JKD Investor is owned by Jack DiMaio, the vice chairman of the Company’s board of directors and the Operating LLC’s board of managers, and his spouse.

Pursuant to the Note Purchase Agreement, JKD Investor and RNCS each purchased a Senior Promissory Note in the principal amount of $2,250 (for an aggregate investment of $4,500).  The Senior Promissory Notes bear interest at a fixed rate of 12% per annum and mature on January 31, 2022.  On February 3, 2020, pursuant to the Note Purchase Agreement, the Operating LLC used the proceeds received from the issuance of the Senior Promissory Notes to repay in full all amounts outstanding under the Senior Promissory Note, dated September 25, 2019, issued by the Company to Pensco Trust Company, Custodian fbo Edward E. Cohen IRA in the principal amount of $4,386 (the “Cohen IRA Note”).  The Cohen IRA Note is included as a portion of the 2019 Senior Notes outstanding as of December 31, 2019.  The Cohen IRA Note was fully paid and extinguished on February 3, 2020.  Subsequent to this repayment, $2,400 of the 2019 Senior Notes remain outstanding.  See note 17. 

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5. NET TRADING

Net trading consisted of the following in the periods presented.

NET TRADING
(Dollars in Thousands)
		Three Months Ended
		March 31, 2020		March 31, 2019
Net realized gains (losses) - trading inventory	$	10,443	$	6,295
Net unrealized gains (losses) - trading inventory		(440)		559
Net gains and losses		10,003		6,854
Interest income- trading inventory		2,477		1,615
Interest income - residential transition loans		-		15
Interest income-receivables under resale agreements		41,485		37,483
Interest income		43,962		39,113
Interest expense-securities sold under agreements to repurchase		(34,766)		(36,381)
Interest expense-LegacyTexas Credit Facility		(39)		(5)
Interest expense-margin payable		(599)		(857)
Interest expense		(35,404)		(37,243)
Net trading	$	18,561	$	8,724

Trading inventory includes investmentsclassified as investments-trading as well as trading securities sold, not yet purchased.  See note 7. 

During 2019, RTLs were accounted for at lower of cost or market and included as a component of other assets and the interest income related to those loans was shown separately in the table above.  Effective January 1, 2020, in connection with the adoption of ASC 326, the Company began accounting for RTLs at fair value and including them as a component of investments-trading. Therefore, income earned on RTLs is included in interest income-trading inventory in the table above effective January 1, 2020. 

Also, see note 10 for discussion of receivables under resale agreements and securities sold under agreements to repurchase.  See note 6 for discussion of margin payable.  See note 17 for discussion of LegacyTexas Credit Facility. 

6. RECEIVABLES FROM AND PAYABLES TO BROKERS, DEALERS, AND CLEARING AGENCIES

Amounts receivable from brokers, dealers, and clearing agencies consisted of the following.

RECEIVABLES FROM BROKERS, DEALERS, AND CLEARING AGENCIES
(Dollars in Thousands)
	March 31, 2020		December 31, 2019
Deposits with clearing agencies	$	250	$	250
Unsettled regular way trades, net		11,260		12,170
Receivables from clearing agencies		66,094		83,712
Receivables from brokers, dealers, and clearing agencies	$	77,604	$	96,132

Amounts payable to brokers, dealers, and clearing agencies consisted of the following.

PAYABLES TO BROKERS, DEALERS, AND CLEARING AGENCIES
(Dollars in Thousands)
	March 31, 2020		December 31, 2019
Margin payable	$	201,242	$	208,441
Due to clearing agent		-		32,820
Payables to brokers, dealers, and clearing agencies	$	201,242	$	241,261

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Deposits with clearing agencies represent contractual amounts the Company is required to deposit with its clearing agents.

Securities transactions that settle in the regular way are recorded on the trade date, as if they had settled. The related amounts receivable and payable for unsettled securities transactions are recorded net in receivables from or payables to brokers, dealers, and clearing agencies on the Company’s consolidated balance sheets.

Receivables from clearing agencies are primarily comprised of (i) cash received by the Company upon execution of short trades that is restricted from withdrawal by the clearing agent and (ii) cash deposited with the FICC to support the Company’s General Collateral Funding (“GCF”) matched book repo business.

Margin payable represents amounts borrowed from Pershing, LLC to finance the Company’s trading portfolio.  Substantially all of the Company’s investments-trading and deposits with clearing agencies serve as collateral for the margin payable.  See note 5 for interest expense incurred on margin payable.

Due to clearing agent represents amounts due to Bank of New York under the Company’s intra-day and overnight lending facility supporting the GCF matched repo business. See note 10.

7. FINANCIAL INSTRUMENTS

Investments—Trading

Investments-trading consisted of the following.

INVESTMENTS - TRADING
(Dollars in Thousands)
	March 31, 2020		December 31, 2019
U.S. government agency MBS and CMOs	$	218,767	$	196,146
U.S. government agency debt securities		4,791		14,680
RMBS		14		15
U.S. Treasury securities		6,065		11,105
ABS		1		100
SBA loans		26,073		27,634
Corporate bonds and redeemable preferred stock		31,877		38,503
Foreign government bonds		626		844
Municipal bonds		25,121		13,737
Certificates of deposit		3,575		841
Derivatives		55,780		3,686
Equity securities		99		561
Residential transition loans		2,956		-
Investments-trading	$	375,745	$	307,852

Trading Securities Sold, Not Yet Purchased

Trading securities sold, not yet purchased consisted of the following.

TRADING SECURITIES SOLD, NOT YET PURCHASED
(Dollars in Thousands)
	March 31, 2020		December 31, 2019
U.S. Treasury securities	$	16,211	$	16,827
Corporate bonds and redeemable preferred stock		43,937		58,083
Municipal bonds		20		20
Derivatives		54,599		3,017
Trading securities sold, not yet purchased	$	114,767	$	77,947

The Company manages its exposure to changes in interest rates for the interest rate sensitive securities it holds by entering into offsetting short positions for similar fixed rate securities. See note 5 for realized and unrealized gains recognized on investments-trading.

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Other Investments, at fair value

Other investments, at fair value consisted of the following.

OTHER INVESTMENTS, AT FAIR VALUE
(Dollars in Thousands)
	March 31, 2020
	Amortized Cost		Carrying Value		Unrealized Gain / (Loss)
Equity securities	$	6,905	$	5,457	$	(1,448)
CLOs		2,557		1,877		(680)
U.S. Insurance JV		2,009		2,017		8
SPAC Fund		646		609		(37)
Residential loans		126		97		(29)
Other investments, at fair value	$	12,243	$	10,057	$	(2,186)

	December 31, 2019
	Amortized Cost		Carrying Value		Unrealized Gain / (Loss)
Equity securities	$	8,598	$	9,352	$	754
CLOs		2,894		2,522		(372)
U.S. Insurance JV		2,048		2,223		175
SPAC Fund		646		668		22
Residential loans		129		99		(30)
Other investments, at fair value	$	14,315	$	14,864	$	549

8. FAIR VALUE DISCLOSURES

Fair Value Option

The Company has elected to account for certain of its other financial assets at fair value under the fair value option provisions of FASB ASC 825. The primary reason for electing the fair value option was to reduce the burden of monitoring the differences between the cost and the fair value of the Company’s investments, previously classified as available for sale securities, including the assessment as to whether the declines are temporary in nature and to further remove an element of management judgment.

Such financial assets accounted for at fair value include:

· securities that would otherwise qualify for available for sale treatment;

· investments in equity method affiliates that have the attributes in FASB ASC 946-10-15-2 (commonly referred to as investment companies); and

· investments in residential loans.

The changes in fair value (realized and unrealized gains and losses) of these instruments for which the Company has elected the fair value option are recorded in principal transactions and other income in the consolidated statements of operations. All of the investments for which the Company has elected the fair value option are included as a component of other investments, at fair value in the consolidated balance sheets. The Company recognized net gains (losses) related to changes in fair value of investments that are included as a component of other investments, at fair value during the three months ended March 31, 2020 and 2019 of $(2,695) and $249 respectively

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Fair Value Measurements

In accordance with FASB ASC 820, the Company has categorized its financial instruments, based on the priority of the inputs to the valuation technique, into a three level valuation hierarchy. The valuation hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (level 1 measurement) and the lowest priority to unobservable inputs (level 3 measurement). The three levels of the valuation hierarchy under FASB ASC 820 are described below.

Level 1            Financial assets and liabilities whose values are based on unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities.

Level  2            Financial assets and liabilities whose values are based on one or more of the following:

1. Quoted prices for similar assets or liabilities in active markets;

2. Quoted prices for identical or similar assets or liabilities in non-active markets;

3. Pricing models whose inputs are derived, other than quoted prices, are observable for substantially the full term of the asset or liability; or

4. Pricing models whose inputs are derived principally from or corroborated by observable market data through   correlation or other means for substantially the full term of the asset or liability.

Level 3            Financial assets and liabilities whose values are based on prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable. These inputs reflect management’s own assumptions about the assumptions a market participant would use in pricing the asset or liability.

In certain cases, the inputs used to measure fair value may fall into different levels of the valuation hierarchy. In such cases, the level in the valuation hierarchy within which the fair value measurement in its entirety falls has been determined based on the lowest level input that is significant to the fair value measurement in its entirety. The Company’s assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to the asset or liability.

Both observable and unobservable inputs may be used to determine the fair value of positions that the Company has classified within the level 3 category. As a result, the unrealized gains and losses for assets and liabilities within the level 3 category presented in the tables below may include changes in fair value that were attributable to both observable (e.g., changes in market interest rates) and unobservable (e.g., changes in unobservable long-dated volatilities) inputs.

The following tables present information about the Company’s assets and liabilities measured at fair value as of March 31, 2020 and December 31, 2019 and indicates the valuation hierarchy of the valuation techniques utilized by the Company to determine such fair value.

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FAIR VALUE MEASUREMENTS ON A RECURRING BASIS
March 31, 2020
(Dollars in Thousands)
					Significant		Significant
			Quoted Prices in		Other Observable		Unobservable
			Active Markets		Inputs		Inputs
Assets	Fair Value		(Level 1)		(Level 2)		(Level 3)
Investments-trading:
U.S. government agency MBS and CMOs	$	218,767	$	-	$	218,767	$	-
U.S. government agency debt securities		4,791		-		4,791		-
RMBS		14		-		14		-
U.S. Treasury securities		6,065		6,065		-		-
ABS		1		-		1		-
SBA loans		26,073		-		26,073		-
Corporate bonds and redeemable preferred stock		31,877		-		31,877		-
Foreign government bonds		626		-		626		-
Municipal bonds		25,121		-		25,121		-
Certificates of deposit		3,575		-		3,575		-
Derivatives		55,780		-		55,780		-
Equity securities		99		-		99		-
Residential transition loans		2,956		-		-		2,956
Total investments - trading	$	375,745	$	6,065	$	366,724	$	2,956
Other investments, at fair value:
Equity securities	$	5,457	$	-	$	5,457	$	-
CLOs		1,877		-		-		1,877
Residential loans		97		-		97		-
		7,431	$	-	$	5,554	$	1,877
Investments measured at NAV (1)		2,626
Total other investments, at fair value	$	10,057
Liabilities
Trading securities sold, not yet purchased:
U.S. Treasury securities	$	16,211	$	16,211	$	-	$	-
Corporate bonds and redeemable preferred stock		43,937		-		43,937		-
Municipal bonds		20		-		20		-
Derivatives		54,599		-		54,599		-
Total trading securities sold, not yet purchased	$	114,767	$	16,211	$	98,556	$	-

(1) As a practical expedient, the Company uses NAV per share (or its equivalent)  to measure the fair value of its investments in the U.S. Insurance JV and the SPAC Fund.  The U.S. Insurance JV invests in debt issued by small and medium sized U.S. and Bermuda insurance and reinsurance companies.  The SPAC Fund invests in equity securities of SPACs.  According to ASC 820, these investments are not categorized within the valuation hierarchy.

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FAIR VALUE MEASUREMENTS ON A RECURRING BASIS
December 31, 2019
(Dollars in Thousands)
					Significant		Significant
			Quoted Prices in		Other Observable		Unobservable
			Active Markets		Inputs		Inputs
Assets	Fair Value		(Level 1)		(Level 2)		(Level 3)
Investments-trading:
U.S. government agency MBS and CMOs	$	196,146	$	-	$	196,146	$	-
U.S. government agency debt securities		14,680		-		14,680		-
RMBS		15		-		15		-
U.S. Treasury securities		11,105		11,105		-		-
ABS		100		-		100		-
SBA loans		27,634		-		27,634		-
Corporate bonds and redeemable preferred stock		38,503		-		38,503		-
Foreign government bonds		844		-		844		-
Municipal bonds		13,737		-		13,737		-
Certificates of deposit		841		-		841		-
Derivatives		3,686		-		3,686		-
Equity securities		561		-		561		-
Total investments - trading	$	307,852	$	11,105	$	296,747	$	-
Other investments, at fair value:
Equity Securities	$	9,352	$	2,009	$	7,343	$	-
CLOs		2,522		-		-		2,522
Residential loans		99		-		99		-
		11,973	$	2,009	$	7,442	$	2,522
Investments measured at NAV (1)		2,891
Total other investments, at fair value	$	14,864
Liabilities
Trading securities sold, not yet purchased:
U.S. Treasury securities	$	16,827	$	16,827	$	-	$	-
Corporate bonds and redeemable preferred stock		58,083		-		58,083		-
Municipal bonds		20		-		20		-
Derivatives		3,017		-		3,017		-
Total trading securities sold, not yet purchased	$	77,947	$	16,827	$	61,120	$	-

(1)As a practical expedient, the Company uses NAV per share (or its equivalent)  to measure the fair value of its investments in the U.S. Insurance JV and the SPAC Fund.  The U.S. Insurance JV invests in debt issued by small and medium sized U.S. and Bermuda insurance and reinsurance companies.  The SPAC Fund invests in equity securities of SPACs.  According to ASC 820, these investments are not categorized within the valuation hierarchy.

The following provides a brief description of the types of financial instruments the Company holds, the methodology for estimating fair value, and the level within the valuation hierarchy of the estimate. The discussion that follows applies regardless of whether the instrument is included in investments-trading; other investments, at fair value; or trading securities sold, not yet purchased.

U.S. Government Agency MBS and CMOs: These are securities that are generally traded over-the-counter. The Company generally values these securities using third party quotations such as unadjusted broker-dealer quoted prices or market price quotations from third party pricing services. These valuations are based on a market approach. The Company classifies the fair value of these securities within level 2 of the valuation hierarchy.

U.S. Government Agency Debt Securities: Callable and non-callable U.S. government agency debt securities are measured primarily based on quoted market prices obtained from third party pricing services. Non-callable U.S. government agency debt securities are generally classified within level 1 and callable U.S. government agency debt securities are classified within level 2 of the valuation hierarchy.

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RMBS: The Company generally values these securities using third party quotations such as unadjusted broker-dealer quoted prices or market price quotations from third party pricing services. These valuations are based on a market approach. The Company generally classifies the fair value of these securities based on third party quotations within level 2 of the valuation hierarchy.

U.S. Treasury Securities: U.S. Treasury securities include U.S. Treasury bonds and notes and the fair values of the U.S. Treasury securities are based on quoted prices or market activity in active markets. Valuation adjustments are not applied. The Company classifies the fair value of these securities within level 1 of the valuation hierarchy.

CLOs, CDOs, and ABS: CLOs, CDOs, and ABS are interests in securitizations. ABS may include, but are not limited to, securities backed by auto loans, credit card receivables, or student loans. When the Company is able to obtain independent market quotations from at least two broker-dealers and where a price within the range of at least two broker-dealers is used or market price quotations from third party pricing services is used, these interests in securitizations will generally be classified within level 2 of the valuation hierarchy. These valuations are based on a market approach. The independent market quotations from broker-dealers are generally nonbinding. The Company seeks quotations from broker-dealers that historically have actively traded, monitored, issued, and been knowledgeable about the interests in securitizations. The Company generally believes to the extent that it (i)  receives two quotations in a similar range from broker-dealers knowledgeable about these interests in securitizations and (ii)  considers the broker-dealers gather and utilize observable market information such as new issue activity in the primary market, trading activity in the secondary market, credit spreads versus historical levels, bid-ask spreads, and price consensus among market participants and sources, then classification within level 2 of the valuation hierarchy is appropriate. In the absence of two broker-dealer market quotations, a single broker-dealer market quotation may be used without corroboration of the quote in which case the Company generally classifies the fair value within level 3 of the valuation hierarchy.

If quotations are unavailable, prices observed by the Company for recently executed market transactions or valuation models prepared by the Company’s management may be used, which are based on an income approach. These models prepared by the Company’s management include estimates, and the valuations derived from them could differ materially from amounts realizable in an open market exchange. Each CLO and CDO position is evaluated independently taking into consideration available comparable market levels, underlying collateral performance and pricing, deal structures, and liquidity.  Fair values based on internal valuation models prepared by the Company’s management are generally classified within level 3 of the valuation hierarchy. 

Establishing fair value is inherently subjective (given the volatile and sometimes illiquid markets for certain interests in securitizations) and requires management to make a number of assumptions, including assumptions about the future of interest rates, discount rates, and the timing of cash flows. The assumptions the Company applies are specific to each security. Although the Company may rely on internal calculations to compute the fair value of certain interest in securitizations, the Company requests and considers indications of fair value from third party pricing services to assist in the valuation process.

SBA Loans: SBA loans include loans and SBA interest only strips.  In the case of loans, the Company generally values these securities using third party quotations such as unadjusted broker-dealer quoted prices, internal valuation models using observable inputs, or market price quotations from third party pricing services. The Company generally classifies these investments within level 2 of the valuation hierarchy. These valuations are based on a market approach. SBA interest only strips do not trade in an active market with readily available prices. Accordingly, the Company generally uses valuation models to determine fair value and classifies the fair value of the SBA interest only strips within level 2 or level 3 of the valuation hierarchy depending on whether the model inputs are observable or not. 

Corporate Bonds and Redeemable Preferred Stock: The Company uses recently executed transactions or third party quotations from independent pricing services to arrive at the fair value of its investments in corporate bonds and redeemable preferred stock. These valuations are based on a market approach. The Company generally classifies the fair value of these bonds within level 2 of the valuation hierarchy. In instances where the fair values of securities are based on quoted prices in active markets (for example with redeemable preferred stock), the Company classifies the fair value of these securities within level 1 of the valuation hierarchy.

Foreign Government Bonds: The fair value of foreign government bonds is estimated using valuations provided by third party pricing services and classifies the fair value within level 2 of the valuation hierarchy.

Municipal Bonds: Municipal bonds, which include obligations of U.S. states, municipalities, and political subdivisions, primarily include bonds or notes issued by U.S. municipalities. The Company generally values these securities using third party quotations such as market price quotations from third party pricing services. The Company generally classifies the fair value of these bonds within level 2 of the valuation hierarchy. The valuations are based on a market approach. In instances where the Company is unable to obtain reliable market price quotations from third party pricing services, the Company will use its own internal valuation models. In these cases, the Company will classify such securities as level 3 within the valuation hierarchy until it is able to obtain third party pricing.

Certificates of Deposit: The fair value of certificates of deposit is estimated using valuations provided by third party pricing services. The Company classifies the fair value of certificates of deposit within level 2 of the valuation hierarchy.

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Residential Loans: Management utilizes home price indices or market indications to value the residential loans.  The Company classifies the fair value of these loans within level 2 in the valuation hierarchy.

Residential transition loans:The Company uses valuation models prepared by management which are based on an income approach. These models include estimates, and the valuations derived from them could differ materially from amounts realizable in an open market exchange. Fair values based on internal valuation models prepared by the Company’s management are generally classified within level 3 of the valuation hierarchy. 

Equity Securities: The fair value of equity securities that represent unrestricted investments in publicly traded companies (common or preferred shares, options, warrants, and other equity investments) are determined using the closing price of the security as of the reporting date. These are securities that are traded on a recognized liquid exchange and the Company classifies their fair value  within level 1 of the valuation hierarchy.

The Company may own an option or warrant where the underlying security is publicly traded but the option or warrant is not.  In those cases, the Company may determine fair value using a Black-Scholes model and will generally classify their fair valuewithin level 2 within the valuation hierarchy.

The Company may own an equity investment in a publicly traded company that is restricted as to resale. In those cases, the Company may determine fair value by preparing a model. The fair value will be classified within level 2 of the valuation hierarchy if the inputs to the model are observable.  Otherwise, it will be classified within level 3 of the valuation hierarchy.  

The Company may own an equity interest in a private company.  In those cases, the Company may determine fair value by preparing a model.  The model may be either a market-based or income-based model, whichever is considered the most appropriate in each case.  The fair value will be classified within level 2 if the inputs to the model are observable.  Otherwise, it will be classified within level 3 of the valuation hierarchy.

Derivatives

Foreign Currency Forward Contracts

Foreign currency forward contracts are exchange-traded derivatives, which transact on an exchange that is deemed to be active.  The fair value of the foreign currency forward contracts is based on current quoted market prices.  Valuation adjustments are not applied.  These are classified within level 1 of the valuation hierarchy. See note 9.

TBAs and Other Forward Agency MBS Contracts

The Company generally values these securities using third party quotations such as unadjusted broker-dealer quoted prices or market price quotations from third party pricing services. TBAs and other forward agency MBS contracts are generally classified within level 2 of the valuation hierarchy. If there is limited transaction activity or less transparency to observe market based inputs to valuation models, TBAs and other forward agency MBS contracts are classified within level 3 of the valuation hierarchy.  U.S. government agency MBS and CMOs include TBAs and other forward agency MBS contracts.  Unrealized gains on TBAs and other forward agency MBS contracts are included in investments-trading on the Company’s consolidated balance sheets and unrealized losses on TBAs and other forward agency MBS contracts are included in trading securities sold, not yet purchased on the Company’s consolidated balance sheets. See note 9.

Other Extended Settlement Trades

When the Company buys or sells a financial instrument that will not settle in the regular time frame, the Company will account for that purchase or sale on the settlement date rather than the trade date.  In those cases, the Company accounts for the transaction between trade date and settlement date as a derivative (as either a purchase commitment or sale commitment). The Company will record an unrealized gain or unrealized loss on the derivative for the difference between the fair value of the underlying financial instrument as of the reporting date and the agreed upon transaction price.  The Company will determine the fair value of the financial instrument using the methodologies described above.

Level 3 Financial Assets and Liabilities

Financial Instruments Measured at Fair Value on a Recurring Basis

The following table presents additional information about assets measured at fair value on a recurring basis and for which the Company has utilized level 3 inputs to determine fair value.

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LEVEL 3 ROLLFORWARD
	Three Months Ended March 31,
	2020		2019
Beginning of period	$	2,522	$	2,756
Net trading		(78)		-
Gains & losses (1)		(603)		(33)
Accretion of income (1)		78		106
Purchases		609		-
Sales and returns of capital		(2,973)		(50)
Reclassification of RTLs		5,278		-
End of period	$	4,833	$	2,779
Change in unrealized gains / (losses) (2)	$	(385)	$	(33)

(1) Gains and losses and accretion of income on other investments, at fair value are recorded as a component of principal transactions and other income in the consolidated statements of operations.

(2) Represents the change in unrealized gains and losses for the period included in earnings for assets held at the end of the reporting period.

The following tables provide the quantitative information about level 3 fair value measurements as of March 31, 2020 and December 31, 2019.

QUANTITATIVE INFORMATION ABOUT LEVEL 3 FAIR VALUE MEASUREMENTS
(Dollars in Thousands)
				Significant		Range of
		Fair Value	Valuation	Unobservable	Weighted	Significant
		March 31, 2020	Technique	Inputs	Average	Inputs
Assets
Investments - trading
Residential Transition Loans	$	2,956	Discounted Cash Flow Model	Yield	15.00%	15.00%
Other investments, at fair value
CLOs	$	1,877	Discounted Cash Flow Model	Yield	20.8%	20.8% - 20.9%
				Duration-years	10.3	9.3 - 11.3
				Default rate	2.0%	2.0% - 2.0%

QUANTITATIVE INFORMATION ABOUT LEVEL 3 FAIR VALUE MEASUREMENTS
(Dollars in Thousands)
				Significant		Range of
		Fair Value	Valuation	Unobservable	Weighted	Significant
		December 31, 2019	Technique	Inputs	Average	Inputs
Assets
Other investments, at fair value
CLOs	$	2,522	Discounted Cash Flow Model	Yield	17.9%	16.9% - 19.2%
				Duration-years	5.8	5.3 - 6.5
				Default rate	2.0%	2.0% - 2.0%

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Sensitivity of Fair Value to Changes in Significant Unobservable Inputs

For recurring fair value measurements categorized within level 3 of the valuation hierarchy, the sensitivity of the fair value measurement to changes in significant unobservable inputs and interrelationships between those unobservable inputs (if any) are described below.

· CLOs:  The Company uses a discounted cash flow model to determine the fair value of its investments in CLOs.  Changes in the yield, duration, and default rate assumptions would impact the fair value determined.  The longer the duration, the lower the fair value of the investment.  The higher the yield, the lower the fair value of the investment.  The higher the default rate, the lower the fair value of the investment. 

· RTLs:  The Company uses a discounted cash flow model to determine the fair value of its investments in RTLs.  These loans are short term in nature (generally less than 18 months).  Changes in the yield or defaults will have the largest impact on the fair value calculation.  The higher the yield, the lower the fair value of the investment.  The higher the default rate, the lower the fair value of the investment. 

Investments in Certain Entities that Calculate NAV Per Share (or its Equivalent)

The following table presents additional information about investments in certain entities that calculate NAV per share (regardless of whether the “practical expedient” provisions of FASB ASC 820 have been applied), which are measured at fair value on a recurring basis at March 31, 2020 and December 31, 2019.

FAIR VALUE MEASUREMENTS OF INVESTMENTS IN CERTAIN ENTITIES
THAT CALCULATE NET ASSET VALUE PER SHARE (OR ITS EQUIVALENT)
(Dollars in Thousands)
		Fair Value March 31, 2020		Unfunded Commitments	Redemption Frequency	Redemption Notice Period
Other investments, at fair value
U.S. Insurance JV (a)	$	2,017	$	817	N/A	N/A
SPAC Fund  (b)		609		N/A	Quarterly after 1 year lock up	90 days
	$	2,626
		Fair Value December 31, 2019		Unfunded Commitments	Redemption Frequency	Redemption Notice Period
Other investments, at fair value
U.S. Insurance JV (a)	$	2,223	$	817	N/A	N/A
SPAC Fund  (b)		668		N/A	Quarterly after 1 year lock up	90 days
	$	2,891

N/ANot applicable.

(a) The U.S. Insurance JV invests in debt issued by small and medium sized U.S. and Bermuda insurance and reinsurance companies.

(b) The SPAC Fund invests in equity interests of SPACs.

9. DERIVATIVE FINANCIAL INSTRUMENTS

FASB ASC 815, Derivatives and Hedging (“FASB ASC 815”), provides for optional hedge accounting. When a derivative is deemed to be a hedge and certain documentation and effectiveness testing requirements are met, reporting entities can record all or a portion of the change in the fair value of a designated hedge as an adjustment to OCI rather than as a gain or loss in the statements of operations. To date, the Company has not designated any derivatives as hedges under the provisions included in FASB ASC 815.

All of the derivatives that the Company enters into contain master netting arrangements.  If certain requirements are met, the offsetting provisions included in FASB ASC 210, Balance Sheet (“ASC 210”), allow (but do not require) the reporting entity to net the asset and liability on the consolidated balance sheets. It is the Company’s policy to present the derivative assets and liabilities on a

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net basis if the conditions of ASC 210 are met.  However, in general the Company does not enter in offsetting derivatives with the same counterparties.  Therefore, in all periods presented, no derivatives are presented on a net basis. 

Derivative financial instruments are recorded at fair value. If the derivative was entered into as part of the Company’s broker-dealer operations, it will be included as a component of investments-trading or trading securities sold, not yet purchased. If it is entered into as a hedge for another financial instrument included in other investments, at fair value then the derivative will be included as a component of other investments, at fair value.

The Company may, from time to time, enter into derivatives to manage its risk exposures arising from (i) fluctuations in foreign currency rates with respect to the Company’s investments in foreign currency denominated investments; (ii) the Company’s investments in interest sensitive investments; and (iii) the Company’s facilitation of mortgage-backed trading. Derivatives entered into by the Company, from time to time, may include (a) foreign currency forward contracts; (b) purchase and sale agreements of TBAs and other forward agency MBS contracts; and (c) other extended settlement trades.

TBAs are forward contracts to purchase or sell MBS whose collateral remain “to be announced” until just prior to the trade settlement date. In addition to TBAs, the Company sometimes enters into forward purchases or sales of agency MBS where the underlying collateral has been identified.  These transactions are referred to as other forward agency MBS contracts.  TBAs and other forward agency MBS contracts are accounted for as derivatives by the Company under ASC 815.  The settlement of these transactions is not expected to have a material effect on the Company’s consolidated financial statements.

In addition to TBAs and other forward agency MBS contracts as part of the Company’s broker-dealer operations, the Company may from time to time enter into other securities or loan trades that do not settle within the normal securities settlement period. In those cases, the purchase or sale of the security or loan is not recorded until the settlement date.  However, from the trade date until the settlement date, the Company’s interest in the security is accounted for as a derivative as either a forward purchase commitment or forward sale commitment.  The Company will classify the related derivative either within investments-trading or other investments, at fair value depending on where it intends to classify the investment once the trade settles.

Derivatives involve varying degrees of off-balance sheet risk, whereby changes in the level or volatility of interest rates or market values of the underlying financial instruments may result in changes in the value of a particular financial instrument in excess of its carrying amount. Depending on the Company’s investment strategy, realized and unrealized gains and losses are recognized in principal transactions and other income or in net trading in the Company’s consolidated statements of operations on a trade date basis.

The Company may, from time to time, enter into the following derivative instruments.

Foreign Currency Forward Contracts

The Company invests in foreign currency denominated investments that expose it to fluctuations in foreign currency rates, and, therefore, the Company may, from time to time, hedge such exposure by using foreign currency forward contracts.  The Company carries foreign currency forward contracts at fair value and includes them as a component of other investments, at fair value in the Company’s consolidated balance sheets.  As of March 31, 2020 and December 31, 2019, the Company had no outstanding foreign currency forward contracts.

TBAs and Other Forward Agency MBS Contracts

The Company enters into TBAs and other forward agency MBS transactions for three main reasons.

(i) The Company trades U.S. government agency obligations.  In connection with these activities, the Company may be required to maintain inventory in order to facilitate customer transactions.  In order to mitigate exposure to market risk, the Company may enter into the purchase and sale of TBAs and other forward agency MBS contracts.

(ii) The Company also enters into TBAs and other forward agency MBS contracts in order to assist clients (generally small to mid-size mortgage loan originators) in hedging the interest rate risk associated with the mortgages owned by these clients.

(iii) Finally, the Company may enter into TBAs and other forward agency MBS contracts on a speculative basis.

The Company carries the TBAs and other forward agency MBS contracts at fair value and includes them as a component of investments-trading or trading securities sold, not yet purchased in the Company’s consolidated balance sheets. At March 31, 2020, the Company had open TBA and other forward MBS purchase agreements in the notional amount of $2,090,750 and open TBA and other forward MBS sale agreements in the notional amount of $2,212,275. At December 31, 2019, the Company had open TBA and other forward agency MBS purchase agreements in the notional amount of $1,773,000 and open TBA and other forward agency MBS sale agreements in the notional amount of $1,874,194.

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During March and continuing subsequent to March 31, 2020, the Company reduced its TBA trading activity as a response to the financial market volatility associated with the COVID-19 pandemic.  See note 4.  As of April 30, 2020, the Company had open TBA and other forward MBS purchase agreements in the notional amount of approximately $1,134,419 and open TBA and other forward MBS sale agreements in the notional amount of approximately $1,252,919. 

Other Extended Settlement Trades

When the Company buys or sells a financial instrument that will not settle in the regular time frame, the Company will account for that purchase or sale on the settlement date rather than the trade date.  In those cases, the Company accounts for the transaction between trade date and settlement date as either a forward purchase commitment or a forward sale commitment, both considered derivatives.  The Company will record an unrealized gain or unrealized loss on the derivative for the difference between the fair value of the underlying financial instrument as of the reporting date and the agreed upon transaction price. At March 31, 2020, the Company had open forward purchase commitments of $1,725 and open forward sale commitments of $0.  At December 31, 2019, the Company had open forward purchase commitments of $1,526 and open forward sale commitments of $0.

The following table presents the Company’s derivative financial instruments and the amount and location of the fair value (unrealized gain / (loss)) recognized in the consolidated balance sheets as of March 31, 2020 and December 31, 2019.  

DERIVATIVE FINANCIAL INSTRUMENTS-BALANCE SHEET INFORMATION
(Dollars in Thousands)
Derivative Financial Instruments Not Designated as Hedging Instruments Under FASB ASC 815	Balance Sheet Classification		March 31, 2020		December 31, 2019
TBAs and other forward agency MBS	Investments-trading	$	55,779	$	3,686
Other extended settlement trades	Investments-trading		1		-
Foreign currency forward contracts	Other investments, at fair value		-		-
TBAs and other forward agency MBS	Trading securities sold, not yet purchased		(54,599)		(3,017)
Other extended settlement trades	Trading securities sold, not yet purchased		-		-
		$	1,181	$	669

The following table presents the Company’s derivative financial instruments and the amount and location of the net gain (loss) recognized in the consolidated statements of operations.

DERIVATIVE FINANCIAL INSTRUMENTS-STATEMENT OF OPERATIONS INFORMATION
(Dollars in Thousands)
Derivative Financial Instruments Not Designated as Hedging Instruments Under FASB ASC 815	Income Statement Classification		Three Months Ended March 31, 2020		Three Months Ended March 31, 2019
Foreign currency forward contracts	Revenue-principal transactions and other income	$	-	$	40
Other extended settlement trades	Revenue-net trading		1		(24)
TBAs and other forward agency MBS	Revenue-net trading		(213)		761
		$	(212)	$	777

10. COLLATERALIZED SECURITIES TRANSACTIONS

Matched Book RepoBusiness

The Company enters into repos and reverse repos as part of its matched book repo business.  In general, the Company will lend money to a counterparty after obtaining collateral securities from that counterparty pursuant to a reverse repo.  The Company will borrow money from another counterparty using the same collateral securities pursuant to a repo.  The Company seeks to earn net interest income on these transactions. Currently, the Company categorizes its matched book repo business into two major groups: gestation repo and GCF repo.

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Gestation Repo

Gestation repo involves entering into repo and reverse repo where the underlying collateral security represents a pool of newly issued mortgage loans.  The borrowers (the reverse repo counterparties) are generally mortgage originators.  The lenders (the repo  counterparties) are a diverse group of the counterparties comprised of banks, insurance companies, and other financial institutions.  The Company self-clears its gestation repo transactions.

GCF Repo

In October 2017, the Company became a full netting member of the FICC’s Government Securities Division.  As a full netting member of the FICC, the Company has access to the FICC’s GCF repo service that provides netting and settlement services for repo transactions where the underlying security is general collateral (primarily U.S. Treasuries and U.S. Agency securities).  The Company began entering into matched book GCF repo transactions in November 2017.  The borrowers (the reverse repo  counterparties) are a diverse group of financial institutions including hedge funds, registered investment funds, REITs, and other similar counterparties.  The lenders (the repo counterparties)  are the FICC and other large financial institutions. The Company uses Bank of New York (“BONY”) as its settlement agent for its GCF repo matched book transactions.  The Company is considered self-clearing for this business.  In connection with the Company’s full netting membership of the FICC, the Company agreed to establish and maintain a committed line of credit in a minimum amount of $25,000, which it entered into with Fifth Third Financial Bank, N.A. (“FT Financial”)   on April 25, 2018.  This line of credit arrangement was subsequently amended. See note 17.

Other Repo Transactions

In addition to the Company’s matched book repo business, the Company may also enter into reverse repos to acquire securities to cover short positions or as an investment.  Additionally, the Company may enter into repos to finance the Company’s securities positions held in inventory.  These repo and reverse repo agreements are generally cleared on a bilateral or triparty basis; no clearing broker is involved.  These transactions are not matched.

Repo Information

At March 31, 2020 and December 31, 2019, the Company held reverse repos of $6,014,438 and $7,500,002, respectively, and the fair value of collateral received under reverse repos was $6,167,233and $7,769,693, respectively.  As ofMarch 31, 2020 and December 31, 2019,  the reverse repo balance was comprised of receivables collateralized by securities with  30and 41counterparties, respectively.

At March 31, 2020 and December 31, 2019, the Company held repos of $6,066,372 and $7,534,443, respectively, and the fair value of securities and cash pledged as collateral under repos was $6,035,939and$7,561,978, respectively. These amounts include collateral for reverse repos that were re-pledged as collateral for repos.

Intraday and OvernightLending Facility

In conjunction with the Company’s GCF repo business, on October 19, 2018, the Company and BONY entered into an intraday lending facility.  The lending facility allows for BONY to advance funds to JVB in order to facilitate the settlement of GCF repo transactions.  The total committed amount at March 31, 2020 was $75,000.  The current termination date of this facility is October 16, 2020. It is expected that this facility will be renewed for successive 364-day periods provided that the Company continues its GCF matched book repo business.

The BONY lending 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 an annual 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.  For the three months ended March 31, 2020, the Company received no advances under the intraday lending facility.  During the year ended December 31, 2019 advances of $32,818 were made under this facility.  This draw plus accrued interest of $2, or $32,820, was outstanding as of December 31, 2019 and was included as a component of payable to brokers, dealers, and clearing agencies in the statement of financial condition.  This amount was repaid in full in January 2020.

Concentration

In the matched book repo business, the demand for borrowed funds is generated by the reverse repo counterparty and the supply of funds is provided by the repo counterparty. 

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On the demand side, the Company does not consider its GCF repo business to be concentrated because the Company’s  reverse repo counterparties are comprised of a diverse group of financial institutions. 

On the supply side, the Company obtains a significant amount of its funds from the FICC.  If the FICC were to reduce its repo lending activities or make significant adverse changes to the cost of such lending, the Company may not be able to replace the FICC funding, or if the Company does so, it may be at a higher cost of funding.  Therefore, the Company considers its GCF repo business to be concentrated from the supply side of the business. 

The gestation repo business has been and continues to be concentrated as to reverse repurchase counterparties.  The Company conducts this business with a limited number of reverse repo counterparties.  As of March 31, 2020 and December 31, 2019, the Company’s gestation reverse repos shown in the tables below represented balances from seven counterparties.  The Company also has a limited number of repo counterparties in the gestation repo business.  However, this is primarily a function of the limited number of reverse repo agreement counterparties with whom the Company conducts this business rather than a reflection of a limited supply of funds.  Therefore, the Company considers the gestation repo business to be concentrated on the demand side. 

The total net revenue earned by the Company on its matched book repo business (both gestation repo and GCF repo) was $6,868 and $1,294 for the three months ended March 31, 2020 and 2019, respectively. 

Detail

Effective June 1, 2019, the Company changed its accounting policy regarding the netting of reverse repo and repo transactions.  ASC 210 provides the option to present reverse repo and repo on a net basis if certain netting conditions are met.  Prior to this date, the Company utilized this option and presented repo and reverse repo on a net basis when these conditions were met.  As of June 1, 2019, the Company changed its policy to present all repo and reverse repo transactions on a gross basis even if the underlying netting conditions are met.  The Company believes that the newly adopted accounting principle is preferable in the circumstances because it provides consistency for the accounting of all repurchase and reverse repos, as well as more information on the face of the financial statements.The amounts in the table below (including periods prior to June 1, 2019) are presented on a gross basis. 

As March 31, 2020, the Company had outstanding reverse repos of $6,014,438 and repos of $6,066,372.  Included in these amounts are outstanding reverse repos of $1,473,033and repos of $4,570,581,  where the FICC was the Company’s counterparty to the transaction and which were subject to a master netting arrangement. 

As of December 31, 2019, the Company had outstanding reverse repos of $7,500,002and repos of $7,534,443.  Included in these amounts are outstanding reverse repos of $371,025 and repos of $5,138,712,  where the FICC was the Company’s counterparty to the transaction and which were subject to a master netting arrangement. 

The following tables summarize the remaining contractual maturity of the gross obligations under repos accounted for as secured borrowings segregated by the underlying collateral pledged as of each date shown.  All amounts as well as counterparty cash collateral (see note 14) are subject to master netting arrangements.

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SECURED BORROWINGS
(Dollars in Thousands)
March 31, 2020
	Repurchase Agreements
	Remaining Contractual Maturity of the Agreements
Collateral Type:	Overnight and Continuous		Up to 30 days		30 - 90 days		Greater than 90 days		Total
U.S. government agency MBS (GCF repo)	$	3,923,623	$	672,974	$	-	$	400,101	$	4,996,698
MBS (gestation repo)		-		1,046,002		-		-		1,046,002
SBA loans		23,672		-		-		-		23,672
	$	3,947,295	$	1,718,976	$	-	$	400,101	$	6,066,372
	Reverse Repurchase Agreements
	Remaining Contractual Maturity of the Agreements
Collateral Type:	Overnight and Continuous		Up to 30 days		30 - 90 days		Greater than 90 days		Total
U.S. government agency MBS (GCF repo)	$	828,399	$	3,824,896	$	312,087	$	-	$	4,965,382
MBS (gestation repo)		-		1,049,056		-		-		1,049,056
	$	828,399	$	4,873,952	$	312,087	$	-	$	6,014,438

SECURED BORROWINGS
(Dollars in Thousands)
December 31, 2019
	Repurchase Agreements
	Remaining Contractual Maturity of the Agreements
Collateral Type:	Overnight and Continuous		Up to 30 days		30 - 90 days		Greater than 90 days		Total
U.S. government agency MBS (GCF repo)	$	5,117,811	$	1,546,510	$	-	$	-	$	6,664,321
MBS (gestation repo)		-		742,035		100,403		-		842,438
SBA loans		27,684		-		-		-		27,684
	$	5,145,495	$	2,288,545	$	100,403	$	-	$	7,534,443
	Reverse Repurchase Agreements
	Remaining Contractual Maturity of the Agreements
Collateral Type:	Overnight and Continuous		Up to 30 days		30 - 90 days		Greater than 90 days		Total
U.S. government agency MBS (GCF repo)	$	1,231,027	$	2,525,188	$	2,319,079	$	575,058	$	6,650,352
MBS (gestation repo)		-		747,692		101,958		-		849,650
	$	1,231,027	$	3,272,880	$	2,421,037	$	575,058	$	7,500,002

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11.   INVESTMENT IN EQUITY METHOD AFFILIATE

Equity method accounting requires that the Company record its investment in equity method affiliates on the consolidated balance sheets and recognize its share of the equity method affiliates’ net income as earnings each reporting period. 

The Company has certain equity method affiliates for which it has elected the fair value option.  Those investees are excluded from the table below.  Those investees are included as a component of other investments, at fair value in the consolidated balance sheets.  All gains and losses (unrealized and realized) from securities classified as other investments, at fair value in the consolidated balance sheets are recorded as a component of principal transactions and other income in the consolidated statement of operations. See note 24.

The following table summarizes the activity and earnings in the Company’s investment that is accounted for under the equity method.

INVESTMENTS IN EQUITY METHOD AFFILIATES
(Dollars in Thousands)
	Insurance SPAC		AOI		CK Capital		Total
January 1, 2020	$	3,222	$	559	$	18	$	3,799
Investments / advances		-		2,097		-		2,097
Distributions / repayments		-		-		-		-
Earnings / (loss) realized		(306)		(31)		230		(107)
March 31, 2020	$	2,916	$	2,625	$	248	$	5,789

12.  GOODWILL

Goodwill consisted of the following.

GOODWILL
(Dollars in Thousands)
	March 31, 2020		December 31, 2019
AFN	$	109	$	109
JVB		-		7,883
Goodwill	$	109	$	7,992

The Company measures its goodwill impairment on an annual basis or when events indicate that goodwill may be impaired.  The Company performs its annual impairment tests ofAFN goodwill on October 1 of each year; and JVBgoodwill on January 1 of each year. 

In the first quarter of 2020, the Company determined that the financial market volatility that resulted from the COVID-19 pandemic was a triggering event that required a reassessment of the goodwill related to JVB.See note 4. The Company concluded there was no triggering event for the goodwill related to AFN.

The Company performed a valuation of JVB as of March 31, 2020 by applying equal weighting to both the income approach and the market approach.  Under the guidance of FASB ASC 350, the Company determined that the fair value of JVB was less than the carrying value (including the goodwill).  As a result, the Company recognized an impairment loss of $7,883 in the three months ended March 31, 2020. The impairment loss is included in the consolidated statements of operations as impairment of goodwill and is reflected as a component of operating expense.

13.  LEASES

The Company leases office space and certain computer and related equipment under noncancelable operating leases.  The Company determines if an arrangement is a lease at the inception date of the contract.   The Company measures operating lease liabilities using an estimated incremental borrowing rate as there is no rate implicit in the Company’s operating lease arrangements. 

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An incremental borrowing rate was calculated for each operating lease based on the term of the lease, the U.S. Treasury term interest rate, and an estimated spread to borrow on a secured basis.

The Company adopted the provisions of ASC 842 effective January 1, 2019.  At adoption, the Company elected to not restate prior periods and rather record a cumulative effect of accounting change effective January 1, 2019.  The Company recorded the following: (a) a right of use asset of $8,416, (b) a lease commitment liability of $8,860, (c) a reduction in retained earnings from cumulative effect of adoption of $20, (d) an increase in other receivables of $18, and (e) a reduction in other liabilities of $406.

Rent expense is recognized on a straight-line basis over the lease term and is in included business development, occupancy, and equipment expense.

As of March 31, 2020, all of the leases to which the Company was a party were operating leases.  The weighted average remaining term of the leases was 8.2 years.  The weighted average discount rate for the leases was 5.36%.

Maturities of operating lease liability payments consisted of the following.

FUTURE MATURITY OF LEASE LIABILITIES
(Dollars in Thousands)
		As of March 31, 2020
2020 - remaining	$	1,161
2021		1,108
2022		933
2023		950
2024		983
Thereafter		4,094
Total		9,229
Less imputed interest		(1,838)
Lease obligation	$	7,391

During the three months ended March 31, 2020, total cash payments of $403 were recorded as a reduction in the operating lease obligation.   No cash payments were made to acquire right of use assets. For the three months ended March 31, 2020 and 2019, rent expense, net of sublease income of $79 and $65, was $378 and $390, respectively.

14.  OTHER RECEIVABLES, OTHER ASSETS, ACCOUNTS PAYABLE AND OTHER LIABILITIES

Other receivables consisted of the following.

OTHER RECEIVABLES
(Dollars in Thousands)
	March 31, 2020		December 31, 2019
Cash collateral due from counterparties	$	4,838	$	41,172
Asset management fees receivable		886		1,159
Accrued interest receivable and dividend receivable		10,521		3,549
Revenue share receivable		115		150
Other receivables		647		595
Other receivables	$	17,007	$	46,625

When the Company enters into a reverse repo, it obtains collateral in excess of the principal amount of the reverse repo.  The Company accepts collateral in the form of liquid securities or cash.  If the value of the securities the Company receives as collateral increases, the Company’s reverse repo counterparties may request a return of their collateral with a value equal to such increase.  In some cases, the Company will return to such reverse repo counterparties cash instead of securities.  In that case, the Company includes the cash returned as a component of other receivables (see above).

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When the Company enters into repo transactions, the Company provides collateral to the Company’s repo counterparties in excess of the principal balance of the repo.  The Company’s counterparties accept collateral in the form of liquid securities or cash.  To the extent the Company provides the collateral in cash, the Company includes it as a component of other receivables (see above).

Asset management fees receivable are of a routine and short-term nature.  These amounts are generally accrued monthly and paid on a monthly or quarterly basis. 

Accrued interest and dividends receivable represent interest and dividends accrued on the Company’s investment securities included as a component of investments-trading or other investments, at fair value. Interest payable on securities sold, not yet purchased is included as a component of accounts payable and other liabilities in the table entitled Accounts Payable and Other Liabilities below.

Revenue share receivable represents the amount due to the Company for the Company’s share of revenue arrangements generated from various entities in which the Company receives a share of the entity’s revenue. Other receivables represent other miscellaneous receivables that are of a short-term nature.

Other assets consisted of the following.

OTHER ASSETS
(Dollars in Thousands)
	March 31, 2020		December 31, 2019
Deferred costs	$	241	$	301
Prepaid expenses		1,075		796
Deposits		403		656
Miscellaneous other assets		275		275
Residential transition loans		-		5,323
Furniture, equipment, and leasehold improvements, net		899		916
Intangible assets		166		166
Other assets	$	3,059	$	8,433

Deferred costs and prepaid expenses represent amounts paid for services that are being amortized over their expected period of use and benefit.  They are all routine and short-term in nature.  Deposits are amounts held by landlords or other parties which will be returned or offset upon satisfaction of a lease or other contractual arrangement. 

During 2019, RTLs were accounted for at lower of cost or market and included as a component of other assets.  Effective January 1, 2020, in connection with the adoption of ASC 326, the Company began accounting for RTLs at fair value and including them as a component of investments-trading. 

See note 16 to the Company’s consolidated financial statements included in its Annual Report on Form 10-K for the year ended December 31, 2019 for further discussion of the firm’s furniture, equipment, and leasehold improvements.  Intangible assets represent the carrying value of the JVB broker-dealer license. 

Accounts payable and other liabilities consisted of the following.

ACCOUNTS PAYABLE AND OTHER LIABILITIES
(Dollars in Thousands)
	March 31, 2020		December 31, 2019
Accounts payable	$	141	$	362
Redeemable financial instruments accrued interest		814		403
Accrued interest payable		738		711
Accrued interest on securities sold, not yet purchased		882		914
Payroll taxes payable		677		729
Counterparty cash collateral		74,692		9,524
Accrued expense and other liabilities		3,837		7,652
Accounts payable and other liabilities	$	81,781	$	20,295

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aa

The redeemable financial instrument accrued interest represents accrued interest on the JKD Capital Partners I LTD and the DGC Trust/CBF redeemable financial instruments.  See note 16.

When the Company enters into a reverse repo, the Company obtains collateral in excess of the principal of the reverse repo.   The Company accepts collateral in the form of liquid securities or cash.  To the extent the Company receives cash collateral, the Company includes it as a component of other liabilities (counterparty cash collateral) in the table above. 

When the Company enters into repo transactions, the Company provides collateral to the Company’s repo counterparty in excess of the principal balance of the repo.  If the value of the securities the Company provides as collateral increases, the Company may request a return of its collateral with a value equal to such increase.  In some cases, the repo counterparty will return cash instead of securities.  In that case, the Company includes the cash returned as a component of other liabilities (counterparty cash collateral) in the table above.  See note 10.

15.  VARIABLE INTEREST ENTITIES

As a general matter, a reporting entity must consolidate a variable interest entity (“VIE”) when it is deemed to be the primary beneficiary.  The primary beneficiary is the entity that has both (a) the power to direct the matters that most significantly impact the VIE’s financial performance and (b) a significant variable interest in the VIE.

The Company’s Principal Investing Portfolio

Included in other investments, at fair value in the consolidated balance sheets are investments in several VIEs.  In each case, the Company determined it was not the primary beneficiary.  The maximum potential financial statement loss the Company would incur if the VIEs were to default on all their obligations would be the loss of the carrying value of these investments as well as any future investments the Company were to make.  As of March 31, 2020, there were $817 of unfunded commitments to VIEs that the Company has invested in.  Other than its investment in these entities, the Company did not provide financial support to these VIEs during the three months ended March 31, 2020 and 2019 and had no liabilities, contingent liabilities, or guarantees (implicit or explicit) related to these VIEs at March 31, 2020 and December 31, 2019.  See table below. 

For each investment management contract entered into by the Company, the Company assesses whether the entity being managed is a VIE and if the Company is the primary beneficiary.  Certain of the Investment Vehicles managed by the Company are VIEs.  Under the current guidance of ASU 2015-12, the Company has concluded that its asset management contracts are not variable interests.  Currently, the Company has no other interests in entities it manages that are considered variable interests and are considered significant.  Therefore, the Company is not the primary beneficiary of any VIEs that it manages.

The Company’s Trading Portfolio

From time to time, the Company may acquire an interest in a VIE through the investments it makes as part of its trading operations, which are included as investments-trading or securities sold, not yet purchased in the consolidated balance sheets.   Because of the high volume of trading activity in which the Company engages, the Company does not perform a formal assessment of each individual investment within its trading portfolio to determine if the investee is a VIE and if the Company is a primary beneficiary.  Even if the Company were to obtain a variable interest in a VIE through its trading portfolio, the Company would not be deemed to be the primary beneficiary for two main reasons: (a) the Company does not usually obtain the power to direct activities that most significantly impact any investee’s financial performance  and (b) a scope exception exists within the consolidation guidance for cases where the reporting entity is a broker-dealer and any control (either as the primary beneficiary of a VIE or through a controlling interest in a voting interest entity) was deemed to be temporary.  In the unlikely case that the Company obtained the power to direct activities and obtained a significant variable interest in an investee in its trading portfolio that was a VIE, any such control would be deemed to be temporary due to the rapid turnover of the Company’s trading portfolio. 

The following table presents the carrying amounts of the assets in the Company’s consolidated balance sheets related to the Company’s variable interests in identified VIEs with the exception of (i) the two trust VIEs that hold the Company’s junior subordinated notes (see note 17) and (ii) any security that represents an interest in a VIE that is included in investments-trading or securities sold, not yet purchased in the Company’s consolidated balance sheets. The table below shows the Company’s maximum exposure to loss associated with these identified nonconsolidated VIEs in which it holds variable interests at March 31, 2020 and December 31, 2019.

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CARRYING VALUE OF VARIABLE INTERESTS IN NON-CONSOLIDATED VARIABLE INTEREST ENTITIES
(Dollars in Thousands)
		As of March 31, 2020		As of December 31, 2019
Other Investments, at fair value	$	4,503	$	5,413
Maximum exposure	$	4,503	$	5,413

16.  REDEEMABLE FINANCIAL INSTRUMENTS

Redeemable financial instruments consisted of the following .

REDEEMABLE FINANCIAL INSTRUMENTS
(Dollars in Thousands)
		As of March 31, 2020		As of December 31, 2019
JKD Capital Partners I LTD	$	7,957	$	7,957
DGC Trust / CBF		8,500		8,500
ViaNova Capital Group, LLC		450		526
	$	16,907	$	16,983

JKD Capital Partners I LTD Amendment

On October 3, 2016, the Operating LLC entered into an investment agreement (the “JKD Investment Agreement”), by and between Operating LLC and the JKD Investor, pursuant to which the JKD Investor agreed to invest up to $12,000 in the Operating LLC (the “JKD Investment”), $6,000 of which was invested upon the execution of the JKD Investment Agreement, an additional $1,000 was invested in January 2017,and an additional $1,268 was invested on January 9, 2019.  The JKD Investor is owned by Jack DiMaio, the vice chairman of the Company’s board of directors and the Operating LLC’s board of managers, and his spouse.

In exchange for the JKD Investment, the Operating LLC agreed to pay to JKD Investor during the term of the JKD Investment Agreement an amount (“JKD Investment Return”) equal to 50% of the difference between (i) the revenues generated during a quarter by the activities of the Institutional Corporate Trading Business of JVB (as defined in the JKD Investment Agreement, as amended) and (ii) certain expenses incurred by such Institutional Corporate Trading Business (the “Institutional Corporate Trading Business Net Revenue”). This JKD Investment Return is recorded monthly as interest expense or (interest income) with the related accrued interest recorded in accounts payable and other accrued liabilities. If the return is negative in an individual quarter, it will reduce the balance of the JKD Investment.  Payments of the JKD Investment Return are made on a quarterly basis.  The term of the JKD Investment Agreement commenced on October 3, 2016 and will continue until a redemption (as described below) occurs, unless the JKD Investment Agreement is earlier terminated.

On March 6, 2019, the JKD Investor and the Operating LLC entered into an amendment to the JKD Investment Agreement (the “JKD Investment Agreement Amendment”), pursuant to which the term “JKD Investment Return” under the JKD Investment Agreement was amended as follows:

(a) during the fourth quarter of 2018, an amount equal to 42% of the Institutional Corporate Trading Business Net Revenue and

(b) commencing on January 1, 2019 and for each quarter during the remainder of the term of the JKD Investment Agreement, an amount equal to a percentage of the Institutional Corporate Trading Business Net Revenue, which percentage is based on the JKD Investor’s investment under the JKD Investment Agreement as a percentage of the total capital allocated to the Institutional Corporate Trading Business of JVB.

The JKD Investor may terminate the JKD Investment Agreement (i) upon 90 days’ prior written notice to the Operating LLC if the Operating LLC or its affiliates modify any of their policies or procedures governing the operation of their businesses or change the way they operate their business and such modification has a material adverse effect on the amounts payable to the JKD Investor pursuant to the JKD Investment Agreement or (ii) upon 60 days’ prior written notice to the Operating LLC if the employment of Lester Brafman, the Company’s chief executive officer, is terminated. The Operating LLC may terminate the JKD Investment Agreement, as amended, upon 60 days’ prior written notice to the JKD Investor if Mr. DiMaio ceases to control the day-to-day operations of the JKD Investor.

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Upon a termination of the JKD Investment Agreement, as amended, the Operating LLC will pay to the JKD Investor an amount equal to the “Investment Balance” (as such term is defined in the JKD Investment Agreement, as amended) as of the day prior to such termination.

At any time following October 3, 2019, the JKD Investor or the Operating LLC may, upon two months’ notice to the other party, cause the Operating LLC to pay a redemption to the JKD Investor in an amount equal to the Investment Balance (as such term is defined in the JKD Investment Agreement, as amended) as of the day prior to such redemption.

If the Operating LLC or JVB sells JVB’s Institutional Corporate Trading Business to any unaffiliated third party, and such sale is not part of a larger sale of all or substantially all of the assets or equity securities of the Operating LLC or JVB, the Operating LLC will pay to the JKD Investor an amount equal to 25% of the net consideration paid to the Operating LLC in connection with such sale, after deducting certain amounts and certain expenses incurred by the Operating LLC or JVB in connection with such sale.

DGC Trust/ CBF Amendments

Prior to September 30, 2019, the DGC Trust / CBF redeemable financial instruments were comprised of two separate agreements: one with CBF pursuant to which CBF invested $8,000 into the Operating LLC (the “CBF Investment Agreement”), and one with the DGC Trust pursuant to which the DGC  Trust invested $2,000 into the Operating LLC (the “DGC Trust Investment Agreement”).

The CBF Investment Agreement and the DGC Trust Investment Agreement were both amended on September 25, 2019, and again on December 4, 2019, with each amendment becoming effective October 1, 2019.  The amendments included the following amendments to each of the CBF Investment Agreement and the DGC Trust Investment Agreement:  

(a) The term “Investment Amount” under the CBF Investment Agreement was reduced from $8,000 to $6,500 in exchange for aone-time payment of $1,500 from the Operating LLC to CBF; and

(b) The term “Investment Return” under the CBF Investment Agreement was amended to mean an annual return equal to:

· for the AnnualPeriod ending on September 29, 2020, 3.75% of the Investment Amount, plus (x) 11.47% of any revenue of the GCF repo business (the “Revenue of the Business”) during such period between zero and $11,777 plus (y) 7.65% of any Revenue of the Business during such period in excess of $11,777. Prior to the second amendment, the Investment Return was with respect to any twelve-month period ending on September 29,2020 (each an “Annual Period”) was 3.75% of the Investment Amount plus (x) 11.47% of the Revenue of the Business for any Annual Period in which the Revenue of the Business was greater than zero but less than or equal to $5,333, (y) $612 for any Annual Period in which the Revenue of the Business is greater than $5,333 but less than or equal to $8,000, or (z) 7.65% of the Revenue of the Business for any Annual Period in which the Revenue of the Business is greater than $8,000, and

· for any Annual Period following September 29, 2020, (x) for any Annual Period in which the Revenue of the Business is greater than zero, the greater of 20% of theInvestment Amount or 15.29% of the Revenue of the Business, or (y) for any Annual Period in which the Revenue of the Business is zero or less than zero,  3.75% of the Investment Amount.

.

(c) The term “Investment Return” under the DGC Trust  Investment Agreement was amended to mean an annual return equal to:

· for the twelve-month period ending on September 29, 2020,  3.75% of the Investment Amount plus (x) 3.53% of any Revenue of the Business, during such period between zero and $11,177 plus (y) 2.35% of any Revenue of the Business during such period in excess of $11,177.  Prior to the second amendment, the Investment Return was 3.75% of the Investment Amount, as defined in the DGC Trust Investment Agreement , plus (x) 3.53% of the Revenue of the Business, for any Annual Period in which the Revenue of the Business is greater than zero  but less than or equal to $5,333 (y) $188 for any Annual Period in which the Revenue of the Business is greater than $5,333, but less than or equal to $8,000, or (z) 2.35% of the Revenue of the Business for any Annual Period in which the Revenue of the Business is greater than $8,000 and

· for any Annual Period following September 29, 2020, (x) for any Annual Period in which the Revenue of the Business is greater than zero, the greater of 20% of the Investment Amount or 4.71% of the Revenue of the Business, or (y) for any Annual Period in which the Revenue of the Business is zero or less than zero, 3.75% of the Investment Amount.

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Except as set forth above, the other material terms and conditions of the CBF Investment Agreement and the DGC Trust Investment Agreement remained substantially unchanged by the amendment.  The payment of $1,500 was made by the Operating LLC to CBF in October 2019, which reduced the redeemable financial instrument balance under the CBF Investment Agreement. 

ViaNova Capital Group LLC

On November 16, 2018, and effective as of November 19, 2018, the Operating LLC entered into an investment agreement (the “ViaNova Investment Agreement”) by and among Hancock Funding, LLC (“Hancock”), New Avenue Investments LLC (“New Avenue”), JVB, ViaNova, and the Operating LLC. Pursuant to the ViaNova Investment Agreement, Hancock, New Avenue, the Operating LLC, and JVB agreed to invest $500,  $250,  $500, and $2,750, respectively, into ViaNova (collectively, the “ViaNova Investment”). Pursuant to the ViaNova Investment Agreement, Hancock, the Operating LLC, and JVB invested their respective portions of the ViaNova Investment into ViaNova prior to the effective date of the ViaNova Investment Agreement. In February 2019, New Avenue invested $220 of its portion of the ViaNova Investment (i.e., $250), the remaining $30 is included in due from related parties on the consolidated balance sheets.  Hancock and New Avenue are owned by employees of the Company. 

Pursuant to the ViaNova Investment Agreement, in consideration of the ViaNova Investment, once the Operating LLC is repaid $693 of funded operating costs from net revenue (as defined in the ViaNova Investment Agreement) generated directly by the activities of ViaNova’s RTL business, each party to the ViaNova Investment Agreement is entitled to receive a quarterly payment equal to the net revenue (to the extent positive) generated directly by the activities of ViaNova’s RTL business during such quarter, multiplied by a fraction, the numerator of which is equal to such party’s portion of the ViaNova Investment and the denominator is equal to the entire ViaNova Investment.

During the first quarter of 2020, the Company ceased acquiring new RTLs and began an orderly wind down of its RTL business.  See note 4.  Upon its termination, the remaining redeemable investment balance will be repaid by the Operating LLC to Hancock and New Avenue in accordance with the ViaNova Investment Agreement.

17. DEBT

The Company had the following debt outstanding.

DETAIL OF DEBT
(Dollars in Thousands)
Description		As of March 31, 2020		As of December 31, 2019	Interest Rate Terms	Interest (4)		Maturity
Non-convertible debt:
12.00% senior note (the "2020 Senior Note")	$	4,500	$	-	Fixed	12.00	%	January 2022
12.00% senior note (the "2019 Senior Note")		2,400		6,786	Fixed	12.00	%	September 2020 (1)
Contingent convertible debt:
8.00% convertible senior note (the "2017 Convertible Note")		15,000		15,000	Fixed	8.00	%	March 2022 (2)
Less unamortized debt issuance costs		(631)		(703)
		14,369		14,297
Junior subordinated notes (3):
Alesco Capital Trust I		28,125		28,125	Variable	5.77	%	July 2037
Sunset Financial Statutory Trust I		20,000		20,000	Variable	5.52	%	March 2035
Less unamortized discount		(25,030)		(25,124)
		23,095		23,001
FT Financial Bank, N.A. Credit Facility		17,500		-	Variable	N/A		April 2021
LegacyTexas Credit Facility		-		4,777	Variable	N/A		NA
Total	$	61,864	$	48,861

(1) On September 25, 2019, the Company amended the previously outstanding 2013 Convertible Notes, which were scheduled to mature on September 25, 2019.  The material terms and conditions of the 2013 Convertible Notes remained substantially the same, except that (i) the maturity date changed from September 25, 2019 to September 25, 2020; (ii) the conversion feature in the 2013 Convertible Notes was removed; (iii) the interest rate changed from 8% per annum (9% in the event of certain 37  

events of default) to 12% per annum (13% in the event of certain events of default); and (iv) the restrictions regarding the prepayment were removed.  The post amendment notes are referred to herein as the “2019 Senior Notes” and the pre-amendment notes are referred to herein as the “2013 Convertible Notes.”  

(2) The holder of the 2017 Convertible Note may convert all or any part of the outstanding principal amount at any time prior to maturity into units of membership interests of the Operating LLC at a conversion price of $1.45 per unit, subject to customary anti-dilution adjustments.  Units of membership interests in the Operating LLC not held by Cohen & Company Inc. may, with certain restrictions, be redeemed and exchanged into shares of the Cohen & Company Inc. common stock, par value $0.01 per share (“Common Stock”) on a ten-for-one basis.  Therefore, the 2017 Convertible Note can be converted into Operating LLC units of membership interests and then redeemed and exchanged into Common Stock at an effective conversion price of $14.50.  See note 20 to our Annual Report on Form 10-K for the year ended December 31, 2019. 

(3) The junior subordinated notes listed represent debt the Company owes to the two trusts noted above. The total par amount owed by the Company to the trusts is $49,614.  However, the Company owns the common stock of the trusts in a total par amount of $1,489.  The Company pays interest (and at maturity, principal) to the trusts on the entire $49,614 junior notes outstanding. However, the Company receives back from the trusts the pro rata share of interest and principal on the common stock held by the Company.  These trusts are VIEs and the Company does not consolidate them even though the Company holds the common stock.  The Company carries the common stock on its balance sheet at a value of $0. The junior subordinated notes are recorded at a discount to par.  When factoring in the discount, the yield to maturity of the junior subordinated notes as of March 31, 2020 on a combined basis was 15.04% assuming the variable rate in effect on the last day of the reporting period remains in effect until maturity.

(4) Represents the interest rate in effect as of the last day of the reporting period. 

The 2020 Senior Notes

On January 31, 2020, the Operating LLC entered into a Note Purchase Agreement with JKD Capital Partners I LTD, a New York corporation (“JKD Investor”), and RN Capital Solutions LLC, a Delaware limited liability company (“RNCS”).  The JKD Investor is owned by Jack DiMaio, the vice chairman of the Company’s board of directors and the Operating LLC’s board of managers, and his spouse.

Pursuant to the Note Purchase Agreement, JKD Investor and RNCS each purchased a Senior Promissory Note in the principal amount of $2,250 (for an aggregate investment of $4,500).  The Senior Promissory Notes bear interest at a fixed rate of 12% per annum and mature on January 31, 2022.  On February 3, 2020, pursuant to the Note Purchase Agreement, the Operating LLC used the proceeds received from the issuance of the Senior Promissory Notes to repay in full all amounts outstanding under the Senior Promissory Note, dated September 25, 2019, issued by the Company to Pensco Trust Company, Custodian fbo Edward E. Cohen IRA in the principal amount of $4,386 (the “Cohen IRA Note”).  The Cohen IRA Note is included as a portion of the 2019 Senior Notes outstanding as of December 31, 2019.  The Cohen IRA Note was fully paid and extinguished on February 3, 2020.  Subsequent to this repayment, $2,400 of the 2019 Senior Notes remain outstanding.

The 2019 Senior Notes

On September 25, 2019, the Company amended and restated the previously outstanding 2013 Convertible Notes, which was scheduled to mature on September 25, 2019.  The material terms and conditions of the 2013 Convertible Notes remained substantially the same, except that (i) the maturity date was changed from September 25, 2019 to September 25, 2020; (ii) the conversion feature in the 2013 Convertible Notes was removed; (iii) the interest rate was changed from 8% per annum (9% in the event of certain events of default) to 12% per annum (13% in the event of certain events of default); and (iv) the restrictions regarding prepayment were removed.  The post amendment notes are referred to herein as the “2019 Senior Notes” and the pre-amendment notes are referred to herein as the “2013 Convertible Notes”.

LegacyTexas Bank

On November 20, 2018, ViaNova, as borrower, entered into a Warehousing Credit and Security Agreement (the “LegacyTexas Credit Facility”) with LegacyTexas Bank, as the lender, with an effective date of November 16, 2018, and amended on May 4, 2019 and September 25, 2019.  The LegacyTexas Credit Facility supported the purchasing, aggregating, and distribution of residential transition loans by ViaNova. 

On March 19, 2020, ViaNova received a notice of default from LegacyTexas Bank regarding the LegacyTexas Credit Facility, stating that ViaNova’s unrestricted cash balance was less than the amount required.  Also, on March 19, 2020, ViaNova received notice from LegacyTexas Bank that the Bank had suspended funding all “Alternative” loans for all of their clients, including the RTLs that are the subject of the LegacyTexas Credit Facility with LegacyTexas Bank.  Since March 19, 2020 ViaNova has repaid all outstanding indebtedness under the Agreement.  ViaNova stopped acquiring new RTLs and does not intend to acquire any new RTLs in the future.  See note 4. 

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See note 20 to the Company’s consolidated financial statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2019 for a discussion of the Company’s other debt.

FT Financial Bank, N.A. (“FT Bank”) Credit Facility

The credit facility with FT Bank has a total borrowing capacity of $25,000.  It is comprised of a revolving credit facility (the “2019 FT Revolver”) which has a total borrowing capacity of $17,500 and a line of credit (the “2018 FT LOC”), which has a total borrowing capacity of $7,500.  Both mature on April 10, 2021.  However, the 2019 FT Revolver does not allow for additional draws after April 10, 2020.  During March 2020, the Company drew the full amount of $17,500 under the 2019 FT Revolver and that amount remains outstanding to date.  If the Company were to repay the $17,500 currently outstanding, it would not be able to re-draw that amount again under the 2019 FT Revolver in the future.  Furthermore, JVB is subject to financial covenants including a minimum excess net capital covenant, a debt to tangible net worth covenant, and a minimum tangible net worth covenant.  See note 20 to Company’s 2019 audited financial statements included in its annual report on Form 10-K.  The Company is currently working to extend the draw period and the maturity of the 2019 FT Revolver and the 2018 FT LOC. 

Interest Expense, net

INTEREST EXPENSE
(Dollars in Thousands)
	Three Months Ended March 31,
	2020		2019
Junior subordinated notes	$	821	$	880
2020 Senior Notes		89		-
2017 Convertible Note		371		360
2013 Convertible Notes / 2019 Senior Notes		119		133
2018 FT LOC/2019 FT Revolver		152		92
Redeemable Financial Instrument - DGC Trust / CBF		690		148
Redeemable Financial Instrument - JKD Capital Partners I LTD		440		278
Redeemable Financial Instrument - ViaNova Capital Group, LLC		(77)		(37)
	$	2,605	$	1,854

Because the LegacyTexas Credit Facility was used to directly finance the purchase of securities and loans, the interest expense incurred on the Legacy Texas Credit Facility is included as a component of net trading revenue.  See note 5.

18. EQUITY

Stockholders’ Equity

Common Equity: The following table reflects the activity for the three months ended March 31, 2020 related to the number of shares of unrestricted Common Stock that the Company had issued.

	Common Stock
	Shares
December 31, 2019	1,119,909
Vesting of shares	55,278
Shares withheld for employee taxes and retired	(15,043)
March 31, 2020	1,160,144

Series E Voting Non-Convertible Preferred Stock: Each share of the Company’s Series E Voting Non-Convertible Preferred Stock (“Series E Preferred Stock”) has no economic rights but entitles the holders there of to vote the Series E Preferred Stock on all matters presented to the Company’s stockholders.  For every ten shares of Series E Preferred Stock, the holders are entitled to one vote on any such matter.  Daniel G. Cohen, the Company’s chairman, is the sole holder of all 4,983,557 shares of Series E Preferred Stock issued and outstanding as of March 31, 2020, For a more detailed description of these shares see note 21 to the Company’s Annual Report on Form 10-K for the year ended December 31, 2019.

Series F Voting Non-Convertible Preferred Stock:  On December 23, 2019, the Company’s board of directors adopted a resolution that reclassified 25,000,000 authorized but unissued shares of Preferred Stock, par value $0.001 per share, of the Company as a series of Preferred Stock designated as Series F Voting Non-Convertible Preferred Stock (“Series F Preferred Stock”).   Pursuant

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to the Securities Purchase Agreement (the “SPA”), dated December 30, 2019, by and among the Company, the Operating LLC, Daniel G. Cohen, and The DGC Family FinTech Trust (the “DGC Trust”), the Company issued 12,549,273 Series F Preferred Stock to Daniel G. Cohen and 9,880,268 Series F Preferred Stock to the DGC Trust. The Series F Preferred Stock have substantially the same rights as the Series E Preferred Stock.  The holders of the Series F Preferred Stock are not entitled to receive any dividends or distributions (whether in cash, stock or property of the Company).  The holders of Series F Preferred Stock and Common Stock are required to vote, together as a single class on all matters with respect to which a vote of the stockholders of the Company is required or permitted.  Each outstanding share of Series F Preferred Stock entitles the holder to one vote for every ten shares of Series F Preferred Stock on each matter submitted to the holders for their vote.  As of December 31, 2019, there were 22,429,541 shares of Series F Preferred Stock issued and outstanding.  See Non-Controlling Interest/ - Securities Purchase Agreement – Purchase of IMXI shares below.For a more detailed description of these shares see note 21 to the Company’s Annual Report on Form 10-K for the year ended December 31, 2019.

Stockholder Rights Plan

On August 3, 2016, the Company adopted a Section 382 Rights Agreement (the “2016 Rights Agreement”) between the Company and Computershare, Inc. The Company’s board of directors adopted the 2016 Rights Agreement in an effort to protect stockholder value by attempting to protect against a possible limitation on the Company’s ability to use its net operating loss and net capital loss carryforwards to reduce potential future federal income tax obligations.  This 2016 Rights Agreement expired in accordance with its terms on December 31, 2019. 

On March 10, 2020, the Company entered into a new Section 382 Rights Agreement (the “Rights Agreement”) with Computershare Inc., as rights agent (the “Rights Agent”).

The Rights Agreement provided for a distribution of one preferred stock purchase right (each, a “Right,” and collectively, the “Rights”) for each share of the Company’s common stock outstanding to stockholders of record at the close of business on March 20, 2020 (the “Record Date”). Each Right entitles the registered holder to purchase from the Company a unit (a “Unit”) consisting of one ten-thousandth of a share of the Company’s Series C Junior Participating Preferred Stock, par value $0.001 per share (the “Series C Preferred Stock”), at a purchase price of $100.00 per Unit (the “Purchase Price”), subject to adjustment. The description and terms of the Rights are set forth in the Rights Agreement.

Initially, the Rights will be attached to all Common Stock certificates representing shares then outstanding or, in the case of uncertificated shares of Common Stock registered in book entry form (“Book Entry Shares”) by notation in book entry (which certificates for Common Stock and Book Entry Shares shall be deemed also to be certificates for Rights), and no separate Rights certificates will be distributed.

Subject to certain exceptions specified in the Rights Agreement, the Rights will separate from the Common Stock and a “Distribution Date” will occur upon the earlier of (i) 10 days following a public announcement that a person or group of affiliated or associated persons has become an “Acquiring Person” (as defined below) (the “Stock Acquisition Date”) and (ii) 10 business days following the commencement of a tender offer or exchange offer that would result in a person or group becoming an Acquiring Person. Pursuant to the Rights Agreement, an “Acquiring Person” means any person or entity who or which, together with all affiliates and associates of such person or entity, is the beneficial owner of 4.95% or more of the shares of Common Stock then outstanding, but does not include the Company or any “Exempted Person” (as defined below). Until the Distribution Date, (i) the Rights will be evidenced by the Common Stock certificates and will be transferred with and only with such Common Stock certificates, (ii) new Common Stock certificates after the Record Date will contain a notation incorporating the Rights Agreement by reference, and (iii) the surrender for transfer of any certificates for Common Stock outstanding will also constitute the transfer of the Rights associated with the Common Stock represented by such certificate.

Pursuant to the Rights Agreement, an “Exempted Person” is any person or entity who, together with all affiliates and associates of such person or entity, was or could become, as of March 10, 2020, the beneficial owner of Common Stock and/or other securities exercisable for shares of Common Stock representing 4.95% or more of the shares of Common Stock outstanding as of March 10, 2020. However, any such person or entity will no longer be deemed to be an Exempted Person and shall be deemed an Acquiring Person under the Rights Agreement if such person or entity, together with all affiliates and associates of such person or entity, becomes the beneficial owner (and so long as such person continues to be the beneficial owner of 4.95% or more of the then outstanding shares of Common Stock) of additional shares of Common Stock, except (x) pursuant to equity compensation awards granted to such person or entity by the Company or options or warrants outstanding and beneficially owned by such person or entity as of March 10, 2020, or as a result of an adjustment to the number of shares of Common Stock represented by such equity compensation award pursuant to the terms thereof; or (y) as a result of a stock split, stock dividend or the like. In addition, any person or entity who, together with all affiliates and associates of such person or entity, becomes the beneficial owner of Common Stock and/or other securities exercisable for shares of Common Stock representing 4.95% or more of the shares of Common Stock then outstanding as a result of a purchase by the Company or any of its subsidiaries of shares of Common Stock will also be an “Exempted Person.” However, any such person will no longer be deemed to be an Exempted Person and will be deemed to be an Acquiring Person if such

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person, together with all affiliates and associates of such person, becomes the beneficial owner, at any time after the date such person became the beneficial owner of 4.95% or more of the then outstanding shares of Common Stock, of additional shares of Common Stock, except if such additional securities are acquired (x) pursuant to the exercise of options or warrants to purchase Common Stock outstanding and beneficially owned by such person as of the date such person became the beneficial owner of 4.95% or more of the then outstanding shares of Common Stock or as a result of an adjustment to the number of shares of Common Stock for which such options or warrants are exercisable pursuant to the terms thereof, or (y) as a result of a stock split, stock dividend or the like.

In addition, the Rights Agreement defines the term “Exempted Person” to also include any person or entity who, together with all affiliates and associates of such person or entity, is the beneficial owner of Common Stock and/or other securities exercisable for shares of Common Stock representing 4.95% or more of the shares of Common Stock outstanding, and whose beneficial ownership would not, as determined by the Company’s board of directors, jeopardize or endanger the availability of the Company of its deferred tax assets. However, any such person or entity will cease to be an Exempted Person if (x) such person or entity ceases to beneficially own 4.95% or more of the shares of the then outstanding Common Stock or (y) the Company’s board of directors makes a contrary determination with respect to the effect of such person’s or entity’s beneficial ownership (together with all affiliates and associates of such person) with respect to the availability to the Company of its deferred tax assets.

Pursuant to the Rights Agreement, a purchaser, assignee or transferee of the shares of Common Stock (or options or warrants exercisable for Common Stock) from an Exempted Person will not be considered an Exempted Person, except that a transferee from the estate of an Exempted Person who receives Common Stock as a bequest or inheritance from an Exempted Person will be an Exempted Person so long as such transferee continues to be the beneficial owner of 4.95% or more of the then outstanding shares of Common Stock.

The Rights are not exercisable until the Distribution Date and will expire on the earliest of (i) the close of business on December 31, 2023, (ii) the time at which the Rights are redeemed pursuant to the Rights Agreement, (iii) the time at which the Rights are exchanged pursuant to the Rights Agreement, (iv) the repeal of Section 382 of the Code or any successor statute if the Company’s board of directors determines that the Rights Agreement is no longer necessary or desirable for the preservation of certain tax benefits, and (v) the beginning of a taxable year of the Company to which the Company’s board of directors determines that certain tax benefits may not be carried forward. At no time will the Rights have any voting power.

Except as otherwise determined by the Company’s board of directors, only shares of Common Stock issued prior to the Distribution Date will be issued with Rights.

Pursuant to the Rights Agreement, in the event that a person or entity becomes an Acquiring Person, each other holder of a Right will thereafter have the right to receive, upon exercise, Common Stock (or, in certain circumstances, cash, property or other securities of the Company), having a value equal to two times the exercise price of the Right. The exercise price is the Purchase Price times the number of Units associated with each Right (initially, one). For example, at an exercise price of $100.00 per Right, each Right not owned by an Acquiring Person (or by certain related parties) following an event set forth in the preceding paragraph would entitle its holder to purchase $200.00 worth of Common Stock (or other consideration, as noted above) for $100.00. If the Common Stock at the time of exercise had a market value per share of $20.00, the holder of each valid Right would be entitled to purchase ten (10) shares of Common Stock for $100.00.

Notwithstanding any of the foregoing, following the occurrence of a person or entity becoming an Acquiring Person (the “Flip-In Event”), all Rights that are, or (under certain circumstances specified in the Rights Agreement) were, beneficially owned by such Acquiring Person will be null and void.

In the event that, at any time following the Stock Acquisition Date, (i) the Company engages in a merger or other business combination transaction in which the Company is not the surviving corporation; (ii) the Company engages  in a merger or other business combination transaction in which the Company is the surviving corporation and the Common Stock is changed or exchanged; or (iii) 50% or more of the Company’s assets, cash flow or earning power is sold or transferred, each holder of a Right (except Rights which have previously been voided as set forth above) will thereafter have the right to receive, upon exercise of the Right, common stock of the acquiring company having a value equal to two times the exercise price of the Right.

However, Rights are not exercisable following the occurrence of a Flip-In Event until such time as the Rights are no longer redeemable by the Company as set forth below.

The Purchase Price payable, and the number of Units of Series C Preferred Stock or other securities or property issuable, upon exercise of the Rights are subject to adjustment from time to time to prevent dilution (i) in the event of a stock dividend on, or a subdivision, combination or reclassification of, the Series C Preferred Stock, (ii) if holders of the Series C Preferred Stock are granted certain rights or warrants to subscribe for Series C Preferred Stock or convertible securities at less than the current market price of the Series C Preferred Stock, or (iii) upon the distribution to holders of the Series C Preferred Stock of evidences of indebtedness or assets (excluding regular quarterly cash dividends) or of subscription rights or warrants (other than those referred to above).

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With certain exceptions, no adjustments in the Purchase Price will be required until cumulative adjustments amount to at least 1% of the Purchase Price. No fractional Units will be issued and, in lieu thereof, an adjustment in cash will be made based on the market price of the Series C Preferred Stock on the last trading date prior to the date of exercise.

At any time after the Stock Acquisition Date, the Company may exchange all or part of the Rights (other than Rights owned by an Acquiring Person) for Common Stock at an exchange ratio equal to (i) a number of shares of Common Stock per Right with a value equal to the spread between the value of the number of shares of Common Stock for which the Rights may then be exercised and the Purchase Price or (ii) if prior to the acquisition by the Acquiring Person of 50% or more of the then outstanding shares of Common Stock, one share of Common Stock per Right (subject to adjustment).

At any time until ten days following the Stock Acquisition Date, the Company may redeem the Rights in whole, but not in part, at a price of $0.001 per Right. Immediately upon the action of the Company’s board of directors ordering redemption of the Rights, the Rights will terminate and the only right of the holders of Rights will be to receive the $0.001 redemption price.

Until a Right is exercised, the holder thereof, as such, will have no rights as a stockholder of the Company, including, without limitation, the right to vote or to receive dividends. While the distribution of the Rights will not be taxable to shareholders or to the Company, stockholders may, depending upon the circumstances, recognize taxable income in the event that the Rights become exercisable for Common Stock (or other consideration) of the Company as set forth above or in the event the Rights are redeemed.

Acquisition and Surrender of Additional Units of the Operating LLC, net: Effective January 1, 2011, Cohen & Company Inc. and the Operating LLC entered into a Unit Issuance and Surrender Agreement (the “UIS Agreement”), that was approved by the board of directors of Cohen & Company Inc. and the board of managers of the Operating LLC. In an effort to maintain a 1:10 ratio of Common Stock to the number units of membership interests  Cohen & Company Inc. holds in the Operating LLC, the UIS Agreement calls for the issuance of additional units of membership interests of the Operating LLC to Cohen & Company Inc. when Cohen & Company Inc. issues its Common Stock to employees under existing equity compensation plans. In certain cases, the UIS Agreement calls for Cohen & Company Inc. to surrender units to the Operating LLC when certain restricted shares are forfeited by the employee or repurchased by the Company.

During the three months ended March 31, 2020, Cohen & Company Inc. received and surrendered units of the Operating LLC. The following table displays the amount of units surrendered (net of receipts) by Cohen & Company Inc.

	Operating LLC
	Membership Units
Units related to UIS Agreement	402,350
Total	402,350

The Company recognized a net decrease in additional paid in capital of $123 and a net increase in AOCI of $8 with an offsetting increase in non-controlling interest of $115 in connection with the acquisition and surrender of additional units of the Operating LLC. The following schedule presents the effects of changes in Cohen & Company Inc.’s ownership interest in the Operating LLC on the equity attributable to Cohen & Company Inc. for the three months ended March 31, 2020 and 2019.

		Three Months Ended		Three Months Ended
	March 31, 2020		March 31, 2019
Net income / (loss) attributable to Cohen & Company Inc.	$	(3,102)	$	(1,202)
Transfers (to) from the non-controlling interest:
Increase / (decrease) in Cohen & Company, Inc. paid in capital for the acquisition / (surrender) of additional units in consolidated subsidiary, net		(123)		133
Changes from net income / (loss) attributable to Cohen & Company Inc. and transfers (to) from the non-controlling interest	$	(3,225)	$	(1,069)

Repurchases of Shares and Retirement of Treasury Stock

On March 19, 2018, the Company entered into a letter agreement (the “10b-5 Plan”) with Sandler O’Neill & Partners, L.P. (the “Agent”).  The 10b-5 Plan was in effect from March 19, 2018 until March 19, 2019 and was not renewed. Pursuant to the 10b5-1 Plan, the Agent agreed to use its commercially reasonable efforts to purchase , on the Company’s behalf, up to an aggregate maximum of $2,000 of Common Stock on any day that the NYSE American Stock Exchange was open for business.   Pursuant to the 10b5-1 Plan, purchases of Common Stock may be made in public and private transactions and had to comply with Rule 10b-18 under the Exchange Act.  The 10b5-1 Plan was designed to comply with Rule 10b5-1 under the Exchange Act. 

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During the three months ended March 31, 2019, the Company repurchased 7,890 shares in the open market pursuant to the 10b5-1 Plan for a total purchase price of $65. 

All of the repurchases noted above were completed using cash on hand.  The Company currently has no 10b5-1 Plan in place.

Non-Controlling Interest

Securities Purchase Agreement – Purchase of IMXI shares

On December 30, 2019 (the “SPA Effective Date”), the Company entered into the SPA, pursuant to which Daniel G. Cohen and the DGC Trust purchased (i) an aggregate of 22,429,541 newly issued units of membership interests in the Operating LLC (collectively, the “LLC Units”); and (ii) 22,429,541 newly issued, Series F Preferred Stock.

In consideration for the issuance of the LLC Units and Series F Preferred Stock, Daniel G. Cohen transferred to the Operating LLC 370,881 shares of common stock, par value $0.00001 per share (“IMXI Common Stock”), of International Money Express, Inc. (formerly FinTech Acquisition Corp. II) a Delaware corporation (“IMXI”), and the DGC Trust transferred to the Operating LLC an aggregate of 291,480 shares of IMXI common stock.  The aggregate number of IMXI shares transferred to the Operating LLC was 662,361, of which (a) 264,021 shares are subject to certain restrictions on transfer until the closing price per share of IMXI Common Stock (as reported by The Nasdaq Capital Market) exceeds $15.00 for any 20 trading days within a consecutive 30 trading day period or immediately upon certain change of control events involving IMXI, as set forth in the letter agreement, dated January 19, 2017 (the “Letter Agreement”), by and among IMXI, Daniel G. Cohen, the DGC Trust and the other parties named therein, and (b) 264,023 shares are subject to certain restrictions on transfer until the closing price per share of IMXI Common Stock (as reported by The Nasdaq Capital Market) exceeds $17.00 for any 20 trading days within a consecutive 30 trading day period or immediately upon certain change of control events involving IMXI, as set forth in the Letter Agreement.

The Company engaged a third-party valuation firm to value the 662,361 shares of IMXI common stock transferred to the Operating LLC.  The shares transferred by Daniel Cohen were valued at $4,351 and the shares transferred by the DGC Trust were valued at $3,428.  The Company accounted for this transaction by recording an increase of $7,779 in other investments, at fair value and a corresponding increase in the non-controlling interest.  

The IMXI Common Stock is listed on The Nasdaq Capital Market (“Nasdaq”) under the trading symbol “IMXI.” Prior to the merger of IMXI with and into a special purpose acquisition company in a transaction that resulted in the listing of IMXI on Nasdaq, Mr. Cohen served as the chief executive officer and member of the board of directors of the special purpose acquisition company.

The SPA contains customary representations and warranties on the part of each of the Operating LLC, the Company, Daniel G. Cohen, and the DGC Trust.  The Operating LLC, the Company, Daniel G. Cohen, and the DGC Trust provide customary indemnifications thereunder.

Pursuant to the Amended and Restated Limited Liability Company Agreement of the Operating LLC, dated as of December 16, 2009, as amended (“LLC Agreement”), a holder of units of membership interests in the Operating Agreement, including the LLC Units, may cause the Operating LLC to redeem (each, a “Unit Redemption”) such units at any time for, at the Company’s option, (A) cash or (B) one share of Common Stock for every ten units of membership interests in the Operating LLC.

However, pursuant to the SPA, Daniel G. Cohen and the DGC Trust agreed that, until the Company’s stockholders approve the Stockholder Proposal (as defined below), they will not cause a Unit Redemption with respect to any portion of the LLC Units if such Unit Redemption would result in the Company issuing a number of shares of Common Stock that, when aggregated with any shares of Common Stock previously issued in connection with any Unit Redemption of the LLC Units equals or exceeds 19.99% of the outstanding Common Stock as of the SPA Effective Date.

Pursuant to the SPA, Daniel G. Cohen and the DGC Trust also agreed to not cause a Unit Redemption with respect to any portion of the Cohen LLC Units if the Company’s board of directors determines that the satisfaction of such Unit Redemption by the Company with shares of Common Stock would jeopardize or endanger the availability to the Company of its net operating loss and net capital loss carryforwards and certain other tax benefits under Section 382 of the Internal Revenue Code of 1986, as amended.

Pursuant to the SPA, at the 2020 annual meeting of the Company’s stockholders, the Company agreed to cause its stockholders to vote on proposals (collectively, the “Stockholder Proposal”) regarding the issuance of all shares of Common Stock issuable in connection with a redemption of the LLC Units for purposes of Section 713 of the NYSE American’s Company Guide. Further, the Company’s board of directors must recommend to the Company’s stockholders that such stockholders approve the Stockholder Proposal and may not modify or withdraw such resolution.

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In addition, effective as of the SPA Effective Date, if the Company owns a number of units of membership interests in the Operating LLC representing less than a majority of the votes entitled to be cast at any meeting or any other circumstances upon which a vote, agreement, consent (including unanimous written consents) or other approval is sought from the holders of units of membership interests in the Operating LLC (each, a “Meeting”), then for so long as the Company owns a number of units of membership interests in the Operating LLC representing less than a majority of the votes entitled to be cast at any Meeting, Daniel G. Cohen and the DGC Trust have agreed to grant a voting proxy to the Company pursuant to which the Company may vote at any Meeting the number of units of membership interests in the Operating LLC owned by  Daniel G. Cohen and the DGC Trust necessary to give the Company a majority of the votes at such Meeting.  See note 24.

19. NET CAPITAL REQUIREMENTS

JVB is subject to the net capital provision of Rule 15c3-1 under the Exchange Act, which requires the maintenance of minimum net capital, as defined therein.

As of March 31, 2020, JVB’s adjusted net capital was $56,517which exceeded the minimum requirements by $55,632.  

CCFEL, a subsidiary of the Company regulated by the Central Bank of Ireland (“CBI”), is subject to certain regulatory capital requirements in accordance with the Capital Requirements Regulation 575/2013 and applicable CBI requirements.  As of March 31, 2020, the total minimum required net capital was $945, and actual net capital in CCFEL was $2,194, which exceeded the minimum requirements by $1,249 and was in compliance with the net liquid capital provisions.

CCFL, a subsidiary of the Company and an entity regulated by the FCA, is subject to the net liquid capital provision of the Financial Services and Markets Act 2000, GENPRU 2.140R to 2.1.57R, relating to financial prudence with regards to the European Investment Services Directive and the European Capital Adequacy Directive, which requires the maintenance of minimum liquid capital, as defined therein. As of March 31, 2020, the total minimum required net liquid capital was $145, and net liquid capital in CCFL was $627, which exceeded the minimum requirements by $482 and was in compliance with the net liquid capital provisions.

20. EARNINGS / (Loss) PER COMMON SHARE

The following table presents a reconciliation of basic and diluted earnings / (loss) per common share for the periods indicated.

EARNINGS / (LOSS) PER COMMON SHARE
(Dollars in Thousands, except share or per share information)
	Three Months Ended March 31,
	2020		2019
Net income / (loss) attributable to Cohen & Company Inc.	$	(3,102)	$	(1,202)
Add/ (deduct): Income / (loss) attributable to non-controlling interest attributable to Operating LLC membership (1)		(8,523)		(622)
Add / (deduct): Adjustment (2)		966		53
Net income / (loss) on a fully converted basis	$	(10,659)	$	(1,771)
Weighted average common shares outstanding - Basic		1,146,879		1,133,166
Unrestricted Operating LLC membership units exchangeable into Cohen & Company, Inc. shares (1)		2,793,798		532,409
Weighted average common shares outstanding - Diluted (3)		3,940,677		1,665,575
Net income / (loss) per common share - Basic	$	(2.70)	$	(1.06)
Net income / (loss) per common share - Diluted	$	(2.70)	$	(1.06)

(1) The Operating LLC units of membership interest not held by Cohen & Company Inc. (that is, those held by the non-controlling interest) may be redeemed and exchanged into shares of the Company on a ten-for-one basis. The Operating LLC units of membership interests not held by Cohen & Company Inc. are redeemable, at the member’s option at any time, for (i) cash in an amount equal to the average of the per share closing prices of the Common Stock for the ten consecutive trading days immediately preceding the date the Company receives the member’s redemption notice, or (ii) at the Company’s option, one tenth of a share of the Common Stock, subject, in each case, to appropriate adjustment upon the occurrence of an issuance of additional shares of the Common Stock as a dividend or other distribution on the outstanding Common Stock, or a further subdivision or combination of the outstanding shares of the  Common Stock. These units are not included in the computation of 44  

basic earnings per share.  These units enter into the computation of diluted net income (loss) per common share when the effect is not anti-dilutive using the if-converted method.

(2) An adjustment is included because the Company would have incurred a higher income tax expense or realized a higher income tax benefit, as applicable, if the Operating LLC units of membership interests had been converted at the beginning of the period.

(3) Potentially diluted securities that were not included in the diluted per share calculations because they would be anti-dilutive were as follows:

	Three Months Ended March 31,
	2020	2019
2017 Convertible Note	1,034,483	1,034,483
2013 Convertible Notes	-	565,469
Restricted Common Stock	30,466	44,176
Restricted Operating LLC units	15,424	15,006
	1,080,373	1,659,134

21. COMMITMENTS AND CONTINGENCIES

Legal and Regulatory Proceedings

The Company’s U.S. broker-dealer subsidiary, J.V.B. Financial Group, LLC is a party to litigation commenced on August 7, 2019, in the Supreme Court of the State of New York under the caption VA Management, LP v. Odeon Capital Group LLC; Janney Montgomery Scott LLC; C&Co/PrinceRidge LLC; and JVB Financial Group LLC.  The plaintiff, VA Management, LP (f/k/a Visium Asset Management, LP) (“Visium”), alleges that the defendants, as third-party broker-dealers, aided and abetted Visium’s portfolio managers’ breaches of their fiduciary duties by assisting in carrying out a fraudulent “mismarking scheme.”  Visium is seeking in excess of $1 billion in damages from the defendants including disgorgement of the compensation paid to Visium’s portfolio managers, restitution of and damages for the investigative and legal fees, administrative wind down costs, and regulatory penalties paid by Visium as a result of the “mismarking scheme,” direct and consequential damages for the destruction of Visium’s business, including lost profits and lost enterprise value, and attorneys’ fees and costs.  JVB filed a motion to dismiss the complaint in lieu of an answer on October 16, 2019.  Visium’s response to the motion was due on November 15, 2019 and JVB filed a reply brief on November 26, 2019.  On April 29, 2020, the Court issued a ruling denying the motions to dismiss filed by each of the defendants.  The Company intends to defend the action vigorously.

In addition to the matter set forth above, the Company is a party to various routine legal proceedings and regulatory inquiries arising out of the ordinary course of the Company’s business. Management believes that the results of these routine legal proceedings and regulatory matters will not have a material adverse effect on the Company’s financial condition, or on the Company’s operations and cash flows. However, the Company cannot estimate the legal fees and expenses to be incurred in connection with these routine matters and, therefore, is unable to determine whether these future legal fees and expenses will have a material impact on the Company’s operations and cash flows. It is the Company’s policy to expense legal and other fees as incurred.

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22. SEGMENT AND GEOGRAPHIC INFORMATION

Segment Information

The Company operates within three business segments: Capital Markets, Asset Management, and Principal Investing. See note 1.

The Company’s business segment information was prepared using the following methodologies and generally represents the information that is relied upon by management in its decision- making processes:

(a) Revenues and expenses directly associated with each business segment are included in determining net income / (loss) by segment, and

(b) Indirect expenses (such as general and administrative expenses including executive and indirect overhead costs) not directly associated with specific business segments are not allocated to the business segments’ statements of operations.

Accordingly, the Company presents segment information consistent with internal management reporting. See note (1) in the table below for more detail on unallocated items. The following tables present the financial information for the Company’s segments for the periods indicated.

SEGMENT INFORMATION
Statement of Operations Information
Three Months Ended March 31, 2020
	Capital		Asset		Principal		Segment		Unallocated
	Markets		Management		Investing		Total		(1)		Total
Net trading	$	18,561	$	-	$	-	$	18,561	$	-	$	18,561
Asset management		-		1,615		-		1,615		-		1,615
Principal transactions and other income		9		116		(2,531)		(2,406)		-		(2,406)
Total revenues		18,570		1,731		(2,531)		17,770		-		17,770
Salaries/Wages		11,910		1,117		-		13,027		1,107		14,134
Other Operating Expense		3,277		477		50		3,804		1,394		5,198
Impairment of goodwill		7,883		-		-		7,883		-		7,883
Total operating expenses		23,070		1,594		50		24,714		2,501		27,215
Operating income (loss)		(4,500)		137		(2,581)		(6,944)		(2,501)		(9,445)
Interest income (expense)		(75)		-		-		(75)		(2,530)		(2,605)
Income (loss) from equity method affiliates		-		200		(307)		(107)		-		(107)
Income (loss) before income taxes		(4,575)		337		(2,888)		(7,126)		(5,031)		(12,157)
Income tax expense (benefit)		-		-		-		-		(372)		(372)
Net income (loss)		(4,575)		337		(2,888)		(7,126)		(4,659)		(11,785)
Less: Net income (loss) attributable to the non-controlling interest		-		-		-		-		(8,683)		(8,683)
Net income (loss) attributable to Cohen & Company Inc.	$	(4,575)	$	337	$	(2,888)	$	(7,126)	$	4,024	$	(3,102)
Other statement of operations data
Depreciation and amortization (included in total operating expense)	$	4	$	1	$	-	$	5	$	75	$	80

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SEGMENT INFORMATION
Statement of Operations Information
Three Months Ended March 31, 2019
	Capital		Asset		Principal		Segment		Unallocated
	Markets		Management		Investing		Total		(1)		Total
Net trading	$	8,724	$	-	$	-	$	8,724	$	-	$	8,724
Asset management		-		2,002		-		2,002		-		2,002
Principal transactions and other income		1		97		316		414		-		414
Total revenues		8,725		2,099		316		11,140		-		11,140
Salaries/Wages		4,547		1,122		-		5,669		695		6,364
Other Operating Expense		2,911		693		100		3,704		1,140		4,844
Impairment of goodwill		-		-		-		-		-		-
Total operating expenses		7,458		1,815		100		9,373		1,835		11,208
Operating income (loss)		1,267		284		216		1,767		(1,835)		(68)
Interest (expense) income		(55)		-		-		(55)		(1,799)		(1,854)
Income (loss) from equity method affiliates		-		-		(8)		(8)		-		(8)
Income (loss) before income taxes		1,212		284		208		1,704		(3,634)		(1,930)
Income tax expense (benefit)		-		-		-		-		(106)		(106)
Net income (loss)		1,212		284		208		1,704		(3,528)		(1,824)
Less: Net income (loss) attributable to the non-controlling interest		-		-		-		-		(622)		(622)
Net income (loss) attributable to Cohen & Company Inc.	$	1,212	$	284	$	208	$	1,704	$	(2,906)	$	(1,202)
Other statement of operations data
Depreciation and amortization (included in total operating expense)	$	5	$	1	$	-	$	6	$	75	$	81

(1) Unallocated includes certain expenses incurred by indirect overhead and support departments (such as the executive, finance, legal, information technology, human resources, risk, compliance, and other similar overhead and support departments). Some of the items not allocated include: (1) operating expenses (such as cash compensation and benefits, equity-based compensation expense, professional fees, travel and entertainment, consulting fees, and rent) related to support departments excluding certain departments that directly support the Capital Markets business segment; (2) interest expense on debt; and (3) income taxes. Management does not consider these items necessary for an understanding of the operating results of these business segments and such amounts are excluded in business segment reporting to the chief operating decision maker.

BALANCE SHEET DATA
As of March 31, 2020
(Dollars in Thousands)
	Capital		Asset		Principal		Segment		Unallocated
	Markets		Management		Investing		Total		(1)		Total
Total Assets	$	6,564,241	$	1,348	$	15,873	$	6,581,462	$	15,078	$	6,596,540
Included within total assets:
Investment in equity method affiliates	$	-	$	-	$	5,789	$	5,789	$		$	5,789
Goodwill (2)	$	54	$	55	$	-	$	109	$	-	$	109
Intangible assets (2)	$	166	$	-	$	-	$	166	$	-	$	166

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BALANCE SHEET DATA
December 31, 2019
(Dollars in Thousands)
	Capital		Asset		Principal		Segment		Unallocated
	Markets		Management		Investing		Total		(1)		Total
Total Assets	$	7,968,491	$	1,616	$	18,689	$	7,988,796	$	12,828	$	8,001,624
Included within total assets:
Investment in equity method affiliates	$	-	$	-	$	3,799	$	3,799	$	-	$	3,799
Goodwill (2)	$	7,937	$	55	$	-	$	7,992	$	-	$	7,992
Intangible assets (2)	$	166	$	-	$	-	$	166	$	-	$	166

(1)Unallocated assets primarily include: (1) amounts due from related parties; (2) furniture and equipment, net; and (3) other assets that are not considered necessary for an understanding of business segment assets.  Such amounts are excluded in business segment reporting to the chief operating decision maker.

(2)Goodwill and intangible assets are allocated to the Capital Markets and Asset Management business segments as indicated in the table above.

Geographic Information

The Company conducts its business activities through offices in the following locations: (1) United States and (2) United Kingdom and Other.  Total revenues by geographic area are summarized as follows.

GEOGRAPHIC DATA
(Dollars in Thousands)
	Three Months Ended March 31,
		2020	2019
Total Revenues:
United States	$	16,942	$	10,082
Europe & Other		828		1,058
Total	$	17,770	$	11,140

Long-lived assets attributable to an individual country, other than the United States, are not material.

23. SUPPLEMENTAL CASH FLOW DISCLOSURE

Interest paid by the Company on its debt and redeemable financial instruments was $2,033 and $2,070 for the three months ended March 31, 2020 and 2019, respectively.

The Company paid income taxes of $4 and $4 for the three months ended March 31, 2020 and 2019, respectively. The Company received income tax refunds of $48 for the three months ended March 31, 2019.

For the three months ended March 31, 2020, the Company had the following significant non-cash transactions that are not reflected on the statement of cash flows:

· The Company net surrendered units of membership interests the Operating LLC.  The Company recognized a net decrease in additional paid-in capital of $123, a net increase of $8 in AOCI, and a increase of $115 in non-controlling interest.  See note 18.

· The investment return related to certain of the Company’s redeemable financial instruments was negative within certain quarterly periods.  According to the terms of those agreements, the redemption value of the instrument is reduced in those cases.  Accordingly, the Company recorded interest income and reduced the balance of redeemable financial instruments by $76. See note 16.

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For the three months ended March 31, 2019, the Company had the following significant non-cash transactions that are not reflected on the statement of cash flows:

· The Company net surrendered units of membership interests in the Operating LLC.  The Company recognized a net increase in additional paid-in capital of $133, a net decrease of $14 in AOCI, and a decrease of $119 in non-controlling interest.  See note 18.

· The investment return related to certain of the Company’s redeemable financial instruments was negative within certain quarterly periods.  According to the terms of those agreements, the redemption value of the instrument is reduced in those cases.  Accordingly, the Company recorded interest income and reduced the balance of redeemable financial instruments by $37.

· The Company recognized an accrual of $335 in accounts payable and other accrued liabilities for dividends and distributions declared on March 6, 2019, which were paid after March 31, 2019.

· On January 1, 2019, the Company recorded a right of use asset of $8,416 and a right of use liability of $8,860, a reduction in retained earnings from cumulative effect of adoption of $20, an increase in other receivables of $18, and a reduction in other liabilities of $406, resulting from the adoption of ASU 2016-02. See note 2.

24. RELATED PARTY TRANSACTIONS

The Company has identified the following related party transactions for the three months ended March 31, 2020 and 2019. The transactions are listed by related party and, unless otherwise noted in the text of the description, the amounts are disclosed in the tables at the end of this section.

A. The Bancorp, Inc. (“TBBK”)

TBBK is identified as a related party because Daniel G. Cohen is chairman of TBBK.

As part of the Company’s broker-dealer operations, the Company from time to time purchases securities from third parties and sells those securities to TBBK. The Company may purchase securities from TBBK and ultimately sell those securities to third parties. In either of the cases listed above, the Company includes the trading revenue earned (i.e. the gain or loss realized, or commission earned) by the Company for the entire transaction in the amounts disclosed as part of net trading in the table at the end of this section.

From time to time, the Company will enter into repos with TBBK as its counterparty.  As of March 31, 2020 and December 31, 2019, the Company had norepos with TBBK.  For the three months ending March 31, 2020,and 2019, the Company incurred no interest expense related to repos with TBBK as its counterparty.

B. Daniel G. Cohen/Cohen Bros. Financial, LLC (“CBF”)/ EBC 2013 Family Trust (“EBC”)

On December 30, 2019, Daniel G.  Cohen contributed 370,881shares of IMXI common stock to the Operating LLC.  In exchange for these shares, the Operating LLC issued 12,549,273 newly issued units of membership interests in the Operating LLC and 12,549,273 shares of newly issued Series F Preferred Stock.  The Company included the value of the IMXI common stock in other investments at fair value. See note 11.

In December 2019, the Company acquired a 45% interest in CK Capital Partners B.V. (“CK Capital”).  The Company purchased this interest for $18 (of which $17 was from an entity controlled by Daniel G. Cohen). In addition, the Company also acquired a 10% interest in Amersfoot Office Investment I Cooperatief U.A. (“AOI”), a real estate holding company, for $1 from entities controlled by Daniel G. Cohen. CK Capital is a private company incorporated in the Netherlands and provides asset and investment advisory services relating to real estate holdings. See note 11.

CBF has been identified as a related party because (i) CBF is a non-controlling interest holder of the Company and (ii) CBF is wholly owned by Daniel G. Cohen.On September 29, 2017, CBF also invested $8,000 of the $10,000 total investment in the Company’s Redeemable Financial Instrument – DGC Trust / CBF pursuant to the CBF Investment Agreement.   The Company incurred interest expense on this instrument, which is disclosed as part of interest expense incurred in the table at the end of this section.  In October 2019, a payment of $1,500 was made by the Company to CBF which reduced the redeemable financial instrument balance.  See notes 16 and 17.

EBC has been identified as a related party because Daniel G. Cohen is a trustee of EBC and has sole voting power with respect to all shares of the Company held by EBC. In September 2013, EBC, as an assignee of CBF, made a $4,000 investment in the Company.  The Company issued $2,400 in principal amount of the 2013 Convertible Notes and $1,600 of Common Stock to EBC. See note 20 to the Company’s consolidated financial statements included in the Company’s Annual Report on Form 10-K for the year

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ended December 31, 2019.  On September 25, 2019, the 2013 Convertible Notes were amended and restated by the 2019 Senior Notes.   See note 17. The Company incurred interest expense on this debt, which is disclosed as part of interest expense incurred in the table at the end of this section.

C. The Edward E. Cohen IRA

On August 28, 2015, $4,386 in principal amount of the 2013 Convertible Notes originally issued to Mead Park Capital in September 2013 was purchased by the Edward E. Cohen IRA of which Edward E. Cohen is the benefactor.  Edward E. Cohen is the father of Daniel G. Cohen.  On September 25, 2019, the 2013 Convertible Notes were amended and restated by the 2019 Senior Notes. See note 17 for a description of amendments related to the 2019 Senior Notes and 2013 Convertible Notes.   The Company incurred interest expense on this debt, which is disclosed as part of interest expense incurred in the tables at the end of this section. The 2019 Senior Notes were fully repaid on February 3, 2020.  See note 17 and note 20 to the Company’s consolidated financial statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2019.

D. JKD Investor

The JKD Investor is an entity owned by Jack J. DiMaio, the vice chairman of the board of directors and vice chairman of the Operating LLC’s board of managers, and his spouse.  On October 3, 2016, JKD Investor invested $6,000 in the Operating LLC.   Additional investments were made in January 2017 and January 2019 in the amounts of $1,000 and $1,268 respectively.  See note 16. The interest expense incurred on this investment is disclosed in the table at the end of this section. 

On January 31, 2020, JKD Investor purchased $2,250 of the 2020 Senior Notes.  See note 17.  The Company incurred interest expense on this debt, which is disclosed as part of interest expense incurred in the tale at the end of this section.

E. DGC Trust

DGC Trust was established by Daniel G. Cohen, chairman of the Company’s board of directors and chairman of the Operating LLC board of managers.  Daniel G. Cohen does not have any voting or dispositive control of securities held in the interest of the trust.  The Company considers DGC Trust a related party because it was established by Daniel G. Cohen. 

On December 30, 2019, the DGC Trust contributed 291,480 shares of IMXI common stock with a fair value of $3,428 to the Operating LLC.  In exchange for these shares, the Operating LLC issued to the DGC Trust 9,880,268 newly issued units of membership interests in the Operating LLC and the Company issued to the DGC Trust 9,880,268 shares of newly issued Series F Preferred Stock.  The Company included the value of the shares of IMXI common stock in other investments, at fair value. See note 18.

In March 2017, the 2017 Convertible Note was issued to the DGC Trust.   The Company incurred interest expense on the 2017 Convertible Note, which is disclosed as part of interest expense incurred in the table at the end of this section.  

On September 29, 2017, the DGC Trust  invested $2,000 of the $10,000 total investment in the Company’s Redeemable Financial Instrument – DGC  Trust / CBF pursuant to the DGC Trust Investment Agreement.  See notes 19 to the Company’s consolidated financial statements included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2019 and note 16 herein.  Interest incurred on this instrument is disclosed in the tables at the end of this section. 

F. FinTech Acquisition Corp. III

In December 2018, the Operating LLC entered into an agreement with FinTech Acquisition Corp. III whereby the Company will provide certain accounting and administrative services.  FinTech Acquisition Corp. III is considered a related party because Daniel G. Cohen is the chief executive officer of FinTech Acquisition Corp, III and Betsy Cohen is the chairman of the board of directors of FinTech Acquisition Corp. III.  Income earned on this arrangement is disclosed in the tables below.

G. FinTech Investor Holdings II, LLC

FinTech Investor Holdings II, LLC is considered a related party because Daniel G. Cohen is the manager of the entity.

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In July 2018, the Operating LLC acquired publicly traded shares of FinTech Acquisition Corp. II from an unrelated third party for a total purchase price of $2,513.  In connection with this purchase, the Operating LLC agreed with FinTech Investor Holdings II, LLC to not redeem these shares in advance of the merger between FinTech Acquisition Corp. II and Intermex Holdings II, LLC.   In exchange for this agreement to not redeem these shares prior to the merger, as well as the outlay of capital to purchase the publicly traded shares of FinTech Acquisition Corp. II, the Operating LLC received unregistered, restricted shares of common stock of FinTech Acquisition Corp. II from FinTech Investor Holdings II, LLC.  In connection with the merger, FinTech Acquisition Corp. II changed its name to International Money Express, Inc. 

H.  Duane Morris, LLP (“Duane Morris”)

Duane Morris is an international law firm and serves as legal counsel to the Company.  Duane Morris is considered a related party because a partner at Duane Morris is a member of the same household as a director of the Company.  Expense incurred by the Company for services provided by Duane Morris are included within professional fees and operating expense in the consolidated statements of operations and comprehensive income and are disclosed in the table below. 

I. FinTech Masala, LLC

FinTech Masala, LLC is a related party because Betsy Cohen is the mother of Daniel G. Cohen and is a member of FinTech Masala, LLC.  Daniel G. Cohen is also a member of FinTech Masala, LLC.  The Company has engaged Betsy Cohen on behalf of FinTech Masala, LLC as a consultant to provide certain services related to the Insurance SPAC.  The Company agreed to pay a consultant fee of $1 per month, which commenced July 1, 2019 and shall continue until the earlier of (i) the date that is thirty days following the closing of the Insurance SPAC’s initial Business Combination and (ii) the date on which the Company or Betsy Cohen terminates the consulting agreement.  Betsy Cohen made a $2 investment in the Sponsor Entities in March 2019, which is included as a component of non-controlling interest in the consolidated balance sheet.  The expense incurred by the Company for the consulting services provided by FinTech Masala, LLC are included within professional fees and operating expense in the consolidated income statement and are disclosed in the table below.

The Company has a sublease agreement for certain office space with FinTech Masala, LLC (formerly Bezuco Capital, LLC).  The Company received payments under this agreement.  The payments are recorded as a reduction in rent expenses.  This sublease agreement commenced on August 1, 2018.  It has an annual term that auto-renews if not cancelled earlier.  It can be cancelled by either party upon 90 days’ notice.  The income earned on this sublease is included as a reduction in rent expense in the consolidated statements of income and are disclosed in the tables below.  

J. Investment Vehicle and Other

EuroDekania

EuroDekania is considered a related party because it is an equity method investment of the Company.   The Company had an investment in and a management contract with EuroDekania.  Income earned or loss incurred on the investment is included as part of principal transactions and other income in the tables below.  Revenue earned on the management contract is included as part of asset management in the tables below.  EuroDekania liquidated  in 2019.

SPAC Fund

The SPAC Fund is considered a related party because it is an equity method investment of the Company.   The Company has an investment in and a management contract with the SPAC Fund.  Income earned or loss incurred on the investment is included as part of principal transactions and other income in the tables below.  Revenue earned on the management contract is included as part of asset management in the tables below.  As of March 31, 2020, the Company owned 2.53% of the equity of the SPAC Fund. 

U.S. Insurance JV

U.S. Insurance JV is considered a related party because it is an equity method investment of the Company. The Company has an investment in and a management contract with the U.S. Insurance JV.  Income earned or loss incurred on the investment is included as part of principal transactions and other income in the tables below.  Revenue earned on the management contract is included as part of asset management and are shown in the tables below.  As of March 31, 2020, the Company owned 4.66% of the equity of the U.S. Insurance JV.

Insurance SPAC

The Insurance SPAC is a related party as it is an equity method investment of the Sponsor Entities, which are consolidated by the Company.  As of March 31, 2020, the Sponsor Entities owned 26.5% of the equity in the Insurance SPAC. Income earned, or loss

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incurred on equity method investments is included in the tables below.  The Operating LLC and the Insurance SPAC entered into an administrative services agreement, dated March 19, 2019, pursuant to which the Operating LLC and the Insurance SPAC agreed that, commencing on the date that the Insurance SPAC’s securities were first listed on the Nasdaq Capital Market through the earlier of the Insurance SPAC’s consummation of a Business Combination and its liquidation, the Insurance SPAC will pay the Operating LLC $10 per month for certain office space, utilities, secretarial support, and administrative services.  Revenue earned by the Company from the administrative services agreement is included as part of principal transactions and other income in the tables below.  The Company agreed to lend the Insurance SPAC $750 for operating and acquisition related expenses.  No amounts have been lent to date under this facility.  See note 11. 

CK Capital and AOI

CK Capital and AOI are related parties as they are equity method investments of the Company.  In December 2019, the Company acquired a 45% interest in CK Capital.  The Company purchased this interest for $18 (of which $17 was from an entity controlled by Daniel G. Cohen).  In addition, the Company also acquired a 10% interest AOI, a real estate holding company, for $1 from entities controlled by Daniel G. Cohen.  See Note 11. 

The following tables display the routine transactions recognized in the statements of operations from the identified related parties that are described above.

	Related Party Transactions
	(Dollars in Thousands)
		Three Months Ended
		March 31, 2020		March 31, 2019
Net trading
TBBK	$	-	$	2
Asset management
EuroDekania		-		86
SPAC Fund		(47)		31
U.S.  Insurance JV		90		80
	$	43	$	197
Principal transactions and other income
EuroDekania		-		291
FinTech Acquisition Corp.		3		3
Insurance SPAC		30		4
SPAC Fund		(59)		24
U.S.  Insurance JV		(167)		39
	$	(193)	$	361
Income (loss) from equity method affiliates
AOI		(30)		-
CK Capital		230		-
Insurance SPAC		(307)		(8)
	$	(107)	$	(8)
Operating expense (income)
Duane Morris		319		101
FinTech Masala, LLC		(11)		(6)
	$	308	$	95
Interest expense (income)
CBF		528		119
DGC Trust		533		390
EBC		72		47
Edward E. Cohen IRA		48		87
JKD Investor		484		278
	$	1,665	$	921

The following related party transactions are non-routine and are not included in the tables above.

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K.  Directors and Employees

The Company has entered into employment agreements with Daniel G. Cohen and Joseph W. Pooler, Jr., its chief financial officer.  The Company has entered into its standard indemnification agreement with each of its directors and executive officers.

The Company maintains a 401(k) savings plan covering substantially all of its employees.  The Company matches 50% of employee contributions for all participants not to exceed 3% of their salary.  Contributions made on behalf of the Company were $98 and $91 for the three months ended March 31, 2020, and 2019, respectively.

The Company leases office space from Zucker and Moore, LLC.  Zucker and Moore, LLC is partially owned by Jack DiMaio, Jr., the vice chairman of the Company’s board of directors.  The Company recorded $24 of rent expense related to this office space for the three months ended March 31, 2020 and 2019.

25. DUE FROM / DUE TO RELATED PARTIES

Amounts due to related parties related to redeemable financial instruments and outstanding debt are included as components of those balances in the consolidated balance sheets.  Also, interest or investment return owed on those balances are included as a component of accounts payable and other in the consolidated balance sheets.  Any investment made in an equity method affiliate for which the Company does not elect the fair value option is included as a component of investments in equity method affiliates in the consolidated balance sheets.  Any investment made in an equity method affiliate for which the Company elected the fair value option is included as a component of other investments, at fair value in the consolidated balance sheets.

The following table summarizes amounts due from / to related parties as of each date shown. These amounts may result from normal operating advances, employee advances, or from timing differences between the transactions disclosed in note 24 and final settlement of those transactions in cash. All amounts are primarily non-interest bearing.

DUE FROM/DUE TO RELATED PARTIES
(Dollars in Thousands)
	March 31, 2020		December 31, 2019
Employees & other	$	411	$	466
Due from related parties	$	411	$	466

26. SUBSEQUENT EVENTS

The Company has applied for and received a $2.2 million loan under the Paycheck Protection Program (PPP) of the Coronavirus Aid, Relief, and Economic Security (CARES) Act. The Company has carefully considered the eligibility requirements for PPP loans as well as supplemental guidance regarding the PPP beyond the applicable statute issued from time to time by government agencies and certain government officials. The Company is eligible to receive a PPP loan because it has fewer than 100 employees. Further, although the Company is public and listed on the NYSE American stock exchange, the Company’s market capitalization is small, and the Company believes that it does not have access to the public capital markets at this time. In part due to the PPP loan, the Company does not anticipate any significant workforce reduction or reductions in compensation levels in the near future. However, the Company will continue to carefully monitor revenue levels to assess whether compensatory or other cost-cutting measures might be necessary. 

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ITEM 2.MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.

The following discussion and analysis of the consolidated financial condition and results of operations of Cohen & Company Inc. and its majority owned subsidiaries (collectively, “we,” “us,” “our,” or the “Company”) should be read in conjunction with the unaudited consolidated financial statements and the notes thereto appearing elsewhere in this Quarterly Report on Form 10-Q and the audited consolidated financial statements and notes thereto appearing in the Company’s Annual Report on Form 10-K for the year ended December 31, 2019.

“Management’s Discussion and Analysis of Financial Condition and Results of Operations” is based on our consolidated financial statements, which have been prepared in accordance with U.S. GAAP. The preparation of these financial statements requires us to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosures of contingent assets and liabilities. On a regular basis, we evaluate these estimates, including fair value of financial instruments. These estimates are based on historical experience and on various other assumptions that are believed to be reasonable under the circumstances. Actual results may differ from these estimates.

All amounts in this disclosure are in thousands (except share and unit and per share and per unit data) except where noted.

Overview

We are a financial services company specializing in fixed income markets. We were founded in 1999 as an investment firm focused on small-cap banking institutions, but have grown to provide an expanding range of capital markets and asset management services. We are organized into three business segments: Capital Markets, Asset Management, and Principal Investing.

· Capital Markets:  Our Capital Markets business segment consists primarily of fixed income sales, trading, matched book repo financing, new issue placements in corporate and securitized products, and advisory services. Our fixed income sales and trading group provides trade execution to corporate investors, institutional investors, mortgage originators, and other smaller broker-dealers. We specialize in a variety of products, including but not limited to: corporate bonds, ABS, MBS, RMBS, CDOs, CLOs, CBOs, CMOs, municipal securities, TBAs and other forward agency MBS contracts, SBA loans, U.S. government bonds, U.S. government agency securities, brokered deposits and CDs for small banks, and hybrid capital of financial institutions including TruPS, whole loans, and other structured financial instruments. We also offer execution and brokerage services for equity products. We carry out our capital markets activities primarily through our subsidiaries: JVB in the United States and CCFL and CCFEL in Europe.

· Asset Management:Our Asset Management business segment manages assets within CDOs, managed accounts, joint ventures, and investment funds (collectively, “Investment Vehicles”). A CDO is a form of secured borrowing. The borrowing is secured by different types of fixed income assets such as corporate or mortgage loans or bonds. The borrowing is in the form of a securitization, which means that the lenders are actually investing in notes backed by the assets. In the event of default, the lenders will have recourse only to the assets securing the loan. Our Asset Management business segment includes our fee-based asset management operations, which include on-going base and incentive management fees. As of March 31, 2020, we had approximately $2.65 billion in assets under management (“AUM”) of which 79.1% was in CDOs. A substantial portion of our asset management revenue is earned from the management of CDOs.  We have not completed a new securitization since 2008.  As a result, our asset management revenue has declined from its historical highs as the assets of the CDOs decline due to maturities, repayments, auction call redemptions, and defaults.  Our ability to complete securitizations in the future will depend upon, among other things, our asset origination capacity and success, our ability to arrange warehouse financing to originate assets, our willingness and capacity to fund required amounts to obtain warehouse financing and securitized financings, and the demand in the markets for such securitizations.  The remaining portion of our AUM is from a diversified mix of other Investment Vehicles that were more recently formed. 

· Principal Investing: Our Principal Investing business segment is comprised of investments that we have made for the purpose of earning an investment return rather than investments to support our trading, matched book repo, or other Capital Markets business segment activities.  These investments are a component of our other investments, at fair value in our consolidated balance sheet. 

We generate our revenue by business segment primarily through the following activities.

Capital Markets:

· Our trading activities, which include execution and brokerage services, securities lending activities, riskless trading activities, as well as gains and losses (unrealized and realized) and income and expense earned on securities and derivatives classified as trading;

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· Net interest income on our matched book repo financing activities; and

· New issue and advisory revenue comprised primarily of (a) new issue revenue associated with originating, arranging, or placing newly created financial instruments and (b) revenue from advisory services.

Asset Management:

· Asset management fees for our on-going asset management services provided to certain Investment Vehicles, which may include fees both senior and subordinate to the securities issued in the Investment Vehicle; and

· Incentive management fees earned based on the performance of the various Investment Vehicles.

Principal Investing:

· Gains and losses (unrealized and realized) and income and expense earned on securities classified as other investments, at fair value.

Business Environment

Our business in general and our Capital Markets business segment in particular, do not produce predictable earnings.  Our results can vary dramatically from year to year and quarter to quarter. 

Our business is materially affected by economic conditions in the financial markets, political conditions, broad trends in business and finance, the housing and mortgage markets, changes in volume and price levels of securities transactions, and changes in interest rates, including overnight funding rates, all of which can affect our profitability and are unpredictable and beyond our control. These factors may affect the financial decisions made by investors and companies, including their level of participation in the financial markets and their willingness to participate in corporate transactions. Severe market fluctuations or weak economic conditions could reduce our trading volume and revenues, negatively affect our ability to generate new issue and advisory revenue, and adversely affect our profitability.

As a general rule, our trading business benefits from increased market volatility.  Increased volatility usually results in increased activity from our clients and counterparties.  However, periods of extreme volatility may at times result in clients reducing their trading volumes, which would negatively impact our results.  Also, periods of extreme volatility may result in large fluctuations in securities valuations and we may incur losses on our holdings.  Also, our mortgage group’s business benefits when mortgage volumes increase, and may suffer when mortgage volumes decrease.  Among other things, mortgage volumes are significantly impacted by changes in interest rates. 

In addition, as a smaller firm, we are exposed to intense competition.  Although we provide financing to our customers, larger firms have a much greater capability to provide their clients with financing, giving them a competitive advantage.  We are much more reliant upon our employees’ relationships, networks, and abilities to identify and capitalize on market opportunities.  Therefore, our business may be significantly impacted by the addition or loss of key personnel. 

We try to address these challenges by (i) focusing our business on clients and asset classes that are underserved by the large firms, (ii) continuing to monitor our fixed costs to enhance operating leverage and limit our losses during periods of low volumes, and (iii) attempting to hire and retain entrepreneurial and effective traders and salespeople. 

Our business environment is rapidly changing.  New risks and uncertainties emerge continuously and it is not possible for us to predict all the risks we will face.  This may negatively impact our operating performance. 

A portion of our revenue is generated from net trading activity. We engage in proprietary trading for our own account, provide securities financing for our customers, and execute “riskless” trades with a customer order in hand resulting in limited market risk to us. The inventory of securities held for our own account, as well as held to facilitate customer trades, and our market making activities are sensitive to market movements.

A portion of our revenue is generated from new issue and advisory engagements. The fees charged and volume of these engagements are sensitive to the overall business environment.  We provide investment banking and advisory services in Europe through our subsidiary CCFEL and new issue services in the U.S. through our subsidiary JVB. Currently, our primary source of new issue revenue is from originating assets for our U.S. and European insurance asset management business.

A portion of our revenue is generated from management fees. Our ability to charge management fees and the amount of those fees is dependent upon the underlying investment performance and stability of the Investment Vehicles. If these types of investments do not provide attractive returns to investors, the demand for such instruments will likely fall, thereby reducing our opportunity to earn new management fees or maintain existing management fees.  As of March 31, 2020,  79.0% of our existing AUM were in CDOs. The creation of CDOs has depended upon a vibrant securitization market. Since 2008, volumes within the securitization market have dropped significantly and have not fully recovered since that time. We have not completed a new securitization since 2008. The remaining portion of our AUM is from a diversified mix of other Investment Vehicles most of which were more recently formed. 

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A substantial portion of our asset management revenue is earned from the management of CDOs.  As a result, our asset management revenue has declined from its historical highs as the assets of the CDOs decline due to maturities, repayments, auction call redemptions, and defaults.  Our ability to complete securitizations in the future will depend upon, among other things, our asset origination capacity and success, our ability to arrange warehouse financing to originate assets, our willingness and capacity to fund required amounts to obtain warehouse financing and securitized financings, and the demand in the markets for such securitizations.

A portion of our revenues is generated from our principal investing activities. Therefore, our revenues are impacted by the overall market supply and demand of these investments as well as the individual performance of each investment. Our principal investments are included within other investments, at fair value in our consolidated balance sheets.  See note 7 to our consolidated financial statements included in Item 1 of this Quarterly Report on Form 10-Q. 

Margin Pressures in Fixed Income Brokerage Business

Performance in the financial services industry in which we operate is highly correlated to the overall strength of the economy and financial market activity. Overall market conditions are a product of many factors beyond our control and can be unpredictable. These factors may affect the financial decisions made by investors, including their level of participation in the financial markets. In turn, these decisions may affect our business results. With respect to financial market activity, our profitability is sensitive to a variety of factors including the volatility of the equity and fixed income markets, the level and shape of the various yield curves, and the volume and value of trading in securities.

Margins and volumes in certain products and markets within the fixed income brokerage business continue to decrease materially as competition has increased and general market activity has declined. Further, we continue to expect that competition will increase over time, resulting in continued margin pressure.

Our response to this margin compression has included: (i) building a diversified fixed income trading platform; (ii) acquiring or building out new product lines and expanding existing product lines; (iii) building a hedging execution and funding operation to service mortgage originators; (iv) becoming a full netting member of the FICC enabling us to expand our matched book repo business; and (v) monitoring our fixed costs. Our cost management initiatives are ongoing. However, there can be no certainty that these efforts will be sufficient. If insufficient, we will likely see a decline in profitability.

U.S.  Housing Market

In recent years, our mortgage group has grown in significance to our Capital Markets segment and our company overall.  The mortgage group primarily earns revenue by providing hedging execution, securities financing, and trade execution services to mortgage originators and other investors in mortgage backed securities.  Therefore, this group’s revenue is highly dependent on the volume of mortgage originations in the U.S.  Origination activity is highly sensitive to interest rates, the U.S. job market, housing starts, sale activity of existing housing stock, as well as the general health of the U.S. economy.  In addition, any new regulation that impacts U.S. government agency mortgage backed security issuance activity, residential mortgage underwriting standards, or otherwise impacts mortgage originators will impact our business.  We have no control over these external factors and there is no effective way for us to hedge against these risks.  Our mortgage group’s volumes and profitability will be highly impacted by these external factors.

COVID 19 / Impairment of Goodwill

In March 2020, the World Health Organization declared the outbreak of a novel coronavirus (COVID-19) as a pandemic, which continues to spread throughout the United States. The spread of COVID-19 has caused significant volatility in domestic and international markets. There is on-going uncertainty around the breadth and duration of business disruptions related to COVID-19, as well as its impact on the U.S. and international economies.  While we cannot fully assess the impact COVID-19 will have on all of our operations at this time, there are certain impacts that we have identified:

· The unprecedented volatility of the financial markets experienced in March 2020, has caused us to operate JVB at a lower level of leverage than prior to the pandemic.  Specifically, JVB has reduced the size of its GCF repo operations and the volume of its TBA trading.  We have determined that at our pre-pandemic levels in these businesses, we were exposed to a higher level of counterparty credit risk than we should have and were experiencing too much volatility in our available liquidity to conservatively meet capital requirements and margin calls in these businesses.  We expect JVB to operate at lower volumes in both these businesses for an indefinite period of time, which could unfavorably impact the operating profitability of JVB. 

· The financial market volatility, as well as the reduction in volumes in the GCF repo and TBA businesses, that resulted from COVID-19 required us to reassess the goodwill we had recorded related to JVB under the guidance of ASC 350.  We determined that the fair value of JVB was less than the carrying value (including the goodwill).  As a result, we recorded an impairment loss of $7,883 in the three months ended March 31, 2020.  See note 12. 

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· We expect that our asset management segment will also be adversely impacted by the pandemic.  While it is difficult to determine the extent of the impact at this time, we expect that raising capital for new funds may become more challenging.  In addition, lower returns earned by funds will adversely impact our asset management fees and investors’ need for liquidity may result in reductions in AUM. 

· JVB’s mortgage group’s operations are centered on serving the financial needs of mortgage originators and institutions that invest in mortgage backed securities.  Prolonged high unemployment will most likely impact mortgage originations and demand for and supply of mortgage backed securities, which may have a significant unfavorable impact on the revenue earned by JVB’s mortgage group. 

We will likely be impacted by the pandemic in other ways which we cannot yet determine.  We will continue to monitor market conditions and respond accordingly.  Subsequent to March 31, the Company has applied for and received a $2.2 million loan under the Paycheck Protection Program (PPP) of the Coronavirus Aid, Relief, and Economic Security (CARES) Act. See recent events below. 

Recent Events

The 2019 Senior Notes

On September 25, 2019, we amended the previously outstanding 2013 Convertible Notes that were scheduled to mature on September 25, 2019.  The material terms and conditions of the 2013 Convertible Notesremained substantially the same, except that (i) the maturity date changed from September 25, 2019 to September 25, 2020; (ii) the conversion feature in the 2013 Convertible Notes was removed; (iii) the interest rate changed from 8% per annum (9% in the event of certain events of default) to 12% per annum (13% in the event of certain events of default); and (iv) the restrictions regarding prepayment was removed.  The post amendment notes are referred to herein as the “2019 Senior Notes” and the pre-amendment notes are referred to herein as the “2013 Convertible Notes.” 

The 2020 Senior Notes

On January 31, 2020, the Operating LLC entered into a Note Purchase Agreement with  JKD Capital Partners I LTD, a New York corporation (“JKD Investor”), and RN Capital Solutions LLC, a Delaware limited liability company (“RNCS”).  The JKD Investor is owned by Jack DiMaio, the vice chairman of the Company’s board of directors and the Operating LLC’s board of managers, and his spouse.

Pursuant to the Note Purchase Agreement, JKD Investor and RNCS each purchased a Senior Promissory Note in the principal amount of $2,250 (for an aggregate investment of $4,500).  The Senior Promissory Notes bear interest at a fixed rate of 12% per annum and mature on January 31, 2022.  On February 3, 2020, pursuant to the Note Purchase Agreement, the Operating LLC used the proceeds received from the issuance of the Senior Promissory Notes to repay in full all amounts outstanding under the Senior Promissory Note, dated September 25, 2019, issued by the Company to Pensco Trust Company, Custodian fbo Edward E. Cohen IRA in the principal amount of $4,386 (the “Cohen IRA Note”).  The Cohen IRA Note is included as a portion of the 2019 Senior Notes outstanding as of December 31, 2019.  The Cohen IRA Note was fully paid and extinguished on February 3, 2020.  Subsequent to this repayment, $2,400 of the 2019 Senior Notes remain outstanding.  See note 17 to our financial statements included in this Quarterly Report on Form 10-Q.  

ViaNova

In 2018, we formed a new subsidiary, ViaNova, for the purpose of building a RTL business.  RTLs are small balance commercial loans secured by first lien mortgages used by professional investors and real estate developers to finance the purchase and rehabilitation of residential properties.  ViaNova’s business plan includes buying, aggregating, and distributing these loans to produce superior risk-adjusted returns through the pursuit of opportunities overlooked by commercial banks. 

On March 19, 2020, ViaNova received a notice of default from LegacyTexas Bank regarding the LegacyTexas Credit Facility, stating that ViaNova’s unrestricted cash balance was less than the amount required.  Also, on March 19, 2020, ViaNova received notice from LegacyTexas Bank that the Bank had suspended funding all “Alternative” loans for all of their clients, including the RTL loans that are the subject of the LegacyTexas Credit Facility with LegacyTexas Bank.  Since March 19, 2020 ViaNova has repaid all outstanding indebtedness under the Agreement.  ViaNova stopped acquiring new RTLs and does not intend to acquire any new RTLs in the future.  As of March 31, 2020, the Company had four RTLs  and several interest strips representing a par value of $3,034 and a fair value of $2,956, including the fair value of interest strips held.  These RTLsand interest strips are included as a component of investments-trading (see note 7).  The Company intends to opportunistically sell these loans if possible or allow them to mature.  The latest maturity date of the loans is January 9, 2021.See note 4 to our financial statements included in this Quarterly Report on Form 10-Q. 

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Cares Act

On March 27, 2020, the United States enacted the Coronavirus Aid, Relief and Economic Security Act (CARES Act). The Cares Act is an emergency economic stimulus package that includes spending and tax breaks to strengthen the United States economy and fund a nationwide effort to curtail the effect of COVID-19. The CARES Act includes significant business tax provisions that, among other things, include the removal of certain limitations on utilization of net operating losses, increase the loss carryback period for certain losses to five years, and increase the ability to deduct interest expense, as well as amending certain provisions of the previously enacted Tax Cuts and Jobs Act. We do not expect the CARES Act to have a significant impact on our tax obligations.

Paycheck Protection Program

Subsequent to March 31, 2020, we applied for and received a $2.2 million loan under the Paycheck Protection Program (PPP) of the Coronavirus Aid, Relief, and Economic Security (CARES) Act. We have carefully considered the eligibility requirements for PPP loans as well as supplemental guidance regarding the PPP beyond the applicable statute issued from time to time by government agencies and certain government officials. We are eligible to receive a PPP loan because we have fewer than 100 employees. Further, although we are public and listed on the NYSE American stock exchange, our market capitalization is small, and we believe that we do not have access to the public capital markets at this time. In part due to the PPP loan, we do not anticipate any significant workforce reduction or reductions in compensation levels in the near future. However, we will continue to carefully monitor revenue levels to assess whether compensatory or other cost-cutting measures might be necessary. 

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Consolidated Results of Operations

This section provides a comparative discussion of our consolidated results of operations for the specified periods. The period-to-period comparisons of financial results are not necessarily indicative of future results.

Three Months Ended March 31, 2020 Compared to the Three Months Ended March 31, 2019

The following table sets forth information regarding our consolidated results of operations for the three months ended March 31, 2020 and 2019.  

COHEN & COMPANY INC.
CONSOLIDATED  STATEMENTS OF OPERATIONS
(Dollars in Thousands)
(Unaudited)
	Three Months Ended March 31,				Favorable / (Unfavorable)
	2020		2019		$ Change		% Change
Revenues
Net trading	$	18,561	$	8,724	$	9,837		113%
Asset management		1,615		2,002		(387)		(19)%
Principal transactions and other income		(2,406)		414		(2,820)		(681)%
Total revenues		17,770		11,140		6,630		60%
Operating expenses
Compensation and benefits		14,134		6,364		(7,770)		(122)%
Business development, occupancy,  equipment		756		811		55		7%
Subscriptions, clearing, and execution		2,580		2,273		(307)		(14)%
Professional fee and other operating		1,782		1,679		(103)		(6)%
Depreciation and amortization		80		81		1		1%
Impairment of goodwill		7,883		-		(7,883)		NM
Total operating expenses		27,215		11,208		(16,007)		(143)%
Operating income / (loss)		(9,445)		(68)		(9,377)		(13790)%
Non-operating income / (expense)
Interest expense, net		(2,605)		(1,854)		(751)		(41)%
Income / (loss) from equity method affiliates		(107)		(8)		(99)		(1238)%
Income / (loss) before income taxes		(12,157)		(1,930)		(10,227)		(530)%
Income tax expense / (benefit)		(372)		(106)		266		251%
Net income / (loss)		(11,785)		(1,824)		(9,961)		(546)%
Less: Net income (loss) attributable to the non-controlling interest		(8,683)		(622)		8,061		1296%
Net income / (loss) attributable to Cohen & Company Inc.	$	(3,102)	$	(1,202)	$	(1,900)		(158)%

Revenues

Revenues increased by $6,630, or 60%, to $17,770 for the three months ended March 31, 2020 from $11,140 for the three months ended March 31, 2019. As discussed in more detail below, the change was comprised of (i) an increase of $9,837 in net trading revenue; (ii) a decrease of $387 in asset management revenue; and (iii) a decrease of $2,820 in principal transactions and other income.

Net Trading

Net trading revenue increased by $9,837, or 113%, to $18,561 for the three months ended March 31, 2020 from $8,724 for the three months ended March 31, 2019.The following table shows the detail by group.

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NET TRADING
(Dollars in Thousands)
	Three Months Ended March 31,
	2020		2019		Change
Mortgage	$	3,035	$	1,108	$	1,927
Matched book repo		6,868		1,294		5,574
High yield corporate		(1,996)		1,891		(3,887)
Investment grade corporate		9,958		255		9,703
Wholesale and other		696		4,176		(3,480)
Total	$	18,561	$	8,724	$	9,837

Our net trading revenue includes unrealized gains on our trading investments as of the applicable measurement date that may never be realized due to changes in market or other conditions not in our control.  This may adversely affect the ultimate value realized from these investments. In addition, our net trading revenue also includes realized gains on certain proprietary trading positions. Our ability to derive trading gains from such trading positions is subject to overall market conditions. Due to volatility and uncertainty in the capital markets, the net trading revenue recognized may not be indicative of future results. Furthermore, from time to time, some of the assets included in the investments-trading line of our consolidated balance sheets represent level 3 valuations within the FASB valuation hierarchy. Level 3 assets are carried at fair value based on estimates derived using internal valuation models and other estimates. See notes 7, 8, and 9 to our consolidated financial statements included in this Quarterly Report on Form 10-Q. The fair value estimates made by us may not be indicative of the final sale price at which these assets may be sold.

We consider our matched book repo business to be subject to significant concentration risk.  See note 10 to our consolidated financial statements included in this Quarterly Report on Form 10-Q.

Asset Management

Assets Under Management

Our AUM equals the sum of: (1) the gross assets included in CDOs that we have sponsored and manage; plus (2) the NAV of investment funds we manage; plus (3) the NAV or gross assets of other accounts we manage.

Our calculation of AUM may differ from the calculations used by other asset managers and, as a result, this measure may not be comparable to similar measures presented by other asset managers. This definition of AUM is not necessarily identical to a definition of AUM that may be used in our management agreements.

ASSETS UNDER MANAGEMENT
(Dollars in Thousands)
	As of March 31,					As of December 31,
			2020		2019		2019	2018
Company sponsored CDOs		$	2,095,350	$	2,305,798	$	2,197,208	$	2,386,614
Other Investment Vehicles (1)			555,823		469,511		559,382		465,665
Assets under management (2)		$	2,651,173	$	2,775,309	$	2,756,590	$	2,852,279

(1) Other Investment Vehicles represent any investment vehicles that are not company sponsored CDOs.

(2) In some cases, accounts we manage employ leverage.  In some cases, our fees are based on gross assets and in some cases on net assets.  AUM included herein is calculated using either the gross or net assets of each managed account or CDO based on whichever serves as the basis for our management fees.

(3)

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Asset management fees decreased by $387, or 19%, to $1,615 for the three months ended March 31, 2020 from $2,002 for the three months ended March 31, 2019, as discussed in more detail below. The following table provides a more detailed comparison of the two periods.

ASSET MANAGEMENT
(Dollars in Thousands)
	Three Months Ended March 31,
	2020		2019		Change
CDOs	$	969	$	950	$	19
Other		646		1,052		(406)
Total	$	1,615	$	2,002	$	(387)

CDOs

A substantial portion of our asset management revenue is earned from the management of CDOs.  As a result, our asset management revenue has declined from its historical highs as the assets of the CDOs decline due to maturities, repayments, auction call redemptions, and defaults.  Our ability to complete securitizations in the future will depend upon, among other things, our asset origination capacity and success, our ability to arrange warehouse financing to originate assets, our willingness and capacity to fund required amounts to obtain warehouse financing and securitized financings, and the demand in the markets for such securitizations.

Asset management fees from company sponsored CDOs increased by $19 to $969 for the three months ended March 31, 2020 from $950 for the three months ended March 31, 2019. The following table summarizes the periods presented by asset class.

FEES EARNED BY ASSET CLASS
(Dollars in Thousands)
	Three Months Ended March 31,
	2020		2019		Change
TruPS and insurance company debt - U.S.	$	768	$	797	$	(29)
TruPS and insurance company debt - Europe		97		109		(12)
Broadly syndicated loans - Europe		104		44		60
Total	$	969	$	950	$	19

The reduction in asset management fees for TruPS and insurance company debt – U.S. was a result of average AUM declining due to principal repayments on the assets in these securitizations.

The reduction in asset management fees for TruPS and insurance company debt – Europe was a result a decline in AUM due to principal repayments on the assets in these securitizations as well as changes in foreign exchange rates.

Asset management fees for broadly syndicated loans – Europe consist of a single CLO.  During August 2019, this CLO liquidated.  The revenue earned in the three months ended March 31, 2020 represented a final portion of a contingent successful liquidation fee  earned and received by us.  No future revenue will be earned on this CLO.   

Other

Other asset management revenue decreased by $406 to $646 for the three months ended March 31, 2020 from $1,052 for the three months ended March 31, 2019.  The decrease was primarily due to a reduction in performance fees being earned on our managed accounts during the three months ended March 31, 2020 as compared to the same period in 2019.

Principal Transactions and Other Income

Principal transactions and other income decreased by $2,820, or 681%, to ($2,406) for the three months ended March 31, 2020, as compared to $414 for the three months ended March 31, 2019.  The following table summarizes principal transactions and other income by category.

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PRINCIPAL TRANSACTIONS & OTHER INCOME
(Dollars in Thousands)
	Three Months Ended March 31,
	2020		2019		Change
EuroDekania	$	-	$	292	$	(292)
Currency hedges		-		40		(40)
CLO investments		(525)		73		(598)
IMXI		(1,751)		(22)		(1,729)
U.S. Insurance JV		(167)		39		(206)
SPAC Funds		(59)		24		(83)
Other principal investments		(96)		(96)		-
Total principal transactions		(2,598)		350		(2,948)
IIFC revenue share		116		96		20
All other income / (loss)		76		(32)		108
Other income		192		64		128
Total principal transactions and other income	$	(2,406)	$	414	$	(2,820)

Principal Transactions

EuroDekania was a company that invested in hybrid capital securities of European companies and we carried our investment at the reported NAV.  Income recognized in each period is the result of changes in the underlying NAV of the fund as well as distributions received.  Our investment in EuroDekania was denominated in Euros.  We sometimes hedged this exposure (as described in greater detail below).  EuroDekania sold its remaining investments and liquidated in 2019.   

Our currency hedge consisted of a Euro forward agreement designed to hedge the currency risk primarily associated with our investment in EuroDekania. 

The CLO investments represent investments in the most junior tranche of certain CLOs.  The average carrying value of our CLO investments for the three months ended March 31, 2020 was $2,319 as compared to $2,738 for the three months ended March 31, 2019.  These investments are carried at fair value.  See note 8 to our consolidated financial statements included in Item 1 of this Quarterly Report on Form 10-Q for information about how we determine the value of these instruments.  

IMXI represents unrestricted and restricted equity positions of International Money Express, Inc. (NASDAQ: IMXI), a publicly traded company that resulted from the merger of Intermex Holdings, LLC and FinTech Acquisition Corp. II.  See note 18. 

The U.S. Insurance JV is a company that invests in debt issued by insurance companies and we carry our investment at its reported NAV.  Income recognized in each period is the result of changes in the underlying NAV of the fund as well as distributions received.  See notes 7 and 8. 

The SPAC Fund primarily invests in the equity of SPACs and we carry our investment at its reported NAV.  Income recognized in each period is the result of changes in the underlying NAV of the SPAC Fund as well as distributions received. See notes 7 and 8.

Other Income

Other income increased by $128 to $192 for the three months ended March 31, 2020, as compared to $64 for the three months ended March 31, 2019. Other income / (loss) is comprised of certain ongoing revenue share arrangements as well as other miscellaneous operating income items. 

The revenue share arrangements noted in the table above entitle us to either a percentage of revenue earned by certain entities or a percentage of revenue earned in excess of certain thresholds.  The IIFC revenue share arrangement expires at the earlier of (i) the dissolution of IIFC or (ii) when we have earned a cumulative $20,000 in revenue share payments.  To date, we have earned $2,832.  Also, in any particular year, the revenue share earned by us cannot exceed $2,000. 

Operating Expenses

Operating expenses increased by $16,007, or 143%, to $27,215 for the three months ended March 31, 2020 from $11,208 for the three months ended March 31, 2019. As discussed in more detail below, the change was comprised of (i) an increase of $7,770 in compensation and benefits; (ii) a decrease of $55 in business development, occupancy, and equipment; (iii) an increase of $307 in subscriptions, clearing, and execution; (iv) an increase of $103 of professional fee and other operating; (v) a decrease of $1 of depreciation and amortization; and (vi) impairment of goodwill of $7,883. 

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Compensation and Benefits

Compensation and benefits increased by $7,770, or 122%, to $14,134 for the three months ended March 31, 2020 from $6,364 for the three months ended March 31, 2019.  

COMPENSATION AND BENEFITS
(Dollars in Thousands)
	Three Months Ended March 31,
	2020		2019		Change
Cash compensation and benefits	$	13,976	$	6,192	$	7,784
Equity-based compensation		158		172		(14)
Total	$	14,134	$	6,364	$	7,770

Cash compensation and benefits in the table above was primarily comprised of salary, incentive compensation, and benefits.  Cash compensation and benefits increased by $7,784 to $13,976 for the three months ended March 31, 2020 from $6,192 for the three months ended March 31, 2019. Our total headcount increased from 88 at March 31, 2019 to 95 at March 31, 2020. Cash compensation and benefits as a percentage of revenue was 79% for the three months ended March 31, 2020, compared to 56% for the three months ended March 31, 2019. During the quarter ended March 31, 2020, the Company’s variable compensation structure had an outsized unfavorable impact on the percentage of revenue metric, due to the significant negative revenue recorded from realized and unrealized losses in certain trading books, totaling $5,107 and from principal transactions, totaling $2,598, with no corresponding reduction in variable compensation to offset the negative revenue.

Equity-based compensation decreased by $14 to $158 for the three months ended March 31, 2020 from $172 for the three months ended March 31, 2019. 

Business Development, Occupancy, and Equipment

Business development, occupancy, and equipment decreased by $55, or 7%, to $756 for the three months ended March 31, 2020 from $811 for the three months ended March 31, 2019.  This was comprised of a decrease in business development of $51 and a decrease of occupancy and equipment of $4. 

Subscriptions, Clearing, and Execution

Subscriptions, clearing, and execution increased by $307, or 14%, to $2,580 for the three months ended March 31, 2020 from $2,273 for the three months ended March 31, 2019.  The increase was comprised of an increase in subscriptions of $81 and an increase in clearing and execution costs of $226.  Clearing and execution costs increased primarily as a result of increased trading volumes.

Professional Fee and Other Operating Expenses

Professional fee and other operating expenses increased by $103, or 6%, to $1,782 for the three months ended March 31, 2020 from $1,679 for the three months ended March 31, 2019. The increase was comprised of an increase in professional fees of $91 and an increase in other operating expense of $12. 

Depreciation and Amortization

Depreciation and amortization decreased by $1, or 1%, to $80 for the three months ended March 31, 2020 from $81 for the three months ended March 31, 2019. 

Impairment of Goodwill

We determined the financial market volatility that resulted from COVID-19 was a triggering event that required us to reassess the goodwill we had recorded related to JVB under the guidance of ASC 350.  We determined that the fair value of JVB was less than its carrying value (including the goodwill).  As a result, we recorded an impairment of $7,883 in the three months ended March 31, 2020.  See note 12 in our financial statements included in this Quarterly Report on Form 10-Q. 

Non-Operating Income and Expense

Interest Expense, net

Interest expense, net increased by $751, or 41%, to $2,605 for the three months ended March 31, 2020 from $1,854 for the three months ended March 31, 2019.  

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INTEREST EXPENSE
(Dollars in Thousands)
	Three Months Ended March 31,
	2020		2019		Change
Junior subordinated notes	$	821	$	880	$	(59)
2020 Senior Notes		89		-		89
2013 Convertible Notes / 2019 Senior Notes		119		133		(14)
2017 Convertible Note		371		360		11
2018 FT LOC		152		92		60
Redeemable Financial Instrument - DGC Trust / CBF		690		148		542
Redeemable Financial Instrument - JKD Capital Partners I LTD		440		278		162
Redeemable Financial Instrument - ViaNova Capital Group, LLC		(77)		(37)		(40)
	$	2,605	$	1,854	$	751

See notes 16 and 17 to our consolidated financial statements included in Item 1 of this Quarterly Report on Form 10-Q.  

Income / (loss) from Equity Method Affiliates

Income / (loss) from equity method affiliates decreased by $99 to ($107) for the three months ended March 31, 2020  from ($8) for the three months ended March 31, 2019.  See note 11 to our consolidated financial statements included in this Quarterly Report on Form 10-Q. 

Income Tax Expense / (Benefit)

The income tax expense / (benefit) decreased by $266 to income tax expense / (benefit) of ($372) for the three months ended March 31, 2020 from ($106) for the three months ended March 31, 2019.  In the three months ended March 31, 2020, we estimated that we will incur a net operating loss in 2020 for U.S. income tax purposes.  Therefore, we expect to have additional net operating loss carryforwards available to offset a portion of our deferred tax liability in future years.  The reduction of the deferred tax liability is recorded as an income tax benefit. 

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Net Income / (Loss) Attributable to the Non-controlling Interest

Net income / (loss) attributable to the non-controlling interest for the three months ended March 31, 2020 and 2019 was comprised of the non-controlling interest related to member interests in the Operating LLC other than interests held by us for the relevant periods. In addition, net income / (loss) attributable to the non-controlling interest also included non-controlling interest related to entities that were consolidated by the Operating LLC but not wholly owned by us.

SUMMARY CALCULATION OF NON-CONTROLLING INTEREST
For the Three Months Ended March 31, 2020
	Wholly Owned Subsidiaries		Other Consolidated Subsidiaries		Total Operating LLC Consolidated		Cohen & Company Inc.		Consolidated
Net income / (loss) before tax	$	(11,850)	$	(307)	$	(12,157)	$		$	(12,157)
Income tax expense / (benefit)		25				25		(397)		(372)
Net income / (loss) after tax		(11,875)		(307)		(12,182)		397		(11,785)
Other consolidated subsidiary non-controlling interest		-		(160)		(160)
Net income / (loss) attributable to the Operating LLC		(11,875)		(147)		(12,022)
Average effective Operating LLC non-controlling interest % (1)						70.90%
Operating LLC non-controlling interest					$	(8,523)

SUMMARY CALCULATION OF NON-CONTROLLING INTEREST
For the Three Months Ended March 31, 2029
	Wholly Owned Subsidiaries		Other Consolidated Subsidiaries		Total Operating LLC Consolidated		Cohen & Company Inc.		Consolidated
Net income / (loss) before tax	$	(1,922)	$	(8)	$	(1,930)	$	-	$	(1,930)
Income tax expense / (benefit)		8		-		8		(114)		(106)
Net income / (loss) after tax		(1,930)		(8)		(1,938)		114		(1,824)
Other consolidated subsidiary non-controlling interest		-		(4)		(4)
Net income / (loss) attributable to the Operating LLC		(1,930)		(4)		(1,934)
Average effective Operating LLC non-controlling interest % (1)						31.95%
Operating LLC non-controlling interest					$	(618)

(1)Because earnings are recognized unevenly throughout the year and the non-controlling interest percentage may change during the period, the average effective non-controlling interest percentage may not equal the percentage at the end of any period or the simple average of the beginning and ending percentages.

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Liquidity and Capital Resources

Liquidity is a measurement of our ability to meet potential cash requirements including ongoing commitments to repay debt borrowings, make interest payments on outstanding borrowings, fund investments, and support other general business purposes. In addition, our United States, United Kingdom, and Irish broker-dealer subsidiaries are subject to certain regulatory requirements to maintain minimum levels of net capital. Historically, our primary sources of funds have been our operating activities and general corporate borrowings. In addition, our trading operations have generally been financed by use of collateralized securities financing arrangements as well as margin loans.

Certain subsidiaries of the Operating LLC have restrictions on the withdrawal of capital and otherwise in making distributions and loans. JVB is subject to net capital restrictions imposed by the Securities and Exchange Commission (“SEC”) and Financial Industry Regulatory Authority (“FINRA”) that require certain minimum levels of net capital to remain in this subsidiary. In addition, these restrictions could potentially impose notice requirements or limit our ability to withdraw capital above the required minimum amounts (excess capital) whether through a distribution or a loan. CCFL is regulated by the Financial Conduct Authority (“FCA”) and CCFEL is regulated by the Central Bank of Ireland (the “CBI”) and each must maintain certain minimum levels of capital. See note 18 to our consolidated financial statements included in Item 1 in this Quarterly Report on Form 10-Q.

See Liquidity and Capital Resources – Contractual Obligations below.

During the third quarter of 2010, our board of directors initiated a dividend of $0.50 per quarter, which was paid regularly through December 31, 2011. Beginning in 2012, our board of directors declared a dividend of $0.20 per quarter, which was paid regularly through the first quarter of 2019.  Each time a cash dividend was declared by our board of directors, a pro rata distribution was made to the other members of the Operating LLC upon payment of dividends to our stockholders. 

On August 2, 2019, we announced that we have decided to suspend our quarterly cash dividend. Suspending the $0.20 quarterly dividend is expected to save approximately $1,341 in cash annually. We currently intend to use the related annual cash savings to invest in new business initiatives and improve our financial position. Any future determination to declare and pay dividends will be made at the discretion of our board of directors, after taking into account a variety of factors, including business, financial, and regulatory considerations as well as any limitations under Maryland law or imposed by any agreements governing our indebtedness.  Going forward, the board of directors will re-assess our capital resources and may or may not determine to reinstate the dividend based on that assessment.

On March 19, 2018, the Company entered into a letter agreement (the “10b-5 Plan”) with Sandler O’Neill & Partners, L.P. (the “Agent”).   The 10b-5 Plan was in effect from March 19, 2018 until March 19, 2019 and was not renewed. Pursuant to the 10b5-1 Plan, the Agent agreed to use its commercially reasonable efforts to purchase , on the Company’s behalf, up to an aggregate maximum of $2,000 of Common Stock on any day that the NYSE American Stock Exchange was open for business.   Pursuant to the 10b5-1 Plan, purchases of Common Stock may be made in public and private transactions and had to comply with Rule 10b-18 under the Exchange Act.  The 10b5-1 Plan is designed to comply with Rule 10b5-1 under the Exchange Act. 

During the three months ended March 31, 2019, we repurchased 7,890 shares in the open market under the 10b5-1 Plan for a total purchase price of $65. 

All of the repurchases noted above were completed using cash on hand.

During the three months ended March 31, 2020:

· We drew on the 2019 FT Revolver in the amount of $17,500. 

· We raised $4,500 in proceeds from issuance of the 2020 Senior Notes.

· We repaid $4,386 of the 2019 Senior Notes.

· We repaid $4,277 of the LegacyTexas Credit Facility.

During the three months ended March 31, 2019: 

· We raised $1,268 of proceeds from redeemable financial instruments

· We raised $2,550 by issuing equity of the Sponsor Entities to third parties. 

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Cash Flows

We have seven primary uses for capital:

(1) To fund the operations of our Capital Markets business segment. Our Capital Markets business segment utilizes capital (i) to fund securities inventory to facilitate client trading activities; (ii) for risk trading on the firm’s own account; (iii) to fund our collateralized securities lending activities; (iv) for temporary capital needs associated with underwriting activities; (v) to fund business expansion into existing or new product lines including additional capital dedicated to our mortgage group as well as our matched book repo business; and (vi) to fund any operating losses incurred.

(2) To fund the expansion of our Asset Management business segment.  We generally grow our assets under management by sponsoring new Investment Vehicles.  The creation of a new Investment Vehicle often requires us to invest a certain amount of our own capital to attract outside capital to manage.  Also, these new Investment Vehicles often require warehouse and other third party financing to fund the acquisition of investments.  Finally, we generally will hire employees to manage new Investment Vehicles and will operate at a loss for a startup period. 

(3) To fund investments. We make principal investments to generate returns.  We may need to raise additional debt or equity financing in order to ensure we have the capital necessary to take advantage of attractive investment opportunities. 

(4) To fund mergers or acquisitions. We may opportunistically use capital to acquire other asset managers, individual asset management contracts, or financial services firms. To the extent our liquidity sources are insufficient to fund our future merger or acquisition activities, we may need to raise additional funding through an equity or debt offering. No assurances can be given that additional financing will be available in the future, or that if available, such financing will be on favorable terms.

(5) To fund potential dividends and distributions. During the third quarter of 2010 and for each subsequent quarter through March 31, 2019, the board of directors has declared a dividend. A pro rata distribution has been paid to the other members of the Operating LLC upon the payment of any dividends to stockholders of Cohen & Company Inc.  On August 2, 2019, we announced that we have decided to suspend our quarterly cash dividend.

(6) To fund potential repurchases of Common Stock.  The Company has opportunistically repurchased Common Stock in private transactions as well as through its 10b5-1 Plan.  See note 17 to our consolidated financial statements included in this Quarterly Report on Form 10-Q. 

(7) To pay off debt as it matures:  The Company has indebtedness that must be repaid as it matures. See note 16 to our consolidated financial statements included in this Quarterly Report on Form 10-Q.

If we are unable to raise sufficient capital on economically favorable terms, we may need to reduce the amount of capital invested for the uses described above, which may adversely impact earnings and our ability to pay future dividends, if any.

As of March 31, 2020 and December 31, 2019, we maintained cash and cash equivalents of $85,454 and $8,304, respectively. We generated cash from or used cash for the following activities.

SUMMARY CASH FLOW INFORMATION
(Dollars in Thousands)
	Three Month Ended March 31,
	2020		2019
Cash flow from operating activities	$	64,470	$	(9,270)
Cash flow from investing activities		30		888
Cash flow from financing activities		12,721		3,564
Effect of exchange rate on cash		(71)		(5)
Net cash flow		77,150		(4,823)
Cash and cash equivalents, beginning		8,304		14,106
Cash and cash equivalents, ending	$	85,454	$	9,283

See the statement of cash flows in our consolidated financial statements. We believe our available cash and cash equivalents, as well as our investment in our trading portfolio and related borrowing capacity, will provide sufficient liquidity to meet the cash needs of our ongoing operations in the near term.

Three Months Ended March 31, 2020

As of March 31, 2020, our cash and cash equivalents were $85,454, representing an increase of $77,150 from December 31, 2019. The increase was attributable to cash provided by operating activities of $64,470, cash provided by investing activities of $30, cash provided by financing activities of $12,721, and the decrease in cash caused by the change in exchange rates of $71.  

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The cash provided by operating activities of $64,470 was comprised of (a) net cash inflows of $100,315 related to working capital fluctuations; (b) net cash outflows of  $34,964 from trading activities comprised of our investments-trading, trading securities sold, not yet purchased, receivables under resale agreements, securities sold under agreements to repurchase, and receivables and payables from brokers, dealers, and clearing agencies, as well as the changes in unrealized gains and losses on the investments-trading and trading securities sold, but not yet purchased; and (c)  net cash outflows from other earnings items of $881 (which represents net income or loss adjusted for the following non-cash operating items: other income / (expense), realized and unrealized gains and losses and accretion of income on other investments, equity based compensation, depreciation and amortization, impairment of goodwill, and amortization of discount on debt).

As part of our matched book repo operations, we enter into reverse repos with counterparties whereby we lend money and receive securities as collateral.  In accordance with ASC 860, the collateral securities are not recorded in our consolidated balance sheets.  However, from time to time we will hold cash instead of securities as collateral for these transactions.  When we are provided cash as collateral for reverse repo transactions, we will make an entry to increase our cash and cash equivalents and to increase our other liabilities for the amount of cash received.  There are two main reasons we may receive collateral in the form of cash as opposed to securities.  First, when the value of the collateral securities we have in our possession decline, we will require the counterparty to provide us with additional collateral.  We will accept either cash or additional liquid securities.  Often, our counterparties will provide us with cash as they may not have liquid securities readily available.  Second, from time to time, our counterparties require a portion of the collateral securities in our possession returned to them for operating purposes.  In such instances, the counterparty may not have substitute liquid securities available and will often provide us with cash as collateral instead.  It is important to note that when we receive cash as collateral, it is temporary in nature and we have an obligation to return that cash when the counterparty provides substitute liquid securities as collateral or otherwise satisfies their associated reverse repo obligation.  We are generally required to return any cash collateral the same business day that we receive substitute securities.  The amount of cash we receive as collateral for our repo operations is volatile and therefore both our cash and cash equivalents balance and our cash provided by and used in operations are volatile as they are both impacted. 

As of March 31, 2020, and December 31, 2019, we had counterparty cash collateral of $74,692 and $9,524, respectively, which were included in both our cash and cash equivalents and other liability balances, respectively.  Accordingly, included in our cash flow from operations of $64,470 during the three months ended March 31, 2020 is an inflow of $65,168 as a result of this increase in cash collateral held.  We have no legal or contractual obligation to segregate this cash collateral held and therefore it is included as a component of our cash and cash equivalents in our consolidated balance sheets.  However, it is not available for use in our general operations as we must stand ready at all times to return the collateral held immediately once the reverse repo counterparty provides substitute liquid securities. 

The cash provided by investing activities of $30 was comprised of (a) $2,309 of cash received from sales and returns of principal from other investments, at fair value; partially offset by (b) $119 of cash used to purchase other investments, at fair value; (c) $2,097 of cash used for investments in equity method affiliates; and (d) $62 of cash used to purchase furniture and equipment. 

The cash provided by financing activities of $12,721 was comprised of (a) $17,500 proceeds from the 2019 FT Revolver and (b) $4,500 in proceeds from issuance of the 2020 Senior Notes; partially offset by (c) $9,163 of repayment of debt, (d) $54 of cash used to net settle equity awards, and (e) $62 in cash used to pay dividends on vested shares. 

Three Months Ended March 31, 2019

As of March 31, 2019, our cash and cash equivalents were $9,283, representing a decrease of $4,823 from December 31, 2018. The decrease was attributable to cash used by operating activities of $9,270, cash provided by investing activities of $888, cash provided by financing activities of $3,564, and the decrease in cash caused by the change in exchange rates of $5.

The cash used by operating activities of $9,270 was comprised of (a) net cash inflows of $1,129 related to working capital fluctuations; (b) net cash outflows of  $8,596 from trading activities comprised of our investments-trading, trading securities sold, not yet purchased, securities sold under agreements to repurchase, and receivables and payables from brokers, dealers, and clearing agencies, as well as the changes in unrealized gains and losses on the investments-trading and trading securities sold, but not yet purchased; and (c)  net cash outflows from other earnings items of $1,803 (which represents net income or loss adjusted for the following non-cash operating items: other income / (expense), realized and unrealized gains and losses and accretion of income on other investments, equity based compensation, depreciation and amortization, and amortization of discount on debt).

The cash provided by investing activities of $888 was comprised of (a) $5,091 of sales and returns of principal-other investments, at fair value; partially offset by (b) $3,775 of investment in equity method affiliate; (c) $408 of purchases of other investments, at fair value; and (d) $20 of purchase of furniture fixtures and equipment. 

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The cash provided by financing activities of $3,564 was comprised of (a) $1,268 of proceeds from a redeemable financial instrument; (b) $2,550 in proceeds from issuance of non-controlling interests; partially offset by (c) $128 in cash used to net settle equity awards; (d) $61 in dividends paid; and (e) $65 in purchases and retirement of Common Stock. 

Regulatory Capital Requirements

We have three subsidiaries that are licensed securities dealers: JVB in the United States, CCFL in the United Kingdom, and CCFEL in Ireland. As a U.S. broker-dealer, JVB is subject to the Uniform Net Capital Rule in Rule 15c3-1 under the Exchange Act. Our London-based subsidiary, CCFL, is subject to the regulatory supervision and requirements of the FCA and our Ireland-based subsidiary, CCFEL, is subject to the regulatory supervision and requirements of the CBI.  The amount of net assets that these subsidiaries may distribute is subject to restrictions under these applicable net capital rules. These subsidiaries have historically operated in excess of minimum net capital requirements. Our minimum capital requirements at March 31, 2020 were as follows.

MINIMUM NET CAPITAL REQUIREMENTS
(Dollars in Thousands)
United States	$	885
Europe		1,090
Total	$	1,975

We operate with more than the minimum regulatory capital requirement in our licensed broker-dealers and at March 31, 2020, total net capital, or the equivalent as defined by the relevant statutory regulations, in our licensed broker-dealers totaled $59,338. See note 18 to our consolidated financial statements included in Item 1 in this Quarterly Report on Form 10-Q.

In addition, our licensed broker-dealers are generally subject to capital withdrawal notification and restrictions.

Restrictions of Distributions of Capital from JVB

As of March 31, 2020, our total equity on a consolidated basis was $36,913.  However, the total equity of JVB was $93,271.  Therefore, all of our other subsidiaries and Cohen & Company, Inc. on a stand-alone basis have an equity deficit of $56,358.  Furthermore, during the three months ended March 31, 2020, JVB generated income before income tax expense of $2,666 while our consolidated net loss was $11,785(including goodwill impairment of $7,883).  Therefore, all of our other subsidiaries and Cohen & Company, Inc. on a stand-alone basis had a combined net loss before of $14,451 (including goodwill impairment of $7,883 recorded outside of JVB) for the three months ended March 31, 2020.  We are dependent on taking distributions of income (and potentially returns of capital) from JVB to satisfy the cash needs as a result of the loss incurred outside of JVB or to satisfy other obligations that come due outside of JVB.  However, we are subject to significant limitations on our ability to make distributions from JVB.  These limitations include limitations imposed by FINRA under rule 15c3-1 (described immediately above) and limitations under our line of credit with FT Bank (see note 17 to our consolidated financial statements included in this Quarterly Report on Form 10-Q).  Furthermore, counterparties to JVB have their own internal counterparty credit requirements.  The specific requirements are not generally shared with us.  However, if we take too much in capital distributions from JVB (beyond its net income), we may not be able to trade with certain counterparties which may cause JVB’s operations to deteriorate. 

Securities Financing

We maintain repurchase agreements with various third party institutional investors. There is no maximum limit as to the amount of securities that may be transferred pursuant to these agreements, and transactions are approved on a case-by-case basis. The repurchase agreements do not include substantive provisions other than those covenants and other customary provisions contained in standard master repurchase agreements. The repurchase agreements generally require us to transfer additional securities to the counterparty in the event the value of the securities then held by the counterparty in the margin account falls below specified levels and contain events of default in cases where we breach our obligations under the agreement. We receive margin calls from our repurchase agreement counterparties from time to time in the ordinary course of business. To date, we have maintained sufficient liquidity to meet margin calls, and we have always been able to satisfy a margin call, however, no assurance can be given that we will be able to satisfy requests from our counterparties to post additional collateral in the future. See note 10 to our consolidated financial statements included in Item 1 in this Quarterly Report on Form 10-Q.

If there were an event of default under the repurchase agreements, we would give our counterparty the option to terminate all repurchase transactions existing with us and make any amount due from us to the counterparty payable immediately. Repurchase obligations are full recourse obligations to us. If we were to default under a repurchase obligation, the counterparty would have recourse to our other assets if the collateral was not sufficient to satisfy the obligation in full. Most of our repurchase agreements are entered into as part of our matched book repo business.

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Our clearing agencies provide securities financing arrangements including margin arrangements and securities borrowing and lending arrangements. These arrangements generally require us to transfer additional securities or cash to the clearing agency in the event the value of the securities then held by the clearing agency in the margin account falls below specified levels and contain events of default in cases where we breach our obligations under such agreements.

An event of default under the clearing agreement would give our counterparty the option to terminate our clearing arrangement. Any amounts owed to the clearing agency would be immediately due and payable. These obligations are recourse to us. Furthermore, a termination of our clearing arrangements would result in a significant disruption to our business and would have a significant negative impact on our dealings and relationship with our customers.

The following table presents our period end balance, average monthly balance, and maximum balance at any month end during the three months ended March 31, 2020 and the twelve months ended December 31, 2019 for receivables under resale agreements and securities sold under agreements to repurchase.

		For the Three  Months Ended March 31, 2020		For the Twelve Months Ended December 31, 2019
Receivables under resale agreements
Period end	$	6,014,438	$	7,500,002
Monthly average		7,723,250		6,458,757
Maximum month end		8,945,403		7,500,002
Securities sold under agreements to repurchase
Period end	$	6,066,372	$	7,534,443
Monthly average		7,763,221		6,501,691
Maximum month end		8,960,197		7,534,443

Fluctuations in the balance of our repurchase agreements from period to period and intra-period are dependent on business activity in those periods. The fluctuations in the balances of our receivables under resale agreements over the periods presented were impacted by our clients’ desires to execute collateralized financing arrangements through the repurchase market or other financing products.

Average balances and period end balances will fluctuate based on market and liquidity conditions and we consider such intra-period fluctuations as typical for the repurchase market. Month-end balances may be higher or lower than average period balances.

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Debt Financing

The following table summarizes the Company’s long-term indebtedness and other financing outstanding.

DETAIL OF DEBT
(Dollars in Thousands)
Description		As of March 31, 2020		As of December 31, 2019	Interest Rate Terms	Interest (4)		Maturity
Non-convertible debt:
12.00% senior notes (the "2020 Senior Notes")	$	4,500	$	-	Fixed	12.00	%	January 2022
12.00% senior notes (the "2019 Senior Notes")		2,400		6,786	Fixed	12.00	%	September 2020 (1)
Contingent convertible debt:
8.00% convertible senior note (the "2017 Convertible Note")		15,000		15,000	Fixed	8.00	%	March 2022 (2)
Less unamortized debt issuance costs		(631)		(703)
		14,369		14,297
Junior subordinated notes (3):
Alesco Capital Trust I		28,125		28,125	Variable	5.77	%	July 2037
Sunset Financial Statutory Trust I		20,000		20,000	Variable	5.52	%	March 2035
Less unamortized discount		(25,030)		(25,124)
		23,095		23,001
FT Financial Bank, N.A. Credit Facility		17,500		-	Variable	N/A		April 2021
LegacyTexas Credit Facility		-		4,777	Variable	N/A		NA
Total	$	61,864	$	48,861

(1)On September 25, 2019, we amended the previously outstanding 2013 Convertible Notes which were scheduled to mature September 25, 2019.  The material terms and conditions of the 2013 Convertible Notesremained substantially the same, except that (i) the maturity date changed from September 25, 2019 to September 25, 2020; (ii) the conversion feature in the 2013 Convertible Notes was removed; (iii) the interest rate changed from 8% per annum (9% in the event of certain events of default) to 12% per annum (13% in the event of certain events of default); and (iv) the restrictions regarding prepayment were removed.  The post-amendment notes are referred to as the “2019 Senior Notes” and the pre-amendment notes are referred to herein as the “2013 Convertible Notes.” 

(2)     The holder of the 2017 Convertible Note may convert all or any part of the outstanding principal amount at any time prior to maturity into units of membership interests of the Operating LLC at a conversion price of $1.45 per unit, subject to customary anti-dilution adjustments.  Units of membership interests of the Operating LLC not held by Cohen & Company Inc. may, with certain restrictions, be redeemed and exchanged into shares of the Cohen & Company Inc. common stock, par value $0.01 per share (“Common Stock”) on a ten-for-one basis.  Therefore, the 2017 Convertible Note can be converted into Operating LLC units of membership interests and then redeemed and exchanged into Common Stock at an effective conversion price of $14.50.  See note 20 to our Annual Report on Form 10-K for the year ended December 31, 2019. 

(3)The junior subordinated notes listed represent debt the Company owes to the two trusts noted above. The total par amount owed by the Company to the trusts is $49,614.  However, the Company owns the common stock of the trusts in a total par amount of $1,489.  The Company pays interest (and at maturity, principal) to the trusts on the entire $49,614 junior notes outstanding. However, the Company receives back from the trusts the pro rata share of interest and principal on the common stock held by the Company.  These trusts are VIEs and the Company does not consolidate them even though the Company holds the common stock.  The Company carries the common stock on its balance sheet at a value of $0. The junior subordinated notes are recorded at a discount to par.When factoring in the discount, the yield to maturity of the junior subordinated notes as of March 31, 2020 on a combined basis is 15.04% assuming the variable rate in effect on the last day of the reporting period remains in effect until maturity.

(4)Represents the interest rate in effect as of the last day of the reporting period. 

See note 17 to our consolidated financial statements included in Item 1 in this Quarterly Report on Form 10-Q for a discussion of the Company’s outstanding debt.

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Redeemable Financial Instruments

We had the following sources of financing that we account for as redeemable financial instruments.  See note 16 to our consolidated financial statements included in this Quarterly Report on Form 10-Q.

REDEEMABLE FINANCIAL INSTRUMENTS
(Dollars in thousands)
	As of March 31, 2020		As of December 31, 2019
JKD Capital Partners I LTD	$	7,957	$	7,957
DGC Trust / CBF		8,500		8,500
ViaNova Capital Group LLC		450		526
Total	$	16,907	$	16,983

Off-Balance Sheet Arrangements

Other than as described in note 9 (derivative financial instruments) and note 14 (variable interest entities) to our consolidated financial statements included in Item 1 of this Quarterly Report on Form 10-Q, there were no material off balance sheet arrangements as of March 31, 2020. 

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Contractual Obligations

The table below summarizes our significant contractual obligations as of March 31, 2020 and the future periods in which such obligations are expected to be settled in cash. We assumed that the 2017 Convertible Note is not converted prior to maturity.  Our junior subordinated notes are assumed to be repaid on their respective maturity dates. Excluded from the table below are obligations that are short-term in nature, including trading liabilities (including derivatives) and repurchase agreements.

CONTRACTUAL OBLIGATIONS
March 31, 2020
(Dollars in Thousands)
		Payment Due by Period
		Total		Less than 1 Year		1 - 3 Years		3 - 5 Years		More than 5 Years
Operating lease arrangements	$	8,993	$	1,321	$	1,876	$	1,947	$	3,849
Maturity of 2020 Senior Notes		4,500				4,500
Interest on 2020 Senior Notes		993		540		453
Maturity of 2019 Senior Notes		2,400		2,400		-		-		-
Interest on 2019 Senior Notes		140		140		-		-		-
Maturity of 2017 Convertible Note (1)		15,000		-		15,000		-		-
Interest on 2017 Convertible Note (1)		2,631		1,204		1,427		-		-
Maturities on junior subordinated notes		48,125		-		-		-		48,125
Interest on junior subordinated notes (2)		44,971		2,728		5,455		8,183		28,605
Redeemable Financial Instrument - JKD Capital Partners 1 (3)		7,957		7,957		-		-		-
Redeemable Financial Instrument - DGC Trust / CBF (3)		8,500		8,500		-		-		-
Redeemable Financial Instrument - ViaNova (3)		450		450		-		-		-
Minimum variable payment due on Redeemable Financial Instruments (4)		159		159		-		-		-
Other Operating Obligations (5)		4,553		2,389		1,833		331		-
	$	149,372	$	27,788	$	30,544	$	10,461	$	80,579

(1) Assumes the 2017 Convertible Note is not converted prior to maturity. 

(2) The interest on the junior subordinated notes related to Alesco Capital Trust I is variable. The interest rate of 5.77% (based on a 90-day LIBOR rate in effect as of March 31, 2020 plus 4.00%) was used to compute the contractual interest payment in each period noted. The interest on the junior subordinated notes related to Sunset Financial Statutory Trust I is variable. The interest rate of 5.52% (based on a 90-day LIBOR rate in effect as of March 31, 2020 plus 4.15%) was used to compute the contractual interest payment in each period noted.

(3) Represents redemption value of the redeemable financial instruments as of the reporting period. The redeemable financial instruments do not have a fixed maturity date.  The period shown above represents the first period the holder of these instruments has the ability to require redemption by us. 

(4) The redeemable financial instruments require certain variable payments be made by us based on revenues earned by certain of our operations.  The amounts shown here represent the minimum amount of payments that would be due under these instruments. 

(5) Represents material operating contracts for various services. 

We believe that we will be able to continue to fund our current operations and meet our contractual obligations through a combination of existing cash resources and other sources of credit. Due to the uncertainties that exist in the economy, we cannot be certain that we will be able to replace existing financing or find sources of additional financing in the future.

Recent Accounting Pronouncements

The following is a list of recent accounting pronouncements that we believe will have a continuing impact on our financial statements going forward.

In December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740):  Simplifying the Accounting for Income Taxes. This ASU is intended to simplify accounting for income taxes. It removes specific exceptions to the general principles in Topic 740 and amends existing guidance to improve consistent application.  This ASU is effective for fiscal years beginning after December 15, 2020 and interim period with those fiscal years We are currently evaluating the new guidance to determine the impact it may have on our consolidated financial statements.

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In January 2020, the FASB issued ASU 2020-01,  Investments—Equity Securities (Topic 321), Investments—Equity Method and Joint  Ventures (Topic 323), and Derivatives and Hedging (Topic 815)—Clarifying the Interactions between Topic 321, Topic 323, and Topic 815.  This ASU clarifies accounting certain topics impacted by Topic 321 Investments-Equity Securities. These topics include measuring equity securities using the measurement alternative, how the measurement alternative should be applied to equity method accounting, and certain forward contracts and purchased options which would be accounted for under the equity method of accounting upon settlement or exercise. This ASUis effective for public business entities for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2020. We are currently evaluating the new guidance to determine the impact it may have on its consolidated financial statements.

Critical Accounting Policies and Estimates

Our accounting policies are essential to understanding and interpreting the financial results reported in our condensed consolidated financial statements. The significant accounting policies used in the preparation of our condensed consolidated financial statements are summarized in note 3 to our consolidated financial statements and notes thereto found in our Annual Report on Form 10-K for the year ended December 31, 2019. Certain of those policies are considered to be particularly important to the presentation of our financial results because they require us to make assumptions and estimates about future events, and apply judgments that affect the reported amounts of assets, liabilities, revenues, expenses, and the related disclosures. We base our assumptions, estimates, and judgments on historical experience, current trends, and other factors that management believes to be relevant at the time our consolidated financial statements are prepared. On a regular basis, management reviews the accounting policies, assumptions, estimates, and judgments to ensure that our financial statements are presented fairly and in accordance with U.S. GAAP. However, because future events and their effects cannot be determined with certainty, actual results could differ from our assumptions and estimates, and such differences could be material. During the three months ended March 31, 2020, there were no material changes to matters discussed under the heading “Critical Accounting Policies and Estimates” in Part II, Item 7 of our Annual Report on Form 10-K for the year ended December 31, 2019.

Effective January 1, 2019, we adopted ASU No. 2016-02, Leases (Topic 842).  Effective January 1, 2019, we recorded the following: (a) a right of use asset of $8,416 (b) a lease commitment liability of $8,860 (c) a reduction in retained earnings from cumulative effect of adoption of $20 (d) an increase in other receivables of $18 and (e) a reduction in other liabilities of $406.  See notes 3 and 13 to our consolidated financial statements included in this Quarterly Report on Form 10-Q for further discussion. 

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ITEM 3.QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

All amounts in this section are in thousands unless otherwise noted.

Market Risk

Market risk is the risk of economic loss arising from the adverse impact of market changes to the market value of our trading and investment positions. Market risk is inherent to both derivative and non-derivative financial instruments, and accordingly, the scope of our market risk management procedures extends beyond derivatives to include all market risk sensitive financial instruments. For purposes of analyzing the components of market risk, we have broken out our investment portfolio into three broad categories, plus debt, as described below.

Fixed Income Securities: We hold, from time to time, the following securities: U.S. Treasury securities, U.S. government agency MBS, U.S. government agency debt securities, CMOs, non-government MBS, corporate bonds, non-redeemable and redeemable preferred stock, municipal bonds, certificates of deposits, SBA loans, residential loans, whole loans, and unconsolidated investments in the middle and senior tiers of securitization entities and TruPS. We attempt to mitigate our exposure to market risk by entering into economic hedging transactions, which may include TBAs and other forward agency MBS contracts. The fixed income category can be broadly broken down into two subcategories: fixed rate and floating rate.

Floating rate securities are not in themselves particularly sensitive to interest rate risk. Because they generally accrue income at a variable rate, the movement in interest rates typically does not impact their fair value. Fluctuations in their current income due to variations in interest rates are generally not material to us. Floating rate fixed income securities are subject to other market risks such as default risk of the underlying issuer, changes in issuer’s credit spreads, prepayment rates, investor demand and supply of securities within a particular asset class or industry class of the ultimate obligor. The sensitivity to any individual market risk can be difficult to quantify.

The fair value of fixed rate securities is sensitive to changes in interest rates. However, fixed rate securities that have low credit ratings or represent junior interests in securitizations are not particularly interest rate sensitive. In general, when we acquire interest rate sensitive securities, we enter into an offsetting short position for a similar fixed rate security. Alternatively, we may enter into other interest rate hedging arrangements such as interest rate swaps or Eurodollar futures. We measure our net interest rate sensitivity by determining how the fair value of our net interest rate sensitive assets would change as a result of a 100 basis point (“bps”) adverse shift across the entire yield curve. Based on this analysis, as of March 31, 2020, we would incur a loss of $3,563 if the yield curve rises 100 bps across all maturities and a gain of $3,552 if the yield curve falls 100 bps across all maturities.

Equity Securities: We hold equity interests in the form of investments in investment funds, permanent capital vehicles, and equity instruments of publicly traded companies. These investments are subject to equity price risk. Equity price risk results from changes in the level or volatility of underlying equity prices, which affect the value of equity securities or instruments that in turn derive their value from a particular stock. We attempt to reduce the risk of loss inherent in our inventory of equity securities by closely monitoring those security positions. However, since we generally make investments in our investment funds and permanent capital vehicles in order to facilitate third party capital raising (and hence increase our AUM and asset management fees), we may be unwilling to sell these positions as compared to investments in unaffiliated third parties. We measure our net equity price sensitivity and foreign currency sensitivity by determining how the net fair value of our equity price sensitive and foreign exchange sensitive assets would change as a result of a 10% adverse change in equity prices or foreign exchange rates. Based on this analysis, as of March 31, 2020, our equity price sensitivity was $556 and our foreign exchange currency sensitivity was $0.  

Other Securities: These investments are primarily made up of residual interests in securitization entities. The fair value of these investments will fluctuate over time based on a number of factors including, but not limited to, liquidity of the investment type, the credit performance of the individual assets and issuers within the securitization entity, the asset class of the securitization entity and the relative supply of and demand for investments within that asset class, credit spreads in general, the transparency of valuation of the assets and liabilities of the securitization entity, and investors’ view of the accuracy of ratings prepared by the independent rating agencies. The sensitivity to any individual market risk cannot be quantified.

Debt: In addition to the risks noted above, we incur interest rate risk related to our debt obligations. We have debt that accrues interest at either variable rates or fixed rates. As of March 31, 2020, a 100 bps change in the three month LIBOR would result in a change in our annual cash paid for interest in the amount of $656. A 100 bps adverse change in the market yield to maturity would result in an increase in the fair value of the debt in the amount of $2,241 as of March 31, 2020.  

Counterparty Risk and Settlement Risk

We are subject to counterparty risk primarily in two areas: (i) our collateralized securities transactions described in note 10 to our consolidated financial statements included in Item 1 in this Quarterly Report on Form 10-Q and (ii) our TBA and other forward

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agency MBS activities described in note 9 to our consolidated financial statements included in Item 1 in this Quarterly Report on Form 10-Q. With respect to the matched book repo financing activities, our risk is that the counterparty does not fulfill its obligation to repurchase the underlying security when it is due. In this case, we would typically liquidate the underlying security, which may result in a loss if the security has declined in value in relation to the balance due from the counterparty under the reverse repurchase agreement.

With respect to our TBA and other forward agency MBS activities, our risk is that the counterparty does not settle the TBA trade on the scheduled settlement date. In this case, we would have to execute the trade, which may result in a loss based on market movement in the value of the underlying trade between its initial trade date and its settlement date (which in the case of TBAs can be as long as 90 days). If we were to incur a loss under either of these activities, we have recourse to the counterparty pursuant to the underlying agreements.

Finally, we have general settlement risk in all of our regular way fixed income and equity trading activities. If a counterparty fails to settle a trade, we may incur a loss in closing out the position and would be forced to try to recover this loss from the counterparty. If the counterparty has become insolvent or does not have sufficient liquid assets to reimburse us for the loss, we may not get reimbursed.

How we manage these risks

Market Risk

We seek to manage our market risk by utilizing our underwriting and credit analysis processes that are performed in advance of acquiring any investment. In addition, we continually monitor our investments-trading and our trading securities sold, not yet purchased on a daily basis and our other investments on a monthly basis. We perform an in-depth monthly analysis on all our investments and our risk committee meets on a monthly basis to review specific issues within our portfolio and to make recommendations for dealing with these issues. In addition, each of our broker-dealers has an assigned chief risk officer that reviews the firm’s positions and trading activities on a daily basis.

Counterparty Risk

We seek to manage our counterparty risk primarily through two processes. First, we perform a credit assessment of each counterparty to ensure the counterparty has sufficient equity, liquidity, and profitability to support the level of trading or lending we plan to do with them. Second, we may require counterparties to post cash or other liquid collateral (“margin”) to support changes in the market value of the underlying securities or trades on an ongoing basis.

In the case of collateralized securities financing transactions, we will generally lend less than the market value of the underlying security initially. The difference between the amount lent and the value of the security is referred to as the haircut. We will seek to maintain this haircut while the loan is outstanding. If the value of the security declines, we will require the counterparty to post margin to offset this decline. If the counterparty fails to post margin, we will sell the underlying security. The haircut serves as a buffer against market movements to prevent or minimize a loss.

In the case of TBA and other forward agency MBS activities, we sometimes require counterparties to post margin with us when  the market value of the underlying TBA trade declines. If the counterparty fails to post margin, we will close out the underlying trade. In the case of TBA and other forward agency MBS activities, we will sometimes obtain initial margin or a cash deposit from the counterparty, which serves a purpose similar to the haircut as an additional buffer against losses. However, some of our TBA and other forward agency MBS activities are done without initial margin or cash deposits.

Risks Related to our Matched Book Repo Business

We have entered into repurchase and reverse repurchase agreements as part of our matched book repo business.  In general, we will lend money to a counterparty after obtaining collateral securities from that counterparty pursuant to a reverse repurchase agreement.  We will borrow money from another counterparty using those same collateral securities pursuant to a repurchase agreement.  We seek to earn net interest income on these matched transactions. 

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In our gestation repo business, we will generally ensure that the maturity date of each reverse repurchase agreement matches the maturity date of the matched repurchase agreement.  However, in our GCF repo business, we may enter into a reverse repurchase agreement with a longer term than the matched repurchase agreement. When the maturity dates of the matched agreements are not the same, we are exposed to two risks:

1. Interest rate risk:  We are taking risk that the interest rate we pay on the repurchase agreement may increase during the term of the reverse repurchase agreement.  If this happens, we may make lower net interest income or, in some cases, have a net loss on a matched trade. 

2. Funding risk:  We are taking risk that the repurchase agreement counterparty may increase the haircut (i.e. demand higher levels of collateral) at the maturity date of the repurchase agreement or cease funding altogether. 

We manage these risks in the following ways:

1. We monitor the weighted average maturity of our reverse repurchase agreements as compared to the weighted average maturity of our repurchase agreements on a daily basis.  We limit the difference between the weighted average maturities based on market conditions.

2. We obtain a significantly higher haircut on our reverse repurchase agreements as compared to the required haircut on our repurchase agreements.  This excess haircut provides a cushion if the repurchase agreement counterparty were to increase its required haircut. 

3. We limit the practice of having longer term reverse repurchase agreements as compared to matched repurchase agreements to high quality collateral types that are typically very liquid and have stable funding markets. 

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ITEM 4.CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

We have established and maintain disclosure controls and procedures that are designed to ensure that material information relating to the Company (and its consolidated subsidiaries) required to be disclosed in our Exchange Act reports is recorded, processed, summarized, and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to management, including our chief executive officer and chief financial officer, who certify our financial reports and to other members of senior management and the Company’s board of directors.

Under the supervision and with the participation of our chief executive officer and chief financial officer, we have evaluated the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rule 13a-15(e) and 15d-15(e) of the Exchange Act) as of March 31, 2020. Based on that evaluation, the chief executive officer and the chief financial officer concluded that our disclosure controls and procedures were effective at March 31, 2020.  

Changes in Internal Control Over Financial Reporting

There were no changes in our internal control over financial reporting during the quarter ended March 31, 2020 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

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PART II. OTHER INFORMATION

Item 1.Legal Proceedings

Incorporated by reference to the headings titled “Legal and Regulatory Proceedings” in note 20 to the consolidated financial statements included in Item 1 in this Quarterly Report on Form 10-Q.

Item 1A.Risk Factors

In addition to the information set forth in this Quarterly Report on Form 10-Q, you should also carefully review and consider the risk factors contained in our other reports and periodic filings with the SEC, including without limitation the risk factors contained under the caption “Item 1A—Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2019, that could materially and adversely affect our business, financial condition, and results of operations. The risk factors discussed in that Form 10-K do not identify all risks that we face because our business operations could also be affected by additional factors that are not presently known to us or that we currently consider to be immaterial to our operations. There have been no material changes in the significant factors that may affect our business and operations as described in “Item 1A—Risk Factors” of the Annual Report on 10-K for the year ended December 31, 2019.

The effects of the outbreak of the novel coronavirus (“COVID-19”) have negatively affected the global economy, the United States economy and the global financial markets, and may disrupt our operations and our clients’ and counterparties’ operations, which could have an adverse effect on our business, financial condition and results of operations.

The ongoing COVID-19 global and national health emergency has caused significant disruption in the international and United States economies and financial markets. In March 2020, the World Health Organization declared the COVID-19 outbreak a pandemic. The spread of COVID-19 has caused illness, quarantines, cancellation of events and travel, business and school shutdowns, reduction in business activity and financial transactions, labor shortages, supply chain interruptions and overall economic and financial market instability. The United States now has the world’s most reported COVID-19 cases, and all 50 states and the District of Columbia have reported cases of individuals infected with COVID-19. All states have declared states of emergency. Similar impacts have been experienced in every country in which we do business. Impacts to our business could be widespread and global, and material impacts may be possible, including the following:

· Our 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;

· Closure of our offices or the offices of our clients; and

· De-globalization.

While the Company cannot fully assess the impact COVID-19 will have on all of its operations, at this time, there are certain impacts that the Company has identified:

· The unprecedented volatility of the financial markets experienced in March 2020, has caused the Company to operate JVB, the Company’s wholly owned U.S. broker-dealer subsidiary, at a lower level of leverage than prior to the pandemic. Specifically, the Company has reduced the size of its GCF repo operations and the volume of its TBA trading. The Company determined that at its pre-pandemic levels in these businesses, it was exposed to a high level of counterparty credit risk and was experiencing too much volatility in its available liquidity to meet capital requirements and margin calls in these businesses. The Company expects to operate at lower volumes in both these businesses for a significant period of time, which will impact the operating profitability of JVB. 

· The financial market volatility, as well as the reduction in volumes in the GCF repo and TBA businesses, that resulted from COVID-19 required the Company to reassess the goodwill it had recorded related to JVB. The Company determined that the fair value of JVB was less than the carrying value (including the goodwill). As a result, the Company recorded an impairment loss of $7.9 million in the three months ended March 31, 2020.   

· The Company expects that its asset management segment will also be adversely impacted by the pandemic.  While it is difficult to determine the extent of the impact at this time, the Company expects that raising capital for new funds may become more challenging.  In addition, lower returns earned by funds will adversely impact the Company’s asset management fees, and investors’ need for liquidity may result in reductions in assets under management. 

· The Company’s mortgage group’s operations are centered on serving the financial needs of mortgage originators and institutions that invest in mortgage backed securities. Prolonged high unemployment will most likely impact mortgage 79  

originations and demand for and supply of mortgage backed securities, which may have a significant impact on the revenue earned by JVB’s mortgage group. 

· The Company has taken decisive actions to protect employees and mitigate the impact of COVID-19, including transitioning employees to remote work and limiting onsite presence.  To date, the Company has been able to avoid layoffs and furloughs of employees.

As the situation continues to evolve, the Company will continue to closely monitor market conditions and respond accordingly. 

The further spread of the COVID-19 outbreak may materially disrupt banking and other financial activity generally and in the areas in which we operate. This would likely result in a decline in demand for our products and services, which would negatively impact our liquidity position and our business strategies. Any one or more of these developments could have a material adverse effect on our and our consolidated subsidiaries’ business, operations, consolidated financial condition, and consolidated results of operations.

We may incur losses as a result of unforeseen or catastrophic events, including the emergence of a pandemic, terrorist attacks, extreme weather events or other natural disasters.

The occurrence of unforeseen or catastrophic events, including the emergence of a pandemic, such as COVID-19, or other widespread health emergency (or concerns over the possibility of such an emergency), terrorist attacks, extreme terrestrial or solar weather events or other natural disasters, could create economic and financial disruptions, and could lead to operational difficulties (including travel limitations) that could impair our ability to manage our businesses.

Item 2.Unregistered Sales of Equity Securities and Use of Proceeds

Effective January 1, 2010, the Company ceased to qualify as a REIT and, therefore, is not required to make any dividends or other distributions to its stockholders. However, the Company’s board of directors has the power to decide to increase, reduce, or eliminate dividends in the future. The Company’s board of directors’ decision will depend on a variety of factors, including business, financial, and regulatory considerations as well as any limitations under Maryland law or imposed by any agreements governing indebtedness of the Company. There can be no assurances that such dividends will be maintained or increased and, if maintained or increased, will not subsequently be discontinued.

Certain subsidiaries of the Operating LLC have restrictions on the withdrawal of capital and otherwise in making distributions and loans. JVB is subject to net capital restrictions imposed by the SEC and FINRA that require certain minimum levels of net capital to remain in this subsidiary. In addition, these restrictions could potentially impose notice requirements or limit our ability to withdraw capital above the required minimum amounts (excess capital) whether through distribution or loan. CCFEL is regulated by the CBI in Ireland, and CCFL is regulated by the FCA in the United Kingdom and must maintain certain minimum levels of capital. See note 19 to our consolidated financial statements included in Item 1 in this Quarterly Report on Form 10-Q.

Issuer Purchases of Equity Securities

None.

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Item  6.Exhibits

Exhibit No.	Description
4.1	Section 382 Rights Agreement, dated as of March 10, 2020, between Cohen & Company Inc. and Computershare Inc. (incorporated by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K filed with the SEC on March 10, 2020)
10.1	Note Purchase Agreement, dated as of January 31, 2020, by and among Cohen & Company, LLC, JKD Capital Partners I LTD and RN Capital Solutions LLC (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed with the SEC on January 31, 2020).
10.2	Senior Promissory Note, dated January 31, 2020, issued by Cohen & Company, LLC to JKD Capital Partners I LTD in the aggregate principal amount of $2,250,000 (incorporated by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K filed with the SEC on January 31, 2020).
10.3	Senior Promissory Note, dated January 31, 2020, issued by Cohen & Company, LLC to RN Capital Solutions LLC in the aggregate principal amount of $2,250,000 (incorporated by reference to Exhibit 10.3 to the Company’s Current Report on Form 8-K filed with the SEC on January 31, 2020).
10.4	Cohen & Company Inc. Non-Qualified Deferred Compensation Plan (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed with the SEC on February 12, 2020).
10.5	Cohen & Company Inc. 2020 Long-Term Incentive Plan (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed with the SEC on April 7, 2020).
10.6	U.S. Small Business Association Note, dated May 4, 2020, issued by Cohen & Company, LLC to Fifth Third Bank, National Association, in the aggregate principal amount of $2,165,600 (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed with the SEC on May 7, 2020).
31.1	Certification of the Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002, as amended.*
31.2	Certification of the Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002, as amended.*
32.1	Certification of the Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, as amended.**
32.2	Certification of the Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, as amended.**
101	Interactive data files pursuant to Rule 405 of Regulation S-T: (i) the Consolidated Balance Sheets at March 31, 2020 and December 31, 2019, (ii) the Consolidated Statements of Operations and Comprehensive Income (Loss) for the Three Months Ended March 31, 2020 and 2019, (iii) the Consolidated Statements of Changes in Equity for the Three Months Ended March 31, 2020 and 2019, (iv) the Consolidated Statements of Cash Flows for the Three Months Ended March 31, 2020 and 2019, and (v) Notes to Consolidated Financial Statements.**
*		Filed herewith.
**		Furnished herewith.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

	Cohen & Company Inc.
	By:	/s/ LESTER R. BRAFMAN
		Lester R. Brafman
Date: May 8, 2020		Chief Executive Officer
	Cohen & Company Inc.
	By:	/s/ JOSEPH W. POOLER, JR.
		Joseph W. Pooler, Jr.
Date: May 8, 2020		Executive Vice President, Chief Financial Officer, and Treasurer

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EX-31.1

Exhibit 31.1

SECTION 302 CEO CERTIFICATION

I, Lester R. Brafman, certify that:

1.I have reviewed this Quarterly Report on Form 10-Q of Institutional Financial Markets, 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):

Exhibit 31.1

(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.

Gust
Date: May 8, 2020	Signed:	/s/ LESTER R. BRAFMAN
	Name:	Lester R. Brafman
	Title:	Chief Executive Officer

EX-31.2

Exhibit 31.2

SECTION 302 CFO CERTIFICATION

I, Joseph W. Pooler, Jr., certify that:

1.I have reviewed this Quarterly Report on Form 10-Q of Institutional Financial Markets, 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):

Exhibit 31.2

(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: May 8, 2020	Signed:	/s/ JOSEPH W. POOLER, JR.
	Name:	Joseph W. Pooler, Jr.
	Title:	Executive Vice President, Chief Financial Officer and Treasurer

EX-32.1

Exhibit 32.1

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report on Form 10-Q of Institutional Financial Markets, Inc. (the “Company”) for the three months ended March 31, 2020, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Lester R. Brafman, Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

(1)The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2)The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: May 8, 2020	Signed:	/s/ LESTER R. BRAFMAN
	Name:	Lester R. Brafman
	Title:	Chief Executive Officer

EX-32.2

Exhibit 32.2

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report on Form 10-Q of Institutional Financial Markets, Inc. (the “Company”) for the three months ended March 31, 2020, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Joseph W. Pooler, Jr., Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

(1)The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2)The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: May 8, 2020	Signed:	/s/ JOSEPH W. POOLER, JR.
	Name:	Joseph W. Pooler, Jr.
	Title:	Executive Vice President, Chief Financial Officer and Treasurer

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Earnings/(Loss) Per Common Share (Schedule Of Anti-Dilutive Securities) (Details) - shares	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of earnings per share	1,080,373	1,659,134
8.00% Contingent Convertible Senior Notes (2017 Convertible Note) [Member]
Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of earnings per share	1,034,483	1,034,483
8.00% Contingent Convertible Senior Notes (2013 Convertible Notes) [Member]
Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of earnings per share		565,469
Restricted Common Stock [Member]
Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of earnings per share	30,466	44,176
Restricted Operatnig LLC Units [Member]
Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of earnings per share	15,424	15,006

XML

Fair Value Disclosures (Quantitative Information About Level 3 Fair Value Measurements) (Details) - Significant Unobservable Inputs (Level 3) [Member] - USD ($) $ in Thousands	3 Months Ended	12 Months Ended
	Mar. 31, 2020	Dec. 31, 2019
Weighted Average [Member]
Fair Value Inputs, Assets, Quantitative Information [Line Items]
Measurement Input		2.00%
Measurement Term		5 years 9 months 18 days
Default Rate [Member] | Minimum [Member]
Fair Value Inputs, Assets, Quantitative Information [Line Items]
Measurement Input		2.00%
Default Rate [Member] | Maximum [Member]
Fair Value Inputs, Assets, Quantitative Information [Line Items]
Measurement Input		2.00%
Default Rate [Member] | Weighted Average [Member]
Fair Value Inputs, Assets, Quantitative Information [Line Items]
Measurement Input	2.00%
Residential transition loans [Member]
Fair Value Inputs, Assets, Quantitative Information [Line Items]
Fair Value	$ 2,956
Residential transition loans [Member] | Yield [Member]
Fair Value Inputs, Assets, Quantitative Information [Line Items]
Measurement Input	15.00%
Residential transition loans [Member] | Yield [Member] | Weighted Average [Member]
Fair Value Inputs, Assets, Quantitative Information [Line Items]
Measurement Input	15.00%
CLOs [Member]
Fair Value Inputs, Assets, Quantitative Information [Line Items]
Fair Value	$ 1,877	$ 2,522
CLOs [Member] | Weighted Average [Member]
Fair Value Inputs, Assets, Quantitative Information [Line Items]
Measurement Input		17.90%
CLOs [Member] | Yield [Member] | Minimum [Member]
Fair Value Inputs, Assets, Quantitative Information [Line Items]
Measurement Input	20.80%	16.90%
CLOs [Member] | Yield [Member] | Maximum [Member]
Fair Value Inputs, Assets, Quantitative Information [Line Items]
Measurement Input	20.90%	19.20%
CLOs [Member] | Yield [Member] | Weighted Average [Member]
Fair Value Inputs, Assets, Quantitative Information [Line Items]
Measurement Input	20.80%
CLOs [Member] | Duration [Member] | Minimum [Member]
Fair Value Inputs, Assets, Quantitative Information [Line Items]
Measurement Term	9 years 3 months 18 days	5 years 3 months 18 days
CLOs [Member] | Duration [Member] | Maximum [Member]
Fair Value Inputs, Assets, Quantitative Information [Line Items]
Measurement Term	11 years 3 months 18 days	6 years 6 months
CLOs [Member] | Duration [Member] | Weighted Average [Member]
Fair Value Inputs, Assets, Quantitative Information [Line Items]
Measurement Term	10 years 3 months 18 days
CLOs [Member] | Default Rate [Member] | Minimum [Member]
Fair Value Inputs, Assets, Quantitative Information [Line Items]
Measurement Input	2.00%
CLOs [Member] | Default Rate [Member] | Maximum [Member]
Fair Value Inputs, Assets, Quantitative Information [Line Items]
Measurement Input	2.00%

XML

Financial Instruments (Schedule Of Other Investments) (Details) - USD ($) $ in Thousands	Mar. 31, 2020	Dec. 31, 2019
Schedule of Investments [Line Items]
Other investments, Amortized Cost	$ 12,243	$ 14,315
Other investments, Carrying Value	10,057	14,864
Other investments, Unrealized Gain / (Loss)	(2,186)	549
Equity securities [Member]
Schedule of Investments [Line Items]
Other investments, Amortized Cost	6,905	8,598
Other investments, Carrying Value	5,457	9,352
Other investments, Unrealized Gain / (Loss)	(1,448)	754
U.S. Insurance JV [Member]
Schedule of Investments [Line Items]
Other investments, Amortized Cost	2,009	2,048
Other investments, Carrying Value	2,017	2,223
Other investments, Unrealized Gain / (Loss)	8	175
SPAC Funds [Member]
Schedule of Investments [Line Items]
Other investments, Amortized Cost	646	646
Other investments, Carrying Value	609	668
Other investments, Unrealized Gain / (Loss)	(37)	22
CLOs [Member]
Schedule of Investments [Line Items]
Other investments, Amortized Cost	2,557	2,894
Other investments, Carrying Value	1,877	2,522
Other investments, Unrealized Gain / (Loss)	(680)	(372)
Residential Loans [Member]
Schedule of Investments [Line Items]
Other investments, Amortized Cost	126	129
Other investments, Carrying Value	97	99
Other investments, Unrealized Gain / (Loss)	$ (29)	$ (30)

XML

Equity (Operating LLC Membership Units) (Details)	3 Months Ended
	Mar. 31, 2020 shares
Units related to UIS Agreement	402,350
Unit Issuance And Surrender Agreement [Member]
Units related to UIS Agreement	402,350

XML

Derivative Financial Instruments (Statement Of Operations Information) (Details) - Not Designated as Hedging Instruments [Member] - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Derivative [Line Items]
Derivative financial instruments, net gain (loss) recognized	$ (212)	$ 777
Revenues - principal transactions and other income [Member] | Foreign currency forward contracts [Member]
Derivative [Line Items]
Derivative financial instruments, net gain (loss) recognized		40
Revenues - net trading [Member] | Other Extended Settlement Trades [Member]
Derivative [Line Items]
Derivative financial instruments, net gain (loss) recognized	1	(24)
Revenues - net trading [Member] | TBAs [Member]
Derivative [Line Items]
Derivative financial instruments, net gain (loss) recognized	$ (213)	$ 761

XML

Segment And Geographic Information (Reconciliation Of Assets From Segment To Consolidated) (Details) - USD ($) $ in Thousands		Mar. 31, 2020	Dec. 31, 2019
Segment Reporting, Asset Reconciling Item [Line Items]
Total Assets		$ 6,596,540	$ 8,001,624
Goodwill	[1]	109	7,992
Intangible assets	[1]	166	166
Equity Method Affiliates [Member]
Segment Reporting, Asset Reconciling Item [Line Items]
Total Assets		5,789	3,799
Operating Segments [Member]
Segment Reporting, Asset Reconciling Item [Line Items]
Total Assets		6,581,462	7,988,796
Goodwill	[1]	109	7,992
Intangible assets	[1]	166	166
Operating Segments [Member] | Equity Method Affiliates [Member]
Segment Reporting, Asset Reconciling Item [Line Items]
Total Assets		5,789	3,799
Operating Segments [Member] | Capital Markets [Member]
Segment Reporting, Asset Reconciling Item [Line Items]
Total Assets		6,564,241	7,968,491
Goodwill	[1]	54	7,937
Intangible assets	[1]	166	166
Operating Segments [Member] | Asset Management [Member]
Segment Reporting, Asset Reconciling Item [Line Items]
Total Assets		1,348	1,616
Goodwill	[1]	55	55
Operating Segments [Member] | Principal Investing [Member]
Segment Reporting, Asset Reconciling Item [Line Items]
Total Assets		15,873	18,689
Operating Segments [Member] | Principal Investing [Member] | Equity Method Affiliates [Member]
Segment Reporting, Asset Reconciling Item [Line Items]
Total Assets		5,789	3,799
Unallocated [Member]
Segment Reporting, Asset Reconciling Item [Line Items]
Total Assets	[2]	$ 15,078	$ 12,828

[1] Goodwill and intangible assets are allocated to the Capital Markets and Asset Management business segments as indicated in the table above.

[2] Unallocated assets primarily include: (1) amounts due from related parties; (2) furniture and equipment, net; and (3) other assets that are not considered necessary for an understanding of business segment assets. Such amounts are excluded in business segment reporting to the chief operating decision maker.

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Leases (Tables)

3 Months Ended

Mar. 31, 2020

Leases [Abstract]

Schedule Of Future Maturity Of Lease Liabilities

FUTURE MATURITY OF LEASE LIABILITIES
(Dollars in Thousands)
		As of March 31, 2020
2020 - remaining	$	1,161
2021		1,108
2022		933
2023		950
2024		983
Thereafter		4,094
Total		9,229
Less imputed interest		(1,838)
Lease obligation	$	7,391

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Debt (Tables)

3 Months Ended

Mar. 31, 2020

Debt [Abstract]

Debt Outstanding

DETAIL OF DEBT
(Dollars in Thousands)
Description		As of March 31, 2020		As of December 31, 2019	Interest Rate Terms	Interest (4)		Maturity
Non-convertible debt:
12.00% senior note (the "2020 Senior Note")	$	4,500	$	-	Fixed	12.00	%	January 2022
12.00% senior note (the "2019 Senior Note")		2,400		6,786	Fixed	12.00	%	September 2020 (1)
Contingent convertible debt:
8.00% convertible senior note (the "2017 Convertible Note")		15,000		15,000	Fixed	8.00	%	March 2022 (2)
Less unamortized debt issuance costs		(631)		(703)
		14,369		14,297
Junior subordinated notes (3):
Alesco Capital Trust I		28,125		28,125	Variable	5.77	%	July 2037
Sunset Financial Statutory Trust I		20,000		20,000	Variable	5.52	%	March 2035
Less unamortized discount		(25,030)		(25,124)
		23,095		23,001
FT Financial Bank, N.A. Credit Facility		17,500		-	Variable	N/A		April 2021
LegacyTexas Credit Facility		-		4,777	Variable	N/A		NA
Total	$	61,864	$	48,861

(1) On September 25, 2019, the Company amended the previously outstanding 2013 Convertible Notes, which were scheduled to mature on September 25, 2019.  The material terms and conditions of the 2013 Convertible Notes remained substantially the same, except that (i) the maturity date changed from September 25, 2019 to September 25, 2020; (ii) the conversion feature in the 2013 Convertible Notes was removed; (iii) the interest rate changed from 8% per annum (9% in the event of certain events of default) to 12% per annum (13% in the event of certain events of default); and (iv) the restrictions regarding the prepayment were removed.  The post amendment notes are referred to herein as the “2019 Senior Notes” and the pre-amendment notes are referred to herein as the “2013 Convertible Notes.”  

(2) The holder of the 2017 Convertible Note may convert all or any part of the outstanding principal amount at any time prior to maturity into units of membership interests of the Operating LLC at a conversion price of $1.45 per unit, subject to customary anti-dilution adjustments.  Units of membership interests in the Operating LLC not held by Cohen & Company Inc. may, with certain restrictions, be redeemed and exchanged into shares of the Cohen & Company Inc. common stock, par value $0.01 per share (“Common Stock”) on a ten-for-one basis.  Therefore, the 2017 Convertible Note can be converted into Operating LLC units of membership interests and then redeemed and exchanged into Common Stock at an effective conversion price of $14.50.  See note 20 to our Annual Report on Form 10-K for the year ended December 31, 2019. 

(3) The junior subordinated notes listed represent debt the Company owes to the two trusts noted above. The total par amount owed by the Company to the trusts is $49,614.  However, the Company owns the common stock of the trusts in a total par amount of $1,489.  The Company pays interest (and at maturity, principal) to the trusts on the entire $49,614 junior notes outstanding. However, the Company receives back from the trusts the pro rata share of interest and principal on the common stock held by the Company.  These trusts are VIEs and the Company does not consolidate them even though the Company holds the common stock.  The Company carries the common stock on its balance sheet at a value of $0. The junior subordinated notes are recorded at a discount to par.  When factoring in the discount, the yield to maturity of the junior subordinated notes as of March 31, 2020 on a combined basis was 15.04% assuming the variable rate in effect on the last day of the reporting period remains in effect until maturity.

(4) Represents the interest rate in effect as of the last day of the reporting period. 

Schedule Of Interest Expense By Debt Instrument

INTEREST EXPENSE
(Dollars in Thousands)
	Three Months Ended March 31,
	2020		2019
Junior subordinated notes	$	821	$	880
2020 Senior Notes		89		-
2017 Convertible Note		371		360
2013 Convertible Notes / 2019 Senior Notes		119		133
2018 FT LOC/2019 FT Revolver		152		92
Redeemable Financial Instrument - DGC Trust / CBF		690		148
Redeemable Financial Instrument - JKD Capital Partners I LTD		440		278
Redeemable Financial Instrument - ViaNova Capital Group, LLC		(77)		(37)
	$	2,605	$	1,854

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Net Capital Requirements

3 Months Ended

Mar. 31, 2020

Net Capital Requirements [Abstract]

Net Capital Requirements

19. NET CAPITAL REQUIREMENTS

JVB is subject to the net capital provision of Rule 15c3-1 under the Exchange Act, which requires the maintenance of minimum net capital, as defined therein.

As of March 31, 2020, JVB’s adjusted net capital was $56,517 which exceeded the minimum requirements by $55,632.  

CCFEL, a subsidiary of the Company regulated by the Central Bank of Ireland (“CBI”), is subject to certain regulatory capital requirements in accordance with the Capital Requirements Regulation 575/2013 and applicable CBI requirements.  As of March 31, 2020, the total minimum required net capital was $945, and actual net capital in CCFEL was $2,194, which exceeded the minimum requirements by $1,249 and was in compliance with the net liquid capital provisions.

CCFL, a subsidiary of the Company and an entity regulated by the FCA, is subject to the net liquid capital provision of the Financial Services and Markets Act 2000, GENPRU 2.140R to 2.1.57R, relating to financial prudence with regards to the European Investment Services Directive and the European Capital Adequacy Directive, which requires the maintenance of minimum liquid capital, as defined therein. As of March 31, 2020, the total minimum required net liquid capital was $145, and net liquid capital in CCFL was $627, which exceeded the minimum requirements by $482 and was in compliance with the net liquid capital provisions.

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Variable Interest Entities

3 Months Ended

Mar. 31, 2020

Variable Interest Entities [Abstract]

Variable Interest Entities

15.  VARIABLE INTEREST ENTITIES

As a general matter, a reporting entity must consolidate a variable interest entity (“VIE”) when it is deemed to be the primary beneficiary.  The primary beneficiary is the entity that has both (a) the power to direct the matters that most significantly impact the VIE’s financial performance and (b) a significant variable interest in the VIE.

The Company’s Principal Investing Portfolio

Included in other investments, at fair value in the consolidated balance sheets are investments in several VIEs.  In each case, the Company determined it was not the primary beneficiary.  The maximum potential financial statement loss the Company would incur if the VIEs were to default on all their obligations would be the loss of the carrying value of these investments as well as any future investments the Company were to make.  As of March 31, 2020, there were $817 of unfunded commitments to VIEs that the Company has invested in.  Other than its investment in these entities, the Company did not provide financial support to these VIEs during the three months ended March 31, 2020 and 2019 and had no liabilities, contingent liabilities, or guarantees (implicit or explicit) related to these VIEs at March 31, 2020 and December 31, 2019.  See table below. 

For each investment management contract entered into by the Company, the Company assesses whether the entity being managed is a VIE and if the Company is the primary beneficiary.  Certain of the Investment Vehicles managed by the Company are VIEs.  Under the current guidance of ASU 2015-12, the Company has concluded that its asset management contracts are not variable interests.  Currently, the Company has no other interests in entities it manages that are considered variable interests and are considered significant.  Therefore, the Company is not the primary beneficiary of any VIEs that it manages.

The Company’s Trading Portfolio

From time to time, the Company may acquire an interest in a VIE through the investments it makes as part of its trading operations, which are included as investments-trading or securities sold, not yet purchased in the consolidated balance sheets.   Because of the high volume of trading activity in which the Company engages, the Company does not perform a formal assessment of each individual investment within its trading portfolio to determine if the investee is a VIE and if the Company is a primary beneficiary.  Even if the Company were to obtain a variable interest in a VIE through its trading portfolio, the Company would not be deemed to be the primary beneficiary for two main reasons: (a) the Company does not usually obtain the power to direct activities that most significantly impact any investee’s financial performance  and (b) a scope exception exists within the consolidation guidance for cases where the reporting entity is a broker-dealer and any control (either as the primary beneficiary of a VIE or through a controlling interest in a voting interest entity) was deemed to be temporary.  In the unlikely case that the Company obtained the power to direct activities and obtained a significant variable interest in an investee in its trading portfolio that was a VIE, any such control would be deemed to be temporary due to the rapid turnover of the Company’s trading portfolio. 

The following table presents the carrying amounts of the assets in the Company’s consolidated balance sheets related to the Company’s variable interests in identified VIEs with the exception of (i) the two trust VIEs that hold the Company’s junior subordinated notes (see note 17) and (ii) any security that represents an interest in a VIE that is included in investments-trading or securities sold, not yet purchased in the Company’s consolidated balance sheets. The table below shows the Company’s maximum exposure to loss associated with these identified nonconsolidated VIEs in which it holds variable interests at March 31, 2020 and December 31, 2019.

CARRYING VALUE OF VARIABLE INTERESTS IN NON-CONSOLIDATED VARIABLE INTEREST ENTITIES
(Dollars in Thousands)
		As of March 31, 2020		As of December 31, 2019
Other Investments, at fair value	$	4,503	$	5,413
Maximum exposure	$	4,503	$	5,413

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Related Party Transactions (Narrative) (Details) $ / mo in Thousands							1 Months Ended					3 Months Ended		12 Months Ended		15 Months Ended
	Jan. 31, 2020 USD ($)	Dec. 30, 2019 shares	Oct. 01, 2019 USD ($)	Jan. 09, 2019 USD ($)	Sep. 29, 2017 USD ($)	Oct. 03, 2016 USD ($)	Mar. 31, 2019 USD ($)	Jan. 31, 2019 USD ($)	Jul. 31, 2018 USD ($)	Jan. 31, 2017 USD ($)	Sep. 30, 2013 USD ($)	Mar. 31, 2020 USD ($) $ / mo shares	Mar. 31, 2019 USD ($)	Dec. 31, 2016 USD ($)	Dec. 31, 2015 USD ($)	Mar. 31, 2020 USD ($)	Dec. 31, 2019 USD ($) shares	Sep. 30, 2019 USD ($)
Related Party Transaction [Line Items]
Proceeds from redeemable financial instrument													$ 1,268,000
Redeemable Financial Instrument												$ 16,907,000				$ 16,907,000	$ 16,983,000
Redemption of non-controlling interest, net
Investments / advances												2,097,000
Rent expense												378,000	390,000
Net gains (losses) in principal transactions and other income												$ (107,000)
Company matching percent												50.00%
Percent of employees gross salary qualifying for matching contributions												3.00%
Company plan contributions												$ 98,000	91,000
Insurance SPAC [Member]
Related Party Transaction [Line Items]
Related Party Transaction, Amounts of Transaction												0
Investments / advances
Net gains (losses) in principal transactions and other income												$ (306,000)
Service fees, per month | $ / mo												10
CK Capital Partners B.V. [Member]
Related Party Transaction [Line Items]
Ownership percentage of equity method affiliate																	45.00%
Equity Method Investment, Quoted Market Value																	$ 18,000
Investments / advances
Net gains (losses) in principal transactions and other income												230,000
AOI [Member]
Related Party Transaction [Line Items]
Ownership percentage of equity method affiliate																	10.00%
Equity Method Investment, Quoted Market Value																	$ 1,000
Investments / advances												2,097,000
Net gains (losses) in principal transactions and other income												$ (31,000)
U.S. Insurance JV [Member]
Related Party Transaction [Line Items]
Ownership percentage of equity method affiliate												4.66%				4.66%
SPAC Funds [Member]
Related Party Transaction [Line Items]
Ownership percentage of equity method affiliate												2.53%				2.53%
EBC Family Trust [Member]
Related Party Transaction [Line Items]
Notes payable, related parties											$ 2,400,000
Value of shares issued											1,600,000
Related Party Transaction, Amounts of Transaction											$ 4,000,000
TBBK [Member]
Related Party Transaction [Line Items]
Interest Expense, Related Party												$ 0	0
Related Party Transaction, Expenses from Transactions with Related Party																$ 0
Daniel G. Cohen [Member]
Related Party Transaction [Line Items]
Value of shares issued												4,351,000
Daniel G. Cohen [Member] | CK Capital Partners B.V. [Member]
Related Party Transaction [Line Items]
Equity Method Investment, Quoted Market Value																	17,000
JKD Capital Partners I, LTD [Member]
Related Party Transaction [Line Items]
Proceeds from redeemable financial instrument				$ 1,268,000						$ 1,000,000				$ 6,000,000
Redeemable Financial Instrument												7,957,000				7,957,000	7,957,000
Related Party Transaction, Amounts of Transaction	$ 2,250,000
Investments / advances						$ 6,000,000		$ 1,268,000		$ 1,000,000
CBF Cohen Bros. Financial [Member]
Related Party Transaction [Line Items]
Related Party Transaction, Amounts of Transaction					$ 8,000,000
DGC Trust/CBF [Member]
Related Party Transaction [Line Items]
Redeemable Financial Instrument			$ 6,500,000									$ 8,500,000				8,500,000	$ 8,500,000	$ 8,000,000
One-time payment for amended agreement			$ 1,500,000
Related Party Transaction, Amounts of Transaction					10,000,000
DGC Trust [Member]
Related Party Transaction [Line Items]
Redeemable Financial Instrument																		$ 2,000,000
Related Party Transaction, Amounts of Transaction					$ 2,000,000
FinTech Masala [Member]
Related Party Transaction [Line Items]
Consulting fees per month | $ / mo												1
Zucker and Moore, LLC [Member]
Related Party Transaction [Line Items]
Related Party Transaction, Expenses from Transactions with Related Party												$ 24,000	24,000
Insurance SPAC [Member]
Related Party Transaction [Line Items]
Related Party Transactions, Agreed Amount To Lend												$ 750,000				$ 750,000
Betsy Cohen [Member] | Sponsor Entities [Member]
Related Party Transaction [Line Items]
Investments / advances							$ 2,000
COHN, LLC [Member] | Fin Tech Acquisition Corp II [Member]
Related Party Transaction [Line Items]
Related Party Transaction, Amounts of Transaction									$ 2,513,000
Sponsor Entities [Member] | Insurance SPAC [Member]
Related Party Transaction [Line Items]
Ownership percentage of equity method affiliate												26.50%				26.50%
Contingent Convertible Senior Notes [Member] | Edward E. Cohen IRA [Member]
Related Party Transaction [Line Items]
Convertible notes purchased															$ 4,386,000
Series F Preferred Stock [Member] | DGC Trust [Member]
Related Party Transaction [Line Items]
Preferred Stock, shares issued | shares		9,880,268															9,880,268
Series F Preferred Stock [Member] | Mr. Cohen [Member]
Related Party Transaction [Line Items]
Preferred Stock, shares issued | shares		12,549,273															12,549,273
Series F Preferred Stock [Member] | COHN, LLC [Member] | Daniel G. Cohen [Member]
Related Party Transaction [Line Items]
Issuance of shares | shares		370,881										370,881
Non-controlling Interest [Member]
Related Party Transaction [Line Items]
Redemption of non-controlling interest, net												$ 115,000	$ (119,000)

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Subsequent Events

3 Months Ended

Mar. 31, 2020

Subsequent Events [Abstract]

Subsequent Events

26. SUBSEQUENT EVENTS

The Company has applied for and received a $2.2 million loan under the Paycheck Protection Program (PPP) of the Coronavirus Aid, Relief, and Economic Security (CARES) Act. The Company has carefully considered the eligibility requirements for PPP loans as well as supplemental guidance regarding the PPP beyond the applicable statute issued from time to time by government agencies and certain government officials. The Company is eligible to receive a PPP loan because it has fewer than 100 employees. Further, although the Company is public and listed on the NYSE American stock exchange, the Company’s market capitalization is small, and the Company believes that it does not have access to the public capital markets at this time. In part due to the PPP loan, the Company does not anticipate any significant workforce reduction or reductions in compensation levels in the near future. However, the Company will continue to carefully monitor revenue levels to assess whether compensatory or other cost-cutting measures might be necessary. 

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Consolidated Balance Sheets (Parenthetical) - $ / shares	Mar. 31, 2020	Dec. 31, 2019
Common Stock, par value	$ 0.01	$ 0.01
Common Stock, shares authorized	100,000,000	100,000,000
Common Stock, shares issued	1,246,710	1,193,624
Common Stock, shares outstanding	1,246,710	1,193,624
Common Stock, unvested or restricted share awards	86,566	73,715
Voting Non-Convertible Preferred Stock [Member]
Preferred Stock, par value	$ 0.001	$ 0.001
Preferred Stock, shares authorized	60,000,000	60,000,000
Preferred Stock, shares issued	27,413,098	4,983,557
Preferred Stock, shares outstanding	27,413,098	4,983,557

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Financial Instruments (Tables)

3 Months Ended

Mar. 31, 2020

Financial Instruments [Abstract]

Schedule Of Trading Securities

INVESTMENTS - TRADING
(Dollars in Thousands)
	March 31, 2020		December 31, 2019
U.S. government agency MBS and CMOs	$	218,767	$	196,146
U.S. government agency debt securities		4,791		14,680
RMBS		14		15
U.S. Treasury securities		6,065		11,105
ABS		1		100
SBA loans		26,073		27,634
Corporate bonds and redeemable preferred stock		31,877		38,503
Foreign government bonds		626		844
Municipal bonds		25,121		13,737
Certificates of deposit		3,575		841
Derivatives		55,780		3,686
Equity securities		99		561
Residential transition loans		2,956		-
Investments-trading	$	375,745	$	307,852

Schedule Of Trading Securities Sold, Not Yet Purchased

TRADING SECURITIES SOLD, NOT YET PURCHASED
(Dollars in Thousands)
	March 31, 2020		December 31, 2019
U.S. Treasury securities	$	16,211	$	16,827
Corporate bonds and redeemable preferred stock		43,937		58,083
Municipal bonds		20		20
Derivatives		54,599		3,017
Trading securities sold, not yet purchased	$	114,767	$	77,947

Schedule Of Other Investments

OTHER INVESTMENTS, AT FAIR VALUE
(Dollars in Thousands)
	March 31, 2020
	Amortized Cost		Carrying Value		Unrealized Gain / (Loss)
Equity securities	$	6,905	$	5,457	$	(1,448)
CLOs		2,557		1,877		(680)
U.S. Insurance JV		2,009		2,017		8
SPAC Fund		646		609		(37)
Residential loans		126		97		(29)
Other investments, at fair value	$	12,243	$	10,057	$	(2,186)

	December 31, 2019
	Amortized Cost		Carrying Value		Unrealized Gain / (Loss)
Equity securities	$	8,598	$	9,352	$	754
CLOs		2,894		2,522		(372)
U.S. Insurance JV		2,048		2,223		175
SPAC Fund		646		668		22
Residential loans		129		99		(30)
Other investments, at fair value	$	14,315	$	14,864	$	549

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Consolidated Statements Of Cash Flows - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Operating activities
Net income (loss)	$ (11,785)	$ (1,824)
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
Equity-based compensation	158	172
Accretion of income on other investments, at fair value	(78)	(106)
Realized loss (gain) on other investments, at fair value	(40)	(419)
(Income) / loss from equity method affiliates	107	8
Change in unrealized (gain) loss on other investments, at fair value	2,735	171
Depreciation and amortization	80	81
Impairment of goodwill	7,883
Amortization of discount on debt	166	122
Deferred tax provision (benefit)	(396)	(114)
Change in operating assets and liabilities, net:
(Increase) decrease in other receivables	29,618	3,894
(Increase) decrease in investments-trading	(67,893)	15,762
(Increase) decrease in other assets	5,645	258
(Increase) decrease in receivables under resale agreement	1,485,564	3,121,841
Change in receivables from / payables to related parties, net	55	168
Increase (decrease) in accrued compensation	4,314	(3,310)
Increase (decrease) in accounts payable and other liabilities	61,079	233
Increase (decrease) in trading securities sold, not yet purchased	36,820	(21,877)
Change in receivables from/ payables to brokers, dealers, and clearing agencies	(21,491)	(13,279)
Increase (decrease) in securities sold under agreements to repurchase	(1,468,071)	(3,111,051)
Net cash provided by (used in) operating activities	64,470	(9,270)
Investing activities
Purchase of investments-other investments, at fair value	(119)	(408)
Sales and returns of principal-other investments, at fair value	2,309	5,091
Investment in equity method affiliate	(2,097)	(3,775)
Return from equity method affiliates
Purchase of furniture, equipment, and leasehold improvements	(63)	(20)
Net cash provided by (used in) investing activities	30	888
Financing activities
Proceeds from draws on revolving credit facility	17,500
Proceeds from non-convertible debt	4,500
Repayment of debt	(9,163)
Proceeds from redeemable financial instruments		1,268
Cash used to net share settle equity awards	(54)	(128)
Purchase and retirement of Common Stock		(65)
Proceeds from non-controlling interest investment		2,550
Cohen & Company Inc. dividends	(62)	(61)
Net cash provided by (used in) financing activities	12,721	3,564
Effect of exchange rate on cash	(71)	(5)
Net increase (decrease) in cash and cash equivalents	77,150	(4,823)
Cash and cash equivalents, beginning of period	8,304	14,106
Cash and cash equivalents, end of period	$ 85,454	$ 9,283

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Financial Instruments

3 Months Ended

Mar. 31, 2020

Financial Instruments [Abstract]

Financial Instruments

7. FINANCIAL INSTRUMENTS

Investments—Trading

Investments-trading consisted of the following.

INVESTMENTS - TRADING
(Dollars in Thousands)
	March 31, 2020		December 31, 2019
U.S. government agency MBS and CMOs	$	218,767	$	196,146
U.S. government agency debt securities		4,791		14,680
RMBS		14		15
U.S. Treasury securities		6,065		11,105
ABS		1		100
SBA loans		26,073		27,634
Corporate bonds and redeemable preferred stock		31,877		38,503
Foreign government bonds		626		844
Municipal bonds		25,121		13,737
Certificates of deposit		3,575		841
Derivatives		55,780		3,686
Equity securities		99		561
Residential transition loans		2,956		-
Investments-trading	$	375,745	$	307,852

Trading Securities Sold, Not Yet Purchased

Trading securities sold, not yet purchased consisted of the following.

TRADING SECURITIES SOLD, NOT YET PURCHASED
(Dollars in Thousands)
	March 31, 2020		December 31, 2019
U.S. Treasury securities	$	16,211	$	16,827
Corporate bonds and redeemable preferred stock		43,937		58,083
Municipal bonds		20		20
Derivatives		54,599		3,017
Trading securities sold, not yet purchased	$	114,767	$	77,947

The Company manages its exposure to changes in interest rates for the interest rate sensitive securities it holds by entering into offsetting short positions for similar fixed rate securities. See note 5 for realized and unrealized gains recognized on investments-trading.

Other Investments, at fair value

Other investments, at fair value consisted of the following.

OTHER INVESTMENTS, AT FAIR VALUE
(Dollars in Thousands)
	March 31, 2020
	Amortized Cost		Carrying Value		Unrealized Gain / (Loss)
Equity securities	$	6,905	$	5,457	$	(1,448)
CLOs		2,557		1,877		(680)
U.S. Insurance JV		2,009		2,017		8
SPAC Fund		646		609		(37)
Residential loans		126		97		(29)
Other investments, at fair value	$	12,243	$	10,057	$	(2,186)

	December 31, 2019
	Amortized Cost		Carrying Value		Unrealized Gain / (Loss)
Equity securities	$	8,598	$	9,352	$	754
CLOs		2,894		2,522		(372)
U.S. Insurance JV		2,048		2,223		175
SPAC Fund		646		668		22
Residential loans		129		99		(30)
Other investments, at fair value	$	14,315	$	14,864	$	549

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Summary Of Significant Accounting Policies

3 Months Ended

Mar. 31, 2020

Summary Of Significant Accounting Policies [Abstract]

Summary Of Significant Accounting Policies

3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

A. Adoption of New Accounting Standards

In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842). Under the new guidance (subsequently updated with ASU 2018-01, ASU 2018-10, ASU 2018-11,  ASU 2018-20, and ASU  2019-01), lessees will be required to recognize the following for all leases with the exception of short-term leases:  (i) a lease liability, which is a lessee’s obligation to make lease payments arising from a lease, measured on a discounted basis, and (ii) a right-of-use asset, which is an asset that represents the lessee’s right to use, or control the use of, a specified asset for the lease term.  Lessor accounting is largely unchanged.  The Company adopted the provisions of the new guidance effective January 1, 2019.  The Company recorded the following:  (a) a right of use asset of $8,416, (b) a lease commitment liability of $8,860, (c) a reduction in retained earnings from cumulative effect of adoption of $20, (d) an increase in other receivables of $18, and (e) a reduction in other liabilities of $406.  See note 13.

In June 2016, the FASB issued ASU 2016-13, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments.  Under this guidance (subsequently updated with ASU 2018-19, ASU 2019-05, ASU 2019-11 and ASU 2020-02), the measurement of all expected credit losses for financial assets held at the reporting date is to be based on historical experience, current conditions, and reasonable and supportable forecasts. Financial institutions and other organizations will now use forward-looking information to better inform their credit loss estimates. Many of the loss estimation techniques applied today will still be permitted, although the inputs to those techniques will change to reflect the full amount of expected credit losses. In addition, the ASU amends the accounting for credit losses on available-for-sale debt securities and purchased financial assets with credit deterioration. The Company’s adoption of the provisions of ASU 2016-13, effective January 1, 2020 did not have a material effect on the Company’s consolidated financial statements.

In January 2017, the FASB issued ASU 2017-04, Intangibles  – Goodwill and Other (Topic 350):  Simplifying the Test for GoodwillImpairment.The amendments in this ASU eliminate Step 2 from the goodwill impairment test. The annual or interim goodwill impairment test is performed by comparing the fair value of a reporting unit with its carrying amount.  An impairment charge should be recognized for the amount by which the carrying amount exceeds the reporting unit’s fair value; however, the loss recognized should not exceed the total amount of goodwill allocated to that reporting unit.  The Company adopted the provisions of ASU 2017-04, effective January 1, 2020.  The Company recorded an impairment of goodwill for the three months ended March 31, 2020.  See note 12.  This impairment charge was not the result of the adoption of ASU 2017-04. 

In June 2018, the FASB issued ASU 2018-07, Compensation – Stock Compensation (Topic 718):  Improvements toNonemployee Share-Based Payment Accounting.  The amendments in this ASU expand the scope of Topic 718, which previously only included share-based payments to employees, to include share-based payments issued to nonemployees for goods or services.  Consequently, the accounting for share-based payments to nonemployees and employees will be substantially aligned. The Company’s adoption of the provisions of ASU 2018-07, effective January 1, 2019 did not have an effect on the Company’s consolidated financial statements.

In March 2017, the FASB issued ASU 2017-08, Receivables – Nonrefundable Fees and Other Costs, Premium Amortization onPurchased Callable Debt Securities (Sub-Topic 310-20).  The amendments in this ASU shorten the amortization period for certain callable debt securities held at a premium.  Specifically, the amendments require the premium to be amortized to the earliest call date.  The amendments do not require an accounting change for securities held at a discount; the discount continues to be amortized to maturity.  The Company’s adoption of the provisions of ASU 2017-08, effective January 1, 2019 did not have an effect on the Company’s consolidated financial statements.

In August 2017, the FASB issued ASU 2017-12, Derivative and Hedging – Targeted Improvements to Accounting for HedgingActivities (Topic 815).   The amendments in this ASU refine and expand hedge accounting for both financial and commodity risks and contain provisions to create more transparency and clarify how economic results are presented. The Company’s adoption of the provisions of ASU 2017-12, effective January 1, 2019 did not have an effect on the Company’s consolidated financial statements.

In February 2018, the FASB issued ASU 2018-02, Income Statement – Reporting Comprehensive Income (Topic 220): Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income.  The amendments in this ASU provide the option to reclassify stranded tax effects within accumulated other comprehensive income (“AOCI”) to retained earnings in each period in which the effect of the change in the U.S. federal corporate income tax rate in the Tax Act (or portion thereof) is recorded. The Company’s adoption of the provisions of ASU 2018-02, effective January 1, 2019 did not have an effect on the Company’s consolidated financial statements.

In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement(Topic 820): Disclosure Framework –Changes to the Disclosure Requirements for Fair Value Measurement.  The ASU modifies the disclosure requirements in Topic 820, by removing certain disclosure requirements related to the valuation hierarchy, modifying existing disclosure requirements related to measurement uncertainty and adding new disclosure requirements such as disclosing the changes in unrealized gains and losses for the period included in other comprehensive income for recurring level 3 fair value measurements held at the end of the reporting period and disclosing the range and weighted average of significant unobservable inputs used to develop level 3 fair value measurements. This ASU is effective for public companies for annual reporting periods and interim periods within those annual periods beginning after December 15, 2019. The Company’s adoption of the provisions of ASU 2018-13, effective January 1, 2020 did not have an effect on the Company’s consolidated financial statements.

In October 2018, the FASB issued ASU 2018-17, Consolidation (Topic 810):  Target Improvements to Related Party Guidancefor Variable Interest Entities.  The ASU made targeted changes to the related party consolidation guidance. The new guidance changes how entities evaluate decision-making fees under the variable interest entity guidance. To determine whether decision-making fees represent a variable interest, an entity will need to consider indirect interests held through related parties under common control on a proportionate basis under the new guidance, rather than in their entirety, as has been the case under current guidance. The guidance is effective in annual periods beginning after December 15, 2019 and interim periods within those fiscal years. The Company’s adoption of the provisions of ASU 2018-17, effective January 1, 2020 did not have an effect on the Company’s consolidated financial statements.

In November 2018, the FASB issued ASU 2018-18, Collaborative Arrangements (Topic 808): Clarifying the InteractionBetween Topic 808 and Topic 606.  The ASU provides more comparability in the presentation of revenue for certain transactions between collaborative arrangement participants. It accomplishes this by allowing organizations to only present units of account in collaborative arrangements that are within the scope of the revenue recognition standard together with revenue accounted for under the revenue recognition standard.  The parts of the collaborative arrangement that are not in the scope of the revenue recognition standard should be presented separately from revenue accounted for under the revenue recognition.  The Company’s adoption of the provisions of ASU 2018-18, effective January 1, 2020 did not have an effect on the Company’s consolidated financial statements.

In November 2019, the FASB issued ASU 2019-08, Compensation – Stock Compensation (Topic (718) and Revenue from Contracts with Customers (Topic 606): Codification Improvements– Share-Based Consideration Payable to a Customer.  This ASU requires companies to measure and classify (on the balance sheet) share-based payments to customers by applying the guidance in Topic 718, Compensation—Stock Compensation.  As a result, the amount recorded as a reduction in revenue would be measured based on the grant-date fair value of the share-based payment. The Company’s adoption of the provisions of ASU 2018-18, effective January 1, 2020 did not have an effect on the Company’s consolidated financial statements.

In March 2020, the FASB issued ASU 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting. This ASU provides temporary optional guidance to ease the burden in accounting for reference rate reform by providing optional expedients and exceptions for applying generally accepted accounting principles to contract modifications and hedging relationships, subject to meeting certain criteria, that reference LIBOR or another reference rate expected to be discontinued.  The ASU is intended to help stakeholders during the global market wide reference rate transition period and will be in effect for a limited time through December 31, 2022. The Company’s adoption of the provisions of ASU 2020-04, effective March 12, 2020 did not have an effect on the Company’s consolidated financial statements.

B. Recent Accounting Developments

In December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740):  Simplifying the Accounting for Income Taxes. This ASU is intended to simplify accounting for income taxes. It removes specific exceptions to the general principles in Topic 740 and amends existing guidance to improve consistent application.  This ASU is effective for fiscal years beginning after December 15, 2020 and interim period with those fiscal years The Company is currently evaluating the new guidance to determine the impact it may have on its consolidated financial statements.

In January 2020, the FASB issued ASU 2020-01,  Investments—Equity Securities (Topic 321), Investments—Equity Method and Joint Ventures (Topic 323), and Derivatives and Hedging (Topic 815)—Clarifying the Interactions between Topic 321, Topic 323, and Topic 815.  This ASU clarifies certain accounting certain topics impacted by Topic 321 Investments-Equity Securities. These topics include measuring equity securities using the measurement alternative, how the measurement alternative should be applied to equity method accounting, and certain forward contracts and purchased options which would be accounted for under the equity method of accounting upon settlement or exercise. This ASUis effective for public business entities for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2020. The Company is currently evaluating the new guidance to determine the impact it may have on its consolidated financial statements.

C. Fair Value of Financial Instruments

The following methods and assumptions were used by the Company in estimating the fair value of its financial instruments. These determinations were based on available market information and appropriate valuation methodologies. Considerable judgment is required to interpret market data to develop the estimates and, therefore, these estimates may not necessarily be indicative of the amount the Company could realize in a current market exchange. The use of different market assumptions and/or estimation methodologies may have a material effect on the estimated fair value amounts. Refer to note 8 for a discussion of the valuation hierarchy with respect to investments-trading; other investments, at fair value; and derivatives held by the Company.

Cash equivalents: Cash equivalents are carried at historical cost, which is assumed to approximate fair value. The estimated fair value measurement of cash equivalents is classified within level 1 of the valuation hierarchy.

Investments-trading: These amounts are carried at fair value. The fair value is based on either quoted market prices of an active exchange, independent broker market quotations, market price quotations from third- party pricing services, or valuation models when quotations are not available.

Other investments, at fair value: These amounts are carried at fair value. The fair value is based on quoted market prices of an active exchange, independent broker market quotations, or valuation models when quotations are not available.  In the case of investments in alternative investment funds, fair value is generally based on the reported net asset value of the underlying fund.

Receivables under resale agreements: Receivables under resale agreements are carried at their contracted resale price, have short-term maturities, and are repriced frequently or bear market interest rates and, accordingly, these contracts are at amounts that approximate fair value. The estimated fair value measurements of receivables under resale agreements are based on observations of actual market activity and are generally classified within level 2 of the valuation hierarchy.  

Trading securities sold, not yet purchased: These amounts are carried at fair value. The fair value is based on quoted market prices of an active exchange, independent market quotations, market price quotations from third party pricing services, or valuation models when quotations are not available.

Securities sold under agreements to repurchase: The liabilities for securities sold under agreements to repurchase are carried at their contracted repurchase price, have short-term maturities, and are repriced frequently or bear market interest rates andaccordingly, these contracts are carried at amounts that approximate fair value. The estimated fair value measurements of securities sold under agreements to repurchase are based on observations of actual market activity and are generally classified within level 2 of the valuation hierarchy.

Redeemable financial instruments:  The liabilities for redeemable financial instruments are carried at their redemption value, which approximates fair value. The estimated fair value measurement of the redeemable financial instruments is classified within level 3 of the valuation hierarchy. 

Debt: These amounts are carried at outstanding principal less unamortized discount and deferred financing costs. However, a substantial portion of the debt was assumed in the Merger and recorded at fair value as of that date. As of March 31, 2020, and December 31, 2019, the fair value of the Company’s debt was estimated to be $61,501and $58,635, respectively. The estimated fair value measurements of the debt are generally based on discounted cash flow models prepared by the Company’s management primarily using discount rates for similar instruments issued to companies with similar credit risks to the Company and are generally classified within level 3 of the value hierarchy.

Derivatives: These amounts are carried at fair value. Derivatives may be included as a component of investments-trading; trading securities sold, not yet purchased; and other investments, at fair value. See notes 8 and 9. The fair value is generally based on quoted market prices on an exchange that is deemed to be active for derivative instruments such as foreign currency forward contracts and Eurodollar futures.  For derivative instruments, such as TBAs and other extended settlement trades, the fair value is generally based on market price quotations from third party pricing services.

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Investment In Equity Method Affiliate

3 Months Ended

Mar. 31, 2020

Investment in Equity Method Affiliate [Abstract]

Investment in Equity Method Affiliate

11.   INVESTMENT IN EQUITY METHOD AFFILIATE

Equity method accounting requires that the Company record its investment in equity method affiliates on the consolidated balance sheets and recognize its share of the equity method affiliates’ net income as earnings each reporting period. 

The Company has certain equity method affiliates for which it has elected the fair value option.  Those investees are excluded from the table below.  Those investees are included as a component of other investments, at fair value in the consolidated balance sheets.  All gains and losses (unrealized and realized) from securities classified as other investments, at fair value in the consolidated balance sheets are recorded as a component of principal transactions and other income in the consolidated statement of operations. See note 24.

The following table summarizes the activity and earnings in the Company’s investment that is accounted for under the equity method.

INVESTMENTS IN EQUITY METHOD AFFILIATES
(Dollars in Thousands)
	Insurance SPAC		AOI		CK Capital		Total
January 1, 2020	$	3,222	$	559	$	18	$	3,799
Investments / advances		-		2,097		-		2,097
Distributions / repayments		-		-		-		-
Earnings / (loss) realized		(306)		(31)		230		(107)
March 31, 2020	$	2,916	$	2,625	$	248	$	5,789

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Equity (Schedule Of Unrestricted Common Stock Activity) (Details)	3 Months Ended
	Mar. 31, 2020 shares
Equity [Abstract]
Shares, Beginning	1,119,909
Vesting of shares	55,278
Shares withheld for employee taxes and retired	(15,043)
Shares, Ending	1,160,144

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Variable Interest Entities (Narrative) (Details) $ in Thousands		3 Months Ended	12 Months Ended
		Mar. 31, 2020 USD ($) entity	Dec. 31, 2019 USD ($) entity
Variable Interest Entity [Line Items]
Liabilities, contingent liabilities, or guarantees		$ 6,559,627	$ 7,952,868
Number of VIE's that hold junior subordinated notes. | entity		2	2
Variable Interest Entity, Primary Beneficiary [Member]
Variable Interest Entity [Line Items]
Liabilities, contingent liabilities, or guarantees		$ 0	$ 0
U.S. Insurance JV [Member]
Variable Interest Entity [Line Items]
Unfunded commitments	[1],[2]	$ 817	$ 817

[1] Not applicable.

[2] The U.S. Insurance JV invests in debt issued by small and medium sized U.S. and Bermuda insurance and reinsurance companies.

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Redeemable Financial Instruments (Narrative) (Details) $ in Thousands					1 Months Ended	3 Months Ended			9 Months Ended	12 Months Ended
	Oct. 01, 2020 USD ($)	Oct. 01, 2019 USD ($)	Jan. 09, 2019 USD ($)	Nov. 16, 2018 USD ($)	Jan. 31, 2017 USD ($)	Mar. 31, 2020 USD ($)	Mar. 31, 2019 USD ($)	Dec. 31, 2018	Sep. 30, 2019 USD ($) contract	Sep. 30, 2020 USD ($)	Dec. 31, 2016 USD ($)	Dec. 31, 2019 USD ($)	Feb. 28, 2019 USD ($)	Oct. 03, 2016 USD ($)
Related Party Transaction [Line Items]
Number of investment agreements entered | contract									2
Redeemable financial instrument						$ 16,907						$ 16,983
Due from related parties						$ 411						466
Investment agreement, written notice period for termination						90 days
Investment agreement, alternative period of required prior written notice contingency						60 days
Proceeds from redeemable financial instrument							$ 1,268
JKD Capital Partners I, LTD [Member]
Related Party Transaction [Line Items]
Percentage of difference between revenues generated by activities of redeemable financial instrument								42.00%
Redeemable financial instrument						$ 7,957						7,957
Due to investors, annual return on investment														50.00%
Redeemable financial instruments, maximum														$ 12,000
Proceeds from redeemable financial instrument			$ 1,268		$ 1,000						$ 6,000
Potential percent of consideration owed to investor on qualified sale						25.00%
DGC Trust/CBF [Member]
Related Party Transaction [Line Items]
Redeemable financial instrument		$ 6,500				$ 8,500			$ 8,000			$ 8,500
One-time payment for amended agreement		$ 1,500
DGC Trust [Member]
Related Party Transaction [Line Items]
Redeemable financial instrument									$ 2,000
JVB's [Member]
Related Party Transaction [Line Items]
Redeemable financial instrument				$ 2,750
Hancock [Member]
Related Party Transaction [Line Items]
Redeemable financial instrument				500
New Avenue [Member]
Related Party Transaction [Line Items]
Redeemable financial instrument				250
COHN, LLC [Member]
Related Party Transaction [Line Items]
Redeemable financial instrument				500
Investment Agreement [Member] | DGC Trust/CBF [Member]
Related Party Transaction [Line Items]
Due to investors, annual return on investment		3.75%
Due to investors, additional return on investment		11.47%
Investment Agreement [Member] | DGC Trust/CBF [Member] | Scenario, Forecast [Member]
Related Party Transaction [Line Items]
Due to investors, annual return on investment										3.75%
Due to investors, additional return on investment										11.47%
Investment terms, excess amount for additional return on investment										$ 11,777
Investment terms, additional return on investment on revenue of business in excess of specified amount										7.65%
Investment Agreement [Member] | DGC Trust [Member] | Scenario, Forecast [Member]
Related Party Transaction [Line Items]
Due to investors, annual return on investment										3.75%
Due to investors, additional return on investment										3.53%
Investment terms, additional return on investment on revenue of business in excess of specified amount										2.35%
Investment Agreement, For Any Annual Period Following Specified Date [Member] | DGC Trust/CBF [Member] | Scenario, Forecast [Member]
Related Party Transaction [Line Items]
Due to investors, additional return on investment	3.75%
Investment terms, annual period revenue range for additional return on investment	$ 0
Investment terms, range on investment amount for annual return on investment	15.29%
Investment Agreement, For Any Annual Period Following Specified Date [Member] | DGC Trust [Member] | Scenario, Forecast [Member]
Related Party Transaction [Line Items]
Due to investors, additional return on investment										4.71%
Investment terms, range on investment amount for annual return on investment										20.00%
Investment Agreement, Before Third Anniversary, Greater Than $5,333 But Less Than Or Equal To $8,000 [Member] | DGC Trust/CBF [Member] | Scenario, Forecast [Member]
Related Party Transaction [Line Items]
Investment agreement, due to investors	$ 612
Investment Agreement, Before Third Anniversary, Greater Than $5,333 But Less Than Or Equal To $8,000 [Member] | DGC Trust [Member] | Scenario, Forecast [Member]
Related Party Transaction [Line Items]
Investment agreement, due to investors										$ 188
Investment Agreement, Before Third Anniversary, Greater Than $8,000 [Member] | DGC Trust/CBF [Member]
Related Party Transaction [Line Items]
Due to investors, additional return on investment		7.65%
Investment Agreement, Before Third Anniversary, Greater Than $8,000 [Member] | DGC Trust [Member] | Scenario, Forecast [Member]
Related Party Transaction [Line Items]
Due to investors, additional return on investment										2.35%
Investment Agreement, Following Third Anniversary, Revenue Of Business Greater Than Zero, The Greater Of 20% Investment Amount, Or 20% Of Revenue Of Business Or Any Annual Period Which Revenue Of Business Is Zero Or Less Than Zero [Member] | DGC Trust [Member] | Scenario, Forecast [Member]
Related Party Transaction [Line Items]
Due to investors, additional return on investment										3.75%
ViaNova Investment [Member] | New Avenue [Member]
Related Party Transaction [Line Items]
Redeemable financial instrument													$ 220
ViaNova Investment [Member] | COHN, LLC [Member]
Related Party Transaction [Line Items]
Revenue threshold				693
Redeemable Financial Instrument Payment Due [Member] | New Avenue [Member]
Related Party Transaction [Line Items]
Due from related parties				$ 30
Maximum [Member] | Investment Agreement [Member] | DGC Trust/CBF [Member] | Scenario, Forecast [Member]
Related Party Transaction [Line Items]
Investment terms, annual period revenue range for additional return on investment										$ 11,777
Maximum [Member] | Investment Agreement [Member] | DGC Trust [Member] | Scenario, Forecast [Member]
Related Party Transaction [Line Items]
Investment terms, annual period revenue range for additional return on investment										11,177
Maximum [Member] | Investment Agreement, For Any Annual Period Following Specified Date [Member] | DGC Trust/CBF [Member] | Scenario, Forecast [Member]
Related Party Transaction [Line Items]
Investment terms, annual period revenue range for additional return on investment	0
Maximum [Member] | Investment Agreement, Before Third Anniversary, Greater Than Zero But Less Than Or Equal To $5,333 [Member] | DGC Trust/CBF [Member]
Related Party Transaction [Line Items]
Investment terms, annual period revenue range for additional return on investment		$ 5,333
Maximum [Member] | Investment Agreement, Before Third Anniversary, Greater Than Zero But Less Than Or Equal To $5,333 [Member] | DGC Trust [Member] | Scenario, Forecast [Member]
Related Party Transaction [Line Items]
Investment terms, annual period revenue range for additional return on investment										5,333
Maximum [Member] | Investment Agreement, Before Third Anniversary, Greater Than $5,333 But Less Than Or Equal To $8,000 [Member] | DGC Trust/CBF [Member]
Related Party Transaction [Line Items]
Investment terms, annual period revenue range for additional return on investment		8,000
Maximum [Member] | Investment Agreement, Before Third Anniversary, Greater Than $5,333 But Less Than Or Equal To $8,000 [Member] | DGC Trust [Member] | Scenario, Forecast [Member]
Related Party Transaction [Line Items]
Investment terms, annual period revenue range for additional return on investment										8,000
Minimum [Member] | Investment Agreement [Member] | DGC Trust/CBF [Member] | Scenario, Forecast [Member]
Related Party Transaction [Line Items]
Investment terms, annual period revenue range for additional return on investment										0
Minimum [Member] | Investment Agreement [Member] | DGC Trust [Member] | Scenario, Forecast [Member]
Related Party Transaction [Line Items]
Investment terms, annual period revenue range for additional return on investment										0
Investment terms, excess amount for additional return on investment										11,177
Minimum [Member] | Investment Agreement, For Any Annual Period Following Specified Date [Member] | DGC Trust/CBF [Member] | Scenario, Forecast [Member]
Related Party Transaction [Line Items]
Investment terms, annual period revenue range for additional return on investment	$ 0
Investment terms, range on investment amount for annual return on investment	20.00%
Minimum [Member] | Investment Agreement, Before Third Anniversary, Greater Than Zero But Less Than Or Equal To $5,333 [Member] | DGC Trust/CBF [Member]
Related Party Transaction [Line Items]
Investment terms, annual period revenue range for additional return on investment		0
Minimum [Member] | Investment Agreement, Before Third Anniversary, Greater Than $5,333 But Less Than Or Equal To $8,000 [Member] | DGC Trust/CBF [Member]
Related Party Transaction [Line Items]
Investment terms, annual period revenue range for additional return on investment		5,333
Minimum [Member] | Investment Agreement, Before Third Anniversary, Greater Than $5,333 But Less Than Or Equal To $8,000 [Member] | DGC Trust [Member] | Scenario, Forecast [Member]
Related Party Transaction [Line Items]
Investment terms, annual period revenue range for additional return on investment										5,333
Minimum [Member] | Investment Agreement, Before Third Anniversary, Greater Than $8,000 [Member] | DGC Trust/CBF [Member]
Related Party Transaction [Line Items]
Investment terms, annual period revenue range for additional return on investment		$ 8,000
Minimum [Member] | Investment Agreement, Before Third Anniversary, Greater Than $8,000 [Member] | DGC Trust [Member] | Scenario, Forecast [Member]
Related Party Transaction [Line Items]
Investment terms, annual period revenue range for additional return on investment										$ 8,000

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Investment in Equity Method Affiliate (Schedule Of Investments In Equity Method Affiliates) (Details) $ in Thousands	3 Months Ended
	Mar. 31, 2020 USD ($)
Schedule of Equity Method Investments [Line Items]
Begining Balance	$ 3,799
Investments / advances	2,097
Distributions/repayments
Earnings / (loss) realized	(107)
Ending Balance	5,789
Insurance SPAC [Member]
Schedule of Equity Method Investments [Line Items]
Begining Balance	3,222
Investments / advances
Distributions/repayments
Earnings / (loss) realized	(306)
Ending Balance	2,916
AOI [Member]
Schedule of Equity Method Investments [Line Items]
Begining Balance	559
Investments / advances	2,097
Distributions/repayments
Earnings / (loss) realized	(31)
Ending Balance	2,625
CK Capital Partners B.V. [Member]
Schedule of Equity Method Investments [Line Items]
Begining Balance	18
Investments / advances
Distributions/repayments
Earnings / (loss) realized	230
Ending Balance	$ 248

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Leases (Schedule Of Future Maturity Of Lease Liabilities) (Details) - USD ($) $ in Thousands	Mar. 31, 2020	Dec. 31, 2019
Leases [Abstract]
2020 - remaining	$ 1,161
2021	1,108
2022	933
2023	950
2024	983
Thereafter	4,094
Total	9,229
Less imputed interest	(1,838)
Lease obligation	$ 7,391	$ 7,693

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Debt (Schedule Of Interest Expense By Debt Instrument) (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Debt Instrument [Line Items]
Interest expense, net	$ 2,605	$ 1,854
Junior subordinated notes [Member]
Debt Instrument [Line Items]
Interest expense, net	821	880
2020 Senior Notes [Member]
Debt Instrument [Line Items]
Interest expense, net	89
2017 Convertible Note [Member]
Debt Instrument [Line Items]
Interest expense, net	371	360
2013 Convertible Notes / 2019 Senior Notes [Member]
Debt Instrument [Line Items]
Interest expense, net	119	133
2018 FT LOC/2019 FT Revolver [Member]
Debt Instrument [Line Items]
Interest expense, net	152	92
Redeemable Financial Instrument - DGC Family Fintech Trust / CBF [Member]
Debt Instrument [Line Items]
Interest expense, net	690	148
Redeemable Financial Instrument - JKD Capital Partners I LTD [Member]
Debt Instrument [Line Items]
Interest expense, net	440	278
Redeemable Financial Instrument - ViaNova Capital Group, LLC [Member]
Debt Instrument [Line Items]
Interest adjustment	$ (77)	$ (37)

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Net Trading (Schedule Of Net Trading) (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Net Trading [Abstract]
Net realized gains (losses) - trading inventory	$ 10,443	$ 6,295
Net unrealized gains (losses) - trading inventory	(440)	559
Net gains and losses	10,003	6,854
Interest income-trading inventory	2,477	1,615
Interest income - residential transition loans		15
Interest income-receivables under resale agreements	41,485	37,483
Interest income	43,962	39,113
Interest expense-securities sold under agreements to repurchase	(34,766)	(36,381)
Interest expense-Legacy Texas Credit Facility	(39)	(5)
Interest expense-margin payable	(599)	(857)
Interest expense	(35,404)	(37,243)
Net Trading	$ 18,561	$ 8,724

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Due From / Due To Related Parties (Tables)

3 Months Ended

Mar. 31, 2020

Due From / Due To Related Parties [Abstract]

Schedule Of Due From / Due To Related Parties

DUE FROM/DUE TO RELATED PARTIES
(Dollars in Thousands)
	March 31, 2020		December 31, 2019
Employees & other	$	411	$	466
Due from related parties	$	411	$	466

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Due From / Due To Related Parties

3 Months Ended

Mar. 31, 2020

Due From / Due To Related Parties [Abstract]

Due From / Due To Related Parties

25. DUE FROM / DUE TO RELATED PARTIES

Amounts due to related parties related to redeemable financial instruments and outstanding debt are included as components of those balances in the consolidated balance sheets.  Also, interest or investment return owed on those balances are included as a component of accounts payable and other in the consolidated balance sheets.  Any investment made in an equity method affiliate for which the Company does not elect the fair value option is included as a component of investments in equity method affiliates in the consolidated balance sheets.  Any investment made in an equity method affiliate for which the Company elected the fair value option is included as a component of other investments, at fair value in the consolidated balance sheets.

The following table summarizes amounts due from / to related parties as of each date shown. These amounts may result from normal operating advances, employee advances, or from timing differences between the transactions disclosed in note 24 and final settlement of those transactions in cash. All amounts are primarily non-interest bearing.

DUE FROM/DUE TO RELATED PARTIES
(Dollars in Thousands)
	March 31, 2020		December 31, 2019
Employees & other	$	411	$	466
Due from related parties	$	411	$	466

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Consolidated Balance Sheets - USD ($) $ in Thousands		Mar. 31, 2020	Dec. 31, 2019
Assets
Cash and cash equivalents		$ 85,454	$ 8,304
Receivables from brokers, dealers, and clearing agencies		77,604	96,132
Due from related parties		411	466
Other receivables		17,007	46,625
Investments-trading		375,745	307,852
Other investments, at fair value		10,057	14,864
Receivables under resale agreements		6,014,438	7,500,002
Investment in equity method affiliates		5,789	3,799
Goodwill	[1]	109	7,992
Right-of-use asset - operating leases		6,867	7,155
Other assets		3,059	8,433
Total assets		6,596,540	8,001,624
Liabilities
Payables to brokers, dealers, and clearing agencies		201,242	241,261
Accounts payable and other liabilities		81,781	20,295
Accrued compensation		8,360	4,046
Trading securities sold, not yet purchased		114,767	77,947
Securities sold under agreements to repurchase		6,066,372	7,534,443
Deferred income taxes		943	1,339
Lease liability - operating leases		7,391	7,693
Redeemable financial instruments		16,907	16,983
Debt		61,864	48,861
Total liabilities		6,559,627	7,952,868
Commitments and contingencies (See note 21)
Stockholders' Equity:
Voting Non-Convertible Preferred Stock, $0.001 par value per share, 60,000,000 shares authorized, 27,413,098 and 4,983,557 shares issued and outstanding, respectively		27	27
Common Stock, $0.01 par value per share, 100,000,000 shares authorized, 1,246,710 and 1,1193,624 shares issued and outstanding, respectively, including 86,566 and 73,715 unvested or restricted share awards, respectively		12	12
Additional paid-in capital		68,622	68,714
Accumulated other comprehensive loss		(936)	(915)
Accumulated deficit		(37,683)	(34,519)
Total stockholders' equity		30,042	33,319
Non-controlling interest		6,871	15,437
Total equity		36,913	48,756
Total liabilities and equity		$ 6,596,540	$ 8,001,624

[1] Goodwill and intangible assets are allocated to the Capital Markets and Asset Management business segments as indicated in the table above.

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Receivables From And Payables To Brokers, Dealers, And Clearing Agencies (Tables)

3 Months Ended

Mar. 31, 2020

Receivables From And Payables To Brokers, Dealers, And Clearing Agencies [Abstract]

Schedule Of Due To (From) Broker-Dealers And Clearing Organizations

Amounts receivable from brokers, dealers, and clearing agencies consisted of the following.

RECEIVABLES FROM BROKERS, DEALERS, AND CLEARING AGENCIES
(Dollars in Thousands)
	March 31, 2020		December 31, 2019
Deposits with clearing agencies	$	250	$	250
Unsettled regular way trades, net		11,260		12,170
Receivables from clearing agencies		66,094		83,712
Receivables from brokers, dealers, and clearing agencies	$	77,604	$	96,132

Amounts payable to brokers, dealers, and clearing agencies consisted of the following.

PAYABLES TO BROKERS, DEALERS, AND CLEARING AGENCIES
(Dollars in Thousands)
	March 31, 2020		December 31, 2019
Margin payable	$	201,242	$	208,441
Due to clearing agent		-		32,820
Payables to brokers, dealers, and clearing agencies	$	201,242	$	241,261

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Consolidated Statement Of Changes In Equity - USD ($) $ in Thousands	Preferred Stock [Member] Cumulative Effect, Period of Adoption, Adjustment [Member]	Preferred Stock [Member]	Common Stock [Member] Cumulative Effect, Period of Adoption, Adjustment [Member]	Common Stock [Member]	Additional Paid-in Capital [Member] Cumulative Effect, Period of Adoption, Adjustment [Member]	Additional Paid-in Capital [Member]	Retained Earnings (Accumulated Deficit) [Member] Cumulative Effect, Period of Adoption, Adjustment [Member]	Retained Earnings (Accumulated Deficit) [Member]	Accumulated Other Comprehensive Income (Loss) [Member] Cumulative Effect, Period of Adoption, Adjustment [Member]	Accumulated Other Comprehensive Income (Loss) [Member]	Total Stockholders' Equity [Member] Cumulative Effect, Period of Adoption, Adjustment [Member]	Total Stockholders' Equity [Member]	Non-controlling Interest [Member] Cumulative Effect, Period of Adoption, Adjustment [Member]	Non-controlling Interest [Member]	Cumulative Effect, Period of Adoption, Adjustment [Member]	Total
Balance at Dec. 31, 2018		$ 5		$ 12		$ 68,591		$ (31,926)		$ (908)		$ 35,774		$ 6,664		$ 42,438
Net income (loss)								(1,202)				(1,202)		(622)		(1,824)
Other comprehensive income (loss)										6		6		3		9
Acquisition / (surrender) of additional units of consolidated subsidiary, net						133				(14)		119		(119)
Equity-based compensation and vesting of shares						117						117		55		172
Shares withheld for employee taxes						(87)						(87)		(41)		(128)
Purchase and retirement of common stock						(65)						(65)				(65)
Investment in non-controlling interest														2,550		2,550
Dividends/Distributions								(290)				(290)		(106)		(396)
Balance (Accounting Standards Update 2016-02 [Member]) at Mar. 31, 2019							$ (20)				$ (20)				$ (20)
Balance at Mar. 31, 2019		5		12		68,689		(33,438)		(916)		34,352		8,384		42,736
Balance at Dec. 31, 2019		27		12		68,714		(34,519)		(915)		33,319		15,437		48,756
Net income (loss)								(3,102)				(3,102)		(8,683)		(11,785)
Other comprehensive income (loss)										(29)		(29)		(71)		(100)
Acquisition / (surrender) of additional units of consolidated subsidiary, net						(123)				8		(115)		115
Equity-based compensation and vesting of shares						46						46		112		158
Shares withheld for employee taxes						(15)						(15)		(39)		(54)
Dividends/Distributions								(62)				(62)				(62)
Balance at Mar. 31, 2020		$ 27		$ 12		$ 68,622		$ (37,683)		$ (936)		$ 30,042		$ 6,871		$ 36,913

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Goodwill

3 Months Ended

Mar. 31, 2020

Goodwill [Abstract]

Goodwill

12.  GOODWILL

Goodwill consisted of the following.

GOODWILL
(Dollars in Thousands)
	March 31, 2020		December 31, 2019
AFN	$	109	$	109
JVB		-		7,883
Goodwill	$	109	$	7,992

The Company measures its goodwill impairment on an annual basis or when events indicate that goodwill may be impaired.  The Company performs its annual impairment tests ofAFN goodwill on October 1 of each year; and JVB goodwill on January 1 of each year. 

In the first quarter of 2020, the Company determined that the financial market volatility that resulted from the COVID-19 pandemic was a triggering event that required a reassessment of the goodwill related to JVB. See note 4. The Company concluded there was no triggering event for the goodwill related to AFN.

The Company performed a valuation of JVB as of March 31, 2020 by applying equal weighting to both the income approach and the market approach.  Under the guidance of FASB ASC 350, the Company determined that the fair value of JVB was less than the carrying value (including the goodwill).  As a result, the Company recognized an impairment loss of $7,883 in the three months ended March 31, 2020. The impairment loss is included in the consolidated statements of operations as impairment of goodwill and is reflected as a component of operating expense.

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Fair Value Disclosures

3 Months Ended

Mar. 31, 2020

Fair Value Disclosures [Abstract]

Fair Value Disclosures

8. FAIR VALUE DISCLOSURES

Fair Value Option

The Company has elected to account for certain of its other financial assets at fair value under the fair value option provisions of FASB ASC 825. The primary reason for electing the fair value option was to reduce the burden of monitoring the differences between the cost and the fair value of the Company’s investments, previously classified as available for sale securities, including the assessment as to whether the declines are temporary in nature and to further remove an element of management judgment.

Such financial assets accounted for at fair value include:

· securities that would otherwise qualify for available for sale treatment;

· investments in equity method affiliates that have the attributes in FASB ASC 946-10-15-2 (commonly referred to as investment companies); and

· investments in residential loans.

The changes in fair value (realized and unrealized gains and losses) of these instruments for which the Company has elected the fair value option are recorded in principal transactions and other income in the consolidated statements of operations. All of the investments for which the Company has elected the fair value option are included as a component of other investments, at fair value in the consolidated balance sheets. The Company recognized net gains (losses) related to changes in fair value of investments that are included as a component of other investments, at fair value during the three months ended March 31, 2020 and 2019 of $(2,695) and $249 respectively

Fair Value Measurements

In accordance with FASB ASC 820, the Company has categorized its financial instruments, based on the priority of the inputs to the valuation technique, into a three level valuation hierarchy. The valuation hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (level 1 measurement) and the lowest priority to unobservable inputs (level 3 measurement). The three levels of the valuation hierarchy under FASB ASC 820 are described below.

Level 1            Financial assets and liabilities whose values are based on unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities.

Level  2            Financial assets and liabilities whose  values are based on one or more of the following:

1. Quoted prices for similar assets or liabilities in active markets;

2. Quoted prices for identical or similar assets or liabilities in non-active markets;

3. Pricing models whose inputs are derived, other than quoted prices, are observable for substantially the full term of the asset or liability; or

4. Pricing models whose  inputs are derived principally from or corroborated by observable market data through   correlation or other means for substantially the full term of the asset or liability.

Level 3            Financial assets and liabilities whose values are based on prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable. These inputs reflect management’s own assumptions about the assumptions a market participant would use in pricing the asset or liability.

In certain cases, the inputs used to measure fair value may fall into different levels of the valuation hierarchy. In such cases, the level in the valuation hierarchy within which the fair value measurement in its entirety falls has been determined based on the lowest level input that is significant to the fair value measurement in its entirety. The Company’s assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to the asset or liability.

Both observable and unobservable inputs may be used to determine the fair value of positions that the Company has classified within the level 3 category. As a result, the unrealized gains and losses for assets and liabilities within the level 3 category presented in the tables below may include changes in fair value that were attributable to both observable (e.g., changes in market interest rates) and unobservable (e.g., changes in unobservable long-dated volatilities) inputs.

The following tables present information about the Company’s assets and liabilities measured at fair value as of March 31, 2020 and December 31, 2019 and indicates the valuation hierarchy of the valuation techniques utilized by the Company to determine such fair value.

FAIR VALUE MEASUREMENTS ON A RECURRING BASIS
March 31, 2020
(Dollars in Thousands)
					Significant		Significant
			Quoted Prices in		Other Observable		Unobservable
			Active Markets		Inputs		Inputs
Assets	Fair Value		(Level 1)		(Level 2)		(Level 3)
Investments-trading:
U.S. government agency MBS and CMOs	$	218,767	$	-	$	218,767	$	-
U.S. government agency debt securities		4,791		-		4,791		-
RMBS		14		-		14		-
U.S. Treasury securities		6,065		6,065		-		-
ABS		1		-		1		-
SBA loans		26,073		-		26,073		-
Corporate bonds and redeemable preferred stock		31,877		-		31,877		-
Foreign government bonds		626		-		626		-
Municipal bonds		25,121		-		25,121		-
Certificates of deposit		3,575		-		3,575		-
Derivatives		55,780		-		55,780		-
Equity securities		99		-		99		-
Residential transition loans		2,956		-		-		2,956
Total investments - trading	$	375,745	$	6,065	$	366,724	$	2,956
Other investments, at fair value:
Equity securities	$	5,457	$	-	$	5,457	$	-
CLOs		1,877		-		-		1,877
Residential loans		97		-		97		-
		7,431	$	-	$	5,554	$	1,877
Investments measured at NAV (1)		2,626
Total other investments, at fair value	$	10,057
Liabilities
Trading securities sold, not yet purchased:
U.S. Treasury securities	$	16,211	$	16,211	$	-	$	-
Corporate bonds and redeemable preferred stock		43,937		-		43,937		-
Municipal bonds		20		-		20		-
Derivatives		54,599		-		54,599		-
Total trading securities sold, not yet purchased	$	114,767	$	16,211	$	98,556	$	-

(1) As a practical expedient, the Company uses NAV per share (or its equivalent)  to measure the fair value of its investments in the U.S. Insurance JV and the SPAC Fund.  The U.S. Insurance JV invests in debt issued by small and medium sized U.S. and Bermuda insurance and reinsurance companies.  The SPAC Fund invests in equity securities of SPACs.  According to ASC 820, these investments are not categorized within the valuation hierarchy.

FAIR VALUE MEASUREMENTS ON A RECURRING BASIS
December 31, 2019
(Dollars in Thousands)
					Significant		Significant
			Quoted Prices in		Other Observable		Unobservable
			Active Markets		Inputs		Inputs
Assets	Fair Value		(Level 1)		(Level 2)		(Level 3)
Investments-trading:
U.S. government agency MBS and CMOs	$	196,146	$	-	$	196,146	$	-
U.S. government agency debt securities		14,680		-		14,680		-
RMBS		15		-		15		-
U.S. Treasury securities		11,105		11,105		-		-
ABS		100		-		100		-
SBA loans		27,634		-		27,634		-
Corporate bonds and redeemable preferred stock		38,503		-		38,503		-
Foreign government bonds		844		-		844		-
Municipal bonds		13,737		-		13,737		-
Certificates of deposit		841		-		841		-
Derivatives		3,686		-		3,686		-
Equity securities		561		-		561		-
Total investments - trading	$	307,852	$	11,105	$	296,747	$	-
Other investments, at fair value:
Equity Securities	$	9,352	$	2,009	$	7,343	$	-
CLOs		2,522		-		-		2,522
Residential loans		99		-		99		-
		11,973	$	2,009	$	7,442	$	2,522
Investments measured at NAV (1)		2,891
Total other investments, at fair value	$	14,864
Liabilities
Trading securities sold, not yet purchased:
U.S. Treasury securities	$	16,827	$	16,827	$	-	$	-
Corporate bonds and redeemable preferred stock		58,083		-		58,083		-
Municipal bonds		20		-		20		-
Derivatives		3,017		-		3,017		-
Total trading securities sold, not yet purchased	$	77,947	$	16,827	$	61,120	$	-

(1)As a practical expedient, the Company uses NAV per share (or its equivalent)  to measure the fair value of its investments in the U.S. Insurance JV and the SPAC Fund.  The U.S. Insurance JV invests in debt issued by small and medium sized U.S. and Bermuda insurance and reinsurance companies.  The SPAC Fund invests in equity securities of SPACs.  According to ASC 820, these investments are not categorized within the valuation hierarchy.

The following provides a brief description of the types of financial instruments the Company holds, the methodology for estimating fair value, and the level within the valuation hierarchy of the estimate. The discussion that follows applies regardless of whether the instrument is included in investments-trading; other investments, at fair value; or trading securities sold, not yet purchased.

U.S. Government Agency MBS and CMOs: These are securities that are generally traded over-the-counter. The Company generally values these securities using third party quotations such as unadjusted broker-dealer quoted prices or market price quotations from third party pricing services. These valuations are based on a market approach. The Company classifies the fair value of these securities within level 2 of the valuation hierarchy.

U.S. Government Agency Debt Securities: Callable and non-callable U.S. government agency debt securities are measured primarily based on quoted market prices obtained from third party pricing services. Non-callable U.S. government agency debt securities are generally classified within level 1 and callable U.S. government agency debt securities are classified within level 2 of the valuation hierarchy.

RMBS: The Company generally values these securities using third party quotations such as unadjusted broker-dealer quoted prices or market price quotations from third party pricing services. These valuations are based on a market approach. The Company generally classifies the fair value of these securities based on third party quotations within level 2 of the valuation hierarchy.

U.S. Treasury Securities: U.S. Treasury securities include U.S. Treasury bonds and notes and the fair values of the U.S. Treasury securities are based on quoted prices or market activity in active markets. Valuation adjustments are not applied. The Company classifies the fair value of these securities within level 1 of the valuation hierarchy.

CLOs, CDOs, and ABS: CLOs, CDOs, and ABS are interests in securitizations. ABS may include, but are not limited to, securities backed by auto loans, credit card receivables, or student loans. When the Company is able to obtain independent market quotations from at least two broker-dealers and where a price within the range of at least two broker-dealers is used or market price quotations from third party pricing services is used, these interests in securitizations will generally be classified within level 2 of the valuation hierarchy. These valuations are based on a market approach. The independent market quotations from broker-dealers are generally nonbinding. The Company seeks quotations from broker-dealers that historically have actively traded, monitored, issued, and been knowledgeable about the interests in securitizations. The Company generally believes to the extent that it (i)  receives two quotations in a similar range from broker-dealers knowledgeable about these interests in securitizations and (ii)  considers the broker-dealers gather and utilize observable market information such as new issue activity in the primary market, trading activity in the secondary market, credit spreads versus historical levels, bid-ask spreads, and price consensus among market participants and sources, then classification within level 2 of the valuation hierarchy is appropriate. In the absence of two broker-dealer market quotations, a single broker-dealer market quotation may be used without corroboration of the quote in which case the Company generally classifies the fair value within level 3 of the valuation hierarchy.

If quotations are unavailable, prices observed by the Company for recently executed market transactions or valuation models prepared by the Company’s management may be used, which are based on an income approach. These models prepared by the Company’s management include estimates, and the valuations derived from them could differ materially from amounts realizable in an open market exchange. Each CLO and CDO position is evaluated independently taking into consideration available comparable market levels, underlying collateral performance and pricing, deal structures, and liquidity.  Fair values based on internal valuation models prepared by the Company’s management are generally classified within level 3 of the valuation hierarchy. 

Establishing fair value is inherently subjective (given the volatile and sometimes illiquid markets for certain interests in securitizations) and requires management to make a number of assumptions, including assumptions about the future of interest rates, discount rates, and the timing of cash flows. The assumptions the Company applies are specific to each security. Although the Company may rely on internal calculations to compute the fair value of certain interest in securitizations, the Company requests and considers indications of fair value from third party pricing services to assist in the valuation process.

SBA Loans: SBA loans include loans and SBA interest only strips.  In the case of loans, the Company generally values these securities using third party quotations such as unadjusted broker-dealer quoted prices, internal valuation models using observable inputs, or market price quotations from third party pricing services. The Company generally classifies these investments within level 2 of the valuation hierarchy. These valuations are based on a market approach. SBA interest only strips do not trade in an active market with readily available prices. Accordingly, the Company generally uses valuation models to determine fair value and classifies the fair value of the SBA interest only strips within level 2 or level 3 of the valuation hierarchy depending on whether the model inputs are observable or not. 

Corporate Bonds and Redeemable Preferred Stock: The Company uses recently executed transactions or third party quotations from independent pricing services to arrive at the fair value of its investments in corporate bonds and redeemable preferred stock. These valuations are based on a market approach. The Company generally classifies the fair value of these bonds within level 2 of the valuation hierarchy. In instances where the fair values of securities are based on quoted prices in active markets (for example with redeemable preferred stock), the Company classifies the fair value of these securities within level 1 of the valuation hierarchy.

Foreign Government Bonds: The fair value of foreign government bonds is estimated using valuations provided by third party pricing services and classifies the fair value within level 2 of the valuation hierarchy.

Municipal Bonds: Municipal bonds, which include obligations of U.S. states, municipalities, and political subdivisions, primarily include bonds or notes issued by U.S. municipalities. The Company generally values these securities using third party quotations such as market price quotations from third party pricing services. The Company generally classifies the fair value of these bonds within level 2 of the valuation hierarchy. The valuations are based on a market approach. In instances where the Company is unable to obtain reliable market price quotations from third party pricing services, the Company will use its own internal valuation models. In these cases, the Company will classify such securities as level 3 within the valuation hierarchy until it is able to obtain third party pricing.

Certificates of Deposit: The fair value of certificates of deposit is estimated using valuations provided by third party pricing services. The Company classifies the fair value of certificates of deposit within level 2 of the valuation hierarchy.

Residential Loans: Management utilizes home price indices or market indications to value the residential loans.  The Company classifies the fair value of these loans within level 2 in the valuation hierarchy.

Residential transition loans:The Company uses valuation models prepared by management which are based on an income approach. These models include estimates, and the valuations derived from them could differ materially from amounts realizable in an open market exchange. Fair values based on internal valuation models prepared by the Company’s management are generally classified within level 3 of the valuation hierarchy. 

Equity Securities: The fair value of equity securities that represent unrestricted investments in publicly traded companies (common or preferred shares, options, warrants, and other equity investments) are determined using the closing price of the security as of the reporting date. These are securities that are traded on a recognized liquid exchange and the Company classifies their fair value  within level 1 of the valuation hierarchy.

The Company may own an option or warrant where the underlying security is publicly traded but the option or warrant is not.  In those cases, the Company may determine fair value using a Black-Scholes model and will generally classify their fair valuewithin level 2 within the valuation hierarchy.

The Company may own an equity investment in a publicly traded company that is restricted as to resale. In those cases, the Company may determine fair value by preparing a model. The fair value will be classified within level 2 of the valuation hierarchy if the inputs to the model are observable.  Otherwise, it will be classified within level 3 of the valuation hierarchy.  

The Company may own an equity interest in a private company.  In those cases, the Company may determine fair value by preparing a model.  The model may be either a market-based or income-based model, whichever is considered the most appropriate in each case.  The fair value will be classified within level 2 if the inputs to the model are observable.  Otherwise, it will be classified within level 3 of the valuation hierarchy.

Derivatives

Foreign Currency Forward Contracts

Foreign currency forward contracts are exchange-traded derivatives, which transact on an exchange that is deemed to be active.  The fair value of the foreign currency forward contracts is based on current quoted market prices.  Valuation adjustments are not applied.  These are classified within level 1 of the valuation hierarchy. See note 9.

TBAs and Other Forward Agency MBS Contracts

The Company generally values these securities using third party quotations such as unadjusted broker-dealer quoted prices or market price quotations from third party pricing services. TBAs and other forward agency MBS contracts are generally classified within level 2 of the valuation hierarchy. If there is limited transaction activity or less transparency to observe market based inputs to valuation models, TBAs and other forward agency MBS contracts are classified within level 3 of the valuation hierarchy.  U.S. government agency MBS and CMOs include TBAs and other forward agency MBS contracts.  Unrealized gains on TBAs and other forward agency MBS contracts are included in investments-trading on the Company’s consolidated balance sheets and unrealized losses on TBAs and other forward agency MBS contracts are included in trading securities sold, not yet purchased on the Company’s consolidated balance sheets. See note 9.

Other Extended Settlement Trades

When the Company buys or sells a financial instrument that will not settle in the regular time frame, the Company will account for that purchase or sale on the settlement date rather than the trade date.  In those cases, the Company accounts for the transaction between trade date and settlement date as a derivative (as either a purchase commitment or sale commitment). The Company will record an unrealized gain or unrealized loss on the derivative for the difference between the fair value of the underlying financial instrument as of the reporting date and the agreed upon transaction price.  The Company will determine the fair value of the financial instrument using the methodologies described above.

Level 3 Financial Assets and Liabilities

Financial Instruments Measured at Fair Value on a Recurring Basis

The following table presents additional information about assets measured at fair value on a recurring basis and for which the Company has utilized level 3 inputs to determine fair value.

LEVEL 3 ROLLFORWARD
	Three Months Ended March 31,
	2020		2019
Beginning of period	$	2,522	$	2,756
Net trading		(78)		-
Gains & losses (1)		(603)		(33)
Accretion of income (1)		78		106
Purchases		609		-
Sales and returns of capital		(2,973)		(50)
Reclassification of RTLs		5,278		-
End of period	$	4,833	$	2,779
Change in unrealized gains / (losses) (2)	$	(385)	$	(33)

(1) Gains and losses and accretion of income on other investments, at fair value are recorded as a component of principal transactions and other income in the consolidated statements of operations.

(2) Represents the change in unrealized gains and losses for the period included in earnings for assets held at the end of the reporting period.

The following tables provide the quantitative information about level 3 fair value measurements as of March 31, 2020 and December 31, 2019.

QUANTITATIVE INFORMATION ABOUT LEVEL 3 FAIR VALUE MEASUREMENTS
(Dollars in Thousands)
				Significant		Range of
		Fair Value	Valuation	Unobservable	Weighted	Significant
		March 31, 2020	Technique	Inputs	Average	Inputs
Assets
Investments - trading
Residential Transition Loans	$	2,956	Discounted Cash Flow Model	Yield	15.00%	15.00%
Other investments, at fair value
CLOs	$	1,877	Discounted Cash Flow Model	Yield	20.8%	20.8% - 20.9%
				Duration-years	10.3	9.3 - 11.3
				Default rate	2.0%	2.0% - 2.0%

QUANTITATIVE INFORMATION ABOUT LEVEL 3 FAIR VALUE MEASUREMENTS
(Dollars in Thousands)
				Significant		Range of
		Fair Value	Valuation	Unobservable	Weighted	Significant
		December 31, 2019	Technique	Inputs	Average	Inputs
Assets
Other investments, at fair value
CLOs	$	2,522	Discounted Cash Flow Model	Yield	17.9%	16.9% - 19.2%
				Duration-years	5.8	5.3 - 6.5
				Default rate	2.0%	2.0% - 2.0%

Sensitivity of Fair Value to Changes in Significant Unobservable Inputs

For recurring fair value measurements categorized within level 3 of the valuation hierarchy, the sensitivity of the fair value measurement to changes in significant unobservable inputs and interrelationships between those unobservable inputs (if any) are described below.

· CLOs:  The Company uses a discounted cash flow model to determine the fair value of its investments in CLOs.  Changes in the yield, duration, and default rate assumptions would impact the fair value determined.  The longer the duration, the lower the fair value of the investment.  The higher the yield, the lower the fair value of the investment.  The higher the default rate, the lower the fair value of the investment. 

· RTLs:  The Company uses a discounted cash flow model to determine the fair value of its investments in RTLs.  These loans are short term in nature (generally less than 18 months).  Changes in the yield or defaults will have the largest impact on the fair value calculation.  The higher the yield, the lower the fair value of the investment.  The higher the default rate, the lower the fair value of the investment. 

Investments in Certain Entities that Calculate NAV Per Share (or its Equivalent)

The following table presents additional information about investments in certain entities that calculate NAV per share (regardless of whether the “practical expedient” provisions of FASB ASC 820 have been applied), which are measured at fair value on a recurring basis at March 31, 2020 and December 31, 2019.

FAIR VALUE MEASUREMENTS OF INVESTMENTS IN CERTAIN ENTITIES
THAT CALCULATE NET ASSET VALUE PER SHARE (OR ITS EQUIVALENT)
(Dollars in Thousands)
		Fair Value March 31, 2020		Unfunded Commitments	Redemption Frequency	Redemption Notice Period
Other investments, at fair value
U.S. Insurance JV (a)	$	2,017	$	817	N/A	N/A
SPAC Fund  (b)		609		N/A	Quarterly after 1 year lock up	90 days
	$	2,626
		Fair Value December 31, 2019		Unfunded Commitments	Redemption Frequency	Redemption Notice Period
Other investments, at fair value
U.S. Insurance JV (a)	$	2,223	$	817	N/A	N/A
SPAC Fund  (b)		668		N/A	Quarterly after 1 year lock up	90 days
	$	2,891

N/ANot applicable.

(a) The U.S. Insurance JV invests in debt issued by small and medium sized U.S. and Bermuda insurance and reinsurance companies.

(b) The SPAC Fund invests in equity interests of SPACs.

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Other Recent Business Transactions Or Events

3 Months Ended

Mar. 31, 2020

Other Recent Business Transactions Or Events [Abstract]

Other Recent Business Transactions Or Events

4. OTHER RECENT BUSINESS TRANSACTIONS OR EVENTS

ViaNova Capital Group LLC

In 2018, the Company formed a wholly-owned subsidiary, ViaNova Capital Group LLC (“ViaNova”), for the purpose of building a residential transition loan (“RTL”) business.  RTLs are small balance commercial loans that are secured by first lien mortgages used by professional investors and real estate developers to finance the purchase and rehabilitation of residential properties. 

On November 20, 2018, ViaNova entered into a Warehousing Credit and Security Agreement with LegacyTexas Bank (the “LegacyTexas Credit Facility”) with an effective date of November 16, 2018.  The LegacyTexas Credit Facility was amended on May 4, 2019 and again on September 25, 2019 and October 28, 2019.  The LegacyTexas Credit Facilitysupported the buying, aggregating, and distributing of RTLs performed by the business of ViaNova.

On March 19, 2020, ViaNova received a notice of default from LegacyTexas Bank regarding the LegacyTexas Credit Facility, stating that ViaNova’s unrestricted cash balance was less than the amount required.  Also, on March 19, 2020, ViaNova received notice from LegacyTexas Bank that the Bank had suspended funding all “Alternative” loans for all of their clients, including the RTL loans that are the subject of the LegacyTexas Credit Facility with LegacyTexas Bank.  Since March 19, 2020 ViaNova has repaid all outstanding indebtedness under the LegacyTexas Credit Facility.  ViaNova stopped acquiring new RTLs and does not intend to acquire any new RTLs in the future.  As of March 31, 2020, the Company had four RTLs and several interest strips representing a par value of $3,034 and a fair value of $2,956, including the fair value of interest strips held.  These RTLsand interest strips are included as a component of investments-trading (see note 7).  The Company intends to opportunistically sell these RTLs if possible or allow them to mature.  The latest maturity date of the RTLs is January 9, 2021.

COVID 19 / Impairment of Goodwill

In March 2020, the World Health Organization declared the outbreak of a novel coronavirus (COVID-19) as a pandemic, which continues to spread throughout the United States. The spread of COVID-19 has caused significant volatility in domestic and international markets. There is on-going uncertainty around the breadth and duration of business disruptions related to COVID-19, as well as its impact on the U.S. and international economies.  While the Company cannot fully assess the impact COVID-19 will have on all of its operations at this time, there are certain impacts that the Company has identified:

· The unprecedented volatility of the financial markets experienced in March 2020, has caused the Company to operate JVB at a lower level of leverage than prior to the pandemic.  Specifically, JVB has reduced the size of its GCF repo operations and the volume of its TBA trading.  The Company determined that at its pre-pandemic levels in these businesses, it was exposed to a higher level of counterparty credit risk than it should have and was experiencing too much volatility in its available liquidity to conservatively meet capital requirements and margin calls in these businesses.  The Company expects JVB to operate at lower volumes in both these businesses for an indefinite period of time, which could unfavorably impact the operating profitability of JVB. 

· The financial market volatility, as well as the reduction in volumes in the GCF repo and TBA businesses, that resulted from COVID-19 required the Company to reassess the goodwill it had recorded related to JVB under the guidance of ASC 350.  The Company determined that the fair value of JVB was less than the carrying value (including the goodwill).  As a result, the Company recorded an impairment loss of $7,883 in the three months ended March 31, 2020.  See note 12. 

· The Company expects that its asset management segment will also be adversely impacted by the pandemic.  While it is difficult to determine the extent of the impact at this time, the Company expects that raising capital for new funds may become more challenging.  In addition, lower returns earned by funds will adversely impact the Company’s asset management fees and investors’ need for liquidity may result in reductions in AUM. 

· JVB’s mortgage group’s operations are centered on serving the financial needs of mortgage originators and institutions that invest in mortgage backed securities.  Prolonged high unemployment will most likely impact mortgage originations and demand for and supply of mortgage backed securities, which may have a significant unfavorable impact on the revenue earned by JVB’s mortgage group. 

The Company will likely be impacted by the pandemic in other ways which the Company cannot yet determine.  The Company will continue to monitor market conditions and respond accordingly. 

Subsequent to March 31, the Company has applied for and received a $2.2 million loan under the Paycheck Protection Program (PPP) of the Coronavirus Aid, Relief, and Economic Security (CARES) Act. See note 26. 

The 2020 Senior Notes

On January 31, 2020, the Operating LLC entered into a Note Purchase Agreement with JKD Capital Partners I LTD, a New York corporation (“JKD Investor”), and RN Capital Solutions LLC, a Delaware limited liability company (“RNCS”).  The JKD Investor is owned by Jack DiMaio, the vice chairman of the Company’s board of directors and the Operating LLC’s board of managers, and his spouse.

Pursuant to the Note Purchase Agreement, JKD Investor and RNCS each purchased a Senior Promissory Note in the principal amount of $2,250 (for an aggregate investment of $4,500).  The Senior Promissory Notes bear interest at a fixed rate of 12% per annum and mature on January 31, 2022.  On February 3, 2020, pursuant to the Note Purchase Agreement, the Operating LLC used the proceeds received from the issuance of the Senior Promissory Notes to repay in full all amounts outstanding under the Senior Promissory Note, dated September 25, 2019, issued by the Company to Pensco Trust Company, Custodian fbo Edward E. Cohen IRA in the principal amount of $4,386 (the “Cohen IRA Note”).  The Cohen IRA Note is included as a portion of the 2019 Senior Notes outstanding as of December 31, 2019.  The Cohen IRA Note was fully paid and extinguished on February 3, 2020.  Subsequent to this repayment, $2,400 of the 2019 Senior Notes remain outstanding.  See note 17. 

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Variable Interest Entities (Schedule Of Variable Interest Entities) (Details) - USD ($) $ in Thousands	Mar. 31, 2020	Dec. 31, 2019	Mar. 31, 2019	Dec. 31, 2018
Variable Interest Entity [Line Items]
Other investments, at fair value	$ 4,833	$ 2,522	$ 2,779	$ 2,756
Maximum exposure	4,503	5,413
Alternative Investments [Member]
Variable Interest Entity [Line Items]
Other investments, at fair value	$ 4,503	$ 5,413

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Collateralized Securities Transactions (Schedule Of Repurchase Agreements Accounted For As Secured Borrowings) (Details) - USD ($) $ in Thousands	Mar. 31, 2020	Dec. 31, 2019
Assets Sold under Agreements to Repurchase [Line Items]
Repurchase Agreements	$ 6,066,372	$ 7,534,443
Reverse Repurchase Agreements	6,014,438	7,500,002
Repurchase Agreements [Member]
Assets Sold under Agreements to Repurchase [Line Items]
Repurchase Agreements	6,066,372	7,534,443
Repurchase Agreements [Member] | Overnight and Continuous [Member]
Assets Sold under Agreements to Repurchase [Line Items]
Repurchase Agreements	3,947,295	5,145,495
Repurchase Agreements [Member] | Up to 30 Days [Member]
Assets Sold under Agreements to Repurchase [Line Items]
Repurchase Agreements	1,718,976	2,288,545
Repurchase Agreements [Member] | 30 to 90 Days [Member]
Assets Sold under Agreements to Repurchase [Line Items]
Repurchase Agreements		100,403
Repurchase Agreements [Member] | Greater than 90 Days [Member]
Assets Sold under Agreements to Repurchase [Line Items]
Repurchase Agreements	400,101
Repurchase Agreements [Member] | U.S. government agency MBS [Member]
Assets Sold under Agreements to Repurchase [Line Items]
Repurchase Agreements	4,996,698	6,664,321
Repurchase Agreements [Member] | U.S. government agency MBS [Member] | Overnight and Continuous [Member]
Assets Sold under Agreements to Repurchase [Line Items]
Repurchase Agreements	3,923,623	5,117,811
Repurchase Agreements [Member] | U.S. government agency MBS [Member] | Up to 30 Days [Member]
Assets Sold under Agreements to Repurchase [Line Items]
Repurchase Agreements	672,974	1,546,510
Repurchase Agreements [Member] | U.S. government agency MBS [Member] | Greater than 90 Days [Member]
Assets Sold under Agreements to Repurchase [Line Items]
Repurchase Agreements	400,101
Repurchase Agreements [Member] | MBS (Gestational Repo) [Member]
Assets Sold under Agreements to Repurchase [Line Items]
Repurchase Agreements	1,046,002	842,438
Repurchase Agreements [Member] | MBS (Gestational Repo) [Member] | Up to 30 Days [Member]
Assets Sold under Agreements to Repurchase [Line Items]
Repurchase Agreements	1,046,002	742,035
Repurchase Agreements [Member] | MBS (Gestational Repo) [Member] | 30 to 90 Days [Member]
Assets Sold under Agreements to Repurchase [Line Items]
Repurchase Agreements		100,403
Repurchase Agreements [Member] | SBA loans [Member]
Assets Sold under Agreements to Repurchase [Line Items]
Repurchase Agreements	23,672	27,684
Repurchase Agreements [Member] | SBA loans [Member] | Overnight and Continuous [Member]
Assets Sold under Agreements to Repurchase [Line Items]
Repurchase Agreements	23,672	27,684
Reverse Repurchase Agreements [Member]
Assets Sold under Agreements to Repurchase [Line Items]
Reverse Repurchase Agreements	6,014,438	7,500,002
Reverse Repurchase Agreements [Member] | Overnight and Continuous [Member]
Assets Sold under Agreements to Repurchase [Line Items]
Reverse Repurchase Agreements	828,399	1,231,027
Reverse Repurchase Agreements [Member] | Up to 30 Days [Member]
Assets Sold under Agreements to Repurchase [Line Items]
Reverse Repurchase Agreements	4,873,952	3,272,880
Reverse Repurchase Agreements [Member] | 30 to 90 Days [Member]
Assets Sold under Agreements to Repurchase [Line Items]
Reverse Repurchase Agreements	312,087	2,421,037
Reverse Repurchase Agreements [Member] | Greater than 90 Days [Member]
Assets Sold under Agreements to Repurchase [Line Items]
Reverse Repurchase Agreements		575,058
Reverse Repurchase Agreements [Member] | U.S. government agency MBS [Member]
Assets Sold under Agreements to Repurchase [Line Items]
Reverse Repurchase Agreements	4,965,382	6,650,352
Reverse Repurchase Agreements [Member] | U.S. government agency MBS [Member] | Overnight and Continuous [Member]
Assets Sold under Agreements to Repurchase [Line Items]
Reverse Repurchase Agreements	828,399	1,231,027
Reverse Repurchase Agreements [Member] | U.S. government agency MBS [Member] | Up to 30 Days [Member]
Assets Sold under Agreements to Repurchase [Line Items]
Reverse Repurchase Agreements	3,824,896	2,525,188
Reverse Repurchase Agreements [Member] | U.S. government agency MBS [Member] | 30 to 90 Days [Member]
Assets Sold under Agreements to Repurchase [Line Items]
Reverse Repurchase Agreements	312,087	2,319,079
Reverse Repurchase Agreements [Member] | U.S. government agency MBS [Member] | Greater than 90 Days [Member]
Assets Sold under Agreements to Repurchase [Line Items]
Reverse Repurchase Agreements		575,058
Reverse Repurchase Agreements [Member] | MBS (Gestational Repo) [Member]
Assets Sold under Agreements to Repurchase [Line Items]
Reverse Repurchase Agreements	1,049,056	849,650
Reverse Repurchase Agreements [Member] | MBS (Gestational Repo) [Member] | Up to 30 Days [Member]
Assets Sold under Agreements to Repurchase [Line Items]
Reverse Repurchase Agreements	$ 1,049,056	747,692
Reverse Repurchase Agreements [Member] | MBS (Gestational Repo) [Member] | 30 to 90 Days [Member]
Assets Sold under Agreements to Repurchase [Line Items]
Reverse Repurchase Agreements		$ 101,958

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Leases (Narrative) (Details) - USD ($)		3 Months Ended
	Jan. 01, 2019	Mar. 31, 2020	Mar. 31, 2019	Dec. 31, 2019	Dec. 31, 2018
Right of use asset		$ 6,867,000		$ 7,155,000
Lease commitment liability		7,391,000		7,693,000
Reduction in retained earnings due to effect of adoption		36,913,000	$ 42,736,000	$ 48,756,000	$ 42,438,000
Increase (decrease) in other receivables		$ (29,618,000)	(3,894,000)
Weighted average remaining term		8 years 2 months 12 days
Weighted average discount rate		5.36%
Operating lease cash payments		$ 403,000
Cash payments to acquire right of use assets		0
Sublease Income		79,000	65,000
Rent expense		$ 378,000	390,000
Accounting Standards Update 2016-02 [Member]
Right of use asset	$ 8,416,000
Lease commitment liability	8,860,000
Increase (decrease) in other receivables	18,000
Reduction in other liabilities	$ (406,000)
Cumulative Effect, Period of Adoption, Adjustment [Member] | Accounting Standards Update 2016-02 [Member]
Reduction in retained earnings due to effect of adoption			$ (20,000)

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Debt (Debt Outstanding) (Details) - USD ($)		3 Months Ended			12 Months Ended
		Mar. 31, 2020		Mar. 31, 2019	Dec. 31, 2019
Debt Instrument [Line Items]
Long term debt less debt discount		$ 61,864,000			$ 48,861,000
Common Stock, Par or Stated Value Per Share		$ 0.01			$ 0.01
Redeemable noncontrolling interest, membership units not held, share ratio		$ 10		$ 10
Non-convertible And Contingent Convertible Debt [Member]
Debt Instrument [Line Items]
Less unamortized debt issuance costs		$ (631,000)			$ (703,000)
Long term debt less debt discount		14,369,000			14,297,000
Junior subordinated debt [Member]
Debt Instrument [Line Items]
Junior subordinated notes		49,614,000
Less unamortized discount	[1]	(25,030,000)			(25,124,000)
Long term debt less debt discount	[1]	23,095,000			23,001,000
Ownership value of common stock of trusts		$ 1,489,000
Yield to maturities		15.04%
12.00% Non-convertible Senior Notes (2020 Senior Notes) [Member] | Non-convertible Senior Notes [Member]
Debt Instrument [Line Items]
Long-term Debt, Gross		$ 4,500,000
Interest Rate	[2]	12.00%
Maturity		Jan. 01, 2022
12.00% Non-convertible Senior Notes (2019 Senior Notes) [Member]
Debt Instrument [Line Items]
Long-term Debt, Gross					2,400,000
12.00% Non-convertible Senior Notes (2019 Senior Notes) [Member] | Minimum [Member]
Debt Instrument [Line Items]
Debt Instrument, Interest rate, in event of default		9.00%
12.00% Non-convertible Senior Notes (2019 Senior Notes) [Member] | Maximum [Member]
Debt Instrument [Line Items]
Debt Instrument, Interest rate, in event of default		13.00%
12.00% Non-convertible Senior Notes (2019 Senior Notes) [Member] | Non-convertible Senior Notes [Member]
Debt Instrument [Line Items]
Long-term Debt, Gross		$ 2,400,000			$ 6,786,000
Interest Rate		12.00%	[2]		8.00%
Debt Instrument, Interest rate, in event of default		13.00%			9.00%
Maturity	[3]	Sep. 25, 2020
8.00% Contingent Convertible Senior Notes (2017 Convertible Note) [Member] | Contingent Convertible Senior Notes [Member]
Debt Instrument [Line Items]
Long-term Debt, Gross		$ 15,000,000			$ 15,000,000
Interest Rate	[2]	8.00%
Maturity	[4]	Mar. 31, 2022
2017 Convertible Note [Member]
Debt Instrument [Line Items]
Debt Instrument, Convertible, Conversion Price		$ 1.45
Redeemable noncontrolling interest, membership units not held, share ratio		$ 14.50
Alesco Capital Trust I [Member] | Junior subordinated debt [Member]
Debt Instrument [Line Items]
Long-term Debt, Gross	[1]	$ 28,125,000			28,125,000
Interest Rate	[1],[2]	5.77%
Maturity	[1]	Jul. 30, 2037
Sunset Financial Statutory Trust I [Member] | Junior subordinated debt [Member]
Debt Instrument [Line Items]
Long-term Debt, Gross	[1]	$ 20,000,000			20,000,000
Interest Rate	[1],[2]	5.52%
Maturity	[1]	Mar. 30, 2035
Sunset Financial Statutory Trust I [Member] | Junior subordinated debt [Member] | Alesco Capital Trust I [Member]
Debt Instrument [Line Items]
Fair value of common securities		$ 0
FT Financial Bank, N.A. [Member] | Credit Facility [Member]
Debt Instrument [Line Items]
Long-term Debt, Gross		$ 17,500,000
Maturity		Apr. 10, 2021
Legacy Texas [Member] | Credit Facility [Member]
Debt Instrument [Line Items]
Long-term Debt, Gross					$ 4,777,000

[1] The junior subordinated notes listed represent debt the Company owes to the two trusts noted above. The total par amount owed by the Company to the trusts is $49,614. However, the Company owns the common stock of the trusts in a total par amount of $1,489. The Company pays interest (and at maturity, principal) to the trusts on the entire $49,614 junior notes outstanding. However, the Company receives back from the trusts the pro rata share of interest and principal on the common stock held by the Company. These trusts are VIEs and the Company does not consolidate them even though the Company holds the common stock. The Company carries the common stock on its balance sheet at a value of $0. The junior subordinated notes are recorded at a discount to par. When factoring in the discount, the yield to maturity of the junior subordinated notes as of March 31, 2020 on a combined basis was 15.04% assuming the variable rate in effect on the last day of the reporting period remains in effect until maturity.

[2] Represents the interest rate in effect as of the last day of the reporting period.

[3] On September 25, 2019, the Company amended the previously outstanding 2013 Convertible Notes, which were scheduled to mature on September 25, 2019. The material terms and conditions of the 2013 Convertible Notes remained substantially the same, except that (i) the maturity date changed from September 25, 2019 to September 25, 2020; (ii) the conversion feature in the 2013 Convertible Notes was removed; (iii) the interest rate changed from 8% per annum (9% in the event of certain events of default) to 12% per annum (13% in the event of certain events of default); and (iv) the restrictions regarding the prepayment were removed. The post amendment notes are referred to herein as the "2019 Senior Notes" and the pre-amendment notes are referred to herein as the "2013 Convertible Notes."

[4] The holder of the 2017 Convertible Note may convert all or any part of the outstanding principal amount at any time prior to maturity into units of membership interests of the Operating LLC at a conversion price of $1.45 per unit, subject to customary anti-dilution adjustments. Units of membership interests in the Operating LLC not held by Cohen & Company Inc. may, with certain restrictions, be redeemed and exchanged into shares of the Cohen & Company Inc. common stock, par value $0.01 per share (“Common Stock”) on a ten-for-one basis. Therefore, the 2017 Convertible Note can be converted into Operating LLC units of membership interests and then redeemed and exchanged into Common Stock at an effective conversion price of $14.50. See note 20 to our Annual Report on Form 10-K for the year ended December 31, 2019.

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Equity (Other Narrative) (Details) - USD ($) $ / shares in Units, $ in Thousands		3 Months Ended
	Dec. 30, 2019	Mar. 31, 2020	Mar. 31, 2019	Dec. 31, 2019	Mar. 31, 2018	Jan. 19, 2017
Permanent Equity [Line Items]
Ratio of Common Stock to membership units		0.1
Redemption of non-controlling interest, net
Increase in other investments		$ 7,779
Common Stock, Par or Stated Value Per Share		$ 0.01		$ 0.01
Series E Preferred Stock [Member]
Permanent Equity [Line Items]
Ratio of shares to vote		10
Preferred Stock, shares outstanding		4,983,557
Series F Preferred Stock [Member]
Permanent Equity [Line Items]
Ratio of shares to vote		10
10b5-1 Plan [Member]
Permanent Equity [Line Items]
Repurchase amount authorized					$ 2,000
Purchase of common stock, shares			7,890
Treasury Stock, Value, Acquired, Par Value Method			$ 65
Accumulated Other Comprehensive Income (Loss) [Member]
Permanent Equity [Line Items]
Redemption of non-controlling interest, net		$ 8	(14)
Additional Paid-in Capital [Member]
Permanent Equity [Line Items]
Redemption of non-controlling interest, net		(123)	133
Non-controlling Interest [Member]
Permanent Equity [Line Items]
Redemption of non-controlling interest, net		$ 115	$ (119)
IMXI [Member]
Permanent Equity [Line Items]
Shares subject to certain restrictions on transfer		264,023
Share Price		$ 17.00				$ 15.00
SPA, Daniel G. Cohen And DGC Trust [Member]
Permanent Equity [Line Items]
Class of Warrant or Right, Exercise Trigger, Percentage of Common Stock Owned by Individual or Affiliates		19.99%
SPA, Daniel G. Cohen And DGC Trust [Member] | Non-controlling Interest [Member] | Series F Preferred Stock [Member]
Permanent Equity [Line Items]
Issuance of shares		22,429,541
SPA, Daniel G. Cohen And DGC Trust [Member] | COHN, LLC [Member] | Non-controlling Interest [Member]
Permanent Equity [Line Items]
Issuance of shares		22,429,541
Daniel G. Cohen [Member]
Permanent Equity [Line Items]
Stock Issued During Period, Value, New Issues		$ 4,351
Daniel G. Cohen [Member] | COHN, LLC [Member] | Series F Preferred Stock [Member]
Permanent Equity [Line Items]
Issuance of shares	370,881	370,881
Common Stock, Par or Stated Value Per Share		$ 0.00001
Daniel G. Cohen [Member] | DGC Trust [Member]
Permanent Equity [Line Items]
Stock Issued During Period, Value, New Issues	$ 3,428	$ 3,428
IMXI And COHN, LLC [Member] | DGC Trust [Member] | Non-controlling Interest [Member]
Permanent Equity [Line Items]
Issuance of shares	291,480	291,480
COHN, LLC [Member] | IMXI [Member] | Non-controlling Interest [Member]
Permanent Equity [Line Items]
Issuance of shares		662,361
Shares subject to certain restrictions on transfer		264,021

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Other Receivables, Other Assets, Accounts Payable And Other Liabilities (Schedule Of Accounts Payable And Other Liabilities) (Details) - USD ($) $ in Thousands	Mar. 31, 2020	Dec. 31, 2019
Other Receivables, Other Assets, Accounts Payable And Other Liabilities [Abstract]
Accounts payable	$ 141	$ 362
Redeemable financial instruments accrued interest	814	403
Accrued interest payable	738	711
Accrued interest on securities sold, not yet purchased	882	914
Payroll taxes payable	677	729
Counterparty cash collateral	74,692	9,524
Accrued expense and other liabilities	3,837	7,652
Accounts payable and other liabilities	$ 81,781	$ 20,295

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Receivables From And Payables To Brokers, Dealers, And Clearing Agencies (Schedule Of Due To (From) Broker-Dealers And Clearing Organizations) (Details) - USD ($) $ in Thousands	Mar. 31, 2020	Dec. 31, 2019
Receivables from Brokers-Dealers and Clearing Agencies [Abstract]
Deposits with clearing agencies	$ 250	$ 250
Unsettled regular way trades, net	11,260	12,170
Receivable from clearing agencies	66,094	83,712
Receivables from brokers, dealers, and clearing agencies	77,604	96,132
Payables to Broker-Dealers and Clearing Agencies [Abstract]
Margin payable	201,242	208,441
Due to clearing agent		32,820
Payables to brokers, dealers, and clearing agencies	$ 201,242	$ 241,261

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Organization And Nature Of Operations (Narrative) (Details) $ / shares in Units, $ in Millions	3 Months Ended
	Mar. 31, 2020 USD ($) segment $ / shares	Dec. 31, 2019 $ / shares
Securities [Line Items]
Common Stock, Par or Stated Value Per Share | $ / shares	$ 0.01	$ 0.01
Assets under management	$ 2,650
Number of Operating Segments | segment	3
CDOs [Member]
Securities [Line Items]
Assets under management	$ 2,100
Assets under management which are collateralized debt obligations percentage	79.00%

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Collateralized Securities Transactions (Narrative) (Details)	3 Months Ended		12 Months Ended
	Mar. 31, 2020 USD ($) item	Mar. 31, 2019 USD ($)	Dec. 31, 2019 USD ($) item	Apr. 25, 2018 USD ($)
Concentration Risk [Line Items]
Number of major groups of repo business | item	2
Securities reverse repurchase agreements	$ 6,014,438,000		$ 7,500,002,000
Fair value of securities received as collateral under reverse repurchase agreements	$ 6,167,233,000		$ 7,769,693,000
Number of counterparties related to reverse repurchase agreements | item	30		41
Securities sold under agreements to repurchase	$ 6,066,372,000		$ 7,534,443,000
Fair value of securities pledged as collateral under repurchase agreements	6,035,939,000		7,561,978,000
Intraday lending facility, commitment amount	$ 75,000,000		32,820,000
Intraday lending facility, termination date	Oct. 16, 2020
Intraday lending facility, renewal period	364 days
Intraday lending facility, annual interest rate	0.12%
Advances under intraday lending facility	$ 0		32,818,000
Intraday lending facility, accrued interest			$ 2,000
Revenues	$ 17,770,000	$ 11,140,000
Gestational Repo Business [Member]
Concentration Risk [Line Items]
Line of credit, borrowing capacity				$ 25,000,000
Number of counterparties related to reverse repurchase agreements | item	7		7
Base Rate [Member]
Concentration Risk [Line Items]
Intraday lending facility, basis spread on variable rate	3.00%
Feds Fund Rate [Member]
Concentration Risk [Line Items]
Intraday lending facility, basis spread on variable rate	0.50%
FICC [Member]
Concentration Risk [Line Items]
Securities reverse repurchase agreements	$ 1,473,033,000		$ 371,025,000
Securities sold under agreements to repurchase	4,570,581,000		$ 5,138,712,000
Product Concentration Risk [Member]
Concentration Risk [Line Items]
Revenues	$ 6,868,000	$ 1,294,000

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Segment And Geographic Information (Revenue By Geographic Area) (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Revenues from External Customers and Long-Lived Assets [Line Items]
Total revenue	$ 17,770	$ 11,140
United States [Member]
Revenues from External Customers and Long-Lived Assets [Line Items]
Total revenue	16,942	10,082
United Kingdom & Other [Member]
Revenues from External Customers and Long-Lived Assets [Line Items]
Total revenue	$ 828	$ 1,058

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Commitments And Contingencies (Narrative) (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Commitments And Contingencies [Line Items]
Rent expense	$ 378	$ 390
JVB Holdings [Member]
Commitments And Contingencies [Line Items]
Loss Contingency, Estimate of Possible Loss	$ 1,000,000

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Fair Value Disclosures (Fair Value, Investments, Entities That Calculate Net Asset Value Per Share) (Details) - USD ($) $ in Thousands		Mar. 31, 2020	Dec. 31, 2019
Other Investment Vehicles [Member]
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items]
Other investments, at fair value		$ 2,626	$ 2,891
U.S. Insurance JV [Member]
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items]
Unfunded commitments	[1],[2]	817	817
U.S. Insurance JV [Member] | Other Investment Vehicles [Member]
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items]
Other investments, at fair value	[2]	2,017	2,223
SPAC Funds [Member] | Other Investment Vehicles [Member]
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items]
Other investments, at fair value	[3]	$ 609	$ 668

[1] Not applicable.

[2] The U.S. Insurance JV invests in debt issued by small and medium sized U.S. and Bermuda insurance and reinsurance companies.

[3] The SPAC Fund invests in equity interests of SPACs.

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Fair Value Disclosures (Narrative) (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Fair Value Disclosures [Abstract]
Fair value, option, changes in fair value, gains (losses)	$ (2,695)	$ 249

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Equity (Schedule Of Effects Of Changes In Ownership Interest Subsidiary) (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Equity [Abstract]
Net income (loss) attributable to Cohen & Company Inc.	$ (3,102)	$ (1,202)
Increase / (decrease) in Cohen & Company Inc. paid in capital for the acquisition / (surrender) of additional units in consolidated subsidiary, net	123	(133)
Changes from net income / (loss) attributable to Cohen & Company Inc. and transfers (to) from non-controlling interest	$ (3,225)	$ (1,069)

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Goodwill (Tables)

3 Months Ended

Mar. 31, 2020

Goodwill [Abstract]

Schedule Of Goodwill

GOODWILL
(Dollars in Thousands)
	March 31, 2020		December 31, 2019
AFN	$	109	$	109
JVB		-		7,883
Goodwill	$	109	$	7,992

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Redeemable Financial Instruments (Tables)

3 Months Ended

Mar. 31, 2020

Redeemable Financial Instruments [Abstract]

Schedule Of Redeemable Financial Instruments

REDEEMABLE FINANCIAL INSTRUMENTS
(Dollars in Thousands)
		As of March 31, 2020		As of December 31, 2019
JKD Capital Partners I LTD	$	7,957	$	7,957
DGC Trust / CBF		8,500		8,500
ViaNova Capital Group, LLC		450		526
	$	16,907	$	16,983

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Earnings / (Loss) Per Common Share

3 Months Ended

Mar. 31, 2020

Earnings / (Loss) Per Common Share [Abstract]

Earnings / (Loss) Per Common Share

20. EARNINGS / (Loss) PER COMMON SHARE

The following table presents a reconciliation of basic and diluted earnings / (loss) per common share for the periods indicated.

EARNINGS / (LOSS) PER COMMON SHARE
(Dollars in Thousands, except share or per share information)
	Three Months Ended March 31,
	2020		2019
Net income / (loss) attributable to Cohen & Company Inc.	$	(3,102)	$	(1,202)
Add/ (deduct): Income / (loss) attributable to non-controlling interest attributable to Operating LLC membership (1)		(8,523)		(622)
Add / (deduct): Adjustment (2)		966		53
Net income / (loss) on a fully converted basis	$	(10,659)	$	(1,771)
Weighted average common shares outstanding - Basic		1,146,879		1,133,166
Unrestricted Operating LLC membership units exchangeable into Cohen & Company, Inc. shares (1)		2,793,798		532,409
Weighted average common shares outstanding - Diluted (3)		3,940,677		1,665,575
Net income / (loss) per common share - Basic	$	(2.70)	$	(1.06)
Net income / (loss) per common share - Diluted	$	(2.70)	$	(1.06)

(1) The Operating LLC units of membership interest not held by Cohen & Company Inc. (that is, those held by the non-controlling interest) may be redeemed and exchanged into shares of the Company on a ten-for-one basis. The Operating LLC units of membership interests not held by Cohen & Company Inc. are redeemable, at the member’s option at any time, for (i) cash in an amount equal to the average of the per share closing prices of the Common Stock for the ten consecutive trading days immediately preceding the date the Company receives the member’s redemption notice, or (ii) at the Company’s option, one tenth of a share of the Common Stock, subject, in each case, to appropriate adjustment upon the occurrence of an issuance of additional shares of the Common Stock as a dividend or other distribution on the outstanding Common Stock, or a further subdivision or combination of the outstanding shares of the  Common Stock. These units are not included in the computation of basic earnings per share.  These units enter into the computation of diluted net income (loss) per common share when the effect is not anti-dilutive using the if-converted method.

(2) An adjustment is included because the Company would have incurred a higher income tax expense or realized a higher income tax benefit, as applicable, if the Operating LLC units of membership interests had been converted at the beginning of the period.

(3) Potentially diluted securities that were not included in the diluted per share calculations because they would be anti-dilutive were as follows:

	Three Months Ended March 31,
	2020	2019
2017 Convertible Note	1,034,483	1,034,483
2013 Convertible Notes	-	565,469
Restricted Common Stock	30,466	44,176
Restricted Operating LLC units	15,424	15,006
	1,080,373	1,659,134

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Redeemable Financial Instruments

3 Months Ended

Mar. 31, 2020

Redeemable Financial Instruments [Abstract]

Redeemable Financial Instruments

16.  REDEEMABLE FINANCIAL INSTRUMENTS

Redeemable financial instruments consisted of the following .

REDEEMABLE FINANCIAL INSTRUMENTS
(Dollars in Thousands)
		As of March 31, 2020		As of December 31, 2019
JKD Capital Partners I LTD	$	7,957	$	7,957
DGC Trust / CBF		8,500		8,500
ViaNova Capital Group, LLC		450		526
	$	16,907	$	16,983

JKD Capital Partners I LTD Amendment

On October 3, 2016, the Operating LLC entered into an investment agreement (the “JKD Investment Agreement”), by and between Operating LLC and the JKD Investor, pursuant to which the JKD Investor agreed to invest up to $12,000 in the Operating LLC (the “JKD Investment”), $6,000 of which was invested upon the execution of the JKD Investment Agreement, an additional $1,000 was invested in January 2017,and an additional $1,268 was invested on January 9, 2019.  The JKD Investor is owned by Jack DiMaio, the vice chairman of the Company’s board of directors and the Operating LLC’s board of managers, and his spouse.

In exchange for the JKD Investment, the Operating LLC agreed to pay to JKD Investor during the term of the JKD Investment Agreement an amount (“JKD Investment Return”) equal to 50% of the difference between (i) the revenues generated during a quarter by the activities of the Institutional Corporate Trading Business of JVB (as defined in the JKD Investment Agreement, as amended) and (ii) certain expenses incurred by such Institutional Corporate Trading Business (the “Institutional Corporate Trading Business Net Revenue”). This JKD Investment Return is recorded monthly as interest expense or (interest income) with the related accrued interest recorded in accounts payable and other accrued liabilities. If the return is negative in an individual quarter, it will reduce the balance of the JKD Investment.  Payments of the JKD Investment Return are made on a quarterly basis.  The term of the JKD Investment Agreement commenced on October 3, 2016 and will continue until a redemption (as described below) occurs, unless the JKD Investment Agreement is earlier terminated.

On March 6, 2019, the JKD Investor and the Operating LLC entered into an amendment to the JKD Investment Agreement (the “JKD Investment Agreement Amendment”), pursuant to which the term “JKD Investment Return” under the JKD Investment Agreement was amended as follows:

(a) during the fourth quarter of 2018, an amount equal to 42% of the Institutional Corporate Trading Business Net Revenue and

(b) commencing on January 1, 2019 and for each quarter during the remainder of the term of the JKD Investment Agreement, an amount equal to a percentage of the Institutional Corporate Trading Business Net Revenue, which percentage is based on the JKD Investor’s investment under the JKD Investment Agreement as a percentage of the total capital allocated to the Institutional Corporate Trading Business of JVB.

The JKD Investor may terminate the JKD Investment Agreement (i) upon 90 days’ prior written notice to the Operating LLC if the Operating LLC or its affiliates modify any of their policies or procedures governing the operation of their businesses or change the way they operate their business and such modification has a material adverse effect on the amounts payable to the JKD Investor pursuant to the JKD Investment Agreement or (ii) upon 60 days’ prior written notice to the Operating LLC if the employment of Lester Brafman, the Company’s chief executive officer, is terminated. The Operating LLC may terminate the JKD Investment Agreement, as amended, upon 60 days’ prior written notice to the JKD Investor if Mr. DiMaio ceases to control the day-to-day operations of the JKD Investor.

Upon a termination of the JKD Investment Agreement, as amended, the Operating LLC will pay to the JKD Investor an amount equal to the “Investment Balance” (as such term is defined in the JKD Investment Agreement, as amended) as of the day prior to such termination.

At any time following October 3, 2019, the JKD Investor or the Operating LLC may, upon two months’ notice to the other party, cause the Operating LLC to pay a redemption to the JKD Investor in an amount equal to the Investment Balance (as such term is defined in the JKD Investment Agreement, as amended) as of the day prior to such redemption.

If the Operating LLC or JVB sells JVB’s Institutional Corporate Trading Business to any unaffiliated third party, and such sale is not part of a larger sale of all or substantially all of the assets or equity securities of the Operating LLC or JVB, the Operating LLC will pay to the JKD Investor an amount equal to 25% of the net consideration paid to the Operating LLC in connection with such sale, after deducting certain amounts and certain expenses incurred by the Operating LLC or JVB in connection with such sale.

DGC Trust/ CBF Amendments

Prior to September 30, 2019, the DGC Trust / CBF redeemable financial instruments were comprised of two separate agreements: one with CBF pursuant to which CBF invested $8,000 into the Operating LLC (the “CBF Investment Agreement”), and one with the DGC Trust pursuant to which the DGC  Trust invested $2,000 into the Operating LLC (the “DGC Trust Investment Agreement”).

The CBF Investment Agreement and the DGC Trust Investment Agreement were both amended on September 25, 2019, and again on December 4, 2019, with each amendment becoming effective October 1, 2019.  The amendments included the following amendments to each of the CBF Investment Agreement and the DGC Trust Investment Agreement:

(a) The term “Investment Amount” under the CBF Investment Agreement was reduced from $8,000 to $6,500 in exchange for aone-time payment of $1,500 from the Operating LLC to CBF; and

(b) The term “Investment Return” under the CBF Investment Agreement was amended to mean an annual return equal to:

· for the Annual Period ending on September 29, 2020, 3.75% of the Investment Amount, plus (x) 11.47% of any revenue of the GCF repo business (the “Revenue of the Business”) during such period between zero and $11,777 plus (y) 7.65% of any Revenue of the Business during such period in excess of $11,777. Prior to the second amendment, the Investment Return was with respect to any twelve-month period ending on September 29, 2020 (each an “Annual Period”) was 3.75% of the Investment Amount plus (x) 11.47% of the Revenue of the Business for any Annual Period in which the Revenue of the Business was greater than zero but less than or equal to $5,333, (y) $612 for any Annual Period in which the Revenue of the Business is greater than $5,333 but less than or equal to $8,000, or (z) 7.65% of the Revenue of the Business for any Annual Period in which the Revenue of the Business is greater than $8,000, and

· for any Annual Period following September 29, 2020, (x) for any Annual Period in which the Revenue of the Business is greater than zero, the greater of 20% of theInvestment Amount or 15.29% of the Revenue of the Business, or (y) for any Annual Period in which the Revenue of the Business is zero or less than zero,  3.75% of the Investment Amount.

.

(c) The term “Investment Return” under the DGC Trust  Investment Agreement was amended to mean an annual return equal to:

· for the twelve-month period ending on September 29, 2020,  3.75% of the Investment Amount plus (x) 3.53% of any Revenue of the Business, during such period between zero and $11,177 plus (y) 2.35% of any Revenue of the Business during such period in excess of $11,177.  Prior to the second amendment, the Investment Return was 3.75% of the Investment Amount, as defined in the DGC Trust Investment Agreement , plus (x) 3.53% of the Revenue of the Business, for any Annual Period in which the Revenue of the Business is greater than zero  but less than or equal to $5,333 (y) $188 for any Annual Period in which the Revenue of the Business is greater than $5,333, but less than or equal to $8,000, or (z) 2.35% of the Revenue of the Business for any Annual Period in which the Revenue of the Business is greater than $8,000 and

· for any Annual Period following September 29, 2020, (x) for any Annual Period in which the Revenue of the Business is greater than zero, the greater of 20% of the Investment Amount or 4.71% of the Revenue of the Business, or (y) for any Annual Period in which the Revenue of the Business is zero or less than zero, 3.75% of the Investment Amount.

Except as set forth above, the other material terms and conditions of the CBF Investment Agreement and the DGC Trust Investment Agreement remained substantially unchanged by the amendment.  The payment of $1,500 was made by the Operating LLC to CBF in October 2019, which reduced the redeemable financial instrument balance under the CBF Investment Agreement. 

ViaNova Capital Group LLC

On November 16, 2018, and effective as of November 19, 2018, the Operating LLC entered into an investment agreement (the “ViaNova Investment Agreement”) by and among Hancock Funding, LLC (“Hancock”), New Avenue Investments LLC (“New Avenue”), JVB, ViaNova, and the Operating LLC. Pursuant to the ViaNova Investment Agreement, Hancock, New Avenue, the Operating LLC, and JVB agreed to invest $500,  $250,  $500, and $2,750, respectively, into ViaNova (collectively, the “ViaNova Investment”). Pursuant to the ViaNova Investment Agreement, Hancock, the Operating LLC, and JVB invested their respective portions of the ViaNova Investment into ViaNova prior to the effective date of the ViaNova Investment Agreement. In February 2019, New Avenue invested $220 of its portion of the ViaNova Investment (i.e., $250), the remaining $30 is included in due from related parties on the consolidated balance sheets.  Hancock and New Avenue are owned by employees of the Company. 

Pursuant to the ViaNova Investment Agreement, in consideration of the ViaNova Investment, once the Operating LLC is repaid $693 of funded operating costs from net revenue (as defined in the ViaNova Investment Agreement) generated directly by the activities of ViaNova’s RTL business, each party to the ViaNova Investment Agreement is entitled to receive a quarterly payment equal to the net revenue (to the extent positive) generated directly by the activities of ViaNova’s RTL business during such quarter, multiplied by a fraction, the numerator of which is equal to such party’s portion of the ViaNova Investment and the denominator is equal to the entire ViaNova Investment.

During the first quarter of 2020, the Company ceased acquiring new RTLs and began an orderly wind down of its RTL business.  See note 4.  Upon its termination, the remaining redeemable investment balance will be repaid by the Operating LLC to Hancock and New Avenue in accordance with the ViaNova Investment Agreement.

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Subsequent Events (Narrative) (Details)		1 Months Ended
	Feb. 03, 2020 USD ($)	Apr. 30, 2020 USD ($) employee
Edward E. Cohen IRA [Member]
Subsequent Event [Line Items]
Repayments of Long-term Debt	$ 4,386,000
Subsequent Event [Member]
Subsequent Event [Line Items]
Debt Instrument, Face Amount		$ 2,200,000
Subsequent Event [Member] | Maximum [Member]
Subsequent Event [Line Items]
Number of employees | employee		100

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Supplemental Cash Flow Disclosure (Narrative) (Details) - USD ($) $ in Thousands		3 Months Ended
	Jan. 01, 2019	Mar. 31, 2020	Mar. 31, 2019	Dec. 31, 2019	Dec. 31, 2018
Debt Conversion [Line Items]
Interest paid		$ 2,033	$ 2,070
Income taxes paid		4	4
Income tax refunds			48
Redemption of non-controlling interest, net
Right-of-use asset - operating leases		6,867		$ 7,155
Lease liability - operating leases		7,391		7,693
Reduction in retained earnings due to effect of adoption		36,913	42,736	48,756	$ 42,438
Increase (decrease) in other receivables		(29,618)	(3,894)
Increase in other investments		7,779
Dividends payable		335
Increase (decrease) due to recorded interest income in redeemable financial instruments		76	37
Accounting Standards Update 2016-02 [Member]
Debt Conversion [Line Items]
Right-of-use asset - operating leases	$ 8,416
Lease liability - operating leases	8,860
Increase (decrease) in other receivables	18
Reduction in other liabilities	$ (406)
Common Stock [Member]
Debt Conversion [Line Items]
Redemption of non-controlling interest, net
Reduction in retained earnings due to effect of adoption		12	12	12	12
Additional Paid-in Capital [Member]
Debt Conversion [Line Items]
Redemption of non-controlling interest, net		(123)	133
Reduction in retained earnings due to effect of adoption		68,622	68,689	68,714	68,591
Accumulated Other Comprehensive Income (Loss) [Member]
Debt Conversion [Line Items]
Redemption of non-controlling interest, net		8	(14)
Reduction in retained earnings due to effect of adoption		(936)	(916)	(915)	(908)
Non-controlling Interest [Member]
Debt Conversion [Line Items]
Redemption of non-controlling interest, net		115	(119)
Reduction in retained earnings due to effect of adoption		6,871	8,384	15,437	$ 6,664
Contingent Convertible Senior Notes [Member] | 8.00% Contingent Convertible Senior Notes (2017 Convertible Note) [Member]
Debt Conversion [Line Items]
Long-term Debt, Gross		$ 15,000		$ 15,000
Cumulative Effect, Period of Adoption, Adjustment [Member] | Accounting Standards Update 2016-02 [Member]
Debt Conversion [Line Items]
Reduction in retained earnings due to effect of adoption			(20)
Cumulative Effect, Period of Adoption, Adjustment [Member] | Common Stock [Member] | Accounting Standards Update 2016-02 [Member]
Debt Conversion [Line Items]
Reduction in retained earnings due to effect of adoption
Cumulative Effect, Period of Adoption, Adjustment [Member] | Additional Paid-in Capital [Member] | Accounting Standards Update 2016-02 [Member]
Debt Conversion [Line Items]
Reduction in retained earnings due to effect of adoption
Cumulative Effect, Period of Adoption, Adjustment [Member] | Accumulated Other Comprehensive Income (Loss) [Member] | Accounting Standards Update 2016-02 [Member]
Debt Conversion [Line Items]
Reduction in retained earnings due to effect of adoption
Cumulative Effect, Period of Adoption, Adjustment [Member] | Non-controlling Interest [Member] | Accounting Standards Update 2016-02 [Member]
Debt Conversion [Line Items]
Reduction in retained earnings due to effect of adoption

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Collateralized Securities Transactions

3 Months Ended

Mar. 31, 2020

Collateralized Securities Transactions [Abstract]

Collateralized Securities Transactions

10. COLLATERALIZED SECURITIES TRANSACTIONS

Matched Book RepoBusiness

The Company enters into repos and reverse repos as part of its matched book repo business.  In general, the Company will lend money to a counterparty after obtaining collateral securities from that counterparty pursuant to a reverse repo.  The Company will borrow money from another counterparty using the same collateral securities pursuant to a repo.  The Company seeks to earn net interest income on these transactions. Currently, the Company categorizes its matched book repo business into two major groups: gestation repo and GCF repo.

Gestation Repo

Gestation repo involves entering into repo and reverse repo where the underlying collateral security represents a pool of newly issued mortgage loans.  The borrowers (the reverse repo counterparties) are generally mortgage originators.  The lenders (the repo  counterparties) are a diverse group of the counterparties comprised of banks, insurance companies, and other financial institutions.  The Company self-clears its gestation repo transactions.

GCF Repo

In October 2017, the Company became a full netting member of the FICC’s Government Securities Division.  As a full netting member of the FICC, the Company has access to the FICC’s GCF repo service that provides netting and settlement services for repo transactions where the underlying security is general collateral (primarily U.S. Treasuries and U.S. Agency securities).  The Company began entering into matched book GCF repo transactions in November 2017.  The borrowers (the reverse repo  counterparties) are a diverse group of financial institutions including hedge funds, registered investment funds, REITs, and other similar counterparties.  The lenders (the repo counterparties)  are the FICC and other large financial institutions. The Company uses Bank of New York (“BONY”) as its settlement agent for its GCF repo matched book transactions.  The Company is considered self-clearing for this business.  In connection with the Company’s full netting membership of the FICC, the Company agreed to establish and maintain a committed line of credit in a minimum amount of $25,000, which it entered into with Fifth Third Financial Bank, N.A. (“FT Financial”) on April 25, 2018.  This line of credit arrangement was subsequently amended. See note 17.

Other Repo Transactions

In addition to the Company’s matched book repo business, the Company may also enter into reverse repos to acquire securities to cover short positions or as an investment.  Additionally, the Company may enter into repos to finance the Company’s securities positions held in inventory.  These repo and reverse repo agreements are generally cleared on a bilateral or triparty basis; no clearing broker is involved.  These transactions are not matched.

Repo Information

At March 31, 2020 and December 31, 2019, the Company held reverse repos of $6,014,438 and $7,500,002, respectively, and the fair value of collateral received under reverse repos was $6,167,233 and $7,769,693, respectively.  As ofMarch 31, 2020 and December 31, 2019, the reverse repo balance was comprised of receivables collateralized by securities with  30and 41counterparties, respectively.

At March 31, 2020 and December 31, 2019, the Company held repos of $6,066,372 and $7,534,443, respectively, and the fair value of securities and cash pledged as collateral under repos was $6,035,939and $7,561,978, respectively. These amounts include collateral for reverse repos that were re-pledged as collateral for repos.

Intraday and Overnight Lending Facility

In conjunction with the Company’s GCF repo business, on October 19, 2018, the Company and BONY entered into an intraday lending facility.  The lending facility allows for BONY to advance funds to JVB in order to facilitate the settlement of GCF repo transactions.  The total committed amount at March 31, 2020 was $75,000.  The current termination date of this facility is October 16, 2020. It is expected that this facility will be renewed for successive 364-day periods provided that the Company continues its GCF matched book repo business.

The BONY lending 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 an annual 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.  For the three months ended March 31, 2020, the Company received no advances under the intraday lending facility.  During the year ended December 31, 2019 advances of $32,818 were made under this facility.  This draw plus accrued interest of $2, or $32,820, was outstanding as of December 31, 2019 and was included as a component of payable to brokers, dealers, and clearing agencies in the statement of financial condition.  This amount was repaid in full in January 2020.

Concentration

In the matched book repo business, the demand for borrowed funds is generated by the reverse repo counterparty and the supply of funds is provided by the repo counterparty. 

On the demand side, the Company does not consider its GCF repo business to be concentrated because the Company’s  reverse repo counterparties are comprised of a diverse group of financial institutions. 

On the supply side, the Company obtains a significant amount of its funds from the FICC.  If the FICC were to reduce its repo lending activities or make significant adverse changes to the cost of such lending, the Company may not be able to replace the FICC funding, or if the Company does so, it may be at a higher cost of funding.  Therefore, the Company considers its GCF repo business to be concentrated from the supply side of the business. 

The gestation repo business has been and continues to be concentrated as to reverse repurchase counterparties.  The Company conducts this business with a limited number of reverse repo counterparties.  As of March 31, 2020 and December 31, 2019, the Company’s gestation reverse repos shown in the tables below represented balances from seven counterparties.  The Company also has a limited number of repo counterparties in the gestation repo business.  However, this is primarily a function of the limited number of reverse repo agreement counterparties with whom the Company conducts this business rather than a reflection of a limited supply of funds.  Therefore, the Company considers the gestation repo business to be concentrated on the demand side. 

The total net revenue earned by the Company on its matched book repo business (both gestation repo and GCF repo) was $6,868 and $1,294 for the three months ended March 31, 2020 and 2019, respectively. 

Detail

Effective June 1, 2019, the Company changed its accounting policy regarding the netting of reverse repo and repo transactions.  ASC 210 provides the option to present reverse repo and repo on a net basis if certain netting conditions are met.  Prior to this date, the Company utilized this option and presented repo and reverse repo on a net basis when these conditions were met.  As of June 1, 2019, the Company changed its policy to present all repo and reverse repo transactions on a gross basis even if the underlying netting conditions are met.  The Company believes that the newly adopted accounting principle is preferable in the circumstances because it provides consistency for the accounting of all repurchase and reverse repos, as well as more information on the face of the financial statements.The amounts in the table below (including periods prior to June 1, 2019) are presented on a gross basis. 

As March 31, 2020, the Company had outstanding reverse repos of $6,014,438 and repos of $6,066,372.  Included in these amounts are outstanding reverse repos of $1,473,033and repos of $4,570,581, where the FICC was the Company’s counterparty to the transaction and which were subject to a master netting arrangement. 

As of December 31, 2019, the Company had outstanding reverse repos of $7,500,002and repos of $7,534,443.  Included in these amounts are outstanding reverse repos of $371,025 and repos of $5,138,712, where the FICC was the Company’s counterparty to the transaction and which were subject to a master netting arrangement. 

The following tables summarize the remaining contractual maturity of the gross obligations under repos accounted for as secured borrowings segregated by the underlying collateral pledged as of each date shown.  All amounts as well as counterparty cash collateral (see note 14) are subject to master netting arrangements.

SECURED BORROWINGS
(Dollars in Thousands)
March 31, 2020
	Repurchase Agreements
	Remaining Contractual Maturity of the Agreements
Collateral Type:	Overnight and Continuous		Up to 30 days		30 - 90 days		Greater than 90 days		Total
U.S. government agency MBS (GCF repo)	$	3,923,623	$	672,974	$	-	$	400,101	$	4,996,698
MBS (gestation repo)		-		1,046,002		-		-		1,046,002
SBA loans		23,672		-		-		-		23,672
	$	3,947,295	$	1,718,976	$	-	$	400,101	$	6,066,372
	Reverse Repurchase Agreements
	Remaining Contractual Maturity of the Agreements
Collateral Type:	Overnight and Continuous		Up to 30 days		30 - 90 days		Greater than 90 days		Total
U.S. government agency MBS (GCF repo)	$	828,399	$	3,824,896	$	312,087	$	-	$	4,965,382
MBS (gestation repo)		-		1,049,056		-		-		1,049,056
	$	828,399	$	4,873,952	$	312,087	$	-	$	6,014,438

SECURED BORROWINGS
(Dollars in Thousands)
December 31, 2019
	Repurchase Agreements
	Remaining Contractual Maturity of the Agreements
Collateral Type:	Overnight and Continuous		Up to 30 days		30 - 90 days		Greater than 90 days		Total
U.S. government agency MBS (GCF repo)	$	5,117,811	$	1,546,510	$	-	$	-	$	6,664,321
MBS (gestation repo)		-		742,035		100,403		-		842,438
SBA loans		27,684		-		-		-		27,684
	$	5,145,495	$	2,288,545	$	100,403	$	-	$	7,534,443
	Reverse Repurchase Agreements
	Remaining Contractual Maturity of the Agreements
Collateral Type:	Overnight and Continuous		Up to 30 days		30 - 90 days		Greater than 90 days		Total
U.S. government agency MBS (GCF repo)	$	1,231,027	$	2,525,188	$	2,319,079	$	575,058	$	6,650,352
MBS (gestation repo)		-		747,692		101,958		-		849,650
	$	1,231,027	$	3,272,880	$	2,421,037	$	575,058	$	7,500,002

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Receivables From And Payables To Brokers, Dealers, And Clearing Agencies

3 Months Ended

Mar. 31, 2020

Receivables From And Payables To Brokers, Dealers, And Clearing Agencies [Abstract]

Receivables From And Payables To Brokers, Dealers, And Clearing Agencies

6. RECEIVABLES FROM AND PAYABLES TO BROKERS, DEALERS, AND CLEARING AGENCIES

Amounts receivable from brokers, dealers, and clearing agencies consisted of the following.

RECEIVABLES FROM BROKERS, DEALERS, AND CLEARING AGENCIES
(Dollars in Thousands)
	March 31, 2020		December 31, 2019
Deposits with clearing agencies	$	250	$	250
Unsettled regular way trades, net		11,260		12,170
Receivables from clearing agencies		66,094		83,712
Receivables from brokers, dealers, and clearing agencies	$	77,604	$	96,132

Amounts payable to brokers, dealers, and clearing agencies consisted of the following.

PAYABLES TO BROKERS, DEALERS, AND CLEARING AGENCIES
(Dollars in Thousands)
	March 31, 2020		December 31, 2019
Margin payable	$	201,242	$	208,441
Due to clearing agent		-		32,820
Payables to brokers, dealers, and clearing agencies	$	201,242	$	241,261

Deposits with clearing agencies represent contractual amounts the Company is required to deposit with its clearing agents.

Securities transactions that settle in the regular way are recorded on the trade date, as if they had settled. The related amounts receivable and payable for unsettled securities transactions are recorded net in receivables from or payables to brokers, dealers, and clearing agencies on the Company’s consolidated balance sheets.

Receivables from clearing agencies are primarily comprised of (i) cash received by the Company upon execution of short trades that is restricted from withdrawal by the clearing agent and (ii) cash deposited with the FICC to support the Company’s General Collateral Funding (“GCF”) matched book repo business.

Margin payable represents amounts borrowed from Pershing, LLC to finance the Company’s trading portfolio.  Substantially all of the Company’s investments-trading and deposits with clearing agencies serve as collateral for the margin payable.  See note 5 for interest expense incurred on margin payable.

Due to clearing agent represents amounts due to Bank of New York under the Company’s intra-day and overnight lending facility supporting the GCF matched repo business. See note 10.

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Fair Value Disclosures (Tables)

3 Months Ended

Mar. 31, 2020

Fair Value Disclosures [Abstract]

Schedule Of Assets And Liabilities Measured At Fair Value On A Recurring Basis

FAIR VALUE MEASUREMENTS ON A RECURRING BASIS
March 31, 2020
(Dollars in Thousands)
					Significant		Significant
			Quoted Prices in		Other Observable		Unobservable
			Active Markets		Inputs		Inputs
Assets	Fair Value		(Level 1)		(Level 2)		(Level 3)
Investments-trading:
U.S. government agency MBS and CMOs	$	218,767	$	-	$	218,767	$	-
U.S. government agency debt securities		4,791		-		4,791		-
RMBS		14		-		14		-
U.S. Treasury securities		6,065		6,065		-		-
ABS		1		-		1		-
SBA loans		26,073		-		26,073		-
Corporate bonds and redeemable preferred stock		31,877		-		31,877		-
Foreign government bonds		626		-		626		-
Municipal bonds		25,121		-		25,121		-
Certificates of deposit		3,575		-		3,575		-
Derivatives		55,780		-		55,780		-
Equity securities		99		-		99		-
Residential transition loans		2,956		-		-		2,956
Total investments - trading	$	375,745	$	6,065	$	366,724	$	2,956
Other investments, at fair value:
Equity securities	$	5,457	$	-	$	5,457	$	-
CLOs		1,877		-		-		1,877
Residential loans		97		-		97		-
		7,431	$	-	$	5,554	$	1,877
Investments measured at NAV (1)		2,626
Total other investments, at fair value	$	10,057
Liabilities
Trading securities sold, not yet purchased:
U.S. Treasury securities	$	16,211	$	16,211	$	-	$	-
Corporate bonds and redeemable preferred stock		43,937		-		43,937		-
Municipal bonds		20		-		20		-
Derivatives		54,599		-		54,599		-
Total trading securities sold, not yet purchased	$	114,767	$	16,211	$	98,556	$	-

(1) As a practical expedient, the Company uses NAV per share (or its equivalent)  to measure the fair value of its investments in the U.S. Insurance JV and the SPAC Fund.  The U.S. Insurance JV invests in debt issued by small and medium sized U.S. and Bermuda insurance and reinsurance companies.  The SPAC Fund invests in equity securities of SPACs.  According to ASC 820, these investments are not categorized within the valuation hierarchy.

FAIR VALUE MEASUREMENTS ON A RECURRING BASIS
December 31, 2019
(Dollars in Thousands)
					Significant		Significant
			Quoted Prices in		Other Observable		Unobservable
			Active Markets		Inputs		Inputs
Assets	Fair Value		(Level 1)		(Level 2)		(Level 3)
Investments-trading:
U.S. government agency MBS and CMOs	$	196,146	$	-	$	196,146	$	-
U.S. government agency debt securities		14,680		-		14,680		-
RMBS		15		-		15		-
U.S. Treasury securities		11,105		11,105		-		-
ABS		100		-		100		-
SBA loans		27,634		-		27,634		-
Corporate bonds and redeemable preferred stock		38,503		-		38,503		-
Foreign government bonds		844		-		844		-
Municipal bonds		13,737		-		13,737		-
Certificates of deposit		841		-		841		-
Derivatives		3,686		-		3,686		-
Equity securities		561		-		561		-
Total investments - trading	$	307,852	$	11,105	$	296,747	$	-
Other investments, at fair value:
Equity Securities	$	9,352	$	2,009	$	7,343	$	-
CLOs		2,522		-		-		2,522
Residential loans		99		-		99		-
		11,973	$	2,009	$	7,442	$	2,522
Investments measured at NAV (1)		2,891
Total other investments, at fair value	$	14,864
Liabilities
Trading securities sold, not yet purchased:
U.S. Treasury securities	$	16,827	$	16,827	$	-	$	-
Corporate bonds and redeemable preferred stock		58,083		-		58,083		-
Municipal bonds		20		-		20		-
Derivatives		3,017		-		3,017		-
Total trading securities sold, not yet purchased	$	77,947	$	16,827	$	61,120	$	-

(1)As a practical expedient, the Company uses NAV per share (or its equivalent)  to measure the fair value of its investments in the U.S. Insurance JV and the SPAC Fund.  The U.S. Insurance JV invests in debt issued by small and medium sized U.S. and Bermuda insurance and reinsurance companies.  The SPAC Fund invests in equity securities of SPACs.  According to ASC 820, these investments are not categorized within the valuation hierarchy

Schedule Of Assets And Liabilities Measured With Level 3 Inputs

LEVEL 3 ROLLFORWARD
	Three Months Ended March 31,
	2020		2019
Beginning of period	$	2,522	$	2,756
Net trading		(78)		-
Gains & losses (1)		(603)		(33)
Accretion of income (1)		78		106
Purchases		609		-
Sales and returns of capital		(2,973)		(50)
Reclassification of RTLs		5,278		-
End of period	$	4,833	$	2,779
Change in unrealized gains / (losses) (2)	$	(385)	$	(33)

(1) Gains and losses and accretion of income on other investments, at fair value are recorded as a component of principal transactions and other income in the consolidated statements of operations.

(2) Represents the change in unrealized gains and losses for the period included in earnings for assets held at the end of the reporting period.

Quantitative Information About Level 3 Fair Value Measurements

QUANTITATIVE INFORMATION ABOUT LEVEL 3 FAIR VALUE MEASUREMENTS
(Dollars in Thousands)
				Significant		Range of
		Fair Value	Valuation	Unobservable	Weighted	Significant
		March 31, 2020	Technique	Inputs	Average	Inputs
Assets
Investments - trading
Residential Transition Loans	$	2,956	Discounted Cash Flow Model	Yield	15.00%	15.00%
Other investments, at fair value
CLOs	$	1,877	Discounted Cash Flow Model	Yield	20.8%	20.8% - 20.9%
				Duration-years	10.3	9.3 - 11.3
				Default rate	2.0%	2.0% - 2.0%

Fair Value, Investments, Entities That Calculate Net Asset Value Per Share

FAIR VALUE MEASUREMENTS OF INVESTMENTS IN CERTAIN ENTITIES
THAT CALCULATE NET ASSET VALUE PER SHARE (OR ITS EQUIVALENT)
(Dollars in Thousands)
		Fair Value March 31, 2020		Unfunded Commitments	Redemption Frequency	Redemption Notice Period
Other investments, at fair value
U.S. Insurance JV (a)	$	2,017	$	817	N/A	N/A
SPAC Fund  (b)		609		N/A	Quarterly after 1 year lock up	90 days
	$	2,626
		Fair Value December 31, 2019		Unfunded Commitments	Redemption Frequency	Redemption Notice Period
Other investments, at fair value
U.S. Insurance JV (a)	$	2,223	$	817	N/A	N/A
SPAC Fund  (b)		668		N/A	Quarterly after 1 year lock up	90 days
	$	2,891

N/ANot applicable.

(a) The U.S. Insurance JV invests in debt issued by small and medium sized U.S. and Bermuda insurance and reinsurance companies.

The SPAC Fund invests in equity interests of SPACs.

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Organization And Nature Of Operations

3 Months Ended

Mar. 31, 2020

Organization And Nature Of Operations [Abstract]

Organization And Nature Of Operations

1. ORGANIZATION AND NATURE OF OPERATIONS

Organizational History

Cohen Brothers, LLC (“Cohen Brothers”) was formed on October 7, 2004 by Cohen Bros. Financial, LLC (“CBF”). Cohen Brothers was established to acquire the net assets of CBF’s subsidiaries (the “Formation Transaction”): Cohen Bros. & Company, Inc.; Cohen Frères SAS; Dekania Investors, LLC; Emporia Capital Management, LLC; and the majority interest in Cohen Bros. & Toroian Investment Management, Inc. The Formation Transaction was accomplished through a series of transactions occurring between March 4, 2005 and May 31, 2005.

From its formation until December 16, 2009, Cohen Brothers operated as a privately-owned limited liability company. On December 16, 2009, Cohen Brothers completed its merger (the “Merger”) with a subsidiary of Alesco Financial Inc. (“AFN”), a publicly traded real estate investment trust.

As a result of the Merger, AFN contributed substantially all of its assets into Cohen Brothers in exchange for newly issued units of membership interests directly from Cohen Brothers. In addition, AFN received additional Cohen Brothers membership interests directly from its members in exchange for AFN common stock. In accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”), the Merger was accounted for as a reverse acquisition, and Cohen Brothers was deemed to be the accounting acquirer. As a result, all of AFN’s assets and liabilities were required to be revalued at fair value as of the acquisition date. The remaining units of membership interests of Cohen Brothers that were not held by AFN were included as a component of non-controlling interest in the consolidated balance sheets.

Subsequent to the Merger, AFN was renamed Cohen & Company Inc. In January 2011, it was renamed again as Institutional Financial Markets, Inc. (“IFMI”) and on September 1, 2017 it was renamed again as Cohen & Company Inc.  Effective January 1, 2010, the Company ceased to qualify as a REIT. 

The Company

The Company is a financial services company specializing in fixed income markets. As of March 31, 2020, the Company had $2.65 billion in assets under management (“AUM”) of which 79.0%, or $2.10 billion, was in collateralized debt obligations (“CDOs”). The remaining portion of AUM is from a diversified mix of Investment Vehicles (as defined herein).

In these financial statements, the “Company” refers to Cohen & Company Inc. and its subsidiaries on a consolidated basis. Cohen & Company, LLC or the “Operating LLC” refers to the main operating subsidiary of the Company.  “Cohen Brothers” refers to the pre-Merger Cohen Brothers, LLC and its subsidiaries. “AFN” refers to the pre-merger Alesco Financial Inc. and its subsidiaries. When the term “Cohen & Company Inc.” is used, it is referring to the parent company itself. “JVB Holdings” refers to J.V.B. Financial Holdings, LLC; “JVB” refers to J.V.B. Financial Group LLC, a broker-dealer subsidiary; “CCFL” refers to Cohen & Company Financial Limited (formerly known as EuroDekania Management LTD), a subsidiary regulated by the Financial Conduct Authority (formerly known as Financial Services Authority) in the United Kingdom; “CCFEL” refers to Cohen & Company Financial (Europe) Limited, a subsidiary regulated by the Central Bank of Ireland in Ireland; and “EuroDekania” refers to EuroDekania (Cayman) Ltd., a Cayman Islands exempted company that is externally managed by CCFL.

The Company’s business is organized into the following three business segments.

Capital Markets: The Company’s Capital Markets business segment consists primarily of fixed income sales, trading, matched book repurchase agreement (“repo”) financing, new issue placements in corporate and securitized products, and advisory services. The Company’s fixed income sales and trading group provides trade execution to corporate investors, institutional investors, mortgage originators, and other smaller broker-dealers. The Company specializes in a variety of products, including but not limited to: corporate bonds, asset backed securities (“ABS”), mortgage backed securities (“MBS”), residential mortgage backed securities (“RMBS”), CDOs, collateralized loan obligations (“CLOs”), collateralized bond obligations (“CBOs”), collateralized mortgage obligations (“CMOs”), municipal securities, to-be-announced securities (“TBAs”) and other forward agency MBS contracts, Small Business Administration (“SBA”) loans, U.S. government bonds, U.S. government agency securities, brokered deposits and certificates of deposit (“CDs”) for small banks, and hybrid capital of financial institutions including trust preferred securities (“TruPS”), whole loans, residential transition loans, (“RTLs”), and other structured financial instruments. The Company also offers execution and brokerage services for equity products. The Company operates its capital markets activities primarily through its subsidiaries: JVB in the United States, and CCFL and CCFEL in Europe.

Asset Management: The Company’s Asset Management business segment manages assets within CDOs, managed accounts, joint ventures, and investment funds (collectively referred to as “Investment Vehicles”). A CDO is a form of secured borrowing. The borrowing is secured by different types of fixed income assets such as corporate or mortgage loans or bonds. The borrowing is in the form of a securitization, which means that the lenders are actually investing in notes backed by the assets. In the event of default, the lenders will have recourse only to the assets securing the loan. The Company’s Asset Management business segment includes its fee-based asset management operations, which include ongoing base and incentive management fees.

Principal Investing: The Company’s Principal Investing business segment is comprised of investments that the Company has made for the purpose of earning an investment return rather than investments made to support the Company’s trading, matched book repo, or other Capital Markets business segment activities.  These investments are included in the Company’s other investments, at fair value and investments in equity method affiliates in the Company’s consolidated balance sheets.

The Company generates its revenue by business segment primarily through the following activities.

Capital Markets

· Trading activities of the Company, which include execution and brokerage services, riskless trading activities as well as gains and losses (unrealized and realized) and income and expense earned on securities and derivatives classified as trading;

· Net interest income on the Company’s matched book repo financing activities; and

· New issue and advisory revenue comprised primarily of (i) new issue revenue associated with originating, arranging, or placing newly created financial instruments and (ii) revenue from advisory services.

Asset Management

· Asset management fees for the Company’s on-going asset management services provided to certain Investment Vehicles, which may include fees both senior and subordinate to the securities in the Investment Vehicle, and incentive management fees earned based on the performance of the various Investment Vehicles.

Principal Investing

· Gains and losses (unrealized and realized) and income and expense earned on securities classified as other investments, at fair value.

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Supplemental Cash Flow Disclosure

3 Months Ended

Mar. 31, 2020

Supplemental Cash Flow Disclosure [Abstract]

Supplemental Cash Flow Disclosure

23. SUPPLEMENTAL CASH FLOW DISCLOSURE

Interest paid by the Company on its debt and redeemable financial instruments was $2,033 and $2,070 for the three months ended March 31, 2020 and 2019, respectively.

The Company paid income taxes of $4 and $4 for the three months ended March 31, 2020 and 2019, respectively. The Company received income tax refunds of $48 for the three months ended March 31, 2019.

For the three months ended March 31, 2020, the Company had the following significant non-cash transactions that are not reflected on the statement of cash flows:

· The Company net surrendered units of membership interests the Operating LLC.  The Company recognized a net decrease in additional paid-in capital of $123, a net increase of $8 in AOCI, and a increase of $115 in non-controlling interest.  See note 18.

· The investment return related to certain of the Company’s redeemable financial instruments was negative within certain quarterly periods.  According to the terms of those agreements, the redemption value of the instrument is reduced in those cases.  Accordingly, the Company recorded interest income and reduced the balance of redeemable financial instruments by $76. See note 16.

For the three months ended March 31, 2019, the Company had the following significant non-cash transactions that are not reflected on the statement of cash flows:

· The Company net surrendered units of membership interests in the Operating LLC.  The Company recognized a net increase in additional paid-in capital of $133, a net decrease of $14 in AOCI, and a decrease of $119 in non-controlling interest.  See note 18.

· The investment return related to certain of the Company’s redeemable financial instruments was negative within certain quarterly periods.  According to the terms of those agreements, the redemption value of the instrument is reduced in those cases.  Accordingly, the Company recorded interest income and reduced the balance of redeemable financial instruments by $37.  

· The Company recognized an accrual of $335 in accounts payable and other accrued liabilities for dividends and distributions declared on March 6, 2019, which were paid after March 31, 2019.

· On January 1, 2019, the Company recorded a right of use asset of $8,416 and a right of use liability of $8,860, a reduction in retained earnings from cumulative effect of adoption of $20, an increase in other receivables of $18, and a reduction in other liabilities of $406, resulting from the adoption of ASU 2016-02. See note 2.

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Consolidated Statements Of Operations And Comprehensive Income (Loss) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Revenues
Principal transactions and other income	$ (2,406)	$ 414
Total revenues	17,770	11,140
Operating expenses
Compensation and benefits	14,134	6,364
Business development, occupancy, equipment	756	811
Subscriptions, clearing, and execution	2,580	2,273
Professional fee and other operating	1,782	1,679
Depreciation and amortization	80	81
Impairment of goodwill	7,883
Total operating expenses	27,215	11,208
Operating income (loss)	(9,445)	(68)
Non-operating income (expense)
Interest expense, net	(2,605)	(1,854)
Income (loss) from equity method affiliates	(107)	(8)
Income (loss) before income tax expense (benefit)	(12,157)	(1,930)
Income tax expense (benefit)	(372)	(106)
Net income (loss)	(11,785)	(1,824)
Less: Net income (loss) attributable to the non-controlling interest	(8,683)	(622)
Net income (loss) attributable to Cohen & Company Inc.	$ (3,102)	$ (1,202)
Income (loss) per common share-basic:
Basic income (loss) per common share	$ (2.70)	$ (1.06)
Weighted average shares outstanding-basic	1,146,879	1,133,166
Income (loss) per common share-diluted:
Diluted income (loss) per common share	$ (2.70)	$ (1.06)
Weighted average shares outstanding-diluted	3,940,677	1,665,575
Dividends declared per common share		$ 0.20
Comprehensive income (loss)
Net income (loss)	$ (11,785)	$ (1,824)
Other comprehensive income (loss) item:
Foreign currency translation adjustments, net of tax of $0	(100)	9
Other comprehensive income (loss), net of tax of $0	(100)	9
Comprehensive income (loss)	(11,885)	(1,815)
Less: comprehensive income (loss) attributable to the non-controlling interest	(8,754)	(619)
Comprehensive income (loss) attributable to Cohen & Company Inc.	(3,131)	(1,196)
Net Trading [Member]
Revenues
Total revenue	18,561	8,724
Asset Management [Member]
Revenues
Total revenue	$ 1,615	$ 2,002

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Summary Of Significant Accounting Policies (Policy)

3 Months Ended

Mar. 31, 2020

Summary Of Significant Accounting Policies [Abstract]

Adoption Of New Accounting Standards

A. Adoption of New Accounting Standards

In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842). Under the new guidance (subsequently updated with ASU 2018-01, ASU 2018-10, ASU 2018-11,  ASU 2018-20, and ASU  2019-01), lessees will be required to recognize the following for all leases with the exception of short-term leases:  (i) a lease liability, which is a lessee’s obligation to make lease payments arising from a lease, measured on a discounted basis, and (ii) a right-of-use asset, which is an asset that represents the lessee’s right to use, or control the use of, a specified asset for the lease term.  Lessor accounting is largely unchanged.  The Company adopted the provisions of the new guidance effective January 1, 2019.  The Company recorded the following:  (a) a right of use asset of $8,416, (b) a lease commitment liability of $8,860, (c) a reduction in retained earnings from cumulative effect of adoption of $20, (d) an increase in other receivables of $18, and (e) a reduction in other liabilities of $406.  See note 13.

In June 2016, the FASB issued ASU 2016-13, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments.  Under this guidance (subsequently updated with ASU 2018-19, ASU 2019-05, ASU 2019-11 and ASU 2020-02), the measurement of all expected credit losses for financial assets held at the reporting date is to be based on historical experience, current conditions, and reasonable and supportable forecasts. Financial institutions and other organizations will now use forward-looking information to better inform their credit loss estimates. Many of the loss estimation techniques applied today will still be permitted, although the inputs to those techniques will change to reflect the full amount of expected credit losses. In addition, the ASU amends the accounting for credit losses on available-for-sale debt securities and purchased financial assets with credit deterioration. The Company’s adoption of the provisions of ASU 2016-13, effective January 1, 2020 did not have a material effect on the Company’s consolidated financial statements.

In January 2017, the FASB issued ASU 2017-04, Intangibles  – Goodwill and Other (Topic 350):  Simplifying the Test for GoodwillImpairment.The amendments in this ASU eliminate Step 2 from the goodwill impairment test. The annual or interim goodwill impairment test is performed by comparing the fair value of a reporting unit with its carrying amount.  An impairment charge should be recognized for the amount by which the carrying amount exceeds the reporting unit’s fair value; however, the loss recognized should not exceed the total amount of goodwill allocated to that reporting unit.  The Company adopted the provisions of ASU 2017-04, effective January 1, 2020.  The Company recorded an impairment of goodwill for the three months ended March 31, 2020.  See note 12.  This impairment charge was not the result of the adoption of ASU 2017-04. 

In June 2018, the FASB issued ASU 2018-07, Compensation – Stock Compensation (Topic 718):  Improvements toNonemployee Share-Based Payment Accounting.  The amendments in this ASU expand the scope of Topic 718, which previously only included share-based payments to employees, to include share-based payments issued to nonemployees for goods or services.  Consequently, the accounting for share-based payments to nonemployees and employees will be substantially aligned. The Company’s adoption of the provisions of ASU 2018-07, effective January 1, 2019 did not have an effect on the Company’s consolidated financial statements.

In March 2017, the FASB issued ASU 2017-08, Receivables – Nonrefundable Fees and Other Costs, Premium Amortization onPurchased Callable Debt Securities (Sub-Topic 310-20).  The amendments in this ASU shorten the amortization period for certain callable debt securities held at a premium.  Specifically, the amendments require the premium to be amortized to the earliest call date.  The amendments do not require an accounting change for securities held at a discount; the discount continues to be amortized to maturity.  The Company’s adoption of the provisions of ASU 2017-08, effective January 1, 2019 did not have an effect on the Company’s consolidated financial statements.

In August 2017, the FASB issued ASU 2017-12, Derivative and Hedging – Targeted Improvements to Accounting for HedgingActivities (Topic 815).   The amendments in this ASU refine and expand hedge accounting for both financial and commodity risks and contain provisions to create more transparency and clarify how economic results are presented. The Company’s adoption of the provisions of ASU 2017-12, effective January 1, 2019 did not have an effect on the Company’s consolidated financial statements.

In February 2018, the FASB issued ASU 2018-02, Income Statement – Reporting Comprehensive Income (Topic 220): Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income.  The amendments in this ASU provide the option to reclassify stranded tax effects within accumulated other comprehensive income (“AOCI”) to retained earnings in each period in which the effect of the change in the U.S. federal corporate income tax rate in the Tax Act (or portion thereof) is recorded. The Company’s adoption of the provisions of ASU 2018-02, effective January 1, 2019 did not have an effect on the Company’s consolidated financial statements.

In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement(Topic 820): Disclosure Framework –Changes to the Disclosure Requirements for Fair Value Measurement.  The ASU modifies the disclosure requirements in Topic 820, by removing certain disclosure requirements related to the valuation hierarchy, modifying existing disclosure requirements related to measurement uncertainty and adding new disclosure requirements such as disclosing the changes in unrealized gains and losses for the period included in other comprehensive income for recurring level 3 fair value measurements held at the end of the reporting period and disclosing the range and weighted average of significant unobservable inputs used to develop level 3 fair value measurements. This ASU is effective for public companies for annual reporting periods and interim periods within those annual periods beginning after December 15, 2019. The Company’s adoption of the provisions of ASU 2018-13, effective January 1, 2020 did not have an effect on the Company’s consolidated financial statements.

In October 2018, the FASB issued ASU 2018-17, Consolidation (Topic 810):  Target Improvements to Related Party Guidancefor Variable Interest Entities.  The ASU made targeted changes to the related party consolidation guidance. The new guidance changes how entities evaluate decision-making fees under the variable interest entity guidance. To determine whether decision-making fees represent a variable interest, an entity will need to consider indirect interests held through related parties under common control on a proportionate basis under the new guidance, rather than in their entirety, as has been the case under current guidance. The guidance is effective in annual periods beginning after December 15, 2019 and interim periods within those fiscal years. The Company’s adoption of the provisions of ASU 2018-17, effective January 1, 2020 did not have an effect on the Company’s consolidated financial statements.

In November 2018, the FASB issued ASU 2018-18, Collaborative Arrangements (Topic 808): Clarifying the InteractionBetween Topic 808 and Topic 606.  The ASU provides more comparability in the presentation of revenue for certain transactions between collaborative arrangement participants. It accomplishes this by allowing organizations to only present units of account in collaborative arrangements that are within the scope of the revenue recognition standard together with revenue accounted for under the revenue recognition standard.  The parts of the collaborative arrangement that are not in the scope of the revenue recognition standard should be presented separately from revenue accounted for under the revenue recognition.  The Company’s adoption of the provisions of ASU 2018-18, effective January 1, 2020 did not have an effect on the Company’s consolidated financial statements.

In November 2019, the FASB issued ASU 2019-08, Compensation – Stock Compensation (Topic (718) and Revenue from Contracts with Customers (Topic 606): Codification Improvements– Share-Based Consideration Payable to a Customer.  This ASU requires companies to measure and classify (on the balance sheet) share-based payments to customers by applying the guidance in Topic 718, Compensation—Stock Compensation.  As a result, the amount recorded as a reduction in revenue would be measured based on the grant-date fair value of the share-based payment. The Company’s adoption of the provisions of ASU 2018-18, effective January 1, 2020 did not have an effect on the Company’s consolidated financial statements.

In March 2020, the FASB issued ASU 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting. This ASU provides temporary optional guidance to ease the burden in accounting for reference rate reform by providing optional expedients and exceptions for applying generally accepted accounting principles to contract modifications and hedging relationships, subject to meeting certain criteria, that reference LIBOR or another reference rate expected to be discontinued.  The ASU is intended to help stakeholders during the global market wide reference rate transition period and will be in effect for a limited time through December 31, 2022. The Company’s adoption of the provisions of ASU 2020-04, effective March 12, 2020 did not have an effect on the Company’s consolidated financial statements.

Recent Accounting Developments

B. Recent Accounting Developments

In December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740):  Simplifying the Accounting for Income Taxes. This ASU is intended to simplify accounting for income taxes. It removes specific exceptions to the general principles in Topic 740 and amends existing guidance to improve consistent application.  This ASU is effective for fiscal years beginning after December 15, 2020 and interim period with those fiscal years The Company is currently evaluating the new guidance to determine the impact it may have on its consolidated financial statements.

In January 2020, the FASB issued ASU 2020-01,  Investments—Equity Securities (Topic 321), Investments—Equity Method and Joint Ventures (Topic 323), and Derivatives and Hedging (Topic 815)—Clarifying the Interactions between Topic 321, Topic 323, and Topic 815.  This ASU clarifies certain accounting certain topics impacted by Topic 321 Investments-Equity Securities. These topics include measuring equity securities using the measurement alternative, how the measurement alternative should be applied to equity method accounting, and certain forward contracts and purchased options which would be accounted for under the equity method of accounting upon settlement or exercise. This ASUis effective for public business entities for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2020. The Company is currently evaluating the new guidance to determine the impact it may have on its consolidated financial statements.

Fair Value Of Financial Instruments

B. Recent Accounting Developments

In December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740):  Simplifying the Accounting for Income Taxes. This ASU is intended to simplify accounting for income taxes. It removes specific exceptions to the general principles in Topic 740 and amends existing guidance to improve consistent application.  This ASU is effective for fiscal years beginning after December 15, 2020 and interim period with those fiscal years The Company is currently evaluating the new guidance to determine the impact it may have on its consolidated financial statements.

In January 2020, the FASB issued ASU 2020-01,  Investments—Equity Securities (Topic 321), Investments—Equity Method and Joint Ventures (Topic 323), and Derivatives and Hedging (Topic 815)—Clarifying the Interactions between Topic 321, Topic 323, and Topic 815.  This ASU clarifies certain accounting certain topics impacted by Topic 321 Investments-Equity Securities. These topics include measuring equity securities using the measurement alternative, how the measurement alternative should be applied to equity method accounting, and certain forward contracts and purchased options which would be accounted for under the equity method of accounting upon settlement or exercise. This ASUis effective for public business entities for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2020. The Company is currently evaluating the new guidance to determine the impact it may have on its consolidated financial statements.

C. Fair Value of Financial Instruments

The following methods and assumptions were used by the Company in estimating the fair value of its financial instruments. These determinations were based on available market information and appropriate valuation methodologies. Considerable judgment is required to interpret market data to develop the estimates and, therefore, these estimates may not necessarily be indicative of the amount the Company could realize in a current market exchange. The use of different market assumptions and/or estimation methodologies may have a material effect on the estimated fair value amounts. Refer to note 8 for a discussion of the valuation hierarchy with respect to investments-trading; other investments, at fair value; and derivatives held by the Company.

Cash equivalents: Cash equivalents are carried at historical cost, which is assumed to approximate fair value. The estimated fair value measurement of cash equivalents is classified within level 1 of the valuation hierarchy.

Investments-trading: These amounts are carried at fair value. The fair value is based on either quoted market prices of an active exchange, independent broker market quotations, market price quotations from third- party pricing services, or valuation models when quotations are not available.

Other investments, at fair value: These amounts are carried at fair value. The fair value is based on quoted market prices of an active exchange, independent broker market quotations, or valuation models when quotations are not available.  In the case of investments in alternative investment funds, fair value is generally based on the reported net asset value of the underlying fund.

Receivables under resale agreements: Receivables under resale agreements are carried at their contracted resale price, have short-term maturities, and are repriced frequently or bear market interest rates and, accordingly, these contracts are at amounts that approximate fair value. The estimated fair value measurements of receivables under resale agreements are based on observations of actual market activity and are generally classified within level 2 of the valuation hierarchy.  

Trading securities sold, not yet purchased: These amounts are carried at fair value. The fair value is based on quoted market prices of an active exchange, independent market quotations, market price quotations from third party pricing services, or valuation models when quotations are not available.

Securities sold under agreements to repurchase: The liabilities for securities sold under agreements to repurchase are carried at their contracted repurchase price, have short-term maturities, and are repriced frequently or bear market interest rates andaccordingly, these contracts are carried at amounts that approximate fair value. The estimated fair value measurements of securities sold under agreements to repurchase are based on observations of actual market activity and are generally classified within level 2 of the valuation hierarchy.

Redeemable financial instruments:  The liabilities for redeemable financial instruments are carried at their redemption value, which approximates fair value. The estimated fair value measurement of the redeemable financial instruments is classified within level 3 of the valuation hierarchy. 

Debt: These amounts are carried at outstanding principal less unamortized discount and deferred financing costs. However, a substantial portion of the debt was assumed in the Merger and recorded at fair value as of that date. As of March 31, 2020, and December 31, 2019, the fair value of the Company’s debt was estimated to be $61,501and $58,635, respectively. The estimated fair value measurements of the debt are generally based on discounted cash flow models prepared by the Company’s management primarily using discount rates for similar instruments issued to companies with similar credit risks to the Company and are generally classified within level 3 of the value hierarchy.

Derivatives: These amounts are carried at fair value. Derivatives may be included as a component of investments-trading; trading securities sold, not yet purchased; and other investments, at fair value. See notes 8 and 9. The fair value is generally based on quoted market prices on an exchange that is deemed to be active for derivative instruments such as foreign currency forward contracts and Eurodollar futures.  For derivative instruments, such as TBAs and other extended settlement trades, the fair value is generally based on market price quotations from third party pricing services.

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Other Recent Business Transactions Or Events (Narrative) (Details) $ / shares in Units, $ in Thousands	3 Months Ended
	Mar. 31, 2020 USD ($) item $ / shares	Apr. 30, 2020 USD ($)	Jan. 31, 2020 USD ($)	Dec. 31, 2019 USD ($) $ / shares	Jan. 19, 2017 $ / shares
Schedule of Equity Method Investments [Line Items]
Impairment of goodwill	$ 7,883
Common Stock, par value | $ / shares	$ 0.01			$ 0.01
Repayments of debt	$ 9,163
CK Capital Partners B.V. [Member]
Schedule of Equity Method Investments [Line Items]
Equity Method Investment, Quoted Market Value				$ 18
CK Capital Partners B.V. [Member] | Daniel G. Cohen [Member]
Schedule of Equity Method Investments [Line Items]
Equity Method Investment, Quoted Market Value				17
AOI [Member]
Schedule of Equity Method Investments [Line Items]
Equity Method Investment, Quoted Market Value				1
LegacyTexas Bank [Member]
Schedule of Equity Method Investments [Line Items]
Number of Residential Transition Loans (RTLs) | item	4
Par value of RTLs	$ 3,034
Fair value of RTLs	$ 2,956
IMXI [Member]
Schedule of Equity Method Investments [Line Items]
Share Price | $ / shares	$ 17.00				$ 15.00
Series F Preferred Stock [Member] | COHN, LLC [Member] | Daniel G. Cohen [Member]
Schedule of Equity Method Investments [Line Items]
Common Stock, par value | $ / shares	$ 0.00001
2020 Senior Notes [Member] | JKD Investor And RN Capital Solutions LLC [Member]
Schedule of Equity Method Investments [Line Items]
Principal amount of debt outstanding			$ 4,500
Stated interest rate	12.00%
Edward E. Cohen IRA [Member]
Schedule of Equity Method Investments [Line Items]
Repayments of debt	$ 4,386
12.00% Non-convertible Senior Notes (2019 Senior Notes) [Member]
Schedule of Equity Method Investments [Line Items]
Principal amount of debt outstanding				$ 2,400
Subsequent Event [Member]
Schedule of Equity Method Investments [Line Items]
Loan under paycheck protection program		$ 2,200

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Related Party Transactions (Tables)

3 Months Ended

Mar. 31, 2020

Related Party Transactions [Abstract]

Schedule Of Related Party Transactions

	Related Party Transactions
	(Dollars in Thousands)
		Three Months Ended
		March 31, 2020		March 31, 2019
Net trading
TBBK	$	-	$	2
Asset management
EuroDekania		-		86
SPAC Fund		(47)		31
U.S.  Insurance JV		90		80
	$	43	$	197
Principal transactions and other income
EuroDekania		-		291
FinTech Acquisition Corp.		3		3
Insurance SPAC		30		4
SPAC Fund		(59)		24
U.S.  Insurance JV		(167)		39
	$	(193)	$	361
Income (loss) from equity method affiliates
AOI		(30)		-
CK Capital		230		-
Insurance SPAC		(307)		(8)
	$	(107)	$	(8)
Operating expense (income)
Duane Morris		319		101
FinTech Masala, LLC		(11)		(6)
	$	308	$	95
Interest expense (income)
CBF		528		119
DGC Trust		533		390
EBC		72		47
Edward E. Cohen IRA		48		87
JKD Investor		484		278
	$	1,665	$	921

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Financial Instruments (Schedule Of Trading Securities Sold, Not Yet Purchased) (Details) - USD ($) $ in Thousands	Mar. 31, 2020	Dec. 31, 2019
Security Owned and Sold, Not yet Purchased, at Fair Value [Line Items]
Trading securities sold, not yet purchased	$ 114,767	$ 77,947
U.S. Treasury securities [Member]
Security Owned and Sold, Not yet Purchased, at Fair Value [Line Items]
Trading securities sold, not yet purchased	16,211	16,827
Corporate bonds and redeemable preferred stock [Member]
Security Owned and Sold, Not yet Purchased, at Fair Value [Line Items]
Trading securities sold, not yet purchased	43,937	58,083
Municipal bonds [Member]
Security Owned and Sold, Not yet Purchased, at Fair Value [Line Items]
Trading securities sold, not yet purchased	20	20
Derivatives [Member]
Security Owned and Sold, Not yet Purchased, at Fair Value [Line Items]
Trading securities sold, not yet purchased	$ 54,599	$ 3,017

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Redeemable Financial Instruments (Schedule Of Redeemable Financial Instruments) (Details) - USD ($) $ in Thousands	Mar. 31, 2020	Dec. 31, 2019	Oct. 01, 2019	Sep. 30, 2019
Related Party Transaction [Line Items]
Outstanding balance	$ 16,907	$ 16,983
JKD Capital Partners I, LTD [Member]
Related Party Transaction [Line Items]
Outstanding balance	7,957	7,957
DGC Trust/CBF [Member]
Related Party Transaction [Line Items]
Outstanding balance	8,500	8,500	$ 6,500	$ 8,000
Via Nova Capital Group, LLC [Member]
Related Party Transaction [Line Items]
Outstanding balance	$ 450	$ 526

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Goodwill (Narrative) (Details) $ in Thousands	3 Months Ended
	Mar. 31, 2020 USD ($)
Goodwill [Abstract]
Goodwill impairment charge	$ 7,883

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Other Receivables, Other Assets, Accounts Payable And Other Liabilities (Schedule Of Other Receivables) (Details) - USD ($) $ in Thousands	Mar. 31, 2020	Dec. 31, 2019
Other Receivables, Other Assets, Accounts Payable And Other Liabilities [Abstract]
Cash collateral due from counterparties	$ 4,838	$ 41,172
Asset management fees receivable	886	1,159
Accrued interest and dividend receivable	10,521	3,549
Revenue share receivable	115	150
Other receivables	647	595
Other receivables	$ 17,007	$ 46,625

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Equity (Preferred Stock) (Details)	3 Months Ended
	Mar. 31, 2020 shares	Dec. 31, 2019 $ / shares shares	Dec. 30, 2019 shares
Series E Preferred Stock [Member]
Permanent Equity [Line Items]
Preferred Stock, Shares Outstanding	4,983,557
Ratio of shares to vote	10
Series F Preferred Stock [Member]
Permanent Equity [Line Items]
Preferred Stock, shares authorized		25,000,000
Preferred Stock, Par or Stated Value Per Share | $ / shares		$ 0.001
Ratio of shares to vote	10
Series F Preferred Stock [Member] | Mr. Cohen [Member]
Permanent Equity [Line Items]
Preferred Stock, shares issued		12,549,273	12,549,273
Series F Preferred Stock [Member] | DGC Trust [Member]
Permanent Equity [Line Items]
Preferred Stock, shares issued		9,880,268	9,880,268

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Equity (Tables)

3 Months Ended

Mar. 31, 2020

Equity [Abstract]

Schedule Of Unrestricted Common Stock Activity

	Common Stock
	Shares
December 31, 2019	1,119,909
Vesting of shares	55,278
Shares withheld for employee taxes and retired	(15,043)
March 31, 2020	1,160,144

Operating LLC Membership Units

	Operating LLC
	Membership Units
Units related to UIS Agreement	402,350
Total	402,350

Schedule Of Effects Of Changes In Ownership Interest Subsidiary

		Three Months Ended		Three Months Ended
	March 31, 2020		March 31, 2019
Net income / (loss) attributable to Cohen & Company Inc.	$	(3,102)	$	(1,202)
Transfers (to) from the non-controlling interest:
Increase / (decrease) in Cohen & Company, Inc. paid in capital for the acquisition / (surrender) of additional units in consolidated subsidiary, net		(123)		133
Changes from net income / (loss) attributable to Cohen & Company Inc. and transfers (to) from the non-controlling interest	$	(3,225)	$	(1,069)

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Collateralized Securities Transactions (Tables)

3 Months Ended

Mar. 31, 2020

Collateralized Securities Transactions [Abstract]

Schedule Of Repurchase Agreements Accounted For As Secured Borrowings

SECURED BORROWINGS
(Dollars in Thousands)
March 31, 2020
	Repurchase Agreements
	Remaining Contractual Maturity of the Agreements
Collateral Type:	Overnight and Continuous		Up to 30 days		30 - 90 days		Greater than 90 days		Total
U.S. government agency MBS (GCF repo)	$	3,923,623	$	672,974	$	-	$	400,101	$	4,996,698
MBS (gestation repo)		-		1,046,002		-		-		1,046,002
SBA loans		23,672		-		-		-		23,672
	$	3,947,295	$	1,718,976	$	-	$	400,101	$	6,066,372
	Reverse Repurchase Agreements
	Remaining Contractual Maturity of the Agreements
Collateral Type:	Overnight and Continuous		Up to 30 days		30 - 90 days		Greater than 90 days		Total
U.S. government agency MBS (GCF repo)	$	828,399	$	3,824,896	$	312,087	$	-	$	4,965,382
MBS (gestation repo)		-		1,049,056		-		-		1,049,056
	$	828,399	$	4,873,952	$	312,087	$	-	$	6,014,438

SECURED BORROWINGS
(Dollars in Thousands)
December 31, 2019
	Repurchase Agreements
	Remaining Contractual Maturity of the Agreements
Collateral Type:	Overnight and Continuous		Up to 30 days		30 - 90 days		Greater than 90 days		Total
U.S. government agency MBS (GCF repo)	$	5,117,811	$	1,546,510	$	-	$	-	$	6,664,321
MBS (gestation repo)		-		742,035		100,403		-		842,438
SBA loans		27,684		-		-		-		27,684
	$	5,145,495	$	2,288,545	$	100,403	$	-	$	7,534,443
	Reverse Repurchase Agreements
	Remaining Contractual Maturity of the Agreements
Collateral Type:	Overnight and Continuous		Up to 30 days		30 - 90 days		Greater than 90 days		Total
U.S. government agency MBS (GCF repo)	$	1,231,027	$	2,525,188	$	2,319,079	$	575,058	$	6,650,352
MBS (gestation repo)		-		747,692		101,958		-		849,650
	$	1,231,027	$	3,272,880	$	2,421,037	$	575,058	$	7,500,002

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Other Receivables, Other Assets, Accounts Payable And Other Liabilities (Tables)

3 Months Ended

Mar. 31, 2020

Other Receivables, Other Assets, Accounts Payable And Other Liabilities [Abstract]

Schedule Of Other Receivables

OTHER RECEIVABLES
(Dollars in Thousands)
	March 31, 2020		December 31, 2019
Cash collateral due from counterparties	$	4,838	$	41,172
Asset management fees receivable		886		1,159
Accrued interest receivable and dividend receivable		10,521		3,549
Revenue share receivable		115		150
Other receivables		647		595
Other receivables	$	17,007	$	46,625

Schedule Of Other Assets

OTHER ASSETS
(Dollars in Thousands)
	March 31, 2020		December 31, 2019
Deferred costs	$	241	$	301
Prepaid expenses		1,075		796
Deposits		403		656
Miscellaneous other assets		275		275
Residential transition loans		-		5,323
Furniture, equipment, and leasehold improvements, net		899		916
Intangible assets		166		166
Other assets	$	3,059	$	8,433

Schedule Of Accounts Payable And Other Liabilities

ACCOUNTS PAYABLE AND OTHER LIABILITIES
(Dollars in Thousands)
	March 31, 2020		December 31, 2019
Accounts payable	$	141	$	362
Redeemable financial instruments accrued interest		814		403
Accrued interest payable		738		711
Accrued interest on securities sold, not yet purchased		882		914
Payroll taxes payable		677		729
Counterparty cash collateral		74,692		9,524
Accrued expense and other liabilities		3,837		7,652
Accounts payable and other liabilities	$	81,781	$	20,295

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Segment And Geographic Information (Schedule Of Segment Reporting Information) (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Segment Reporting Information [Line Items]
Principal transactions and other income	$ (2,406)	$ 414
Total revenues	17,770	11,140
Salaries/Wages	14,134	6,364
Other Operating Expense	5,198	4,844
Impairment of goodwill	7,883
Total operating expenses	27,215	11,208
Operating income (loss)	(9,445)	(68)
Interest (income) expense	2,605	1,854
Income (loss) from equity method affiliates	(107)	(8)
Income (loss) before income tax expense (benefit)	(12,157)	(1,930)
Income tax expense (benefit)	(372)	(106)
Net income (loss)	(11,785)	(1,824)
Less: Net income (loss) attributable to the non-controlling interest	(8,683)	(622)
Net income (loss) attributable to Cohen & Company Inc.	(3,102)	(1,202)
Depreciation and amortization (included in total operating expense)	80	81
Operating Segments [Member]
Segment Reporting Information [Line Items]
Principal transactions and other income	(2,406)	414
Total revenues	17,770	11,140
Salaries/Wages	13,027	5,669
Other Operating Expense	3,804	3,704
Impairment of goodwill	7,883
Total operating expenses	24,714	9,373
Operating income (loss)	(6,944)	1,767
Interest (income) expense	75	55
Income (loss) from equity method affiliates	(107)	(8)
Income (loss) before income tax expense (benefit)	(7,126)	1,704
Net income (loss)	(7,126)	1,704
Net income (loss) attributable to Cohen & Company Inc.	(7,126)	1,704
Depreciation and amortization (included in total operating expense)	5	6
Unallocated [Member]
Segment Reporting Information [Line Items]
Salaries/Wages	1,107	695
Other Operating Expense	1,394	1,140
Total operating expenses	2,501	1,835
Operating income (loss)	(2,501)	(1,835)
Interest (income) expense	2,530	1,799
Income (loss) before income tax expense (benefit)	(5,031)	(3,634)
Income tax expense (benefit)	(372)	(106)
Net income (loss)	(4,659)	(3,528)
Less: Net income (loss) attributable to the non-controlling interest	(8,683)	(622)
Net income (loss) attributable to Cohen & Company Inc.	4,024	(2,906)
Depreciation and amortization (included in total operating expense)	75	75
Capital Markets [Member] | Operating Segments [Member]
Segment Reporting Information [Line Items]
Principal transactions and other income	9	1
Total revenues	18,570	8,725
Salaries/Wages	11,910	4,547
Other Operating Expense	3,277	2,911
Impairment of goodwill	7,883
Total operating expenses	23,070	7,458
Operating income (loss)	(4,500)	1,267
Interest (income) expense	75	55
Income (loss) before income tax expense (benefit)	(4,575)	1,212
Net income (loss)	(4,575)	1,212
Net income (loss) attributable to Cohen & Company Inc.	(4,575)	1,212
Depreciation and amortization (included in total operating expense)	4	5
Asset Management [Member] | Operating Segments [Member]
Segment Reporting Information [Line Items]
Principal transactions and other income	116	97
Total revenues	1,731	2,099
Salaries/Wages	1,117	1,122
Other Operating Expense	477	693
Total operating expenses	1,594	1,815
Operating income (loss)	137	284
Income (loss) from equity method affiliates	200
Income (loss) before income tax expense (benefit)	337	284
Net income (loss)	337	284
Net income (loss) attributable to Cohen & Company Inc.	337	284
Depreciation and amortization (included in total operating expense)	1	1
Principal Investing [Member] | Operating Segments [Member]
Segment Reporting Information [Line Items]
Principal transactions and other income	(2,531)	316
Total revenues	(2,531)	316
Other Operating Expense	50	100
Total operating expenses	50	100
Operating income (loss)	(2,581)	216
Income (loss) from equity method affiliates	(307)	(8)
Income (loss) before income tax expense (benefit)	(2,888)	208
Net income (loss)	(2,888)	208
Net income (loss) attributable to Cohen & Company Inc.	(2,888)	208
Net Trading [Member]
Segment Reporting Information [Line Items]
Total revenue	18,561	8,724
Net Trading [Member] | Operating Segments [Member]
Segment Reporting Information [Line Items]
Total revenue	18,561	8,724
Net Trading [Member] | Capital Markets [Member] | Operating Segments [Member]
Segment Reporting Information [Line Items]
Total revenue	18,561	8,724
Asset Management [Member]
Segment Reporting Information [Line Items]
Total revenue	1,615	2,002
Asset Management [Member] | Operating Segments [Member]
Segment Reporting Information [Line Items]
Total revenue	1,615	2,002
Asset Management [Member] | Asset Management [Member] | Operating Segments [Member]
Segment Reporting Information [Line Items]
Total revenue	$ 1,615	$ 2,002

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Derivative Financial Instruments (Balance Sheet Information) (Details) - USD ($) $ in Thousands	Mar. 31, 2020	Dec. 31, 2019
Derivatives, Fair Value [Line Items]
Derivative fair value	$ 1,181	$ 669
Investments-trading [Member] | TBAs [Member]
Derivatives, Fair Value [Line Items]
Derivative fair value	55,779	3,686
Investments-trading [Member] | Other Extended Settlement Trades [Member]
Derivatives, Fair Value [Line Items]
Derivative fair value	1
Trading securities sold, not yet purchased [Member] | TBAs [Member]
Derivatives, Fair Value [Line Items]
Derivative fair value	$ (54,599)	$ (3,017)

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Fair Value Disclosures (Schedule Of Assets And Liabilities Measured With Level 3 Inputs) (Details) - USD ($) $ in Thousands		3 Months Ended
		Mar. 31, 2020	Mar. 31, 2019
Schedule of additional information about assets and liabilities measured at fair value on a recurring basis level 3 inputs
Level 3 inputs, Beginning balance		$ 2,522	$ 2,756
Net trading		(78)
Gains and losses	[1]	(603)	(33)
Accretion of income	[1]	78	106
Purchases		609
Sales and returns of capital		(2,973)	(50)
Reclassification of RTLs		5,278
Level 3 inputs, Ending balance		4,833	2,779
Change in unrealized gains /(losses)	[2]	$ (385)	$ (33)

[1] Gains and losses and accretion of income on other investments, at fair value are recorded as a component of principal transactions and other income in the consolidated statements of operations.

[2] Represents the change in unrealized gains and losses for the period included in earnings for assets held at the end of the reporting period.

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Earnings / (Loss) Per Common Share (Schedule of Earnings / (Loss) Per Common Share) (Details) - USD ($) $ / shares in Units, $ in Thousands		3 Months Ended
		Mar. 31, 2020	Mar. 31, 2019
Earnings / (Loss) Per Common Share [Abstract]
Net income / (loss) attributable to Cohen & Company		$ (3,102)	$ (1,202)
Add/ (deduct): Income / (loss) attributable to non-controlling interest attributable to Operating LLC membership	[1]	(8,523)	(622)
Add / (deduct): Adjustment	[2]	966	53
Net income / (loss) on a fully converted basis		$ (10,659)	$ (1,771)
Weighted average common shares outstanding - Basic		1,146,879	1,133,166
Unrestricted Operating LLC membership units exchangeable into Cohen & Company shares	[1]	2,793,798	532,409
Weighted average common shares outstanding - Diluted		3,940,677	1,665,575
Net income / (loss) per common share - Basic		$ (2.70)	$ (1.06)
Net income / (loss) per common share - Diluted		(2.70)	(1.06)
Redeemable noncontrolling interest, membership units not held, share ratio		$ 10	$ 10

[1] The Operating LLC units of membership interest not held by Cohen & Company Inc. (that is, those held by the non-controlling interest) may be redeemed and exchanged into shares of the Company on a ten-for-one basis. The Operating LLC units of membership interests not held by Cohen & Company Inc. are redeemable, at the member’s option at any time, for (i) cash in an amount equal to the average of the per share closing prices of the Common Stock for the ten consecutive trading days immediately preceding the date the Company receives the member’s redemption notice, or (ii) at the Company’s option, one tenth of a share of the Common Stock, subject, in each case, to appropriate adjustment upon the occurrence of an issuance of additional shares of the Common Stock as a dividend or other distribution on the outstanding Common Stock, or a further subdivision or combination of the outstanding shares of the Common Stock. These units are not included in the computation of basic earnings per share. These units enter into the computation of diluted net income (loss) per common share when the effect is not anti-dilutive using the if-converted method.

[2] An adjustment is included because the Company would have incurred a higher income tax expense or realized a higher income tax benefit, as applicable, if the Operating LLC units of membership interests had been converted at the beginning of the period.

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Related Party Transactions (Schedule Of Related Party Transactions) (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Related Party Transaction [Line Items]
Net trading	$ 18,561	$ 8,724
Principal transactions and other income	(2,406)	414
Income (loss) from equity method affiliates	(107)	(8)
TBBK [Member]
Related Party Transaction [Line Items]
Net trading		2
EuroDekania Management Limited [Member]
Related Party Transaction [Line Items]
Asset management		86
Principal transactions and other income		291
Fin Tech Acquisition Corp II [Member]
Related Party Transaction [Line Items]
Principal transactions and other income	3	3
Insurance SPAC [Member]
Related Party Transaction [Line Items]
Principal transactions and other income	30	4
Income (loss) from equity method affiliates	(307)	(8)
SPAC Funds [Member]
Related Party Transaction [Line Items]
Asset management	(47)	31
Principal transactions and other income	(59)	24
U.S. Insurance JV [Member]
Related Party Transaction [Line Items]
Asset management	90	80
Principal transactions and other income	(167)	39
AOI [Member]
Related Party Transaction [Line Items]
Income (loss) from equity method affiliates	(30)
CK Capital Partners B.V. [Member]
Related Party Transaction [Line Items]
Income (loss) from equity method affiliates	230
Duane Morris [Member]
Related Party Transaction [Line Items]
Operating expense (income)	319	101
FinTech Masala [Member]
Related Party Transaction [Line Items]
Operating expense (income)	11	6
CBF [Member]
Related Party Transaction [Line Items]
Interest expense (income)	528	119
DGC Trust [Member]
Related Party Transaction [Line Items]
Interest expense (income)	533	390
E.B.C. [Member]
Related Party Transaction [Line Items]
Interest expense (income)	72	47
Edward E. Cohen IRA [Member]
Related Party Transaction [Line Items]
Interest expense (income)	48	87
JKD Capital Partners I, LTD [Member]
Related Party Transaction [Line Items]
Interest expense (income)	484	278
Affiliated Entity [Member]
Related Party Transaction [Line Items]
Asset management	43	197
Principal transactions and other income	(193)	361
Income (loss) from equity method affiliates	(107)	(8)
Operating expense (income)	308	95
Interest expense (income)	$ 1,665	$ 921

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Equity

3 Months Ended

Mar. 31, 2020

Equity [Abstract]

Equity

18. EQUITY

Stockholders’ Equity

Common Equity: The following table reflects the activity for the three months ended March 31, 2020 related to the number of shares of unrestricted Common Stock that the Company had issued.

	Common Stock
	Shares
December 31, 2019	1,119,909
Vesting of shares	55,278
Shares withheld for employee taxes and retired	(15,043)
March 31, 2020	1,160,144

Series E Voting Non-Convertible Preferred Stock: Each share of the Company’s Series E Voting Non-Convertible Preferred Stock (“Series E Preferred Stock”) has no economic rights but entitles the holders there of to vote the Series E Preferred Stock on all matters presented to the Company’s stockholders.  For every ten shares of Series E Preferred Stock, the holders are entitled to one vote on any such matter.  Daniel G. Cohen, the Company’s chairman, is the sole holder of all 4,983,557 shares of Series E Preferred Stock issued and outstanding as of March 31, 2020, For a more detailed description of these shares see note 21 to the Company’s Annual Report on Form 10-K for the year ended December 31, 2019.

Series F Voting Non-Convertible Preferred Stock:  On December 23, 2019, the Company’s board of directors adopted a resolution that reclassified 25,000,000 authorized but unissued shares of Preferred Stock, par value $0.001 per share, of the Company as a series of Preferred Stock designated as Series F Voting Non-Convertible Preferred Stock (“Series F Preferred Stock”).   Pursuant to the Securities Purchase Agreement (the “SPA”), dated December 30, 2019, by and among the Company, the Operating LLC, Daniel G. Cohen, and The DGC Family FinTech Trust (the “DGC Trust”), the Company issued 12,549,273 Series F Preferred Stock to Daniel G. Cohen and 9,880,268 Series F Preferred Stock to the DGC Trust. The Series F Preferred Stock have substantially the same rights as the Series E Preferred Stock.  The holders of the Series F Preferred Stock are not entitled to receive any dividends or distributions (whether in cash, stock or property of the Company).  The holders of Series F Preferred Stock and Common Stock are required to vote, together as a single class on all matters with respect to which a vote of the stockholders of the Company is required or permitted.  Each outstanding share of Series F Preferred Stock entitles the holder to one vote for every ten shares of Series F Preferred Stock on each matter submitted to the holders for their vote.  As of December 31, 2019, there were 22,429,541 shares of Series F Preferred Stock issued and outstanding.  See Non-Controlling Interest/ - Securities Purchase Agreement – Purchase of IMXI shares below.For a more detailed description of these shares see note 21 to the Company’s Annual Report on Form 10-K for the year ended December 31, 2019.

Stockholder Rights Plan

On August 3, 2016, the Company adopted a Section 382 Rights Agreement (the “2016 Rights Agreement”) between the Company and Computershare, Inc. The Company’s board of directors adopted the 2016 Rights Agreement in an effort to protect stockholder value by attempting to protect against a possible limitation on the Company’s ability to use its net operating loss and net capital loss carryforwards to reduce potential future federal income tax obligations.  This 2016 Rights Agreement expired in accordance with its terms on December 31, 2019. 

On March 10, 2020, the Company entered into a new Section 382 Rights Agreement (the “Rights Agreement”) with Computershare Inc., as rights agent (the “Rights Agent”).

The Rights Agreement provided for a distribution of one preferred stock purchase right (each, a “Right,” and collectively, the “Rights”) for each share of the Company’s common stock outstanding to stockholders of record at the close of business on March 20, 2020 (the “Record Date”). Each Right entitles the registered holder to purchase from the Company a unit (a “Unit”) consisting of one ten-thousandth of a share of the Company’s Series C Junior Participating Preferred Stock, par value $0.001 per share (the “Series C Preferred Stock”), at a purchase price of $100.00 per Unit (the “Purchase Price”), subject to adjustment. The description and terms of the Rights are set forth in the Rights Agreement.

Initially, the Rights will be attached to all Common Stock certificates representing shares then outstanding or, in the case of uncertificated shares of Common Stock registered in book entry form (“Book Entry Shares”) by notation in book entry (which certificates for Common Stock and Book Entry Shares shall be deemed also to be certificates for Rights), and no separate Rights certificates will be distributed.

Subject to certain exceptions specified in the Rights Agreement, the Rights will separate from the Common Stock and a “Distribution Date” will occur upon the earlier of (i) 10 days following a public announcement that a person or group of affiliated or associated persons has become an “Acquiring Person” (as defined below) (the “Stock Acquisition Date”) and (ii) 10 business days following the commencement of a tender offer or exchange offer that would result in a person or group becoming an Acquiring Person. Pursuant to the Rights Agreement, an “Acquiring Person” means any person or entity who or which, together with all affiliates and associates of such person or entity, is the beneficial owner of 4.95% or more of the shares of Common Stock then outstanding, but does not include the Company or any “Exempted Person” (as defined below). Until the Distribution Date, (i) the Rights will be evidenced by the Common Stock certificates and will be transferred with and only with such Common Stock certificates, (ii) new Common Stock certificates after the Record Date will contain a notation incorporating the Rights Agreement by reference, and (iii) the surrender for transfer of any certificates for Common Stock outstanding will also constitute the transfer of the Rights associated with the Common Stock represented by such certificate.

Pursuant to the Rights Agreement, an “Exempted Person” is any person or entity who, together with all affiliates and associates of such person or entity, was or could become, as of March 10, 2020, the beneficial owner of Common Stock and/or other securities exercisable for shares of Common Stock representing 4.95% or more of the shares of Common Stock outstanding as of March 10, 2020. However, any such person or entity will no longer be deemed to be an Exempted Person and shall be deemed an Acquiring Person under the Rights Agreement if such person or entity, together with all affiliates and associates of such person or entity, becomes the beneficial owner (and so long as such person continues to be the beneficial owner of 4.95% or more of the then outstanding shares of Common Stock) of additional shares of Common Stock, except (x) pursuant to equity compensation awards granted to such person or entity by the Company or options or warrants outstanding and beneficially owned by such person or entity as of March 10, 2020, or as a result of an adjustment to the number of shares of Common Stock represented by such equity compensation award pursuant to the terms thereof; or (y) as a result of a stock split, stock dividend or the like. In addition, any person or entity who, together with all affiliates and associates of such person or entity, becomes the beneficial owner of Common Stock and/or other securities exercisable for shares of Common Stock representing 4.95% or more of the shares of Common Stock then outstanding as a result of a purchase by the Company or any of its subsidiaries of shares of Common Stock will also be an “Exempted Person.” However, any such person will no longer be deemed to be an Exempted Person and will be deemed to be an Acquiring Person if such person, together with all affiliates and associates of such person, becomes the beneficial owner, at any time after the date such person became the beneficial owner of 4.95% or more of the then outstanding shares of Common Stock, of additional shares of Common Stock, except if such additional securities are acquired (x) pursuant to the exercise of options or warrants to purchase Common Stock outstanding and beneficially owned by such person as of the date such person became the beneficial owner of 4.95% or more of the then outstanding shares of Common Stock or as a result of an adjustment to the number of shares of Common Stock for which such options or warrants are exercisable pursuant to the terms thereof, or (y) as a result of a stock split, stock dividend or the like.

In addition, the Rights Agreement defines the term “Exempted Person” to also include any person or entity who, together with all affiliates and associates of such person or entity, is the beneficial owner of Common Stock and/or other securities exercisable for shares of Common Stock representing 4.95% or more of the shares of Common Stock outstanding, and whose beneficial ownership would not, as determined by the Company’s board of directors, jeopardize or endanger the availability of the Company of its deferred tax assets. However, any such person or entity will cease to be an Exempted Person if (x) such person or entity ceases to beneficially own 4.95% or more of the shares of the then outstanding Common Stock or (y) the Company’s board of directors makes a contrary determination with respect to the effect of such person’s or entity’s beneficial ownership (together with all affiliates and associates of such person) with respect to the availability to the Company of its deferred tax assets.

Pursuant to the Rights Agreement, a purchaser, assignee or transferee of the shares of Common Stock (or options or warrants exercisable for Common Stock) from an Exempted Person will not be considered an Exempted Person, except that a transferee from the estate of an Exempted Person who receives Common Stock as a bequest or inheritance from an Exempted Person will be an Exempted Person so long as such transferee continues to be the beneficial owner of 4.95% or more of the then outstanding shares of Common Stock.

The Rights are not exercisable until the Distribution Date and will expire on the earliest of (i) the close of business on December 31, 2023, (ii) the time at which the Rights are redeemed pursuant to the Rights Agreement, (iii) the time at which the Rights are exchanged pursuant to the Rights Agreement, (iv) the repeal of Section 382 of the Code or any successor statute if the Company’s board of directors determines that the Rights Agreement is no longer necessary or desirable for the preservation of certain tax benefits, and (v) the beginning of a taxable year of the Company to which the Company’s board of directors determines that certain tax benefits may not be carried forward. At no time will the Rights have any voting power.

Except as otherwise determined by the Company’s board of directors, only shares of Common Stock issued prior to the Distribution Date will be issued with Rights.

Pursuant to the Rights Agreement, in the event that a person or entity becomes an Acquiring Person, each other holder of a Right will thereafter have the right to receive, upon exercise, Common Stock (or, in certain circumstances, cash, property or other securities of the Company), having a value equal to two times the exercise price of the Right. The exercise price is the Purchase Price times the number of Units associated with each Right (initially, one). For example, at an exercise price of $100.00 per Right, each Right not owned by an Acquiring Person (or by certain related parties) following an event set forth in the preceding paragraph would entitle its holder to purchase $200.00 worth of Common Stock (or other consideration, as noted above) for $100.00. If the Common Stock at the time of exercise had a market value per share of $20.00, the holder of each valid Right would be entitled to purchase ten (10) shares of Common Stock for $100.00.

Notwithstanding any of the foregoing, following the occurrence of a person or entity becoming an Acquiring Person (the “Flip-In Event”), all Rights that are, or (under certain circumstances specified in the Rights Agreement) were, beneficially owned by such Acquiring Person will be null and void.

In the event that, at any time following the Stock Acquisition Date, (i) the Company engages in a merger or other business combination transaction in which the Company is not the surviving corporation; (ii) the Company engages  in a merger or other business combination transaction in which the Company is the surviving corporation and the Common Stock is changed or exchanged; or (iii) 50% or more of the Company’s assets, cash flow or earning power is sold or transferred, each holder of a Right (except Rights which have previously been voided as set forth above) will thereafter have the right to receive, upon exercise of the Right, common stock of the acquiring company having a value equal to two times the exercise price of the Right.

However, Rights are not exercisable following the occurrence of a Flip-In Event until such time as the Rights are no longer redeemable by the Company as set forth below.

The Purchase Price payable, and the number of Units of Series C Preferred Stock or other securities or property issuable, upon exercise of the Rights are subject to adjustment from time to time to prevent dilution (i) in the event of a stock dividend on, or a subdivision, combination or reclassification of, the Series C Preferred Stock, (ii) if holders of the Series C Preferred Stock are granted certain rights or warrants to subscribe for Series C Preferred Stock or convertible securities at less than the current market price of the Series C Preferred Stock, or (iii) upon the distribution to holders of the Series C Preferred Stock of evidences of indebtedness or assets (excluding regular quarterly cash dividends) or of subscription rights or warrants (other than those referred to above).

With certain exceptions, no adjustments in the Purchase Price will be required until cumulative adjustments amount to at least 1% of the Purchase Price. No fractional Units will be issued and, in lieu thereof, an adjustment in cash will be made based on the market price of the Series C Preferred Stock on the last trading date prior to the date of exercise.

At any time after the Stock Acquisition Date, the Company may exchange all or part of the Rights (other than Rights owned by an Acquiring Person) for Common Stock at an exchange ratio equal to (i) a number of shares of Common Stock per Right with a value equal to the spread between the value of the number of shares of Common Stock for which the Rights may then be exercised and the Purchase Price or (ii) if prior to the acquisition by the Acquiring Person of 50% or more of the then outstanding shares of Common Stock, one share of Common Stock per Right (subject to adjustment).

At any time until ten days following the Stock Acquisition Date, the Company may redeem the Rights in whole, but not in part, at a price of $0.001 per Right. Immediately upon the action of the Company’s board of directors ordering redemption of the Rights, the Rights will terminate and the only right of the holders of Rights will be to receive the $0.001 redemption price.

Until a Right is exercised, the holder thereof, as such, will have no rights as a stockholder of the Company, including, without limitation, the right to vote or to receive dividends. While the distribution of the Rights will not be taxable to shareholders or to the Company, stockholders may, depending upon the circumstances, recognize taxable income in the event that the Rights become exercisable for Common Stock (or other consideration) of the Company as set forth above or in the event the Rights are redeemed.

Acquisition and Surrender of Additional Units of the Operating LLC, net: Effective January 1, 2011, Cohen & Company Inc. and the Operating LLC entered into a Unit Issuance and Surrender Agreement (the “UIS Agreement”), that was approved by the board of directors of Cohen & Company Inc. and the board of managers of the Operating LLC. In an effort to maintain a 1:10 ratio of Common Stock to the number units of membership interests  Cohen & Company Inc. holds in the Operating LLC, the UIS Agreement calls for the issuance of additional units of membership interests of the Operating LLC to Cohen & Company Inc. when Cohen & Company Inc. issues its Common Stock to employees under existing equity compensation plans. In certain cases, the UIS Agreement calls for Cohen & Company Inc. to surrender units to the Operating LLC when certain restricted shares are forfeited by the employee or repurchased by the Company.

During the three months ended March 31, 2020, Cohen & Company Inc. received and surrendered units of the Operating LLC. The following table displays the amount of units surrendered (net of receipts) by Cohen & Company Inc.

	Operating LLC
	Membership Units
Units related to UIS Agreement	402,350
Total	402,350

The Company recognized a net decrease in additional paid in capital of $123 and a net increase in AOCI of $8 with an offsetting increase in non-controlling interest of $115 in connection with the acquisition and surrender of additional units of the Operating LLC. The following schedule presents the effects of changes in Cohen & Company Inc.’s ownership interest in the Operating LLC on the equity attributable to Cohen & Company Inc. for the three months ended March 31, 2020 and 2019.

		Three Months Ended		Three Months Ended
	March 31, 2020		March 31, 2019
Net income / (loss) attributable to Cohen & Company Inc.	$	(3,102)	$	(1,202)
Transfers (to) from the non-controlling interest:
Increase / (decrease) in Cohen & Company, Inc. paid in capital for the acquisition / (surrender) of additional units in consolidated subsidiary, net		(123)		133
Changes from net income / (loss) attributable to Cohen & Company Inc. and transfers (to) from the non-controlling interest	$	(3,225)	$	(1,069)

Repurchases of Shares and Retirement of Treasury Stock

On March 19, 2018, the Company entered into a letter agreement (the “10b-5 Plan”) with Sandler O’Neill & Partners, L.P. (the “Agent”).  The 10b-5 Plan was in effect from March 19, 2018 until March 19, 2019 and was not renewed. Pursuant to the 10b5-1 Plan, the Agent agreed to use its commercially reasonable efforts to purchase , on the Company’s behalf, up to an aggregate maximum of $2,000 of Common Stock on any day that the NYSE American Stock Exchange was open for business.   Pursuant to the 10b5-1 Plan, purchases of Common Stock may be made in public and private transactions and had to comply with Rule 10b-18 under the Exchange Act.  The 10b5-1 Plan was designed to comply with Rule 10b5-1 under the Exchange Act. 

During the three months ended March 31, 2019, the Company repurchased 7,890 shares in the open market pursuant to the 10b5-1 Plan for a total purchase price of $65. 

All of the repurchases noted above were completed using cash on hand.  The Company currently has no 10b5-1 Plan in place.

Non-Controlling Interest

Securities Purchase Agreement – Purchase of IMXI shares

On December 30, 2019 (the “SPA Effective Date”), the Company entered into the SPA, pursuant to which Daniel G. Cohen and the DGC Trust purchased (i) an aggregate of 22,429,541 newly issued units of membership interests in the Operating LLC (collectively, the “LLC Units”); and (ii) 22,429,541 newly issued, Series F Preferred Stock.

In consideration for the issuance of the LLC Units and Series F Preferred Stock, Daniel G. Cohen transferred to the Operating LLC 370,881 shares of common stock, par value $0.00001 per share (“IMXI Common Stock”), of International Money Express, Inc. (formerly FinTech Acquisition Corp. II) a Delaware corporation (“IMXI”), and the DGC Trust transferred to the Operating LLC an aggregate of 291,480 shares of IMXI common stock.  The aggregate number of IMXI shares transferred to the Operating LLC was 662,361, of which (a) 264,021 shares are subject to certain restrictions on transfer until the closing price per share of IMXI Common Stock (as reported by The Nasdaq Capital Market) exceeds $15.00 for any 20 trading days within a consecutive 30 trading day period or immediately upon certain change of control events involving IMXI, as set forth in the letter agreement, dated January 19, 2017 (the “Letter Agreement”), by and among IMXI, Daniel G. Cohen, the DGC Trust and the other parties named therein, and (b) 264,023 shares are subject to certain restrictions on transfer until the closing price per share of IMXI Common Stock (as reported by The Nasdaq Capital Market) exceeds $17.00 for any 20 trading days within a consecutive 30 trading day period or immediately upon certain change of control events involving IMXI, as set forth in the Letter Agreement.

The Company engaged a third-party valuation firm to value the 662,361 shares of IMXI common stock transferred to the Operating LLC.  The shares transferred by Daniel Cohen were valued at $4,351 and the shares transferred by the DGC Trust were valued at $3,428.  The Company accounted for this transaction by recording an increase of $7,779 in other investments, at fair value and a corresponding increase in the non-controlling interest.  

The IMXI Common Stock is listed on The Nasdaq Capital Market (“Nasdaq”) under the trading symbol “IMXI.” Prior to the merger of IMXI with and into a special purpose acquisition company in a transaction that resulted in the listing of IMXI on Nasdaq, Mr. Cohen served as the chief executive officer and member of the board of directors of the special purpose acquisition company.

The SPA contains customary representations and warranties on the part of each of the Operating LLC, the Company, Daniel G. Cohen, and the DGC Trust.  The Operating LLC, the Company, Daniel G. Cohen, and the DGC Trust provide customary indemnifications thereunder.

Pursuant to the Amended and Restated Limited Liability Company Agreement of the Operating LLC, dated as of December 16, 2009, as amended (“LLC Agreement”), a holder of units of membership interests in the Operating Agreement, including the LLC Units, may cause the Operating LLC to redeem (each, a “Unit Redemption”) such units at any time for, at the Company’s option, (A) cash or (B) one share of Common Stock for every ten units of membership interests in the Operating LLC.

However, pursuant to the SPA, Daniel G. Cohen and the DGC Trust agreed that, until the Company’s stockholders approve the Stockholder Proposal (as defined below), they will not cause a Unit Redemption with respect to any portion of the LLC Units if such Unit Redemption would result in the Company issuing a number of shares of Common Stock that, when aggregated with any shares of Common Stock previously issued in connection with any Unit Redemption of the LLC Units equals or exceeds 19.99% of the outstanding Common Stock as of the SPA Effective Date.

Pursuant to the SPA, Daniel G. Cohen and the DGC Trust also agreed to not cause a Unit Redemption with respect to any portion of the Cohen LLC Units if the Company’s board of directors determines that the satisfaction of such Unit Redemption by the Company with shares of Common Stock would jeopardize or endanger the availability to the Company of its net operating loss and net capital loss carryforwards and certain other tax benefits under Section 382 of the Internal Revenue Code of 1986, as amended.

Pursuant to the SPA, at the 2020 annual meeting of the Company’s stockholders, the Company agreed to cause its stockholders to vote on proposals (collectively, the “Stockholder Proposal”) regarding the issuance of all shares of Common Stock issuable in connection with a redemption of the LLC Units for purposes of Section 713 of the NYSE American’s Company Guide. Further, the Company’s board of directors must recommend to the Company’s stockholders that such stockholders approve the Stockholder Proposal and may not modify or withdraw such resolution.

In addition, effective as of the SPA Effective Date, if the Company owns a number of units of membership interests in the Operating LLC representing less than a majority of the votes entitled to be cast at any meeting or any other circumstances upon which a vote, agreement, consent (including unanimous written consents) or other approval is sought from the holders of units of membership interests in the Operating LLC (each, a “Meeting”), then for so long as the Company owns a number of units of membership interests in the Operating LLC representing less than a majority of the votes entitled to be cast at any Meeting, Daniel G. Cohen and the DGC Trust have agreed to grant a voting proxy to the Company pursuant to which the Company may vote at any Meeting the number of units of membership interests in the Operating LLC owned by  Daniel G. Cohen and the DGC Trust necessary to give the Company a majority of the votes at such Meeting.  See note 24.

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Other Receivables, Other Assets, Accounts Payable And Other Liabilities

3 Months Ended

Mar. 31, 2020

Other Receivables, Other Assets, Accounts Payable And Other Liabilities [Abstract]

Other Receivables, Other Assets, Accounts Payable And Other Liabilities

14.  OTHER RECEIVABLES, OTHER ASSETS, ACCOUNTS PAYABLE AND OTHER LIABILITIES

Other receivables consisted of the following.

OTHER RECEIVABLES
(Dollars in Thousands)
	March 31, 2020		December 31, 2019
Cash collateral due from counterparties	$	4,838	$	41,172
Asset management fees receivable		886		1,159
Accrued interest receivable and dividend receivable		10,521		3,549
Revenue share receivable		115		150
Other receivables		647		595
Other receivables	$	17,007	$	46,625

When the Company enters into a reverse repo, it obtains collateral in excess of the principal amount of the reverse repo.  The Company accepts collateral in the form of liquid securities or cash.  If the value of the securities the Company receives as collateral increases, the Company’s reverse repo counterparties may request a return of their collateral with a value equal to such increase.  In some cases, the Company will return to such reverse repo counterparties cash instead of securities.  In that case, the Company includes the cash returned as a component of other receivables (see above).

When the Company enters into repo transactions, the Company provides collateral to the Company’s repo counterparties in excess of the principal balance of the repo.  The Company’s counterparties accept collateral in the form of liquid securities or cash.  To the extent the Company provides the collateral in cash, the Company includes it as a component of other receivables (see above).

Asset management fees receivable are of a routine and short-term nature.  These amounts are generally accrued monthly and paid on a monthly or quarterly basis. 

Accrued interest and dividends receivable represent interest and dividends accrued on the Company’s investment securities included as a component of investments-trading or other investments, at fair value. Interest payable on securities sold, not yet purchased is included as a component of accounts payable and other liabilities in the table entitled Accounts Payable and Other Liabilities below.

Revenue share receivable represents the amount due to the Company for the Company’s share of revenue arrangements generated from various entities in which the Company receives a share of the entity’s revenue. Other receivables represent other miscellaneous receivables that are of a short-term nature.

Other assets consisted of the following.

OTHER ASSETS
(Dollars in Thousands)
	March 31, 2020		December 31, 2019
Deferred costs	$	241	$	301
Prepaid expenses		1,075		796
Deposits		403		656
Miscellaneous other assets		275		275
Residential transition loans		-		5,323
Furniture, equipment, and leasehold improvements, net		899		916
Intangible assets		166		166
Other assets	$	3,059	$	8,433

Deferred costs and prepaid expenses represent amounts paid for services that are being amortized over their expected period of use and benefit.  They are all routine and short-term in nature.  Deposits are amounts held by landlords or other parties which will be returned or offset upon satisfaction of a lease or other contractual arrangement. 

During 2019, RTLs were accounted for at lower of cost or market and included as a component of other assets.  Effective January 1, 2020, in connection with the adoption of ASC 326, the Company began accounting for RTLs at fair value and including them as a component of investments-trading. 

See note 16 to the Company’s consolidated financial statements included in its Annual Report on Form 10-K for the year ended December 31, 2019 for further discussion of the firm’s furniture, equipment, and leasehold improvements.  Intangible assets represent the carrying value of the JVB broker-dealer license. 

Accounts payable and other liabilities consisted of the following.

ACCOUNTS PAYABLE AND OTHER LIABILITIES
(Dollars in Thousands)
	March 31, 2020		December 31, 2019
Accounts payable	$	141	$	362
Redeemable financial instruments accrued interest		814		403
Accrued interest payable		738		711
Accrued interest on securities sold, not yet purchased		882		914
Payroll taxes payable		677		729
Counterparty cash collateral		74,692		9,524
Accrued expense and other liabilities		3,837		7,652
Accounts payable and other liabilities	$	81,781	$	20,295

aa

The redeemable financial instrument accrued interest represents accrued interest on the JKD Capital Partners I LTD and the DGC Trust/CBF redeemable financial instruments.  See note 16.

When the Company enters into a reverse repo, the Company obtains collateral in excess of the principal of the reverse repo.   The Company accepts collateral in the form of liquid securities or cash.  To the extent the Company receives cash collateral, the Company includes it as a component of other liabilities (counterparty cash collateral) in the table above. 

When the Company enters into repo transactions, the Company provides collateral to the Company’s repo counterparty in excess of the principal balance of the repo.  If the value of the securities the Company provides as collateral increases, the Company may request a return of its collateral with a value equal to such increase.  In some cases, the repo counterparty will return cash instead of securities.  In that case, the Company includes the cash returned as a component of other liabilities (counterparty cash collateral) in the table above.  See note 10.

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Segment And Geographic Information

3 Months Ended

Mar. 31, 2020

Segment And Geographic Information [Abstract]

Segment And Geographic Information

22. SEGMENT AND GEOGRAPHIC INFORMATION

Segment Information

The Company operates within three business segments: Capital Markets, Asset Management, and Principal Investing. See note 1.

The Company’s business segment information was prepared using the following methodologies and generally represents the information that is relied upon by management in its decision- making processes:

(a) Revenues and expenses directly associated with each business segment are included in determining net income / (loss) by segment, and

(b) Indirect expenses (such as general and administrative expenses including executive and indirect overhead costs) not directly associated with specific business segments are not allocated to the business segments’ statements of operations.

Accordingly, the Company presents segment information consistent with internal management reporting. See note (1) in the table below for more detail on unallocated items. The following tables present the financial information for the Company’s segments for the periods indicated.

SEGMENT INFORMATION
Statement of Operations Information
Three Months Ended March 31, 2020
	Capital		Asset		Principal		Segment		Unallocated
	Markets		Management		Investing		Total		(1)		Total
Net trading	$	18,561	$	-	$	-	$	18,561	$	-	$	18,561
Asset management		-		1,615		-		1,615		-		1,615
Principal transactions and other income		9		116		(2,531)		(2,406)		-		(2,406)
Total revenues		18,570		1,731		(2,531)		17,770		-		17,770
Salaries/Wages		11,910		1,117		-		13,027		1,107		14,134
Other Operating Expense		3,277		477		50		3,804		1,394		5,198
Impairment of goodwill		7,883		-		-		7,883		-		7,883
Total operating expenses		23,070		1,594		50		24,714		2,501		27,215
Operating income (loss)		(4,500)		137		(2,581)		(6,944)		(2,501)		(9,445)
Interest income (expense)		(75)		-		-		(75)		(2,530)		(2,605)
Income (loss) from equity method affiliates		-		200		(307)		(107)		-		(107)
Income (loss) before income taxes		(4,575)		337		(2,888)		(7,126)		(5,031)		(12,157)
Income tax expense (benefit)		-		-		-		-		(372)		(372)
Net income (loss)		(4,575)		337		(2,888)		(7,126)		(4,659)		(11,785)
Less: Net income (loss) attributable to the non-controlling interest		-		-		-		-		(8,683)		(8,683)
Net income (loss) attributable to Cohen & Company Inc.	$	(4,575)	$	337	$	(2,888)	$	(7,126)	$	4,024	$	(3,102)
Other statement of operations data
Depreciation and amortization (included in total operating expense)	$	4	$	1	$	-	$	5	$	75	$	80

SEGMENT INFORMATION
Statement of Operations Information
Three Months Ended March 31, 2019
	Capital		Asset		Principal		Segment		Unallocated
	Markets		Management		Investing		Total		(1)		Total
Net trading	$	8,724	$	-	$	-	$	8,724	$	-	$	8,724
Asset management		-		2,002		-		2,002		-		2,002
Principal transactions and other income		1		97		316		414		-		414
Total revenues		8,725		2,099		316		11,140		-		11,140
Salaries/Wages		4,547		1,122		-		5,669		695		6,364
Other Operating Expense		2,911		693		100		3,704		1,140		4,844
Impairment of goodwill		-		-		-		-		-		-
Total operating expenses		7,458		1,815		100		9,373		1,835		11,208
Operating income (loss)		1,267		284		216		1,767		(1,835)		(68)
Interest (expense) income		(55)		-		-		(55)		(1,799)		(1,854)
Income (loss) from equity method affiliates		-		-		(8)		(8)		-		(8)
Income (loss) before income taxes		1,212		284		208		1,704		(3,634)		(1,930)
Income tax expense (benefit)		-		-		-		-		(106)		(106)
Net income (loss)		1,212		284		208		1,704		(3,528)		(1,824)
Less: Net income (loss) attributable to the non-controlling interest		-		-		-		-		(622)		(622)
Net income (loss) attributable to Cohen & Company Inc.	$	1,212	$	284	$	208	$	1,704	$	(2,906)	$	(1,202)
Other statement of operations data
Depreciation and amortization (included in total operating expense)	$	5	$	1	$	-	$	6	$	75	$	81

(1) Unallocated includes certain expenses incurred by indirect overhead and support departments (such as the executive, finance, legal, information technology, human resources, risk, compliance, and other similar overhead and support departments). Some of the items not allocated include: (1) operating expenses (such as cash compensation and benefits, equity-based compensation expense, professional fees, travel and entertainment, consulting fees, and rent) related to support departments excluding certain departments that directly support the Capital Markets business segment; (2) interest expense on debt; and (3) income taxes. Management does not consider these items necessary for an understanding of the operating results of these business segments and such amounts are excluded in business segment reporting to the chief operating decision maker.

BALANCE SHEET DATA
As of March 31, 2020
(Dollars in Thousands)
	Capital		Asset		Principal		Segment		Unallocated
	Markets		Management		Investing		Total		(1)		Total
Total Assets	$	6,564,241	$	1,348	$	15,873	$	6,581,462	$	15,078	$	6,596,540
Included within total assets:
Investment in equity method affiliates	$	-	$	-	$	5,789	$	5,789	$		$	5,789
Goodwill (2)	$	54	$	55	$	-	$	109	$	-	$	109
Intangible assets (2)	$	166	$	-	$	-	$	166	$	-	$	166

BALANCE SHEET DATA
December 31, 2019
(Dollars in Thousands)
	Capital		Asset		Principal		Segment		Unallocated
	Markets		Management		Investing		Total		(1)		Total
Total Assets	$	7,968,491	$	1,616	$	18,689	$	7,988,796	$	12,828	$	8,001,624
Included within total assets:
Investment in equity method affiliates	$	-	$	-	$	3,799	$	3,799	$	-	$	3,799
Goodwill (2)	$	7,937	$	55	$	-	$	7,992	$	-	$	7,992
Intangible assets (2)	$	166	$	-	$	-	$	166	$	-	$	166

(1)Unallocated assets primarily include: (1) amounts due from related parties; (2) furniture and equipment, net; and (3) other assets that are not considered necessary for an understanding of business segment assets.  Such amounts are excluded in business segment reporting to the chief operating decision maker.

(2)Goodwill and intangible assets are allocated to the Capital Markets and Asset Management business segments as indicated in the table above.

Geographic Information

The Company conducts its business activities through offices in the following locations: (1) United States and (2) United Kingdom and Other.  Total revenues by geographic area are summarized as follows.

GEOGRAPHIC DATA
(Dollars in Thousands)
	Three Months Ended March 31,
		2020	2019
Total Revenues:
United States	$	16,942	$	10,082
Europe & Other		828		1,058
Total	$	17,770	$	11,140

Long-lived assets attributable to an individual country, other than the United States, are not material.

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Investment in Equity Method Affiliate (Tables)

3 Months Ended

Mar. 31, 2020

Investment in Equity Method Affiliate [Abstract]

Schedule Of Investments In Equity Method Affiliates

INVESTMENTS IN EQUITY METHOD AFFILIATES
(Dollars in Thousands)
	Insurance SPAC		AOI		CK Capital		Total
January 1, 2020	$	3,222	$	559	$	18	$	3,799
Investments / advances		-		2,097		-		2,097
Distributions / repayments		-		-		-		-
Earnings / (loss) realized		(306)		(31)		230		(107)
March 31, 2020	$	2,916	$	2,625	$	248	$	5,789

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Variable Interest Entities (Tables)

3 Months Ended

Mar. 31, 2020

Variable Interest Entities [Abstract]

Schedule Of Variable Interest Entities

CARRYING VALUE OF VARIABLE INTERESTS IN NON-CONSOLIDATED VARIABLE INTEREST ENTITIES
(Dollars in Thousands)
		As of March 31, 2020		As of December 31, 2019
Other Investments, at fair value	$	4,503	$	5,413
Maximum exposure	$	4,503	$	5,413

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Earnings / (Loss) Per Common Share (Tables)

3 Months Ended

Mar. 31, 2020

Earnings / (Loss) Per Common Share [Abstract]

Schedule Of Earnings / (Loss) Per Common Share

EARNINGS / (LOSS) PER COMMON SHARE
(Dollars in Thousands, except share or per share information)
	Three Months Ended March 31,
	2020		2019
Net income / (loss) attributable to Cohen & Company Inc.	$	(3,102)	$	(1,202)
Add/ (deduct): Income / (loss) attributable to non-controlling interest attributable to Operating LLC membership (1)		(8,523)		(622)
Add / (deduct): Adjustment (2)		966		53
Net income / (loss) on a fully converted basis	$	(10,659)	$	(1,771)
Weighted average common shares outstanding - Basic		1,146,879		1,133,166
Unrestricted Operating LLC membership units exchangeable into Cohen & Company, Inc. shares (1)		2,793,798		532,409
Weighted average common shares outstanding - Diluted (3)		3,940,677		1,665,575
Net income / (loss) per common share - Basic	$	(2.70)	$	(1.06)
Net income / (loss) per common share - Diluted	$	(2.70)	$	(1.06)

(1) The Operating LLC units of membership interest not held by Cohen & Company Inc. (that is, those held by the non-controlling interest) may be redeemed and exchanged into shares of the Company on a ten-for-one basis. The Operating LLC units of membership interests not held by Cohen & Company Inc. are redeemable, at the member’s option at any time, for (i) cash in an amount equal to the average of the per share closing prices of the Common Stock for the ten consecutive trading days immediately preceding the date the Company receives the member’s redemption notice, or (ii) at the Company’s option, one tenth of a share of the Common Stock, subject, in each case, to appropriate adjustment upon the occurrence of an issuance of additional shares of the Common Stock as a dividend or other distribution on the outstanding Common Stock, or a further subdivision or combination of the outstanding shares of the  Common Stock. These units are not included in the computation of basic earnings per share.  These units enter into the computation of diluted net income (loss) per common share when the effect is not anti-dilutive using the if-converted method.

(2) An adjustment is included because the Company would have incurred a higher income tax expense or realized a higher income tax benefit, as applicable, if the Operating LLC units of membership interests had been converted at the beginning of the period.

Potentially diluted securities that were not included in the diluted per share calculations because they would be anti-dilutive were as follows:

Schedule Of Anti-Dilutive Securities

	Three Months Ended March 31,
	2020	2019
2017 Convertible Note	1,034,483	1,034,483
2013 Convertible Notes	-	565,469
Restricted Common Stock	30,466	44,176
Restricted Operating LLC units	15,424	15,006
	1,080,373	1,659,134

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Segment And Geographic Information (Narrative) (Details) $ in Thousands	3 Months Ended
	Mar. 31, 2020 USD ($) segment
Segment And Geographic Information [Abstract]
Number of Operating Segments | segment	3
Goodwill impairment charge | $	$ 7,883

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Derivative Financial Instruments (Narrative) (Details) - USD ($)	Apr. 30, 2020	Mar. 31, 2020	Dec. 31, 2019	Mar. 31, 2019
TBA And Other Forward Agency MBS [Member] | Short [Member]
Derivative [Line Items]
Derivative, Notional Amount		$ 2,212,275,000	$ 1,874,194,000
TBA And Other Forward Agency MBS [Member] | Long [Member]
Derivative [Line Items]
Derivative, Notional Amount		2,090,750,000	1,773,000,000
Foreign currency forward contracts [Member]
Derivative [Line Items]
Derivative, Notional Amount		0		$ 0
Other Extended Settlement Trades [Member]
Derivative [Line Items]
Forward purchase commitment		1,725,000	1,526,000
Forward sale commitment		$ 0	$ 0
Subsequent Event [Member] | TBA And Other Forward Agency MBS Purchase Agreements [Member]
Derivative [Line Items]
Derivative, Notional Amount	$ 1,134,419,000
Subsequent Event [Member] | TBA And Other Forward MBS Sale Agreements [Member]
Derivative [Line Items]
Derivative, Notional Amount	$ 1,252,919,000

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Fair Value Disclosures (Schedule Of Assets And Liabilities Measured At Fair Value On A Recurring Basis) (Details) - USD ($) $ in Thousands	Mar. 31, 2020	Dec. 31, 2019
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total investments-trading	$ 375,745	$ 307,852
Other investments, measured using hierarchy	7,431	11,973
Other investments, Carrying Value	10,057	14,864
Trading securities sold, not yet purchased	114,767	77,947
Quoted Prices In Active Markets (Level 1) [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total investments-trading	6,065	11,105
Other investments, measured using hierarchy		2,009
Trading securities sold, not yet purchased	16,211	16,827
Significant Other Observable Inputs (Level 2) [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total investments-trading	366,724	296,747
Other investments, measured using hierarchy	5,554	7,442
Trading securities sold, not yet purchased	98,556	61,120
Significant Unobservable Inputs (Level 3) [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total investments-trading	2,956
Other investments, measured using hierarchy	1,877	2,522
Investments Measured At NAV [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Other investments, at fair value	2,626	2,891	[1]
U.S. government agency MBS and CMOs [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total investments-trading	218,767	196,146
U.S. government agency MBS and CMOs [Member] | Significant Other Observable Inputs (Level 2) [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total investments-trading	218,767	196,146
U.S. government agency debt securities [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total investments-trading	4,791	14,680
U.S. government agency debt securities [Member] | Significant Other Observable Inputs (Level 2) [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total investments-trading	4,791	14,680
RMBS [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total investments-trading	14	15
RMBS [Member] | Significant Other Observable Inputs (Level 2) [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total investments-trading	14	15
U.S. Treasury securities [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total investments-trading	6,065	11,105
Trading securities sold, not yet purchased	16,211	16,827
U.S. Treasury securities [Member] | Quoted Prices In Active Markets (Level 1) [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total investments-trading	6,065	11,105
Trading securities sold, not yet purchased	16,211	16,827
ABS [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total investments-trading	1	100
ABS [Member] | Significant Other Observable Inputs (Level 2) [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total investments-trading	1	100
SBA loans [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total investments-trading	26,073	27,634
SBA loans [Member] | Significant Other Observable Inputs (Level 2) [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total investments-trading	26,073	27,634
Corporate bonds and redeemable preferred stock [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total investments-trading	31,877	38,503
Trading securities sold, not yet purchased	43,937	58,083
Corporate bonds and redeemable preferred stock [Member] | Significant Other Observable Inputs (Level 2) [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total investments-trading	31,877	38,503
Trading securities sold, not yet purchased	43,937	58,083
Foreign government bonds [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total investments-trading	626	844
Foreign government bonds [Member] | Significant Other Observable Inputs (Level 2) [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total investments-trading	626	844
Municipal bonds [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total investments-trading	25,121	13,737
Trading securities sold, not yet purchased	20	20
Municipal bonds [Member] | Significant Other Observable Inputs (Level 2) [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total investments-trading	25,121	13,737
Trading securities sold, not yet purchased	20	20
Certificates of deposit [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total investments-trading	3,575	841
Certificates of deposit [Member] | Significant Other Observable Inputs (Level 2) [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total investments-trading	3,575	841
Derivatives [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total investments-trading	55,780	3,686
Trading securities sold, not yet purchased	54,599	3,017
Derivatives [Member] | Significant Other Observable Inputs (Level 2) [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total investments-trading	55,780	3,686
Trading securities sold, not yet purchased	54,599	3,017
Equity securities [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total investments-trading	99	561
Other investments, measured using hierarchy	5,457	9,352
Equity securities [Member] | Quoted Prices In Active Markets (Level 1) [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Other investments, measured using hierarchy		2,009
Equity securities [Member] | Significant Other Observable Inputs (Level 2) [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total investments-trading	99	561
Other investments, measured using hierarchy	5,457	7,343
Residential transition loans [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total investments-trading	2,956
Residential transition loans [Member] | Significant Unobservable Inputs (Level 3) [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total investments-trading	2,956
CLOs [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Other investments, measured using hierarchy	1,877	2,522
CLOs [Member] | Significant Unobservable Inputs (Level 3) [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Other investments, measured using hierarchy	1,877	2,522
Residential loans [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Other investments, measured using hierarchy	97	99
Residential loans [Member] | Significant Other Observable Inputs (Level 2) [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Other investments, measured using hierarchy	$ 97	$ 99

[1] As a practical expedient, the Company uses NAV per share (or its equivalent) to measure the fair value of its investments in the U.S. Insurance JV and the SPAC Fund. The U.S. Insurance JV invests in debt issued by small and medium sized U.S. and Bermuda insurance and reinsurance companies. The SPAC Fund invests in equity securities of SPACs. According to ASC 820, these investments are not categorized within the valuation hierarchy.

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Net Capital Requirements (Details) $ in Thousands	Mar. 31, 2020 USD ($)
JVB's [Member]
Net Capital Requirements [Line Items]
Actual Net Capital or Liquid Capital	$ 56,517
Excess	55,632
CCFEL [Member]
Net Capital Requirements [Line Items]
Actual Net Capital or Liquid Capital	2,194
Amount Required	945
Excess	1,249
Cohen and Company Financial Limited [Member]
Net Capital Requirements [Line Items]
Actual Net Capital or Liquid Capital	627
Amount Required	145
Excess	$ 482

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Due From / Due To Related Parties (Details) - USD ($) $ in Thousands	Mar. 31, 2020	Dec. 31, 2019
Related Party Transaction [Line Items]
Due from related parties	$ 411	$ 466
Employees & Other [Member]
Related Party Transaction [Line Items]
Due from related parties	$ 411	$ 466

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Commitments And Contingencies

3 Months Ended

Mar. 31, 2020

Commitments And Contingencies [Abstract]

Commitments And Contingencies

21. COMMITMENTS AND CONTINGENCIES

Legal and Regulatory Proceedings

The Company’s U.S. broker-dealer subsidiary, J.V.B. Financial Group, LLC is a party to litigation commenced on August 7, 2019, in the Supreme Court of the State of New York under the caption VA Management, LP v. Odeon Capital Group LLC; Janney Montgomery Scott LLC; C&Co/PrinceRidge LLC; and JVB Financial Group LLC.  The plaintiff, VA Management, LP (f/k/a Visium Asset Management, LP) (“Visium”), alleges that the defendants, as third-party broker-dealers, aided and abetted Visium’s portfolio managers’ breaches of their fiduciary duties by assisting in carrying out a fraudulent “mismarking scheme.”  Visium is seeking in excess of $1 billion in damages from the defendants including disgorgement of the compensation paid to Visium’s portfolio managers, restitution of and damages for the investigative and legal fees, administrative wind down costs, and regulatory penalties paid by Visium as a result of the “mismarking scheme,” direct and consequential damages for the destruction of Visium’s business, including lost profits and lost enterprise value, and attorneys’ fees and costs.  JVB filed a motion to dismiss the complaint in lieu of an answer on October 16, 2019.  Visium’s response to the motion was due on November 15, 2019 and JVB filed a reply brief on November 26, 2019.  On April 29, 2020, the Court issued a ruling denying the motions to dismiss filed by each of the defendants.  The Company intends to defend the action vigorously.

In addition to the matter set forth above, the Company is a party to various routine legal proceedings and regulatory inquiries arising out of the ordinary course of the Company’s business. Management believes that the results of these routine legal proceedings and regulatory matters will not have a material adverse effect on the Company’s financial condition, or on the Company’s operations and cash flows. However, the Company cannot estimate the legal fees and expenses to be incurred in connection with these routine matters and, therefore, is unable to determine whether these future legal fees and expenses will have a material impact on the Company’s operations and cash flows. It is the Company’s policy to expense legal and other fees as incurred.

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Debt

3 Months Ended

Mar. 31, 2020

Debt [Abstract]

Debt

17. DEBT

The Company had the following debt outstanding.

DETAIL OF DEBT
(Dollars in Thousands)
Description		As of March 31, 2020		As of December 31, 2019	Interest Rate Terms	Interest (4)		Maturity
Non-convertible debt:
12.00% senior note (the "2020 Senior Note")	$	4,500	$	-	Fixed	12.00	%	January 2022
12.00% senior note (the "2019 Senior Note")		2,400		6,786	Fixed	12.00	%	September 2020 (1)
Contingent convertible debt:
8.00% convertible senior note (the "2017 Convertible Note")		15,000		15,000	Fixed	8.00	%	March 2022 (2)
Less unamortized debt issuance costs		(631)		(703)
		14,369		14,297
Junior subordinated notes (3):
Alesco Capital Trust I		28,125		28,125	Variable	5.77	%	July 2037
Sunset Financial Statutory Trust I		20,000		20,000	Variable	5.52	%	March 2035
Less unamortized discount		(25,030)		(25,124)
		23,095		23,001
FT Financial Bank, N.A. Credit Facility		17,500		-	Variable	N/A		April 2021
LegacyTexas Credit Facility		-		4,777	Variable	N/A		NA
Total	$	61,864	$	48,861

(1) On September 25, 2019, the Company amended the previously outstanding 2013 Convertible Notes, which were scheduled to mature on September 25, 2019.  The material terms and conditions of the 2013 Convertible Notes remained substantially the same, except that (i) the maturity date changed from September 25, 2019 to September 25, 2020; (ii) the conversion feature in the 2013 Convertible Notes was removed; (iii) the interest rate changed from 8% per annum (9% in the event of certain events of default) to 12% per annum (13% in the event of certain events of default); and (iv) the restrictions regarding the prepayment were removed.  The post amendment notes are referred to herein as the “2019 Senior Notes” and the pre-amendment notes are referred to herein as the “2013 Convertible Notes.”  

(2) The holder of the 2017 Convertible Note may convert all or any part of the outstanding principal amount at any time prior to maturity into units of membership interests of the Operating LLC at a conversion price of $1.45 per unit, subject to customary anti-dilution adjustments.  Units of membership interests in the Operating LLC not held by Cohen & Company Inc. may, with certain restrictions, be redeemed and exchanged into shares of the Cohen & Company Inc. common stock, par value $0.01 per share (“Common Stock”) on a ten-for-one basis.  Therefore, the 2017 Convertible Note can be converted into Operating LLC units of membership interests and then redeemed and exchanged into Common Stock at an effective conversion price of $14.50.  See note 20 to our Annual Report on Form 10-K for the year ended December 31, 2019. 

(3) The junior subordinated notes listed represent debt the Company owes to the two trusts noted above. The total par amount owed by the Company to the trusts is $49,614.  However, the Company owns the common stock of the trusts in a total par amount of $1,489.  The Company pays interest (and at maturity, principal) to the trusts on the entire $49,614 junior notes outstanding. However, the Company receives back from the trusts the pro rata share of interest and principal on the common stock held by the Company.  These trusts are VIEs and the Company does not consolidate them even though the Company holds the common stock.  The Company carries the common stock on its balance sheet at a value of $0. The junior subordinated notes are recorded at a discount to par.  When factoring in the discount, the yield to maturity of the junior subordinated notes as of March 31, 2020 on a combined basis was 15.04% assuming the variable rate in effect on the last day of the reporting period remains in effect until maturity.

(4) Represents the interest rate in effect as of the last day of the reporting period. 

The 2020 Senior Notes

On January 31, 2020, the Operating LLC entered into a Note Purchase Agreement with JKD Capital Partners I LTD, a New York corporation (“JKD Investor”), and RN Capital Solutions LLC, a Delaware limited liability company (“RNCS”).  The JKD Investor is owned by Jack DiMaio, the vice chairman of the Company’s board of directors and the Operating LLC’s board of managers, and his spouse.

Pursuant to the Note Purchase Agreement, JKD Investor and RNCS each purchased a Senior Promissory Note in the principal amount of $2,250 (for an aggregate investment of $4,500).  The Senior Promissory Notes bear interest at a fixed rate of 12% per annum and mature on January 31, 2022.  On February 3, 2020, pursuant to the Note Purchase Agreement, the Operating LLC used the proceeds received from the issuance of the Senior Promissory Notes to repay in full all amounts outstanding under the Senior Promissory Note, dated September 25, 2019, issued by the Company to Pensco Trust Company, Custodian fbo Edward E. Cohen IRA in the principal amount of $4,386 (the “Cohen IRA Note”).  The Cohen IRA Note is included as a portion of the 2019 Senior Notes outstanding as of December 31, 2019.  The Cohen IRA Note was fully paid and extinguished on February 3, 2020.  Subsequent to this repayment, $2,400 of the 2019 Senior Notes remain outstanding.

The 2019 Senior Notes

On September 25, 2019, the Company amended and restated the previously outstanding 2013 Convertible Notes, which was scheduled to mature on September 25, 2019.  The material terms and conditions of the 2013 Convertible Notes remained substantially the same, except that (i) the maturity date was changed from September 25, 2019 to September 25, 2020; (ii) the conversion feature in the 2013 Convertible Notes was removed; (iii) the interest rate was changed from 8% per annum (9% in the event of certain events of default) to 12% per annum (13% in the event of certain events of default); and (iv) the restrictions regarding prepayment were removed.  The post amendment notes are referred to herein as the “2019 Senior Notes” and the pre-amendment notes are referred to herein as the “2013 Convertible Notes”.

LegacyTexas Bank

On November 20, 2018, ViaNova, as borrower, entered into a Warehousing Credit and Security Agreement (the “LegacyTexas Credit Facility”) with LegacyTexas Bank, as the lender, with an effective date of November 16, 2018, and amended on May 4, 2019 and September 25, 2019.  The LegacyTexas Credit Facility supported the purchasing, aggregating, and distribution of residential transition loans by ViaNova. 

On March 19, 2020, ViaNova received a notice of default from LegacyTexas Bank regarding the LegacyTexas Credit Facility, stating that ViaNova’s unrestricted cash balance was less than the amount required.  Also, on March 19, 2020, ViaNova received notice from LegacyTexas Bank that the Bank had suspended funding all “Alternative” loans for all of their clients, including the RTLs that are the subject of the LegacyTexas Credit Facility with LegacyTexas Bank.  Since March 19, 2020 ViaNova has repaid all outstanding indebtedness under the Agreement.  ViaNova stopped acquiring new RTLs and does not intend to acquire any new RTLs in the future.  See note 4. 

See note 20 to the Company’s consolidated financial statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2019 for a discussion of the Company’s other debt.

FT Financial Bank, N.A. (“FT Bank”) Credit Facility

The credit facility with FT Bank has a total borrowing capacity of $25,000.  It is comprised of a revolving credit facility (the “2019 FT Revolver”) which has a total borrowing capacity of $17,500 and a line of credit (the “2018 FT LOC”), which has a total borrowing capacity of $7,500.  Both mature on April 10, 2021.  However, the 2019 FT Revolver does not allow for additional draws after April 10, 2020.  During March 2020, the Company drew the full amount of $17,500 under the 2019 FT Revolver and that amount remains outstanding to date.  If the Company were to repay the $17,500 currently outstanding, it would not be able to re-draw that amount again under the 2019 FT Revolver in the future.  Furthermore, JVB is subject to financial covenants including a minimum excess net capital covenant, a debt to tangible net worth covenant, and a minimum tangible net worth covenant.  See note 20 to Company’s 2019 audited financial statements included in its annual report on Form 10-K.  The Company is currently working to extend the draw period and the maturity of the 2019 FT Revolver and the 2018 FT LOC. 

Interest Expense, net

INTEREST EXPENSE
(Dollars in Thousands)
	Three Months Ended March 31,
	2020		2019
Junior subordinated notes	$	821	$	880
2020 Senior Notes		89		-
2017 Convertible Note		371		360
2013 Convertible Notes / 2019 Senior Notes		119		133
2018 FT LOC/2019 FT Revolver		152		92
Redeemable Financial Instrument - DGC Trust / CBF		690		148
Redeemable Financial Instrument - JKD Capital Partners I LTD		440		278
Redeemable Financial Instrument - ViaNova Capital Group, LLC		(77)		(37)
	$	2,605	$	1,854

Because the LegacyTexas Credit Facility was used to directly finance the purchase of securities and loans, the interest expense incurred on the Legacy Texas Credit Facility is included as a component of net trading revenue.  See note 5.

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Leases

3 Months Ended

Mar. 31, 2020

Leases [Abstract]

Leases

13.  LEASES

The Company leases office space and certain computer and related equipment under noncancelable operating leases.  The Company determines if an arrangement is a lease at the inception date of the contract.   The Company measures operating lease liabilities using an estimated incremental borrowing rate as there is no rate implicit in the Company’s operating lease arrangements.  An incremental borrowing rate was calculated for each operating lease based on the term of the lease, the U.S. Treasury term interest rate, and an estimated spread to borrow on a secured basis.

The Company adopted the provisions of ASC 842 effective January 1, 2019.  At adoption, the Company elected to not restate prior periods and rather record a cumulative effect of accounting change effective January 1, 2019.  The Company recorded the following: (a) a right of use asset of $8,416, (b) a lease commitment liability of $8,860, (c) a reduction in retained earnings from cumulative effect of adoption of $20, (d) an increase in other receivables of $18, and (e) a reduction in other liabilities of $406.

Rent expense is recognized on a straight-line basis over the lease term and is in included business development, occupancy, and equipment expense.

As of March 31, 2020, all of the leases to which the Company was a party were operating leases.  The weighted average remaining term of the leases was 8.2 years.  The weighted average discount rate for the leases was 5.36%.

Maturities of operating lease liability payments consisted of the following.

FUTURE MATURITY OF LEASE LIABILITIES
(Dollars in Thousands)
		As of March 31, 2020
2020 - remaining	$	1,161
2021		1,108
2022		933
2023		950
2024		983
Thereafter		4,094
Total		9,229
Less imputed interest		(1,838)
Lease obligation	$	7,391

During the three months ended March 31, 2020, total cash payments of $403 were recorded as a reduction in the operating lease obligation.   No cash payments were made to acquire right of use assets. For the three months ended March 31, 2020 and 2019, rent expense, net of sublease income of $79 and $65, was $378 and $390, respectively.

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Derivative Financial Instruments

3 Months Ended

Mar. 31, 2020

Derivative Financial Instruments [Abstract]

Derivative Financial Instruments

9. DERIVATIVE FINANCIAL INSTRUMENTS

FASB ASC 815, Derivatives and Hedging (“FASB ASC 815”), provides for optional hedge accounting. When a derivative is deemed to be a hedge and certain documentation and effectiveness testing requirements are met, reporting entities can record all or a portion of the change in the fair value of a designated hedge as an adjustment to OCI rather than as a gain or loss in the statements of operations. To date, the Company has not designated any derivatives as hedges under the provisions included in FASB ASC 815.

All of the derivatives that the Company enters into contain master netting arrangements.  If certain requirements are met, the offsetting provisions included in FASB ASC 210, Balance Sheet (“ASC 210”), allow (but do not require) the reporting entity to net the asset and liability on the consolidated balance sheets. It is the Company’s policy to present the derivative assets and liabilities on a net basis if the conditions of ASC 210 are met.  However, in general the Company does not enter in offsetting derivatives with the same counterparties.  Therefore, in all periods presented, no derivatives are presented on a net basis. 

Derivative financial instruments are recorded at fair value. If the derivative was entered into as part of the Company’s broker-dealer operations, it will be included as a component of investments-trading or trading securities sold, not yet purchased. If it is entered into as a hedge for another financial instrument included in other investments, at fair value then the derivative will be included as a component of other investments, at fair value.

The Company may, from time to time, enter into derivatives to manage its risk exposures arising from (i) fluctuations in foreign currency rates with respect to the Company’s investments in foreign currency denominated investments; (ii) the Company’s investments in interest sensitive investments; and (iii) the Company’s facilitation of mortgage-backed trading. Derivatives entered into by the Company, from time to time, may include (a) foreign currency forward contracts; (b) purchase and sale agreements of TBAs and other forward agency MBS contracts; and (c) other extended settlement trades.

TBAs are forward contracts to purchase or sell MBS whose collateral remain “to be announced” until just prior to the trade settlement date. In addition to TBAs, the Company sometimes enters into forward purchases or sales of agency MBS where the underlying collateral has been identified.  These transactions are referred to as other forward agency MBS contracts.  TBAs and other forward agency MBS contracts are accounted for as derivatives by the Company under ASC 815.  The settlement of these transactions is not expected to have a material effect on the Company’s consolidated financial statements.

In addition to TBAs and other forward agency MBS contracts as part of the Company’s broker-dealer operations, the Company may from time to time enter into other securities or loan trades that do not settle within the normal securities settlement period. In those cases, the purchase or sale of the security or loan is not recorded until the settlement date.  However, from the trade date until the settlement date, the Company’s interest in the security is accounted for as a derivative as either a forward purchase commitment or forward sale commitment.  The Company will classify the related derivative either within investments-trading or other investments, at fair value depending on where it intends to classify the investment once the trade settles.

Derivatives involve varying degrees of off-balance sheet risk, whereby changes in the level or volatility of interest rates or market values of the underlying financial instruments may result in changes in the value of a particular financial instrument in excess of its carrying amount. Depending on the Company’s investment strategy, realized and unrealized gains and losses are recognized in principal transactions and other income or in net trading in the Company’s consolidated statements of operations on a trade date basis.

The Company may, from time to time, enter into the following derivative instruments.

Foreign Currency Forward Contracts

The Company invests in foreign currency denominated investments that expose it to fluctuations in foreign currency rates, and, therefore, the Company may, from time to time, hedge such exposure by using foreign currency forward contracts.  The Company carries foreign currency forward contracts at fair value and includes them as a component of other investments, at fair value in the Company’s consolidated balance sheets.  As of March 31, 2020 and December 31, 2019, the Company had no outstanding foreign currency forward contracts.

TBAs and Other Forward Agency MBS Contracts

The Company enters into TBAs and other forward agency MBS transactions for three main reasons.

(i) The Company trades U.S. government agency obligations.  In connection with these activities, the Company may be required to maintain inventory in order to facilitate customer transactions.  In order to mitigate exposure to market risk, the Company may enter into the purchase and sale of TBAs and other forward agency MBS contracts.

(ii) The Company also enters into TBAs and other forward agency MBS contracts in order to assist clients (generally small to mid-size mortgage loan originators) in hedging the interest rate risk associated with the mortgages owned by these clients.

(iii) Finally, the Company may enter into TBAs and other forward agency MBS contracts on a speculative basis.

The Company carries the TBAs and other forward agency MBS contracts at fair value and includes them as a component of investments-trading or trading securities sold, not yet purchased in the Company’s consolidated balance sheets. At March 31, 2020, the Company had open TBA and other forward MBS purchase agreements in the notional amount of $2,090,750 and open TBA and other forward MBS sale agreements in the notional amount of $2,212,275. At December 31, 2019, the Company had open TBA and other forward agency MBS purchase agreements in the notional amount of $1,773,000 and open TBA and other forward agency MBS sale agreements in the notional amount of $1,874,194.

During March and continuing subsequent to March 31, 2020, the Company reduced its TBA trading activity as a response to the financial market volatility associated with the COVID-19 pandemic.  See note 4.  As of April 30, 2020, the Company had open TBA and other forward MBS purchase agreements in the notional amount of approximately $1,134,419 and open TBA and other forward MBS sale agreements in the notional amount of approximately $1,252,919. 

Other Extended Settlement Trades

When the Company buys or sells a financial instrument that will not settle in the regular time frame, the Company will account for that purchase or sale on the settlement date rather than the trade date.  In those cases, the Company accounts for the transaction between trade date and settlement date as either a forward purchase commitment or a forward sale commitment, both considered derivatives.  The Company will record an unrealized gain or unrealized loss on the derivative for the difference between the fair value of the underlying financial instrument as of the reporting date and the agreed upon transaction price. At March 31, 2020, the Company had open forward purchase commitments of $1,725 and open forward sale commitments of $0.  At December 31, 2019, the Company had open forward purchase commitments of $1,526 and open forward sale commitments of $0.

The following table presents the Company’s derivative financial instruments and the amount and location of the fair value (unrealized gain / (loss)) recognized in the consolidated balance sheets as of March 31, 2020 and December 31, 2019.  

DERIVATIVE FINANCIAL INSTRUMENTS-BALANCE SHEET INFORMATION
(Dollars in Thousands)
Derivative Financial Instruments Not Designated as Hedging Instruments Under FASB ASC 815	Balance Sheet Classification		March 31, 2020		December 31, 2019
TBAs and other forward agency MBS	Investments-trading	$	55,779	$	3,686
Other extended settlement trades	Investments-trading		1		-
Foreign currency forward contracts	Other investments, at fair value		-		-
TBAs and other forward agency MBS	Trading securities sold, not yet purchased		(54,599)		(3,017)
Other extended settlement trades	Trading securities sold, not yet purchased		-		-
		$	1,181	$	669

The following table presents the Company’s derivative financial instruments and the amount and location of the net gain (loss) recognized in the consolidated statements of operations.

DERIVATIVE FINANCIAL INSTRUMENTS-STATEMENT OF OPERATIONS INFORMATION
(Dollars in Thousands)
Derivative Financial Instruments Not Designated as Hedging Instruments Under FASB ASC 815	Income Statement Classification		Three Months Ended March 31, 2020		Three Months Ended March 31, 2019
Foreign currency forward contracts	Revenue-principal transactions and other income	$	-	$	40
Other extended settlement trades	Revenue-net trading		1		(24)
TBAs and other forward agency MBS	Revenue-net trading		(213)		761
		$	(212)	$	777

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Net Trading

3 Months Ended

Mar. 31, 2020

Net Trading [Abstract]

Net Trading

5. NET TRADING

Net trading consisted of the following in the periods presented.

NET TRADING
(Dollars in Thousands)
		Three Months Ended
		March 31, 2020		March 31, 2019
Net realized gains (losses) - trading inventory	$	10,443	$	6,295
Net unrealized gains (losses) - trading inventory		(440)		559
Net gains and losses		10,003		6,854
Interest income- trading inventory		2,477		1,615
Interest income - residential transition loans		-		15
Interest income-receivables under resale agreements		41,485		37,483
Interest income		43,962		39,113
Interest expense-securities sold under agreements to repurchase		(34,766)		(36,381)
Interest expense-LegacyTexas Credit Facility		(39)		(5)
Interest expense-margin payable		(599)		(857)
Interest expense		(35,404)		(37,243)
Net trading	$	18,561	$	8,724

Trading inventory includes investments classified as investments-trading as well as trading securities sold, not yet purchased.  See note 7. 

During 2019, RTLs were accounted for at lower of cost or market and included as a component of other assets and the interest income related to those loans was shown separately in the table above.  Effective January 1, 2020, in connection with the adoption of ASC 326, the Company began accounting for RTLs at fair value and including them as a component of investments-trading. Therefore, income earned on RTLs is included in interest income-trading inventory in the table above effective January 1, 2020.   

Also, see note 10 for discussion of receivables under resale agreements and securities sold under agreements to repurchase.  See note 6 for discussion of margin payable.  See note 17 for discussion of LegacyTexas Credit Facility. 

XML

Document and Entity Information - shares	3 Months Ended
	Mar. 31, 2020	May 05, 2020
Document and Entity Information [Abstract]
Document Type	10-Q
Document Quarterly Report	true
Current Fiscal Year End Date	--12-31
Document Period End Date	Mar. 31, 2020
Document Transition Report	false
Entity File Number	001-32026
Entity Registrant Name	Cohen & Co Inc.
Entity Incorporation, State or Country Code	MD
Entity Tax Identification Number	16-1685692
Entity Address, Address Line One	2929 Arch Street
Entity Address, Address Line Two	Suite 1703
Entity Address, City or Town	Philadelphia
Entity Address, State or Province	PA
Entity Address, Postal Zip Code	19104
City Area Code	215
Local Phone Number	701-9555
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Non-accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	false
Entity Shell Company	false
Title of 12(b) Security	Common Stock, par value $0.01 per share
Trading Symbol	COHN
Security Exchange Name	NYSE
Entity Common Stock, Shares Outstanding		1,246,710
Document Fiscal Period Focus	Q1
Entity Central Index Key	0001270436
Amendment Flag	false
Document Fiscal Year Focus	2020

XML

Related Party Transactions

3 Months Ended

Mar. 31, 2020

Related Party Transactions [Abstract]

Related Party Transactions

24. RELATED PARTY TRANSACTIONS

The Company has identified the following related party transactions for the three months ended March 31, 2020 and 2019. The transactions are listed by related party and, unless otherwise noted in the text of the description, the amounts are disclosed in the tables at the end of this section.

A. The Bancorp, Inc. (“TBBK”)

TBBK is identified as a related party because Daniel G. Cohen is chairman of TBBK.

As part of the Company’s broker-dealer operations, the Company from time to time purchases securities from third parties and sells those securities to TBBK. The Company may purchase securities from TBBK and ultimately sell those securities to third parties. In either of the cases listed above, the Company includes the trading revenue earned (i.e. the gain or loss realized, or commission earned) by the Company for the entire transaction in the amounts disclosed as part of net trading in the table at the end of this section.

From time to time, the Company will enter into repos with TBBK as its counterparty.  As of March 31, 2020 and December 31, 2019, the Company had no repos with TBBK.  For the three months ending March 31, 2020, and 2019, the Company incurred no interest expense related to repos with TBBK as its counterparty.

B. Daniel G. Cohen/Cohen Bros. Financial, LLC (“CBF”)/ EBC 2013 Family Trust (“EBC”)

On December 30, 2019, Daniel G.  Cohen contributed 370,881 shares of IMXI common stock to the Operating LLC.  In exchange for these shares, the Operating LLC issued 12,549,273 newly issued units of membership interests in the Operating LLC and 12,549,273 shares of newly issued Series F Preferred Stock.  The Company included the value of the IMXI common stock in other investments at fair value. See note 11.

In December 2019, the Company acquired a 45% interest in CK Capital Partners B.V. (“CK Capital”).  The Company purchased this interest for $18 (of which $17 was from an entity controlled by Daniel G. Cohen).  In addition, the Company also acquired a 10% interest in Amersfoot Office Investment I Cooperatief U.A. (“AOI”), a real estate holding company, for $1 from entities controlled by Daniel G. Cohen. CK Capital is a private company incorporated in the Netherlands and provides asset and investment advisory services relating to real estate holdings. See note 11.

CBF has been identified as a related party because (i) CBF is a non-controlling interest holder of the Company and (ii) CBF is wholly owned by Daniel G. Cohen.On September 29, 2017, CBF also invested $8,000 of the $10,000 total investment in the Company’s Redeemable Financial Instrument – DGC Trust / CBF pursuant to the CBF Investment Agreement.   The Company incurred interest expense on this instrument, which is disclosed as part of interest expense incurred in the table at the end of this section.  In October 2019, a payment of $1,500 was made by the Company to CBF which reduced the redeemable financial instrument balance.  See notes 16 and 17.

EBC has been identified as a related party because Daniel G. Cohen is a trustee of EBC and has sole voting power with respect to all shares of the Company held by EBC. In September 2013, EBC, as an assignee of CBF, made a $4,000 investment in the Company.  The Company issued $2,400 in principal amount of the 2013 Convertible Notes and $1,600 of Common Stock to EBC. See note 20 to the Company’s consolidated financial statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2019.  On September 25, 2019, the 2013 Convertible Notes were amended and restated by the 2019 Senior Notes.   See note 17. The Company incurred interest expense on this debt, which is disclosed as part of interest expense incurred in the table at the end of this section.

C. The Edward E. Cohen IRA

On August 28, 2015, $4,386 in principal amount of the 2013 Convertible Notes originally issued to Mead Park Capital in September 2013 was purchased by the Edward E. Cohen IRA of which Edward E. Cohen is the benefactor.  Edward E. Cohen is the father of Daniel G. Cohen.  On September 25, 2019, the 2013 Convertible Notes were amended and restated by the 2019 Senior Notes. See note 17 for a description of amendments related to the 2019 Senior Notes and 2013 Convertible Notes.   The Company incurred interest expense on this debt, which is disclosed as part of interest expense incurred in the tables at the end of this section. The 2019 Senior Notes were fully repaid on February 3, 2020.  See note 17 and note 20 to the Company’s consolidated financial statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2019.

D. JKD Investor

The JKD Investor is an entity owned by Jack J. DiMaio, the vice chairman of the board of directors and vice chairman of the Operating LLC’s board of managers, and his spouse.  On October 3, 2016, JKD Investor invested $6,000 in the Operating LLC.   Additional investments were made in January 2017 and January 2019 in the amounts of $1,000 and $1,268 respectively.  See note 16. The interest expense incurred on this investment is disclosed in the table at the end of this section. 

On January 31, 2020, JKD Investor purchased $2,250 of the 2020 Senior Notes.  See note 17.  The Company incurred interest expense on this debt, which is disclosed as part of interest expense incurred in the tale at the end of this section.

E. DGC Trust

DGC Trust was established by Daniel G. Cohen, chairman of the Company’s board of directors and chairman of the Operating LLC board of managers.  Daniel G. Cohen does not have any voting or dispositive control of securities held in the interest of the trust.  The Company considers DGC Trust a related party because it was established by Daniel G. Cohen. 

On December 30, 2019, the DGC Trust contributed 291,480 shares of IMXI common stock with a fair value of $3,428 to the Operating LLC.  In exchange for these shares, the Operating LLC issued to the DGC Trust 9,880,268 newly issued units of membership interests in the Operating LLC and the Company issued to the DGC Trust 9,880,268 shares of newly issued Series F Preferred Stock.  The Company included the value of the shares of IMXI common stock in other investments, at fair value. See note 18.

In March 2017, the 2017 Convertible Note was issued to the DGC Trust.   The Company incurred interest expense on the 2017 Convertible Note, which is disclosed as part of interest expense incurred in the table at the end of this section.  

On September 29, 2017, the DGC Trust  invested $2,000 of the $10,000 total investment in the Company’s Redeemable Financial Instrument – DGC  Trust / CBF pursuant to the DGC Trust Investment Agreement.  See notes 19 to the Company’s consolidated financial statements included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2019 and note 16 herein.  Interest incurred on this instrument is disclosed in the tables at the end of this section. 

F. FinTech Acquisition Corp. III

In December 2018, the Operating LLC entered into an agreement with FinTech Acquisition Corp. III whereby the Company will provide certain accounting and administrative services.  FinTech Acquisition Corp. III is considered a related party because Daniel G. Cohen is the chief executive officer of FinTech Acquisition Corp, III and Betsy Cohen is the chairman of the board of directors of FinTech Acquisition Corp. III.  Income earned on this arrangement is disclosed in the tables below.

G. FinTech Investor Holdings II, LLC

FinTech Investor Holdings II, LLC is considered a related party because Daniel G. Cohen is the manager of the entity.

In July 2018, the Operating LLC acquired publicly traded shares of FinTech Acquisition Corp. II from an unrelated third party for a total purchase price of $2,513.  In connection with this purchase, the Operating LLC agreed with FinTech Investor Holdings II, LLC to not redeem these shares in advance of the merger between FinTech Acquisition Corp. II and Intermex Holdings II, LLC.   In exchange for this agreement to not redeem these shares prior to the merger, as well as the outlay of capital to purchase the publicly traded shares of FinTech Acquisition Corp. II, the Operating LLC received unregistered, restricted shares of common stock of FinTech Acquisition Corp. II from FinTech Investor Holdings II, LLC.  In connection with the merger, FinTech Acquisition Corp. II changed its name to International Money Express, Inc. 

H.  Duane Morris, LLP (“Duane Morris”)

Duane Morris is an international law firm and serves as legal counsel to the Company.  Duane Morris is considered a related party because a partner at Duane Morris is a member of the same household as a director of the Company.  Expense incurred by the Company for services provided by Duane Morris are included within professional fees and operating expense in the consolidated statements of operations and comprehensive income and are disclosed in the table below. 

I. FinTech Masala, LLC

FinTech Masala, LLC is a related party because Betsy Cohen is the mother of Daniel G. Cohen and is a member of FinTech Masala, LLC.  Daniel G. Cohen is also a member of FinTech Masala, LLC.  The Company has engaged Betsy Cohen on behalf of FinTech Masala, LLC as a consultant to provide certain services related to the Insurance SPAC.  The Company agreed to pay a consultant fee of $1 per month, which commenced July 1, 2019 and shall continue until the earlier of (i) the date that is thirty days following the closing of the Insurance SPAC’s initial Business Combination and (ii) the date on which the Company or Betsy Cohen terminates the consulting agreement.  Betsy Cohen made a $2 investment in the Sponsor Entities in March 2019, which is included as a component of non-controlling interest in the consolidated balance sheet.  The expense incurred by the Company for the consulting services provided by FinTech Masala, LLC are included within professional fees and operating expense in the consolidated income statement and are disclosed in the table below.

The Company has a sublease agreement for certain office space with FinTech Masala, LLC (formerly Bezuco Capital, LLC).  The Company received payments under this agreement.  The payments are recorded as a reduction in rent expenses.  This sublease agreement commenced on August 1, 2018.  It has an annual term that auto-renews if not cancelled earlier.  It can be cancelled by either party upon 90 days’ notice.  The income earned on this sublease is included as a reduction in rent expense in the consolidated statements of income and are disclosed in the tables below.  

J. Investment Vehicle and Other

EuroDekania

EuroDekania is considered a related party because it is an equity method investment of the Company.   The Company had an investment in and a management contract with EuroDekania.  Income earned or loss incurred on the investment is included as part of principal transactions and other income in the tables below.  Revenue earned on the management contract is included as part of asset management in the tables below.  EuroDekania liquidated  in 2019.

SPAC Fund

The SPAC Fund is considered a related party because it is an equity method investment of the Company.   The Company has an investment in and a management contract with the SPAC Fund.  Income earned or loss incurred on the investment is included as part of principal transactions and other income in the tables below.  Revenue earned on the management contract is included as part of asset management in the tables below.  As of March 31, 2020, the Company owned 2.53% of the equity of the SPAC Fund. 

U.S. Insurance JV

U.S. Insurance JV is considered a related party because it is an equity method investment of the Company. The Company has an investment in and a management contract with the U.S. Insurance JV.  Income earned or loss incurred on the investment is included as part of principal transactions and other income in the tables below.  Revenue earned on the management contract is included as part of asset management and are shown in the tables below.  As of March 31, 2020, the Company owned 4.66% of the equity of the U.S. Insurance JV.

Insurance SPAC

The Insurance SPAC is a related party as it is an equity method investment of the Sponsor Entities, which are consolidated by the Company.  As of March 31, 2020, the Sponsor Entities owned 26.5% of the equity in the Insurance SPAC. Income earned, or loss incurred on equity method investments is included in the tables below.  The Operating LLC and the Insurance SPAC entered into an administrative services agreement, dated March 19, 2019, pursuant to which the Operating LLC and the Insurance SPAC agreed that, commencing on the date that the Insurance SPAC’s securities were first listed on the Nasdaq Capital Market through the earlier of the Insurance SPAC’s consummation of a Business Combination and its liquidation, the Insurance SPAC will pay the Operating LLC $10 per month for certain office space, utilities, secretarial support, and administrative services.  Revenue earned by the Company from the administrative services agreement is included as part of principal transactions and other income in the tables below.  The Company agreed to lend the Insurance SPAC $750 for operating and acquisition related expenses.  No amounts have been lent to date under this facility.  See note 11. 

CK Capital and AOI

CK Capital and AOI are related parties as they are equity method investments of the Company.  In December 2019, the Company acquired a 45% interest in CK Capital.  The Company purchased this interest for $18 (of which $17 was from an entity controlled by Daniel G. Cohen).  In addition, the Company also acquired a 10% interest AOI, a real estate holding company, for $1 from entities controlled by Daniel G. Cohen.  See Note 11. 

The following tables display the routine transactions recognized in the statements of operations from the identified related parties that are described above.

	Related Party Transactions
	(Dollars in Thousands)
		Three Months Ended
		March 31, 2020		March 31, 2019
Net trading
TBBK	$	-	$	2
Asset management
EuroDekania		-		86
SPAC Fund		(47)		31
U.S.  Insurance JV		90		80
	$	43	$	197
Principal transactions and other income
EuroDekania		-		291
FinTech Acquisition Corp.		3		3
Insurance SPAC		30		4
SPAC Fund		(59)		24
U.S.  Insurance JV		(167)		39
	$	(193)	$	361
Income (loss) from equity method affiliates
AOI		(30)		-
CK Capital		230		-
Insurance SPAC		(307)		(8)
	$	(107)	$	(8)
Operating expense (income)
Duane Morris		319		101
FinTech Masala, LLC		(11)		(6)
	$	308	$	95
Interest expense (income)
CBF		528		119
DGC Trust		533		390
EBC		72		47
Edward E. Cohen IRA		48		87
JKD Investor		484		278
	$	1,665	$	921

The following related party transactions are non-routine and are not included in the tables above.

K.  Directors and Employees

The Company has entered into employment agreements with Daniel G. Cohen and Joseph W. Pooler, Jr., its chief financial officer.  The Company has entered into its standard indemnification agreement with each of its directors and executive officers.

The Company maintains a 401(k) savings plan covering substantially all of its employees.  The Company matches 50% of employee contributions for all participants not to exceed 3% of their salary.  Contributions made on behalf of the Company were $98 and $91 for the three months ended March 31, 2020, and 2019, respectively.

The Company leases office space from Zucker and Moore, LLC.  Zucker and Moore, LLC is partially owned by Jack DiMaio, Jr., the vice chairman of the Company’s board of directors.  The Company recorded $24 of rent expense related to this office space for the three months ended March 31, 2020 and 2019.

XML

Consolidated Statements Of Operations And Comprehensive Income (Loss) (Parenthetical) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Consolidated Statements of Operations And Comprehensive Income/(Loss) [Abstract]
Foreign currency translation adjustments, tax	$ 0	$ 0
Other comprehensive income (loss), tax	$ 0	$ 0

XML

Net Trading (Tables)

3 Months Ended

Mar. 31, 2020

Net Trading [Abstract]

Schedule Of Net Trading

NET TRADING
(Dollars in Thousands)
		Three Months Ended
		March 31, 2020		March 31, 2019
Net realized gains (losses) - trading inventory	$	10,443	$	6,295
Net unrealized gains (losses) - trading inventory		(440)		559
Net gains and losses		10,003		6,854
Interest income- trading inventory		2,477		1,615
Interest income - residential transition loans		-		15
Interest income-receivables under resale agreements		41,485		37,483
Interest income		43,962		39,113
Interest expense-securities sold under agreements to repurchase		(34,766)		(36,381)
Interest expense-LegacyTexas Credit Facility		(39)		(5)
Interest expense-margin payable		(599)		(857)
Interest expense		(35,404)		(37,243)
Net trading	$	18,561	$	8,724

XML

Derivative Financial Instruments (Tables)

3 Months Ended

Mar. 31, 2020

Derivative Financial Instruments [Abstract]

Balance Sheet Information

DERIVATIVE FINANCIAL INSTRUMENTS-BALANCE SHEET INFORMATION
(Dollars in Thousands)
Derivative Financial Instruments Not Designated as Hedging Instruments Under FASB ASC 815	Balance Sheet Classification		March 31, 2020		December 31, 2019
TBAs and other forward agency MBS	Investments-trading	$	55,779	$	3,686
Other extended settlement trades	Investments-trading		1		-
Foreign currency forward contracts	Other investments, at fair value		-		-
TBAs and other forward agency MBS	Trading securities sold, not yet purchased		(54,599)		(3,017)
Other extended settlement trades	Trading securities sold, not yet purchased		-		-
		$	1,181	$	669

Statement Of Operations Information

DERIVATIVE FINANCIAL INSTRUMENTS-STATEMENT OF OPERATIONS INFORMATION
(Dollars in Thousands)
Derivative Financial Instruments Not Designated as Hedging Instruments Under FASB ASC 815	Income Statement Classification		Three Months Ended March 31, 2020		Three Months Ended March 31, 2019
Foreign currency forward contracts	Revenue-principal transactions and other income	$	-	$	40
Other extended settlement trades	Revenue-net trading		1		(24)
TBAs and other forward agency MBS	Revenue-net trading		(213)		761
		$	(212)	$	777

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Basis Of Presentation

3 Months Ended

Mar. 31, 2020

Basis Of Presentation [Abstract]

Basis Of Presentation

2. BASIS OF PRESENTATION

The financial statements of the Company included herein were prepared in conformity with U.S. GAAP for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. The information furnished includes all adjustments and accruals of a normal recurring nature, which, in the opinion of management, are necessary for a fair presentation of results for the interim month periods. All intercompany accounts and transactions have been eliminated in consolidation. The results for the three months ended March 31, 2020 and 2019 are not necessarily indicative of the results for the entire year or any subsequent interim period. These financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2019.  

Capitalized terms used herein without definition have the meanings ascribed to them in the Annual Report on Form 10-K for the year ended December 31, 2019.  

Effective June 1, 2019, the Company changed its accounting policy regarding the netting of reverse repurchase agreement and repurchase agreement transactions and updated prior periods’ balances to be consistent with this new accounting policy.  See note 10. 

XML

Financial Instruments (Schedule Of Trading Securities) (Details) - USD ($) $ in Thousands	Mar. 31, 2020	Dec. 31, 2019
Schedule of Trading Securities and Other Trading Assets [Line Items]
Investments-trading	$ 375,745	$ 307,852
U.S. government agency MBS and CMOs [Member]
Schedule of Trading Securities and Other Trading Assets [Line Items]
Investments-trading	218,767	196,146
U.S. government agency debt securities [Member]
Schedule of Trading Securities and Other Trading Assets [Line Items]
Investments-trading	4,791	14,680
RMBS [Member]
Schedule of Trading Securities and Other Trading Assets [Line Items]
Investments-trading	14	15
U.S. Treasury securities [Member]
Schedule of Trading Securities and Other Trading Assets [Line Items]
Investments-trading	6,065	11,105
ABS [Member]
Schedule of Trading Securities and Other Trading Assets [Line Items]
Investments-trading	1	100
SBA loans [Member]
Schedule of Trading Securities and Other Trading Assets [Line Items]
Investments-trading	26,073	27,634
Corporate bonds and redeemable preferred stock [Member]
Schedule of Trading Securities and Other Trading Assets [Line Items]
Investments-trading	31,877	38,503
Foreign government bonds [Member]
Schedule of Trading Securities and Other Trading Assets [Line Items]
Investments-trading	626	844
Municipal bonds [Member]
Schedule of Trading Securities and Other Trading Assets [Line Items]
Investments-trading	25,121	13,737
Certificates of deposit [Member]
Schedule of Trading Securities and Other Trading Assets [Line Items]
Investments-trading	3,575	841
Derivatives [Member]
Schedule of Trading Securities and Other Trading Assets [Line Items]
Investments-trading	55,780	3,686
Equity securities [Member]
Schedule of Trading Securities and Other Trading Assets [Line Items]
Investments-trading	99	$ 561
Residential transition loans [Member]
Schedule of Trading Securities and Other Trading Assets [Line Items]
Investments-trading	$ 2,956

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Summary Of Significant Accounting Policies (Narrative) (Details) - USD ($) $ in Thousands		3 Months Ended
	Jan. 01, 2019	Mar. 31, 2020	Mar. 31, 2019	Dec. 31, 2019	Dec. 31, 2018
Summary Of Significant Accounting Policies [Line Items]
Estimated debt in fair value		$ 61,501		$ 58,635
Right of use asset		6,867		7,155
Lease commitment liability		7,391		7,693
Reduction in retained earnings due to effect of adoption		36,913	$ 42,736	$ 48,756	$ 42,438
Increase (decrease) in other receivables		$ (29,618)	(3,894)
Accounting Standards Update 2016-02 [Member]
Summary Of Significant Accounting Policies [Line Items]
Right of use asset	$ 8,416
Lease commitment liability	8,860
Increase (decrease) in other receivables	18
Reduction in other liabilities	$ (406)
Cumulative Effect, Period of Adoption, Adjustment [Member] | Accounting Standards Update 2016-02 [Member]
Summary Of Significant Accounting Policies [Line Items]
Reduction in retained earnings due to effect of adoption			$ (20)

XML

Segment And Geographic Information (Tables)

3 Months Ended

Mar. 31, 2020

Segment And Geographic Information [Abstract]

Schedule Of Segment Reporting Information

SEGMENT INFORMATION
Statement of Operations Information
Three Months Ended March 31, 2020
	Capital		Asset		Principal		Segment		Unallocated
	Markets		Management		Investing		Total		(1)		Total
Net trading	$	18,561	$	-	$	-	$	18,561	$	-	$	18,561
Asset management		-		1,615		-		1,615		-		1,615
Principal transactions and other income		9		116		(2,531)		(2,406)		-		(2,406)
Total revenues		18,570		1,731		(2,531)		17,770		-		17,770
Salaries/Wages		11,910		1,117		-		13,027		1,107		14,134
Other Operating Expense		3,277		477		50		3,804		1,394		5,198
Impairment of goodwill		7,883		-		-		7,883		-		7,883
Total operating expenses		23,070		1,594		50		24,714		2,501		27,215
Operating income (loss)		(4,500)		137		(2,581)		(6,944)		(2,501)		(9,445)
Interest income (expense)		(75)		-		-		(75)		(2,530)		(2,605)
Income (loss) from equity method affiliates		-		200		(307)		(107)		-		(107)
Income (loss) before income taxes		(4,575)		337		(2,888)		(7,126)		(5,031)		(12,157)
Income tax expense (benefit)		-		-		-		-		(372)		(372)
Net income (loss)		(4,575)		337		(2,888)		(7,126)		(4,659)		(11,785)
Less: Net income (loss) attributable to the non-controlling interest		-		-		-		-		(8,683)		(8,683)
Net income (loss) attributable to Cohen & Company Inc.	$	(4,575)	$	337	$	(2,888)	$	(7,126)	$	4,024	$	(3,102)
Other statement of operations data
Depreciation and amortization (included in total operating expense)	$	4	$	1	$	-	$	5	$	75	$	80

SEGMENT INFORMATION
Statement of Operations Information
Three Months Ended March 31, 2019
	Capital		Asset		Principal		Segment		Unallocated
	Markets		Management		Investing		Total		(1)		Total
Net trading	$	8,724	$	-	$	-	$	8,724	$	-	$	8,724
Asset management		-		2,002		-		2,002		-		2,002
Principal transactions and other income		1		97		316		414		-		414
Total revenues		8,725		2,099		316		11,140		-		11,140
Salaries/Wages		4,547		1,122		-		5,669		695		6,364
Other Operating Expense		2,911		693		100		3,704		1,140		4,844
Impairment of goodwill		-		-		-		-		-		-
Total operating expenses		7,458		1,815		100		9,373		1,835		11,208
Operating income (loss)		1,267		284		216		1,767		(1,835)		(68)
Interest (expense) income		(55)		-		-		(55)		(1,799)		(1,854)
Income (loss) from equity method affiliates		-		-		(8)		(8)		-		(8)
Income (loss) before income taxes		1,212		284		208		1,704		(3,634)		(1,930)
Income tax expense (benefit)		-		-		-		-		(106)		(106)
Net income (loss)		1,212		284		208		1,704		(3,528)		(1,824)
Less: Net income (loss) attributable to the non-controlling interest		-		-		-		-		(622)		(622)
Net income (loss) attributable to Cohen & Company Inc.	$	1,212	$	284	$	208	$	1,704	$	(2,906)	$	(1,202)
Other statement of operations data
Depreciation and amortization (included in total operating expense)	$	5	$	1	$	-	$	6	$	75	$	81

(1) Unallocated includes certain expenses incurred by indirect overhead and support departments (such as the executive, finance, legal, information technology, human resources, risk, compliance, and other similar overhead and support departments). Some of the items not allocated include: (1) operating expenses (such as cash compensation and benefits, equity-based compensation expense, professional fees, travel and entertainment, consulting fees, and rent) related to support departments excluding certain departments that directly support the Capital Markets business segment; (2) interest expense on debt; and (3) income taxes. Management does not consider these items necessary for an understanding of the operating results of these business segments and such amounts are excluded in business segment reporting to the chief operating decision maker.

Reconciliation Of Assets From Segment To Consolidated

BALANCE SHEET DATA
As of March 31, 2020
(Dollars in Thousands)
	Capital		Asset		Principal		Segment		Unallocated
	Markets		Management		Investing		Total		(1)		Total
Total Assets	$	6,564,241	$	1,348	$	15,873	$	6,581,462	$	15,078	$	6,596,540
Included within total assets:
Investment in equity method affiliates	$	-	$	-	$	5,789	$	5,789	$		$	5,789
Goodwill (2)	$	54	$	55	$	-	$	109	$	-	$	109
Intangible assets (2)	$	166	$	-	$	-	$	166	$	-	$	166

BALANCE SHEET DATA
December 31, 2019
(Dollars in Thousands)
	Capital		Asset		Principal		Segment		Unallocated
	Markets		Management		Investing		Total		(1)		Total
Total Assets	$	7,968,491	$	1,616	$	18,689	$	7,988,796	$	12,828	$	8,001,624
Included within total assets:
Investment in equity method affiliates	$	-	$	-	$	3,799	$	3,799	$	-	$	3,799
Goodwill (2)	$	7,937	$	55	$	-	$	7,992	$	-	$	7,992
Intangible assets (2)	$	166	$	-	$	-	$	166	$	-	$	166

(1)Unallocated assets primarily include: (1) amounts due from related parties; (2) furniture and equipment, net; and (3) other assets that are not considered necessary for an understanding of business segment assets.  Such amounts are excluded in business segment reporting to the chief operating decision maker.

(2)Goodwill and intangible assets are allocated to the Capital Markets and Asset Management business segments as indicated in the table above.

Revenue By Geographic Area

GEOGRAPHIC DATA
(Dollars in Thousands)
	Three Months Ended March 31,
		2020	2019
Total Revenues:
United States	$	16,942	$	10,082
Europe & Other		828		1,058
Total	$	17,770	$	11,140

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Debt (Narrative) (Details) - USD ($) $ / shares in Units, $ in Thousands			3 Months Ended			12 Months Ended
		Feb. 03, 2020	Mar. 31, 2020		Mar. 31, 2019	Dec. 31, 2019
Debt Instrument [Line Items]
Redeemable noncontrolling interest, membership units not held, share ratio			$ 10		$ 10
Common Stock, Shares, Issued			1,246,710			1,193,624
Edward E. Cohen IRA [Member]
Debt Instrument [Line Items]
Repayments of Long-term Debt		$ 4,386
Junior subordinated debt [Member]
Debt Instrument [Line Items]
Ownership value of common stock of trusts			$ 1,489
12.00% Non-convertible Senior Notes (2020 Senior Notes) [Member] | Non-convertible Senior Notes [Member]
Debt Instrument [Line Items]
Principal amount of debt outstanding			$ 4,500
Stated interest rate	[1]		12.00%
Maturity			Jan. 01, 2022
12.00% Non-convertible Senior Notes (2019 Senior Notes) [Member]
Debt Instrument [Line Items]
Principal amount of debt outstanding						$ 2,400
12.00% Non-convertible Senior Notes (2019 Senior Notes) [Member] | Minimum [Member]
Debt Instrument [Line Items]
Interest rate, in event of default			9.00%
12.00% Non-convertible Senior Notes (2019 Senior Notes) [Member] | Maximum [Member]
Debt Instrument [Line Items]
Interest rate, in event of default			13.00%
12.00% Non-convertible Senior Notes (2019 Senior Notes) [Member] | Non-convertible Senior Notes [Member]
Debt Instrument [Line Items]
Principal amount of debt outstanding			$ 2,400			$ 6,786
Stated interest rate			12.00%	[1]		8.00%
Maturity	[2]		Sep. 25, 2020
Interest rate, in event of default			13.00%			9.00%
Alesco Capital Trust I [Member] | Junior subordinated debt [Member]
Debt Instrument [Line Items]
Principal amount of debt outstanding	[3]		$ 28,125			$ 28,125
Stated interest rate	[1],[3]		5.77%
Maturity	[3]		Jul. 30, 2037
Sunset Financial Statutory Trust I [Member] | Junior subordinated debt [Member]
Debt Instrument [Line Items]
Principal amount of debt outstanding	[3]		$ 20,000			20,000
Stated interest rate	[1],[3]		5.52%
Maturity	[3]		Mar. 30, 2035
8.00% Contingent Convertible Senior Notes (2017 Convertible Note) [Member] | Contingent Convertible Senior Notes [Member]
Debt Instrument [Line Items]
Principal amount of debt outstanding			$ 15,000			15,000
Stated interest rate	[1]		8.00%
Maturity	[4]		Mar. 31, 2022
2017 Convertible Note [Member]
Debt Instrument [Line Items]
Conversion price per unit			$ 1.45
Redeemable noncontrolling interest, membership units not held, share ratio			$ 14.50
FT Financial Bank, N.A. [Member] | Credit Facility [Member]
Debt Instrument [Line Items]
Principal amount of debt outstanding			$ 17,500
Maturity			Apr. 10, 2021
Aggregate borrowing capacity			$ 25,000
Legacy Texas [Member] | Credit Facility [Member]
Debt Instrument [Line Items]
Principal amount of debt outstanding						$ 4,777
2018 FT LOC [Member] | Credit Facility [Member]
Debt Instrument [Line Items]
Aggregate borrowing capacity			$ 7,500

[1] Represents the interest rate in effect as of the last day of the reporting period.

[2] On September 25, 2019, the Company amended the previously outstanding 2013 Convertible Notes, which were scheduled to mature on September 25, 2019. The material terms and conditions of the 2013 Convertible Notes remained substantially the same, except that (i) the maturity date changed from September 25, 2019 to September 25, 2020; (ii) the conversion feature in the 2013 Convertible Notes was removed; (iii) the interest rate changed from 8% per annum (9% in the event of certain events of default) to 12% per annum (13% in the event of certain events of default); and (iv) the restrictions regarding the prepayment were removed. The post amendment notes are referred to herein as the "2019 Senior Notes" and the pre-amendment notes are referred to herein as the "2013 Convertible Notes."

[3] The junior subordinated notes listed represent debt the Company owes to the two trusts noted above. The total par amount owed by the Company to the trusts is $49,614. However, the Company owns the common stock of the trusts in a total par amount of $1,489. The Company pays interest (and at maturity, principal) to the trusts on the entire $49,614 junior notes outstanding. However, the Company receives back from the trusts the pro rata share of interest and principal on the common stock held by the Company. These trusts are VIEs and the Company does not consolidate them even though the Company holds the common stock. The Company carries the common stock on its balance sheet at a value of $0. The junior subordinated notes are recorded at a discount to par. When factoring in the discount, the yield to maturity of the junior subordinated notes as of March 31, 2020 on a combined basis was 15.04% assuming the variable rate in effect on the last day of the reporting period remains in effect until maturity.

[4] The holder of the 2017 Convertible Note may convert all or any part of the outstanding principal amount at any time prior to maturity into units of membership interests of the Operating LLC at a conversion price of $1.45 per unit, subject to customary anti-dilution adjustments. Units of membership interests in the Operating LLC not held by Cohen & Company Inc. may, with certain restrictions, be redeemed and exchanged into shares of the Cohen & Company Inc. common stock, par value $0.01 per share (“Common Stock”) on a ten-for-one basis. Therefore, the 2017 Convertible Note can be converted into Operating LLC units of membership interests and then redeemed and exchanged into Common Stock at an effective conversion price of $14.50. See note 20 to our Annual Report on Form 10-K for the year ended December 31, 2019.

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Goodwill (Schedule Of Goodwill) (Details) - USD ($) $ in Thousands		Mar. 31, 2020	Dec. 31, 2019
Goodwill [Line Items]
Goodwill	[1]	$ 109	$ 7,992
AFN [Member]
Goodwill [Line Items]
Goodwill		$ 109	109
JVB Holdings [Member]
Goodwill [Line Items]
Goodwill			$ 7,883

[1] Goodwill and intangible assets are allocated to the Capital Markets and Asset Management business segments as indicated in the table above.

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Other Receivables, Other Assets, Accounts Payable And Other Liabilities (Schedule Of Other Assets) (Details) - USD ($) $ in Thousands	Mar. 31, 2020	Dec. 31, 2019
Other Receivables, Other Assets, Accounts Payable And Other Liabilities [Abstract]
Deferred costs	$ 241	$ 301
Prepaid expenses	1,075	796
Deposits	403	656
Miscellaneous other assets	275	275
RTLs		5,323
Furniture, equipment and leasehold improvements, net	899	916
Intangible assets	166	166
Other assets	$ 3,059	$ 8,433

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Equity (Stockholders Rights Plan) (Details) - $ / shares	3 Months Ended
	Mar. 31, 2020	Dec. 31, 2019
Common Stock, Par or Stated Value Per Share	$ 0.01	$ 0.01
2020 Rights Agreement [Member]
Number of shares issuable per right	10
Repurchase of Warrants, price per share	$ 200.00
Share Price	$ 20.00
Voting Power, Percentage	50.00%
Percentage of purchase price requirement	1.00%
Number of fractal units issued	0
Redemption price per right	$ 0.001
Series C Junior Participating Preferred Stock | 2020 Rights Agreement [Member]
Preferred Stock, par value	0.001
Rights agreement, purchase price per unit	$ 100.00
Class of Warrant or Right, Exercise Trigger, Percentage of Common Stock Owned by Individual or Affiliates	4.95%