EX-99.1 2 rso-20140331xex991.htm EXHIBIT 99.1 RSO-2014.03.31-EX99.1




FOR IMMEDIATE RELEASE

CONTACT:
DAVID J. BRYANT
CHIEF FINANCIAL OFFICER
RESOURCE CAPITAL CORP.
712 Fifth Ave, 12TH Floor
New York, NY 10019
212-506-3870
        
RESOURCE CAPITAL CORP.
REPORTS RESULTS FOR
THREE MONTHS ENDED MARCH 31, 2014
Highlights
•
Adjusted Funds from Operations (“AFFO”) of $0.20 per share-diluted (see Schedule I).
•
Invested over $300.0 million in new assets including over $161.0 million in commercial real estate loans and securities during the twelve months ended March 31, 2014.
•
GAAP net income allocable to common shares of $0.12 per share-diluted.
•
Common stock cash dividend of $0.20 per share.

New York, N.Y., May 6, 2014 - Resource Capital Corp. (NYSE: RSO) (“RSO” or the “Company”), a real estate investment trust, or REIT, whose investment strategy focuses on commercial real estate assets, commercial mortgage-backed securities (“CMBS”), commercial finance assets and other investments, reported results for the three months ended March 31, 2014.
•
AFFO for the three months ended March 31, 2014 was $25.0 million, or $0.20 per share-diluted as compared to $21.0 million, or $0.20 per share-diluted for the three months ended March 31, 2013. A reconciliation of GAAP net income to AFFO is set forth in Schedule I of this release.
•
GAAP net income allocable to common shares for the three months ended March 31, 2014 was $15.1 million, or $0.12 per share-diluted, as compared to $11.5 million, or $0.11 per share-diluted, for the three months ended March 31, 2013.

Jonathan Cohen, CEO and President of Resource Capital Corp., commented, "We are pleased with our investment program during the 1st quarter. We are seeing real momentum in achieving our goals of increased commercial real estate loan originations, good credit, and adjusted funds from operations in line or better than our dividend."






Additional highlights:
Commercial Real Estate
•
CRE loan portfolio is comprised of approximately 91% senior whole loans as of March 31, 2014, as compared to 85% a year ago.
•
RSO closed $374.1 million of new whole loans in the last 12 months with a weighted average yield of 6.31%, including origination fees. In addition, RSO funded $20.4 million of previous loan commitments on existing loans.
The following table summarizes RSO's CRE loan activities and fundings of previous commitments, at par, for the three and the twelve months ended March 31, 2014 (in millions, except percentages):
 
 
Three Months Ended
 
12 Months Ended
 
Floating Weighted
Average Spread (1) (2)
 
Weighted Average
Fixed Rate
 
 
March 31,
2014
 
March 31,
2014
 
 
New whole loans production (3) 
 
$
111.6

 
$
394.5

 
4.70
%
 
—
%
Payoffs (4)
 
(22.2
)
 
(81.5
)
 
 
 
 
Sales
 
—

 
(29.9
)
 
 
 
 
Principal paydowns
 
(1.0
)
 
(16.7
)
 
 
 
 
Loans, net
 
$
88.4

 
$
266.4

 
 
 
 
________________
(1)
Represents the weighted average rate above the one-month London Interbank Offered Rate (“LIBOR”) on loans whose interest rate is based on LIBOR as of March 31, 2014. Of these loans, $107.9 million have LIBOR floors with a weighted average floor of 0.80%.
(2)
Reflects rates on RSO's portfolio balance as of March 31, 2014.
(3)
Whole loan production includes the funding of previous commitments of $3.7 million for the three months and $20.4 million for the twelve months ended March 31, 2014, respectively.
(4)
CRE loan payoffs and extensions resulted in $148,000 in extension and exit fees during the three months ended March 31, 2014
CMBS
•
During the three months ended March 31, 2014, RSO acquired $36.8 million, par value, of CMBS which were partially financed by 30-day repurchase contracts with a repurchase value of $25.0 million. In addition, RSO acquired $4.1 million, par value, of CMBS, which were financed by RSO's Wells Fargo repurchase facility and were AAA rated by at least one rating agency.
Commercial Finance - Syndicated Bank Loans
•
RSO's bank loan portfolio, including asset-backed securities (“ABS”), corporate bonds and certain loans held for sale, at the end of the first quarter of 2014 was $726.0 million, at amortized cost, with a weighted-average spread of one-month and three-month LIBOR plus 3.43% at March 31, 2014. RSO's bank loan portfolio was nearly 100% match-funded through three CLOs issuances.
•
RSO, through its subsidiary Resource Capital Asset Management, earned $1.7 million of net fees during the three months ended March 31, 2014.
Middle Market Loans
•
RSO's middle market lending platform has made $58.2 million of loan commitments since January 1, 2014 and funded $41.2 million of those commitments.





Investment Portfolio
The table below summarizes the amortized cost and net carrying amount of RSO's investment portfolio as of March 31, 2014, classified by interest rate and by asset type. The following table includes both (i) the amortized cost of RSO's investment portfolio and the related dollar price, which is computed by dividing amortized cost by par amount, and (ii) the net carrying amount of RSO's investment portfolio and the related dollar price, which is computed by dividing the net carrying amount by par amount (in thousands, except percentages):
 
Amortized
cost
 
Dollar price
 
Net carrying
amount
 
Dollar price
 
Net carrying
amount less
amortized cost
 
Dollar price
March 31, 2014
 
 
 
 
 
 
 
 
 
 
 
Floating rate
 
 
 
 
 
 
 
 
 
 
 
RMBS
$
1,909

 
20.68
%
 
$
438

 
4.74
%
 
$
(1,471
)
 
(15.93
)%
CMBS-private placement
27,138

 
91.99
%
 
15,508

 
52.57
%
 
(11,630
)
 
(39.42
)%
Structured notes - trading
8,057

 
34.49
%
 
9,549

 
40.88
%
 
1,492

 
6.39
 %
Structured notes - available-for-sale
12,841

 
100.00
%
 
12,841

 
100.00
%
 
—

 
—
 %
Mezzanine loans
12,467

 
99.06
%
 
12,365

 
98.25
%
 
(102
)
 
(0.81
)%
Whole loans (1)
833,853

 
99.56
%
 
828,664

 
98.94
%
 
(5,189
)
 
(0.62
)%
Bank loans (2)
687,154

 
99.56
%
 
686,413

 
99.45
%
 
(741
)
 
(0.11
)%
Loans held for sale (3)
272

 
22.08
%
 
272

 
22.08
%
 
—

 
—
 %
ABS Securities
35,648

 
94.25
%
 
36,839

 
97.40
%
 
1,191

 
3.51
 %
Corporate Bonds
2,603

 
96.23
%
 
2,580

 
95.38
%
 
(23
)
 
(0.85
)%
   Total floating rate
1,621,942

 
97.88
%
 
1,605,469

 
96.89
%
 
(16,473
)
 
(0.99
)%
Fixed rate
 
 
 
 
 
 
 
 
 
 
 
CMBS-private placement
159,565

 
80.24
%
 
165,783

 
83.36
%
 
6,218

 
3.12
 %
CMBS-linked transactions
38,214

 
105.59
%
 
34,829

 
96.24
%
 
(3,385
)
 
(9.40
)%
B notes (1)
16,168

 
99.54
%
 
16,036

 
98.73
%
 
(132
)
 
(0.81
)%
Mezzanine loans (1)
51,832

 
100.05
%
 
51,410

 
99.24
%
 
(422
)
 
(0.81
)%
Residential mortgage loans
1,843

 
100.00
%
 
1,843

 
100.00
%
 
—

 
—
 %
Loans held for sale (3)
15,117

 
100.00
%
 
15,117

 
100.00
%
 
—

 
—
 %
Loans receivable-related party
6,498

 
100.00
%
 
6,498

 
100.00
%
 
—

 
—
 %
Total fixed rate
289,237

 
88.57
%
 
291,516

 
89.27
%
 
2,279

 
0.70
 %
Other (non-interest bearing)
 
 
 
 
 
 
 
 
 
 
 
Investment in real estate
19,971

 
100.00
%
 
19,971

 
100.00
%
 
—

 
—
 %
Property available-for-sale
35,256

 
100.00
%
 
35,256

 
100.00
%
 
—

 
—
 %
Investment in unconsolidated entities
62,053

 
100.00
%
 
62,053

 
100.00
%
 
—

 
—
 %
   Total other
117,280

 
100.00
%
 
117,280

 
100.00
%
 
—

 
—
 %
      Grand total
$
2,028,459

 
96.55
%
 
$
2,014,265

 
95.88
%
 
$
(14,194
)
 
(0.68
)%
 
(1)
Net carrying amount includes an allowance for loan losses of $5.8 million at March 31, 2014, allocated as follows:  B notes $132,000, mezzanine loans $524,000 and whole loans $5.2 million.
(2)
Net carrying amount includes allowance for loan losses of $741,000 at March 31, 2014.
(3)
Loans held for sale are carried at the lower of cost or fair market value. Amortized cost is equal to fair value.




Liquidity
At April 30, 2014, after paying RSO's first quarter 2014 common and preferred stock dividends, RSO's liquidity is derived from three primary sources:
•
unrestricted cash and cash equivalents of $156.1 million, restricted cash of $500,000 in margin call accounts and $2.1 million in the form of real estate escrows, reserves and deposits;
•
capital available for reinvestment in its securitizations of $40.3 million, of which $4.9 million is designated to finance future funding commitments on CRE loans; and
•
loan principal repayments that will pay down outstanding CLO notes of $9.3 million and $4.7 million in interest collections.
In addition, RSO has funds available through three term financing facilities to finance the origination of CRE loans of $130.6 million and $194.3 million, respectively, and to finance the purchase of CMBS of $61.1 million.
Capital Allocation
As of March 31, 2014, RSO had allocated its invested equity capital among its targeted asset classes as follows: 73% in CRE assets, 26% in commercial finance assets and 1% in other investments.
Supplemental Information
The following schedules of reconciliations or supplemental information as of March 31, 2014 are included at the end of this release:
•
Schedule I - Reconciliation of GAAP Net Income to Funds from Operations (“FFO”) and AFFO.
•
Schedule II - Book Value Allocable to Common Shareholders Rollforward.
•
Schedule III - Securitizations - Distributions and Coverage Test Summary.
•
Supplemental Information regarding loan investment statistics, CRE loans and bank loans.
About Resource Capital Corp.
RSO is a real estate investment trust that is primarily focused on originating, holding and managing commercial mortgage loans and other commercial real estate-related debt and equity investments. RSO also makes other commercial finance investments.
RSO is externally managed by Resource Capital Manager, Inc., an indirect wholly-owned subsidiary of Resource America, Inc. (NASDAQ: REXI), an asset management company that specializes in real estate and credit investments.
For more information, please visit RSO's website at www.resourcecapitalcorp.com or contact investor relations at pkamdar@resourceamerica.com.





Safe Harbor Statement
Statements made in this release may include forward-looking statements, which involve substantial risks and uncertainties. RSO's actual results, performance or achievements could differ materially from those expressed or implied in this release. The risks and uncertainties associated with forward-looking statements contained in this release include those related to:
•
fluctuations in interest rates and related hedging activities;
•
the availability of debt and equity capital to acquire and finance investments;
•
defaults or bankruptcies by borrowers on RSO's loans or on loans underlying its investments;
•
adverse market trends which have affected and may continue to affect the value of real estate and other assets underlying RSO's investments;
•
increases in financing or administrative costs; and
•
general business and economic conditions that have impaired and may continue to impair the credit quality of borrowers and RSO's ability to originate loans.
For further information concerning these and other risks pertaining to the forward-looking statements contained in this release, and to the general risks to which RSO is subject, see Item 1A, “Risk Factors” included in its Annual Report on Form 10-K and the risks expressed in other of its public filings with the Securities and Exchange Commission.
RSO cautions you not to place undue reliance on any forward-looking statements contained in this release, which speak only as of the date of this release. All subsequent written and oral forward-looking statements attributable to RSO or any person acting on its behalf are expressly qualified in their entirety by the cautionary statements contained or referred to in this release. Except to the extent required by applicable law or regulation, RSO undertakes no obligation to update these forward-looking statements to reflect events or circumstances after the date of this filing or to reflect the occurrence of unanticipated events.
The remainder of this release contains RSO's unaudited consolidated balance sheets, unaudited consolidated statements of income, reconciliation of GAAP net income to FFO and AFFO, Book value allocable to common shareholders rollforward, summary of CDO and CLO performance statistics and supplemental information regarding RSO's CRE loan and bank loan portfolios.











RESOURCE CAPITAL CORP. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(in thousands, except share and per share data)

 
March 31,
2014
 
December 31,
2013
 
(unaudited)
 
 
ASSETS (1)
 
 
 
Cash and cash equivalents
$
166,686

 
$
262,270

Restricted cash
115,952

 
63,309

Investment securities, trading
9,987

 
11,558

Investment securities available-for-sale, pledged as collateral, at fair value
159,051

 
162,608

Investment securities available-for-sale, at fair value
74,500

 
52,598

Linked transactions, net at fair value
34,829

 
30,066

Loans held for sale
15,389

 
21,916

Property available-for-sale
35,256

 
25,346

Investment in real estate
19,971

 
29,778

Loans, pledged as collateral and net of allowances of $6.6 million and $13.8 million
1,596,731

 
1,369,526

Loans receivable–related party
6,498

 
6,966

Investments in unconsolidated entities
62,053

 
69,069

Derivatives, at fair value
556

 
—

Interest receivable
10,503

 
8,965

Deferred tax asset
5,048

 
5,212

Principal paydown receivable
1

 
6,821

Intangible assets
11,283

 
11,822

Prepaid expenses
4,155

 
2,871

Other assets
13,459

 
10,726

Total assets
$
2,341,908

 
$
2,151,427

LIABILITIES (2)
 

 
 

Borrowings
$
1,502,089

 
$
1,319,810

Distribution payable
27,601

 
27,023

Accrued interest expense
3,848

 
1,693

Derivatives, at fair value
10,242

 
10,586

Accrued tax liability
387

 
1,629

Deferred tax liability
4,036

 
4,112

Accounts payable and other liabilities
13,511

 
12,650

Total liabilities
1,561,714

 
1,377,503

STOCKHOLDERS’ EQUITY
 

 
 

Preferred stock, par value $0.001:  100,000,000 shares authorized 8.50% Series A cumulative redeemable preferred shares, liquidation preference $25.00
per share, 872,039 and 680,952 shares issued and outstanding
1

 
1

Preferred stock, par value $0.001:  100,000,000 shares authorized 8.25% Series B cumulative redeemable preferred shares, liquidation preference $25.00 per share 3,988,977 and 3,485,078 shares issued and outstanding
4

 
3

Common stock, par value $0.001:  500,000,000 shares authorized; 128,577,980 and 127,918,927 shares issued and outstanding (including 2,670,189 and 3,112,595 unvested restricted shares)
129

 
128

Additional paid-in capital
1,059,805

 
1,042,480

Accumulated other comprehensive loss
(14,071
)
 
(14,043
)
Distributions in excess of earnings
(265,618
)
 
(254,645
)
Total stockholders’ equity
780,250

 
773,924

     Non-controlling interest
(56
)
 
—

          Total equity
780,194

 
773,924

TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY
$
2,341,908

 
$
2,151,427














RESOURCE CAPITAL CORP. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS - (Continued)
(in thousands, except share and per share data)

 
March 31,
2014
 
December 31,
2013
 
(unaudited)
 
 
(1) Assets of consolidated VIEs included in the total assets:
 
 
 
        Restricted cash
$
113,362

 
$
61,372

        Investment securities available-for-sale, pledged as collateral, at fair value
116,429

 
105,846

        Loans held for sale
272

 
2,376

        Loans, pledged as collateral and net of allowances of $5.1 million and $8.8 million
1,305,377

 
1,219,569

        Interest receivable
6,626

 
5,627

        Prepaid expenses
163

 
247

        Principal paydown receivable
1

 
6,821

        Total assets of consolidated VIEs (a)
$
1,542,230

 
$
1,401,858

 
 
 
 
(2) Liabilities of consolidated VIEs included in the total liabilities:
 
 
 
        Borrowings
$
1,183,468

 
$
1,070,339

        Accrued interest expense
1,356

 
918

        Derivatives, at fair value
9,841

 
10,191

        Accounts payable and other liabilities
4,150

 
1,604

        Total liabilities of consolidated VIEs (b)
$
1,198,815

 
$
1,083,052

_______________
(a)
Assets of each of the consolidated variable interest entities ("VIE"s) may only be used to settle the obligations of each respective VIE.
(b)
The creditors of the Company's VIEs have no recourse to the general credit of the Company.





RESOURCE CAPITAL CORP. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except share and per share data)
(unaudited)

 
Three Months Ended
 
March 31,
 
2014
 
2013
REVENUES
 
 
 
Interest income:
 
 
 
Loans
$
20,229

 
$
27,812

Securities
4,004

 
3,642

Interest income − other
2,852

 
1,866

Total interest income
27,085

 
33,320

Interest expense
9,637

 
11,165

Net interest income
17,448

 
22,155

Rental income
5,152

 
6,174

Dividend income
136

 
16

Equity in net earnings (losses) of unconsolidated subsidiaries
2,014

 
(425
)
Fee income
2,756

 
1,410

Net realized gain on sales of investment securities available-for-sale and loans
3,680

 
391

Net realized and unrealized (loss) gain on investment securities, trading
(1,560
)
 
1,116

Unrealized gain (loss) and net interest income on linked transactions, net
2,305

 
(259
)
Total revenues
31,931

 
30,578

OPERATING EXPENSES
 

 
 

Management fees − related party
3,080

 
2,978

Equity compensation − related party
1,667

 
3,591

Rental operating expense
3,396

 
3,937

General and administrative
8,105

 
3,481

Depreciation and amortization
836

 
1,138

Income tax expense
16

 
1,762

Net impairment losses recognized in earnings
—

 
21

(Benefit) provision for loan losses
(3,960
)
 
1,042

Total operating expenses
13,140

 
17,950

 
18,791

 
12,628

OTHER REVENUE (EXPENSE)
 

 
 

Other expense
(1,262
)
 
—

Loss on the extinguishment of debt
(69
)
 
—

Total other expense
(1,331
)
 
—

NET INCOME
17,460

 
12,628

Net income allocated to preferred shares
(2,400
)
 
(1,311
)
Net loss allocable to non-controlling interest
56

 
209

NET INCOME ALLOCABLE TO COMMON SHARES
$
15,116

 
$
11,526

NET INCOME PER COMMON SHARE – BASIC
$
0.12

 
$
0.11

NET INCOME PER COMMON SHARE – DILUTED
$
0.12

 
$
0.11

WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING − BASIC
125,616,537

 
104,224,083

WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING − DILUTED
126,667,614

 
105,326,614







SCHEDULE I

RESOURCE CAPITAL CORP. AND SUBSIDIARIES
RECONCILIATION OF GAAP NET INCOME TO FFO and AFFO
(in thousands, except per share data)
(unaudited)

Funds from Operations
The Company evaluates its performance based on several performance measures, including funds from operations, or FFO, and adjusted funds from operations ("AFFO") in addition to net income.  The Company computes FFO in accordance with the standards established by the National Association of Real Estate Investment Trusts as net income (computed in accordance with GAAP), excluding gains or losses on the sale of depreciable real estate, the cumulative effect of changes in accounting principles, real estate-related depreciation and amortization, and after adjustments for unconsolidated/uncombined partnerships and joint ventures.
AFFO is a computation made by analysts and investors to measure a real estate company’s cash flow generated by operations.  The Company calculates AFFO by adding or subtracting from FFO the non-cash impacts of the following: non-cash impairment losses resulting from fair value adjustments on financial instruments, provision for loan losses, equity investment gains and losses, straight-line rental effects, share based compensation, amortization of various deferred items and intangible assets, gains on sales of property that are wholly owned or through a joint venture in addition to the cash impact of capital expenditures that are related to its real estate owned. In addition, the Company calculates AFFO by adding and subtracting from FFO the cash impacts of the following: extinguishment of debt and sales of property.
Management believes that FFO and AFFO are appropriate measures of the Company's operating performance in that they are frequently used by analysts, investors and other parties in the evaluation of REITs.  Management uses FFO and AFFO as measures of its operating performance, and believes they are also useful to investors, because they facilitate an understanding of the Company's operating performance after adjustment for certain non-cash items, such as real estate depreciation, share-based compensation and various other items required by GAAP, and capital expenditures, that may not necessarily be indicative of current operating performance and that may not accurately compare the Company's operating performance between periods.
While the Company calculations of AFFO may differ from the methodology used for calculating AFFO by other REITs and its AFFO may not be comparable to AFFO reported by other REITs, the Company also believe that FFO and AFFO may provide the Company and its investors with an additional useful measure to compare its performance with some other REITs.  Neither FFO nor AFFO is equivalent to net income or cash generated from operating activities determined in accordance with GAAP.  Furthermore, FFO and AFFO do not represent amounts available for management’s discretionary use because of needed capital replacement or expansion, debt service obligations or other commitments or uncertainties.  Neither FFO nor AFFO should be considered as an alternative to GAAP net income as an indicator of the Company's operating performance or as an alternative to cash flow from operating activities as a measure of its liquidity.





The following table reconciles GAAP net income to FFO and AFFO for the periods presented (unaudited) (in thousands, except per share data):
 
 
March 31,
 
 
2014
 
2013
Net income allocable to common shares - GAAP
 
$
15,116

 
$
11,526

Adjustments:
 
 
 
 
   Real estate depreciation and amortization
 
292

 
673

   (Gains) losses on sales of property (1) 
 
(866
)
 
22

   Gains on sale of preferred equity
 
(984
)
 
—

FFO
 
13,558

 
12,221

Adjustments:
 
 
 
 
Non-cash items:
 
 
 
 
   Adjust for impact of imputed interest on VIE accounting
 
—

 
(1,090
)
   (Benefit) provision for loan losses
 
(125
)
 
194

   Amortization of deferred costs (non real estate)
and intangible assets
 
2,223

 
1,866

   Equity investment losses
 
1,282

 
336

   Share-based compensation
 
1,667

 
3,591

   Impairment losses
 
—

 
21

   Unrealized gain on CMBS marks - linked transactions
 
(1,763
)
 
—

   Unrealized loss on trading portfolio
 
442

 
—

   Straight line rental adjustments
 
2

 
2

   Loss on the extinguishment of debt
 
69

 
—

   PCA expenses
 
300

 
—

REIT tax planning adjustments
 
957

 
726

Cash items:
 
 
 
 
   Gains (losses) on sales of property (1) 
 
866

 
(22
)
   Gains on sale of preferred equity
 
984

 
—

   Gain on the extinguishment of debt
 
4,532

 
3,585

   Capital expenditures
 
(13
)
 
(418
)
AFFO
 
$
24,981

 
$
21,012

 
 
 
 
 
Weighted average shares – diluted
 
126,668

 
105,327

 
 
 
 
 
AFFO per share – diluted 
 
$
0.20

 
$
0.20

 
(1)
Amount represents gains/losses on sales of joint venture real estate interests that were recorded by RSO on an equity basis.





SCHEDULE II

RESOURCE CAPITAL CORP. AND SUBSIDIARIES
BOOK VALUE ALLOCABLE TO COMMON SHAREHOLDERS ROLLFORWARD
(dollars in thousands, except per share data)
(unaudited)

 
 
Amount
 
Per Share
Book value at December 31, 2013, allocable to common shareholders (1)
 
$
674,681

 
$
5.41

Net income allocable to common shareholders
 
15,116

 
0.12

 
 
 
 
 
Change in other comprehensive income:
 
 
 
 
    Available for sale securities
 
(289
)
 
—

    Derivatives
 
458

 
—

    Foreign currency conversion
 
(196
)
 
—

Common dividends
 
(25,663
)
 
(0.20
)
Proceeds (dilution) from additional shares issued during the year (2)
 
1,193

 
(0.05
)
Total net decrease
 
(9,381
)
 
(0.13
)
Book value at March 31, 2014, allocable to common shareholders (1)(3)
 
$
665,300

 
$
5.28

__________________
(1)
Per share calculations exclude unvested restricted stock, as disclosed on the consolidated balance sheets, of 2.7 million and 3.1 million shares as of March 31, 2014 and December 31, 2013, respectively.
(2)
Includes issuance of common shares from the Company's dividend reinvestment plan of 111,000 shares and 442,000 vesting of shares of restricted stock.
(3)
Book value is calculated as total stockholder's equity of $780.2 million less preferred stock equity of $114.9 million.







SCHEDULE III

RESOURCE CAPITAL CORP. AND SUBSIDIARIES
SUMMARY OF CDO AND CLO PERFORMANCE STATISTICS
(in thousands)
(unaudited)

Securitizations - Distributions and Coverage Test Summary
The following table sets forth the distributions made and coverage test summaries for each of RSO's securitizations for the periods presented (in thousands):
Name
 
Cash Distributions
 
Annualized Interest Coverage Cushion
 
Overcollateralization Cushion
 
Three Months Ended 
 March 31,
 
Year Ended
December 31,
 
Three Months Ended 
 March 31,
 
Three Months Ended 
 March 31,
 
As of Initial
Measurement Date
 
2014 (1)
 
2013 (1)
 
2014 (2) (3)
 
2014 (4)
 
Apidos CDO I (5)
 
$
532

 
$
4,615

 
$
1,512

 
$
11,272

 
$
17,136

Apidos CDO III (6)
 
$
1,170

 
$
6,495

 
$
3,225

 
$
8,853

 
$
11,269

Apidos Cinco CDO (7)
 
$
2,764

 
$
12,058

 
$
5,451

 
$
19,639

 
$
17,774

RREF 2006-1 (8)
 
$
1,770

 
$
36,828

 
$
5,272

 
$
67,336

 
$
24,941

RREF 2007-1 (9)
 
$
2,433

 
$
10,880

 
$
9,022

 
$
39,703

 
$
26,032

RCC CRE Notes 2013 (10)
 
$
2,398

 
N/A

 
N/A

 
N/A

 
N/A

* The above table does not include new CLO investments made in the quarter ended March 31, 2014, as cash distributions were received subsequent to period end. In addition, the above table does not include Apidos CLO VIII or Whitney CLO I, as these CLOs were previously called and were substantially liquidated as of March 31, 2014.
_______________
(1)
Distributions on retained equity interests in CDOs (comprised of note investments and preference share ownership) and principal paydowns on notes owned; RREF CDO 2006-1 includes $231,000 and $28.1 million of paydowns during the three months ended March 31, 2014 and the year ended December 31, 2013, respectively.
(2)
Interest coverage includes annualized amounts based on the most recent trustee statements.
(3)
Interest coverage cushion represents the amount by which annualized interest income expected exceeds the annualized amount payable on all classes of CDO notes senior to the Company's preference shares.
(4)
Overcollateralization cushion represents the amount by which the collateral held by the CDO issuer exceeds the maximum amount required.
(5)
Apidos CDO I's reinvestment period expired in July 2011.
(6)
Apidos CDO III's reinvestment period expired in June 2012.
(7)
Apidos Cinco CDO's reinvestment period ends in May 2014.
(8)
RREF CDO 2006-1's reinvestment period expired in September 2011.
(9)
RREF CDO 2007-1's reinvestment period expired in June 2012.
(10)
RCC CRE Notes 2013 closed on December 23, 2013; the first distribution was in January 2014. There is no reinvestment period for the securitization. Additionally, the indenture contains no coverage tests.






RESOURCE CAPITAL CORP. AND SUBSIDIARIES
SUPPLEMENTAL INFORMATION
(in thousands, except percentages)
(unaudited)

Loan Investment Statistics

The following table presents information on RSO's impaired loans and related allowances for the periods indicated (based on amortized cost):
 
 
March 31,
2014
 
December 31,
2013
Allowance for loan losses:
 
 
 
 
Specific allowance:
 
 
 
 
     Commercial real estate loans
 
$
—

 
$
4,572

     Bank loans
 
441

 
2,621

Total specific allowance
 
441

 
7,193

General allowance:
 
 
 
 
     Commercial real estate loans
 
5,844

 
5,844

     Bank loans
 
300

 
770

Total general allowance
 
6,144

 
6,614

Total allowance for loans
 
$
6,585

 
$
13,807

Allowance as a percentage of total loans
 
0.4
%
 
1.0
%
 
 
 
 
 
Loans held for sale:
 
 
 
 
     Commercial real estate
 
$
—

 
$
—

     Bank loans
 
272

 
6,850

     Residential mortgage loans
 
15,117

 
15,066

Total loans held for sale (1)
 
$
15,389

 
$
21,916

__________________
(1)
Loans held for sale are presented at the lower of cost or fair value.





RESOURCE CAPITAL CORP. AND SUBSIDIARIES
SUPPLEMENTAL INFORMATION
(unaudited)

The following table presents commercial real estate loan portfolio statistics as of March 31, 2014 (based on par value):
Security type:
 
Whole loans
91.2
%
Mezzanine loans
7.0
%
B Notes
1.8
%
Total
100.0
%
 
 
Collateral type:
 
Multifamily
39.9
%
Hotel
19.3
%
Retail
18.9
%
Office
14.0
%
Mixed Use
3.6
%
Industrial
1.5
%
Other
2.8
%
Total
100.0
%
 
 
Collateral location:
 
Southern California
27.3
%
Northern California
9.2
%
Texas
13.2
%
Arizona
10.7
%
Florida
5.9
%
Utah
3.4
%
Washington
3.3
%
Minnesota
3.2
%
Nevada
2.7
%
Other
21.1
%
Total
100.0
%





RESOURCE CAPITAL CORP. AND SUBSIDIARIES
SUPPLEMENTAL INFORMATION
(unaudited)

    
The following table presents bank loan portfolio statistics by industry as of March 31, 2014 (based on par value):
Industry type:
 
Healthcare, education and childcare
13.3
%
Diversified/conglomerate service
11.6
%
Broadcasting and entertainment
6.9
%
Automobile
6.3
%
Chemicals, plastics and rubber
5.8
%
CDO
5.2
%
Retail stores
5.1
%
Telecommunications
4.2
%
Oil and gas
3.5
%
Leisure, amusement, motion pictures, entertainment
3.4
%
Hotels, motels, inns and gaming
3.3
%
Personal, food and miscellaneous services
3.2
%
Electronics
3.0
%
Utilities
2.7
%
Finance
2.3
%
Aerospace and defense
2.1
%
Mining, steel, iron and non-precious metals
2.0
%
Other
16.1
%
Total
100.0
%