8-K

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of The Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): November 21, 2016

SUTHERLAND ASSET MANAGEMENT CORPORATION
(Exact name of registrant as specified in its charter)

Maryland	001-35808	90-0729143
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification No.)

1140 Avenue of the Americas, 7th Floor

New York, NY 10036

(Address of principal executive offices))
(Zip Code)

Registrant's telephone number, including area code: (212) 257-4600

n/a
(Former name or former address, if changed since last report.)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

◻	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

◻	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
◻	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
◻	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 2.02. Results of Operations and Financial Condition.

On October 31, 2016, Sutherland Asset Management Corporation, a private mortgage REIT (the "Prior Entity"), merged with and into a subsidiary of ZAIS Financial Corp., with ZAIS Financial Corp. surviving the merger and changing its name to Sutherland Asset Management Corporation (the "Company"), as described in greater detail in the Current Report on Form 8-K filed by the Company on November 4, 2016.

On November 21,  2016, the Company issued an earnings release announcing the financial results of the Prior Entity for the quarter ended September 30, 2016. A copy of the earnings release is attached as Exhibit 99.1 hereto and incorporated herein by reference.

On November 21, 2016, the Company posted supplemental financial information on the Investor Relations section of its website (www.sutherlandam.com). A copy of the supplemental financial information is furnished as Exhibit 99.2 hereto and incorporated herein by reference.

The information in Item 2.02 of this Current Report, including Exhibits 99.1 and 99.2, is being furnished and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that Section. The information in this Current Report shall not be incorporated by reference into any registration statement or other document pursuant to the Securities Act of 1933, as amended, unless it is specifically incorporated by reference therein.

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits

1,
Exhibit No.	Description
99.1	Earnings Release, dated November 21, 2016
99.2	Supplemental Financial Information for the quarter ended September 30, 2016

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 hereunto duly authorized.

SUTHERLAND ASSET MANAGEMENT CORPORATION
By:	/s/ Frederick C. Herbst
	Name:  Frederick C. Herbst
	Title:   Chief Financial Officer

Date: November 22,  2016

EX-99.1

Exhibit 99.1

SUTHERLAND ASSET MANAGEMENT CORPORATION ANNOUNCES THIRD QUARTER 2016 RESULTS

New York, New York, November 21, 2016 / PRNewswire / – Sutherland Asset Management Corporation (NYSE: SLD) today reported financial results for the quarter ended September 30, 2016.  On October 31, 2016, Sutherland Asset Management Corporation, a private mortgage REIT ("Sutherland"), merged with and into a subsidiary of ZAIS Financial Corp. (the "Merger"), with ZAIS Financial Corp. surviving the merger and changing its name to Sutherland Asset Management Corporation (the "Company"), as described in greater detail in the Current Report on Form 8-K filed by the Company on November 4, 2016.  The Company today reported financial results of Sutherland for the quarter ended September 30, 2016.  ZAIS Financial Corp. separately reported its financial results for the quarter ended September 30, 2016 on October 25, 2016 in a Current Report on Form 8-K filed on such date. 

Third Quarter Highlights:

· Core earnings of $10.1 million, or $0.30 per share of common stock

· Net income of $9.6 million, or $0.28 per share of common stock 

· Declared dividend of $0.30 per share of common stock. Total dividends declared year-to-date represent a 9.9% annualized dividend yield based on December 31, 2015 book value per share of common stock

· Net Book Value of $14.38 per share of common stock as of September 30, 2016 

· Completed merger with ZAIS Financial Corp on October 31, 2016 increasing the Company’s stockholders’ equity to approximately $561 million and delivering liquidity to stockholder base

· Pro-forma Net Book Value of $17.07 per share of common stock, post-closing of the ZAIS merger

· Originated $153.6 million of loans during the quarter

· Robust pipeline with substantial acquisition opportunities

A summary of Sutherland’s operating results for the quarter ended September 30, 2016 is presented below. Sutherland reported U.S. GAAP net income attributable to common stockholders for the three months ended September 30, 2016 of $9.6 million, or $0.28 per share of common stock, and Core Earnings (a non-GAAP financial measure) of $10.1 million, or $0.30 per share of common stock. Sutherland previously announced a dividend of $0.30 per share of common stock and operating partnership unit ("OP unit"). 

The Company issued a full detailed presentation of its third quarter 2016 results, which can be viewed at www.sutherlandam.com.

Common Dividend

The Company’s Board of Directors declared a quarterly cash dividend of $0.30 per share of common stock and OP unit for the quarter ended September 30, 2016 to common stockholders and OP unit holders of record as of October 14, 2016.  The dividend was paid on October 25, 2016.  

Use of Non-GAAP Financial Information

In addition to the results presented in accordance with accounting principles generally accepted in the United States ("U.S. GAAP"), this press release includes Core Earnings which is a non-U.S. GAAP financial measure. The Company defines Core Earnings as net income adjusted for unrealized gains (losses) related to mortgage backed securities and non-recurring expenses.

The Company believes that providing investors with this non-U.S. GAAP financial information, in addition to the related U.S. GAAP measures, gives investors greater transparency into the information used by management in its financial and operational decision-making. However, because Core Earnings is an incomplete measure of the Company's financial performance and involves differences from net income computed in accordance with U.S. GAAP, it should be considered along with, but not as an alternative to, the Company's net income computed in accordance with U.S. GAAP as a measure of the Company's financial performance. In addition, because not all companies use identical calculations, the Company's presentation of Core Earnings may not be comparable to other similarly-titled measures of other companies.

The following table reconciles net income computed in accordance with U.S. GAAP to Core Earnings for the three months ended September 30, 2016: 

(in millions)
Net Income	$	9.6
Reconciling items:
Unrealized (gain) loss on mortgage-backed securities		(0.7)
Merger transaction costs		0.9
Employee severance		0.3
Total reconciling items		0.5
Core earnings	$	10.1

Earnings Conference Call

Management will host a conference call on Tuesday,  November 22, 2016 at 10:00 am EDT to provide a general business update and discuss the financial results for the quarter ended September 30, 2016.  Supplemental financial data is attached hereto.  The conference call can be accessed by dialing (888) 267-2860.  The passcode is 374125.

A replay of the call will be available approximately two hours after the live call and will be available through December 6, 2016.  To access the replay, dial (800) 332-6854.  The passcode is 374125.  

The live broadcast of the Company's quarterly conference call will also be available online at the Company's website, www.sutherlandam.com, on Tuesday, November 22, 2016, beginning at 10:00 am EDT. The online replay will follow shortly after the call and will be available for approximately one year.

In addition to filing or furnishing required information to the U.S. Securities and Exchange Commission, the Company uses its website as a channel of distribution of material Company information. Financial and other material information regarding the Company is routinely posted on the Company's website and is readily accessible.

Safe Harbor Statement

This press release contains statements that constitute "forward-looking statements," as such term is defined in Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and such statements are intended to be covered by the safe harbor provided by the same. These statements are based on management's current expectations and beliefs and are subject to a number of trends and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements; the Company can give no assurance that its expectations will be attained. Factors that could cause actual results to differ materially from the Company's expectations include, but are not limited to, applicable regulatory changes; risks associated with acquisitions, including the integration and implementation of the Merger;  risks associated with achieving expected revenue synergies, cost savings and other benefits from the Merger and the increased scale of the combined company; general volatility of the capital markets; changes in the Company’s investment objectives and business strategy; the availability of financing on acceptable terms or at all; the availability, terms and deployment of capital; the availability of suitable investment opportunities; changes in the interest rates or the general economy; increased rates of default and/or decreased recovery rates on investments; changes in interest rates, interest rate spreads, the yield curve or prepayment rates; changes in prepayments of Company’s assets; the degree and nature of competition, including competition for the Company's target assets; and other factors, including those set forth in the Risk Factors section of the Company's Registration Statement on Form S-4, the most recent Annual Report on Form 10-K filed with the SEC on March 10, 2016, Form 10-K/A filed with the SEC on April 29, 2016 and other reports filed by the Company with the SEC, copies of which are available on the SEC's website, www.sec.gov. The Company undertakes no obligation to update these statements for revisions or changes after the date of this release, except as required by law.

Contact

Additional information can be found on the Company’s website at www.sutherlandam.com.  

SUTHERLAND ASSET MANAGEMENT CORPORATION

Unaudited CONSOLIDATED BALANCE SHEETS

(In Thousands)	September 30, 2016		December 31, 2015
Assets:
Cash and cash equivalents	$	38,458	$	41,569
Restricted cash		15,935		14,757
Short term investments		249,997		249,989
Loans, held for sale, at fair value		23,314		—
Loans, held at fair value		233,618		155,134
Loans, held-for-investment (net of allowances for loan losses of $11,629 at September 30, 2016 and $12,255  at December 31, 2015		923,465		927,218
Mortgage backed securities, at fair value		34,812		213,504
Real estate acquired in settlement of loans		6,275		8,224
Derivative instruments, at fair value		363		723
Servicing rights		23,351		27,250
Intangible assets		1,000		1,000
Assets of consolidated VIEs:
Cash and cash equivalents		77		26
Restricted cash		904		1,362
Loans, held-for-investment (net of allowances for loan losses of $3,352 at September 30, 2016 and $4,867  at December 31, 2015		543,857		633,720
Real estate acquired in settlement of loans		3,734		5,257
Accrued interest		2,252		2,557
Due from servicers		3,508		6,121
Deferred financing costs		3,645		4,788
Accrued interest		5,037		5,258
Due from servicers		14,893		14,208
Receivable from related parties		2		4
Receivable from third parties		7,285		608
Other assets		12,896		5,179
Assets of discontinued operations held for sale		—		11,325
Total Assets	$	2,148,678	$	2,329,781
Liabilities:
Borrowings under credit facilities		228,000		175,306
Promissory note payable		9,040		—
Securitized debt obligations of consolidated VIEs		374,816		461,522
Borrowings under repurchase agreements		581,773		644,137
Guaranteed loan financing		415,417		499,187
Repair and denial reserve		6,849		8,071
Liability under subservicing agreements		7,576		8,827
Liability under participation agreements		2,803		3,700
Accrued salaries, wages and commissions		5,503		7,067
Payable to related parties		2,592		2,305
Derivative instruments, at fair value		3,415		1,499
Dividends payable		—		13,366
Accounts payable and other accrued liabilities		26,265		17,695
Liabilities of discontinued operations held for sale		—		6,886
Total Liabilities	$	1,664,049	$	1,849,568
Stockholders’ Equity
Common stock, $0.01 par value, 450,000,000 share authorized, 30,960,370 and 30,804,029  shares issued and outstanding, respectively		309		308
Preferred stock, $1,000 par value, 125 shares authorized, 125 shares issued and outstanding		125		125
Additional paid-in capital		449,075		446,787
Retained earnings (deficit)		(4,276)		(5,899)
Total Sutherland Asset Management Corporation equity		445,233		441,321
Non-controlling interests		39,396		38,892
Total Stockholders’ Equity	$	484,629	$	480,213
Total Liability and Stockholders’ Equity	$	2,148,678	$	2,329,781

SUTHERLAND ASSET MANAGEMENT CORPORATION

Unaudited CONSOLIDATED STATEMENTS OF INCOME

	Three Months Ended September 30,				Nine Months Ended September 30,
(In Thousands, except share data)	2016		2015		2016		2015
Interest income
Loans, held-for-investment	$	27,009	$	31,623	$	90,118	$	88,710
Loans, held at fair value		3,950		4,947		9,784		12,287
Loans, held for sale, at fair value		164		94		352		148
Mortgage backed securities, at fair value		767		2,981		4,028		8,998
Total interest income		31,890		39,645		104,282		110,143
Interest expense
Borrowings under credit facilities		(2,367)		(1,350)		(6,397)		(6,869)
Promissory note payable		(18)		—		(85)		—
Securitized debt obligations of consolidated VIEs		(4,233)		(2,996)		(13,174)		(7,261)
Borrowings under repurchase agreements		(4,141)		(4,355)		(11,686)		(12,372)
Guaranteed loan financing		(3,338)		(4,923)		(10,701)		(8,210)
Total interest expense		(14,097)		(13,624)		(42,043)		(34,712)
Net interest income before provision for loan losses		17,793		26,021		62,239		75,431
Provision for loan losses		(488)		(4,112)		(4,689)		(15,859)
Net interest income after provision for loan losses		17,305		21,909		57,550		59,572
Other income (expense)
Other income		1,729		3,999		5,335		9,985
Servicing income, net of amortization and impairment of $1,850 and $6,079  for the three and nine months ended September 30, 2016, and $2,855 and $6,439 for the three and nine months ended September 30, 2015, respectively		1,661		994		4,420		5,377
Employee compensation and benefits		(4,822)		(4,934)		(14,005)		(14,015)
Allocated employee compensation and benefits from related party		(900)		(596)		(2,700)		(1,808)
Professional fees		(3,120)		(1,567)		(8,573)		(5,827)
Management fees – related party		(1,793)		(1,841)		(5,464)		(5,424)
Incentive fees – related party		—		(681)		—		(1,073)
Loan servicing expense		(1,830)		(771)		(3,889)		(3,640)
Operating expenses		(3,373)		(3,448)		(11,185)		(8,349)
Total other income (expense)		(12,448)		(8,845)		(36,061)		(24,774)
Net realized gain on financial instruments		2,454		2,989		3,720		2,368
Net unrealized gain (loss) on financial instruments		3,557		(325)		5,800		2,855
Net income from continued operations before income tax provisions		10,868		15,728		31,009		40,021
Provision for income taxes		(1,297)		(2,682)		(3,326)		(5,179)
Net income from continued operations		9,571		13,046		27,683		34,842
Discontinued operations
Loss from discontinued operations (including gain on disposal of $267 for nine months ended September 30,  2016)		—		(857)		(576)		(2,683)
Income tax benefit		—		1,243		225		3,740
Income (loss) from discontinued operations		—		386		(351)		1,057
Net income		9,571		13,432		27,332		35,899
Less: Net income attributable to non-controlling interest		777		1,118		2,217		2,871
Net income attributable to Sutherland Asset Management Corporation	$	8,794	$	12,314	$	25,115	$	33,028
Earnings (loss) per share:
Continuing operations	$	0.28	$	0.39	$	0.82	$	1.05
Discontinued operations	$	—	$	0.01	$	(0.01)	$	0.03
Basic weighted average shares outstanding		30,960,370		30,539,376		30,960,370		30,539,376

SUTHERLAND ASSET MANAGEMENT CORPORATION

Unaudited SEGMENT REPORTING

fOR THE THREE MONTHS ENDED SEPTEMBER 30, 2016

					SBA Loan
	Investment		New Loan		Origination
(In Thousands)	Activities		Origination		and Servicing		Consolidated
Interest income
Loans, held-for-investment	$	15,793		1,015		10,201	$	27,009
Loans, held at fair value		633		3,317		—		3,950
Loans, held for sale, at fair value		—		164		—		164
Mortgage backed securities, at fair value		767		—		—		767
Total interest income		17,193		4,496		10,201		31,890
Interest expense
Borrowings under credit facilities		(1,838)		(14)		(515)		(2,367)
Promissory note payable		(18)		—		—		(18)
Securitized debt obligations		(3,887)		—		(346)		(4,233)
Borrowings under repurchase agreements		(2,300)		(1,841)		—		(4,141)
Guaranteed loan financing		—		—		(3,338)		(3,338)
Total interest expense		(8,043)		(1,855)		(4,199)		(14,097)
Net interest income before provision for loan losses		9,150		2,641		6,002		17,793
Provision for loan losses		153		—		(641)		(488)
Net interest income after provision for loan losses		9,303		2,641		5,361		17,305
Other income (expense)
Other income		844		1,404		(519)		1,729
Servicing income		6		135		1,520		1,661
Employee compensation and benefits		96		(2,351)		(2,567)		(4,822)
Allocated employee compensation and benefits from related party		(542)		(204)		(154)		(900)
Professional fees		(1,797)		(422)		(901)		(3,120)
Management fees – related party		(1,080)		(406)		(307)		(1,793)
Loan servicing expense		(1,473)		(191)		(166)		(1,830)
Operating expenses		(729)		(1,595)		(1,049)		(3,373)
Total other income (expense)		(4,675)		(3,630)		(4,143)		(12,448)
Net realized gain (loss) on financial instruments		423		542		1,489		2,454
Net unrealized gain (loss) on financial instruments		802		2,755		—		3,557
Net income (loss) before income tax provisions		5,853		2,308		2,707		10,868
Provisions for income taxes		145		(487)		(955)		(1,297)
Net income (loss) from continuing operations	$	5,998	$	1,821	$	1,752	$	9,571
Loss from discontinued operations								—
Net income							$	9,571
Less: Net income attributable to non-controlling interests								777
Net income attributable to Sutherland Asset Management Corporation							$	8,794
Total Assets	$	1,282,303	$	241,148	$	625,227	$	2,148,678

SUTHERLAND ASSET MANAGEMENT CORPORATION

Unaudited SEGMENT REPORTING

fOR THE nine MONTHS ENDED SEPTEMBER 30, 2016

					SBA Loan
	Investment		New Loan		Origination
(In Thousands)	Activities		Origination		and Servicing		Consolidated
Interest income
Loans, held-for-investment	$	51,047		3,082		35,989	$	90,118
Loans, held at fair value		1,806		7,978		—		9,784
Loans, held for sale, at fair value		—		352		—		352
Mortgage backed securities, at fair value		4,028		—		—		4,028
Total interest income		56,881		11,412		35,989		104,282
Interest expense
Borrowings under credit facilities		(4,926)		(14)		(1,457)		(6,397)
Promissory note payable		(85)		—		—		(85)
Securitized debt obligations		(12,022)		—		(1,152)		(13,174)
Borrowings under repurchase agreements		(6,463)		(5,223)		—		(11,686)
Guaranteed loan financing		—		—		(10,701)		(10,701)
Total interest expense		(23,496)		(5,237)		(13,310)		(42,043)
Net interest income before provision for loan losses		33,385		6,175		22,679		62,239
Provision for loan losses		(3,370)		—		(1,319)		(4,689)
Net interest income after provision for loan losses		30,015		6,175		21,360		57,550
Other income (expense)
Other income		1,740		2,694		901		5,335
Servicing income		41		371		4,008		4,420
Employee compensation and benefits		(95)		(6,805)		(7,105)		(14,005)
Allocated employee compensation and benefits from related party		(1,596)		(605)		(499)		(2,700)
Professional fees		(4,523)		(1,108)		(2,942)		(8,573)
Management fees – related party		(3,229)		(1,225)		(1,010)		(5,464)
Loan servicing expense		(3,817)		(504)		432		(3,889)
Operating expenses		(2,998)		(5,128)		(3,059)		(11,185)
Total other income (expense)		(14,477)		(12,310)		(9,274)		(36,061)
Net realized gain (loss) on financial instruments		(2,017)		2,311		3,426		3,720
Net unrealized gain (loss) on financial instruments		4,011		1,789		—		5,800
Net income (loss) before income tax provisions		17,532		(2,035)		15,512		31,009
Provisions for income taxes		145		2,003		(5,474)		(3,326)
Net income (loss) from continuing operations	$	17,677	$	(32)	$	10,038	$	27,683
Loss from discontinued operations								(351)
Net income							$	27,332
Less: Net income attributable to non-controlling interests								2,217
Net income attributable to Sutherland Asset Management Corporation							$	25,115
Total Assets	$	1,282,303	$	241,148	$	625,227	$	2,148,678

EX-99.2

Exhibit 99.2

Supplemental Financial Data 3Q16 SutherLand Asset Management

Disclaimer This presentation contains statements that constitute "forward-looking statements," as such term is defined in Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and such statements are intended to be covered by the safe harbor provided by the same. These statements are based on management's current expectations and beliefs and are subject to a number of trends and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements; Sutherland Asset Management Corporation (the "Company") can give no assurance that its expectations will be attained. Factors that could cause actual results to differ materially from the Company's expectations include those set forth in the Risk Factors section of the Company's Registration Statement on Form S-4, the most recent Annual Report on Form 10-K filed with the SEC on March 10, 2016, Form 10-K/A filed with the SEC on April 29, 2016 and other reports filed by the Company with the SEC, copies of which are available on the SEC's website, www.sec.gov. The Company undertakes no obligation to update these statements for revisions or changes after the date of this release, except as required by law. This presentation includes certain non-GAAP financial measures, including Core Earnings. These non-GAAP financial measures should be considered only as supplemental to, and not as superior to, financial measures in accordance with GAAP. Please refer to Appendix A for the most recent GAAP information. This presentation also contains market statistics and industry data which are subject to uncertainty and are not necessarily reflective of market conditions. These have been derived from third party sources and have not been independently verified by the Company or its affiliates. All material presented is compiled from sources believed to be reliable and current, but accuracy cannot be guaranteed. All data is as of September 30, 2016, unless otherwise noted. 1 SutherLand Asset Management

Business overview ORIGINATIONS ACQUISITIONS WATERFALL Asset management Manager and SEC Registered Advisor to Sutherland Asset Management Corporation Sutherland Asset Management Servicing KeyBank TRIMONT MIDLAND LOAN SERVICES PNC REAL ESTATE READY CAP COMMERCIAL, LLC READY CAPITAL STRUCTURED FINANCE READY CAP LENDING, LLC WATERFALL Asset Management Sutherland Asset Management Small Balance Commercial investor property originations Freddie Mac approved Seller and Servicer; small balance multi-family originations Short term commercial and multifamily real estate originations SBA Commercial Loan Originations and Servicing Operations (owner-occupied) Loan acquisitions of performing and distressed loans through negotiated trades with regional banks and other financial institutions (e.g. non-bank lenders, special servicers.) Manager and SEC Registered Advisor to Sutherland Asset Management Corporation 2

► Completed merger with ZAIS Financial Corp on 10/31/2016 with trading on NYSE on 11/1/2016 increasing the pro-forma stockholders’ equity to $561 million and delivering liquidity to shareholders ► Pro-forma(1) combined company balance sheet as of 09/30/2016: COMBINED ► Planned 4Q16 securitizations: CLOSING DATE 3 September 30, 2016. The Sutherland balance sheet information was derived from its unaudited balance sheet at September 30, 2016 that is included as part of the 2016 that was included in its Quarterly Report on Form 10-Q for the quarter then ended, which was filed with the Securities and Exchange Commission on October 25, 2016. (2) Priced on November 21, 2016 (1) The unaudited pro forma combined information gives effect to the Sutherland merger based on the historical balance sheets of Sutherland and ZAIS Financial as of Current Report on Form 8-K dated November 22, 2016. The ZAIS Financial balance sheet information was derived from its unaudited balance sheet at September 30, PRODUCT TARGET ISSUE SIZE TARGET DEBT COST TARGET ADVANCE RATE TARGET Conventional Investor(2) $162 million 3.21% 82% - 89% 11/2016 Conventional Owner-Occupied $182 million 2.75% - 3.25% 80% - 90% 12/2016 (in millions, except share and per share information) SUTHERLAND ZAIS FINANCIAL PRO-FORMA Assets $2,149 $589 $2,647 Liabilities $1,664 $422 $2,086 Stockholders’ equity $485 $167 $561 Book value per share $14.38 $18.73 $17.07 Common shares 30,960,370 8,836,902 30,521,844 OP Units outstanding 2,738,948 60,898 2,349,561 BUSINESS UPDATE

Third Quarter 2016 Highlights ► Core earnings of $10.1 million(1), or $0.30 per common share ► Net income of $9.6 million(1), or $0.28 per common share ► Declared dividend of $0.30 per share ► Net book value of $14.38 per common share, pro-forma net book value of $17.07 per common share ► Originated $153.6 million of loans ► Gross assets exceeding $2.1 billion Returns 3Q 2016 9 Months Ended 09/30/2016 Return on Equity(2) 7.9% 7.5% Core Return on Equity(3) 8.3% 8.1% Dividend Yield 8.3% 9.9% Inclusive of non-controlling interest Return on Equity is a annualized percentage equal to quarterly net income over the average monthly total stockholders’ equity for the quarter Core Return on Equity is an annualized percentage equal to adjusted quarterly net income over the average monthly total stockholders’ equity for the quarter. Refer to slide 20 for a reconciliation of GAAP Net Income to Core Earnings 4

Return on Equity Business Line Levered Yield(1) Equity Allocation Acquisitions 15.7% 31.0% SBC Conventional Originations 13.0% 49.2% SBA Originations, Acquisitions & Servicing 28.6% 19.8% Cash and Other Non-earning Assets, Net Non-earning Equity Realized & Unrealized Gain, net Operating Expenses Investment advisory fees Provision for income taxes Non-recurring expenses Return on Equity Net ROE 16.9% (2.5%) 6.7% (9.6%) (1.5%) (1.1%) (1.0%) 7.9% Core Earnings 16.9% (2.5%) 6.1% (9.6%) (1.5%) (1.1%) -- 8.3% 5 Levered yields are based on net interest income and net servicing income for the quarter ended 09/30/2016 on an annualized basis, which reflects contractual interest rates, accretion of discount and servicing income net of interest expense and amortization of deferred financing costs on an annualized basis

Acquired portfolio ► At this stage of the credit cycle, ample inventory of “scratch-and-dent” performing SBC ► Decline in Gross Levered Yield consistent with Acquired Portfolio migration from NPLs to performing loans ► Acquired $26 million of SBC loans with a levered yield of 15% ► Potential additional leverage provides for increased capacity for acquisitions Number of loans 971 Unpaid principal balance $494,605 Carrying value $428,433 Weighted average LTV 50% Weighted average interest rate 5.9% Weighted average maturity 109 months Weighted average UPB $509,377 Percentage of loans fixed/floating 46% / 54% Percentage of loans perf./non-perf. 93% / 7% Portfolio Metrics Gross Levered Yield 6 22.5% 22.3% 25.2% 22.2% 17.0% 15.7% 0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0% Q2 '15 Q3 '15 Q4 '15 Q1 '16 Q2 '16 Q3 '16 Sutherland Asset Management

SBC Conventional Originations ► Originations of $140 million, a 31% increase quarter over quarter ► Origination pipeline of $154 million ► Post-election rise in 10-year Treasury yields likely to benefit SBC conventional originations ► Completed repo facility with KeyBank to fund Freddie Mac originations Number of loans 258 Unpaid principal balance $703,916 Carrying value $721,059 Weighted average LTV 67% Weighted average interest rate 6.0% Weighted average maturity 68 months Weighted average UPB $2,278,358 Percentage of loans fixed/floating 96% / 4% Percentage of loans perf./non-perf. 100% / 0% Portfolio Metrics Gross Levered Yield 7 12.5% 12.3% 14.0% 15.0% 11.6% 13.0% 0.0% 2.0% 4.0% 6.0% 8.0% 10.0% 12.0% 14.0% 16.0% Q2 '15 Q3 '15 Q4 '15 Q1 '16 Q2 '16 Q3 '16 Sutherland Asset Management

SBA Originations, Acquisitions & Servicing Number of loans 2,735 Unpaid principal balance $653,727 Carrying value $574,761 Weighted average LTV 73% Weighted average interest rate 5.2% Weighted average maturity 168 months Weighted average UPB $239,023 Percentage of loans fixed/floating 1% / 99% Percentage of loans perf./non-perf. 97% / 3% Gross Levered Yield Portfolio Metrics ► SBA 7(a) origination program “kicks off” with 2Q/3Q hiring of 10 Business Development Officers. ► Target of 15 BDOs by end of 1Q17 ► $14.4 million of SBA secondary market loans sales with an average sale premium of 11.9% ► Originated $13.5 million, up 96% quarter over quarter ► Current pipeline of $62 million, up 74% quarter over quarter 8 31.3% 39.3% 21.1% 31.2% 29.1% 28.6% 0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0% 35.0% 40.0% 45.0% Q2 '15 Q3 '15 Q4 '15 Q1 '16 Q2 '16 Q3 '16 Sutherland Asset Management

Quarterly Investment Allocation (Dollars in thousands) Acquisitions Originations SBC Freddie MAC Transitional SBA Total Gross investments $25,832 $51,597 $48,759 $39,681 $13,521 $153,558 Number of loans 102 23 23 8 15 69 Average balance(1) $279 $3,623 $2,120 $9,915 $901 $4,500 Gross Yield(2) 7.2% 6.2% 4.3%(3) 6.6% 5.9%(4) 5.7% Weighted average duration(1) 135 months 66 months 178 months 28 months 255 months 109 months FX / ARM 8% / 92% 37% / 63% 41% / 59% 6% / 94% 0% / 100% 27% / 73% Avg. Advance Rate 70% 70% 100% 52% 74% 68% Debt Cost Libor + 300 Libor + 225 Libor + 175 Libor + 200-250 Libor + 350 Libor + 231 Based on fully funded loan amount Gross yield equals contractual interest rates and accretion of discount based on Sutherland’s estimates of loan performance where applicable Please refer to slide 28 for summary of Freddie Mac return profile Please refer to slide 27 for summary of SBA 7(a) return profile 9

Net Interest Margin(1) Contribution by Operating Segment 10 Net interest margin is based on interest income and net servicing income, which reflects contractual interest rates, accretion of discount and servicing income net of interest expense, which reflects contractual interest rates, and deferred financing amortization 0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0% Q1 2015 Q2 2015 Q3 2015 Q4 2015 Q1 2016 Q2 2016 Q3 2016 Acquired Originated SBA

Other 7% Lodging 5% Retail 20% Mixed Use 7% Industrial 10% COLLATERAL DIVERSIFICATION Office 19% SBA 12% Bridge 10% Day Care 14% Multi-Family 20% Other 38% Dentists 11% SBA SEGMENT DETAILS RETAIL SEGMENT DETAILS Conventional SBC 37% Acquired 53% Hotels Auto 3% Restu rants Physicians 6% Vets 7% Grocery 4% 11 PORTFOLIO COMPOSITION AS OF 09/30/2016

Top 10 Loans 5.5% Sub. Mt . 5% Oth r 2% CA 16% Other 31% TX 14% GEOGRAPHIC DIVERSIFICATION LOAN SIZE LIEN POSITION IL 3% PA 3% FL 11% NC 3% AZ 5% NY 9% GA 5% First Mtg. 93% Remaining 94.5% 12 PORTFOLIO COMPOSITION AS OF 09/30/2016

loans 7(a) loans and newly originated SBA loans loans, CRE bridge loans and acquired CRE 2.5 2 1.5 1 0.5 0 2.0x 2.0x 2.0x 2.0x 1.9 x 1.9x 1.8x 1.3x Q1 2015 Q2 2015 Q3 2015 Q4 2015 Q1 2016 Q2 2016 Q3 2016 Recourse Total (1) Excludes reverse repurchase agreement secured by U.S. Treasuries and guaranteed loan financings13 1.4x 1.4x 1.2x 1.1x 1.1x 1.2x BANK RATE TERM FACILITY SIZE AVAILABLE CAPACITY DESCRIPTION Deutsche Bank L + 225(1) 1 – Year $275 million $115 million Master repurchase agreement used to finance newly originated SBC Citibank L + 300 1 – Year $200 million(3) $135 million Master repurchase agreement used to finance legacy SBC loans J.P. Morgan L + 350 2 – Year $250 million $45 million Credit facility to fund CIT loan acquisition, legacy SBA 504 and J.P. Morgan L + 200 – 250(2) 2 – Year $100 million $58 million Master repurchase agreement used to finance newly originated SBC KeyBank L + 175 1 – Year $50 million $27 million Credit facility to fund Freddie Mac Small Balance originations Total $875 million $380 million HISTORICAL LEVERAGE(1) FINANCING AND LEVERAGE

The Company is actively pursuing various strategies to optimize financial results. Except as noted, no assurance can be given that such strategies will be successfully implemented. LOW END HIGH END Q316 Core ROE Subsidiaries directly to the REIT. The pro forma information above is presented for illustrative purposes only based on hypothetical events and should not be relied upon for any investment decis cert borrowings, to purchase additional interest earning assets that will generate net interest income over the quarterly period after origination or purchase that is comparable to the net interest income generated by Sutherland over the three-month period ended September 30, 2016 as well as other expense reduction measures. The generation of net interest income at the hypothetical levels illustrated in the above table is based on certain assumptions, including those related to asset allocation, asset selection, leverage, asset yields, financing, hedging costs and expenses. Actual results will vary from the hypothetical returns illustrated in the above table based on the timing of asset originations or purchases and/or asset sales and the returns generated by the interest earning assets that are in fact originated or purchased. Such actual returns will also be impacted by economic and market factors and will be subject to a variety of risks and uncertainties. In no circumstances should the hypothetical returns illustrated in the above table be regarded as a representation, warrant y or prediction that any interest earning assets will reflect any particular performance or that they will achieve or are likely to achieve any particular result or that stockholders will be able to avoid losses, including total loss of their investment. 14 Sutherland currently in process of potentially four financing transactions, which, if executed, will provide additional leverage: a) Note Offering b) 11/2016 conventional loan securitization c) 12/2016 owner occupied loan securitization d) 1Q17 transitional loan CLO Staff reductions made in 3Q16 Sutherland is evaluating opportunities to transfer taxable income from Taxable REIT Implementation of various strategies to reduce the level of non-earning assets. Potential Core ROE 8.3% 3.0% 0.4% 0.7% 0.4% 12.8% ain debt offerings, together with additional 8.3% 0.6% 0.4% 0.5% 0.2% 10.0% ion. The pro forma assumes that Sutherland completes ILLUSTRATIVE PRO-FORMA RETURN ON EQUITY

AVG. CARRYING VALUE AVG. DEBT BALANCE LEVERED INVESTMENT TYPE GROSS YIELD(1) DEBT COST(2) (3) YIELD Book Equity Value per Common Share Pro-forma Earnings per Common Share 15 accretion of discount and servicing income expense is calculated based on interest expense and deferred financing amortization for the quarter ended 09/30/2016 on an annualized basis. (3) Levered yields are based on net interest income and net servicing income for the quarter ended 09/30/2016 on an annualized basis, which reflects contractual interest rates, accretion of discount and servicing income net of interest expense and amortization of deferred financing costs on an annualized basis (1) Gross yields are based on interest income and net servicing income for the quarter ended 09/30/2016 on an annualized basis, which reflects contractual interest rates, (2) Sutherland finances the assets included in the Investment Type through securitizations, repurchase agreements, warehouse facilities and bank credit facilities. Interest GAAP earnings $8,794 GAAP earnings per Common Share $0.28 ROE per Common Share 7.9% Dividend yield (on beginning book value per share) 8.3% $521,055 30,521,844 $17.07 Common Stockholders’ equity $445,233 Total Common Shares outstanding 30,960,370 Book value per Common Share $14.38 Acquired portfolio $462,596 8.2% $334,972 5.3% 15.7% SBC conventional origination portfolio $696,403 6.6% $493,919 4.0% 13.0% SBA Originations, Acquisitions & Servicing $613,766 6.5% $532,005 3.2% 28.6% Total $1,772,765 7.0% $1,360,896 4.0% 16.9% SUTHERLAND SNAPSHOT

Appendix Sutherland Asset Management

Historical Financial Performance 17 Refer to slide 20 for a reconciliation of GAAP earnings to Core earnings $0.40 $0.27 $0.27 $0.26 $0.28 $0.40 $0.43 $0.31 $0.27 $0.30 $0.35 $0.50 $0.38 $0.38 $0.30 $- $0.10 $0.20 $0.30 $0.40 $0.50 $0.60 Q3 2015 Q4 2015 Q1 2016 Q2 2016 Q3 2016 $ Per share Earnings Core earnings (1) Dividend declared Sutherland Asset Management

Balance Sheet by Quarter 18 (In millions, except per share values) 9/30/2015 12/31/2015 3/31/2016 6/30/2016 9/30/2016 Assets Cash and cash equivalents $ 80.3 $ 41.6 $ 59.9 $ 55.0 $ 38.5 Restricted cash 27.7 14.8 16.7 14.7 15.9 Short term investments 250.0 250.0 250.0 250.0 250.0 Loans, held at fair value 360.8 155.1 174.3 212.9 233.6 Loans held for sale, at fair value - - - - 23.3 Loans, held-for-investment 847.3 927.2 899.5 939.0 923.5 Mortgage backed securities, at fair value 205.0 213.5 117.1 27.0 34.8 Real estate acquired in settlement of loans 11.4 8.2 6.7 8.0 6.3 Derivative instruments, at fair value (asset) 1.5 0.7 0.7 0.6 0.4 Servicing rights 30.3 27.3 26.0 24.4 23.4 Assets of consolidated VIEs 478.9 649.0 622.7 577.5 554.3 Other assets 55.0 42.4 43.7 38.2 44.7 Total Assets $ 2,348.2 $ 2,329.8 $ 2,217.3 $ 2,147.3 $ 2,148.7 Liabilities Borrowings under credit facilities 112.0 175.3 161.4 191.0 228.0 Promissory note payable - - - 9.2 9.0 Securitized debt obligations of consolidated VIEs 361.2 461.5 435.0 401.8 374.8 Borrowings under repurchase agreements 769.0 644.1 614.6 568.8 581.8 Guaranteed loan financing 528.1 499.2 470.6 439.5 415.4 Repair and denial reserve 13.0 8.1 6.6 6.5 6.8 Accrued salaries, wages and commissions 5.5 7.1 3.0 4.0 5.5 Derivative instruments, at fair value (liabilities) 5.9 1.5 3.7 4.4 3.4 Accounts payable and other accrued liabilities 59.4 52.8 33.1 34.2 39.4 Total Liabilities $ 1,854.1 $ 1,849.6 $ 1,728.0 $ 1,659.4 $ 1,664.1 Stockholders’ Equity Additional paid-in capital 442.6 447.2 447.2 449.5 449.5 Retained earnings (deficit) 12.4 (5.9) 2.5 (1.3) (4.3) Sutherland Asset Management Corporation Equity 455.0 441.3 449.7 448.2 445.2 Non-controlling interests 39.1 38.9 39.6 39.7 39.4 Total Stockholders' Equity 494.1 480.2 489.3 487.9 484.6 Total Liabilities andStockholders' Equity $ 2,348.2 $ 2,329.8 $ 2,217.3 $ 2,147.3 $ 2,148.7 Book Value per Share $ 14.90 $ 14.32 $ 14.59 $ 14.47 $ 14.38 Sutherland Asset Management

Statement of Income by Quarter 19 (In millions, except per share values) Q3 2015 Q4 2015 Q1 2016 Q2 2016 Q3 2016 Interest income Loans, held-for-investment $ 31.6 $ 32.0 $ 32.3 $ 30.8 $ 27.0 Loans, held at fair value 5.0 3.8 3.4 2.7 3.9 Loans, held for sale, at fair value - - - - 0.2 Mortgage backed securities, at fair value 3.0 3.1 2.2 1.0 0.8 Total interest income 39.6 38.9 37.9 34.5 31.9 Interest expense Borrowings under credit facilities (1.4) (1.3) (2.0) (2.1) (2.5) Securitized debt obligations (2.9) (3.7) (4.5) (4.4) (4.2) Borrowings under repurchase agreements (4.4) (4.0) (3.9) (3.7) (4.1) Guaranteed loan financing (4.9) (4.1) (3.9) (3.4) (3.3) Total interest expense (13.6) (13.1) (14.3) (13.6) (14.1) Net interest income before provision for loan losses 26.0 25.8 23.6 20.9 17.8 Provision for loan losses (4.1) (4.1) (2.2) (2.0) (0.5) Net interest income after provision for loan losses 21.9 21.7 21.4 18.9 17.3 Other income (expense) Other income 4.0 4.4 2.3 1.3 1.7 Servicing income, net of amortization and impairment 1.0 (0.3) 1.4 1.3 1.7 Employee compensation and benefits (5.5) (6.4) (6.0) (4.2) (5.7) Professional fees (1.5) (1.1) (1.8) (3.7) (3.1) Management and incentive fees (2.6) (1.6) (1.8) (1.8) (1.8) Loan servicing expense (0.7) (1.0) (0.9) (1.2) (1.8) Operating expenses (3.6) (3.1) (3.8) (4.8) (3.4) Total other income (expense) (8.9) (9.1) (10.6) (13.1) (12.4) Realized gain (loss) 3.0 (2.2) 0.2 1.1 2.5 Unrealized gain (loss) (0.3) 2.8 (0.3) 2.6 3.5 Net income before income tax (expense) benefit and discontinued operations 15.7 13.2 10.7 9.5 10.9 Gain (loss) from discontinued operations 0.3 (1.6) (0.4) - - Income tax (expense) benefit (2.6) (2.7) (1.2) (0.9) (1.3) Net income after tax (expense) benefit and discontinued operations 13.4 8.9 9.1 8.6 9.6 Less: Net income attributable to non-controlling interests 1.1 0.7 0.7 0.7 0.8 Net income attributable to Common Shareholders $ 12.3 $ 8.2 $ 8.4 $ 7.9 $ 8.8 Earnings per share $ 0.40 $ 0.27 $ 0.27 $ 0.26 $ 0.28 Weighted average common shares outstanding 30,360,347 30,804,029 30,804,029 30,960,370 30,960,370 Sutherland Asset Management

Core Earnings Reconciliation 20 (In millions, except per share values) Q3 2015 Q4 2015 Q1 2016 Q2 2016 Q3 2016 Net income $ 13.4 $ 8.9 $ 9.1 $ 8.6 $ 9.6 Reconciling items: Unrealized (gain) loss on mortgage-backed securities 1.3 3.8 (2.0) (1.6) (0.7) Realized (gain) loss on mortgage-backed securities - - 3.1 0.5 - Merger transaction costs - - - 1.7 0.9 Gain on sale of SBA license (1.3) - - - - Employee severance - - - - 0.3 (Gain) loss on discontinued operations, net of tax (0.3) 1.6 0.3 - - Total reconciling items (0.3) 5.4 1.4 0.6 0.5 Core earning before income taxes 13.1 14.3 10.5 9.2 10.1 Income tax adjustment 0.5 - - - - Core earnings 13.6 14.3 10.5 9.2 10.1 Sutherland Asset Management

Corporate Overview Sutherland Asset Management

SLD Overview ► Sutherland Asset Management Corporation (“SLD” or the “Company”), formed on November 4, 2013, is a Maryland-based externally-managed commercial mortgage REIT that is advised by Waterfall Asset Management (“WAM”) ► SLD acquires, originates, services and finances (i) small balance commercial (“SBC”) loans, and (ii) loans issued under programs administered by the Small Business Administration (“SBA”) and Freddie Mac SBC loans are generally secured by properties with a value of $5M or less ► SLD operates mainly in three segments: SLD: manages the Company’s investments in distressed SBC loans ReadyCap Commercial: originates SBC loans ReadyCap Lending: originates and services SBA loans Acquired SBA platform and portfolio from CIT in 2014 Holds 1 of 14 SBA non-bank licenses issued in the U.S. ► WAM: Founded in 2005, WAM is an SEC-registered specialist credit manager focused on high-yield Asset Backed Securities and real estate and consumer debt investment with over $5.9 billion in assets under management 22 Sutherland Asset Management

SLD Overview Acquired Loans Top 5 acquirer of SBC loans since crisis WAM has reviewed approximately 334,000 performing, sub-performing and non-performing SBC and SBA loans, priced approximately 162,000 of these loans and acquired more than 9,200 SBC and SBA loans with aggregate UPB of approximately $3.6 billion for an aggregate purchase price of approximately $2.7 billion. Additionally, WAM has also acquired more than $487.7 million in UPB of SBC ABS notes over this time period Represents 31.0% of SAM’s equity allocation ReadyCap Lending is a market leader in SBA 7(a) loan origination and servicing ReadyCap Lending holds one of only 14 non-bank SBLC licenses which provides a unique advantage in origination and acquisition of 7(a) loans. Of the 14 license holders, only four are actively originating The Company commenced ReadyCap Lending SBA 7(a) originations in 3Q15 Represents 19.9% of SAM’s equity allocation Originated Loans ReadyCap Commercial is a TRS and market-leading nationwide originator, focused solely on providing SBC loans (First mortgage loans, "Mini-perm" loans, Bridge loans, and Mezzanine loans) Originated more than $1.2 billion in loans across 33 states since inception in 09/2012 Represents 49.2% of SAM’s equity allocation 23 Sutherland Asset Management

SLD History 2007 2008 2009 2010 2011 2012 2013 2005 2014 2015 2016 July 2007 Launch of loan strategies August 2008 Acquired performing SBC Loan pool from Lehman Brothers June 2009 Purchased SBC ABS equity tranches from Washington Mutual February 2011 First non performing SBC loan securitization ($41 million) March 2011 First performing SBC loan securitization ($98 million) November 2011 Formation of Sutherland Fund with contributed assets from Victoria Funds ($138 million assets) WAM founded; Launch of ABS Strategies March 2005 April 2012 Coldwell Banker Commercial Alliance formed September 2012 ReadyCap Commercial origination formed December 2013 Raised $226 million in Rule 144A Offering June 2014 Acquisition of CIT SBA platform / portfolio ($573 million UPB) – merged into ReadyCap Lending October 2014 First securitization of SBC mortgage loans originated by ReadyCap ($182 million) 2Q 2015 Seasoned SBA 7(a) Securitization October 2016 Closed Merger with ZAIS Financial Corp. Q4 2016 Anticipated completion conventional loan and owner occupied loan securitizations 24 Sutherland Asset Management

SLD Business Overview Loan Acquisition Business Conventional Loans Bridge Loans Freddie Mac SBL Program SBA 7(a) Origination Business(es) Booking Entity: SLD ReadyCap Commercial ReadyCap Lending Principal Business Activity / Secured by: Acquires pools of performing, sub-performing, and non-performing SBC loans from banks, other lenders, the FDIC, special services and others First mortgages on investor-owned commercial, multi-family or mixed-use properties. Multifamily properties with five units or more First mortgages on owner-occupied commercial properties that are 75% guaranteed by the SBA Typical Size: $500K - $10M $750K - $10M $1M to $15M $1M to $5M Up to $5M Rate: Fixed / floating Fixed / floating Fixed / floating Fixed / floating Typically floating Original Term: 5-30 years (18-36 months hold) 5-10 years 24-36 months 5-20 years 25 years Amortization: Fully amortizing 15-20 years Interest only Up to 30 years Fully amortizing Personal Guarantee: Typically Personal and / or carve-out guarantee Personal and / or carve-out guarantee No Yes Funding Strategy Credit Facilities and Securitizations Credit Facilities and Securitizations Guaranteed portion (75%) sold to unaffiliated parties, non-guaranteed portion retained Sutherland Asset Management 25

Attractive Markets: SBC Offers Compelling Risk-adjusted Returns SBC property market has lagged the larger CRE/housing markets over the last ~2 years due to limited institutional investment Provides strong relative value versus other real estate classes Historical Price Performance Typical Asset Characteristics SBC loans generate higher yields with less credit exposure compared to residential and large balance commercial loans and are backed by personal guarantee SBC loans are secured by first liens on commercial real estate properties valued under $5 million 26 Source: Boxwood Means Inc., Moody’s / RCA and S&P / Case-Shiller. 60.00 80.00 100.00 120.00 140.00 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 Residential (S&P/Case-Shiller Index) Commercial (CPPI) SBC (Boxwood Means Index) $225,000 atleast $20 million $2.0 million  80% 65% 60% 4.0% 4.0% 7.0% N/A 1.4x 1.6x 5.0% 6.0% 8.0% yes No yes Average Initial principal balance Loan to value yield debt service coverage ratio cap rate personal guarantee residential housing large balance commercial loans small balance commercial loans % peak-to-trough % recovery residential commercial 35.1)% 35.3% (40.5)% 62.5% sbc (22.3)% 16.3% Sutherland Asset Management

• The SBA was created in 1953 as an independent agency of the federal government to aid, counsel, assist and protect the intere sts of small business concerns – – – The SBA does not make direct loans to small businesses The SBA sets guidelines for loans, which are then made by its partners The SBA guarantees that these loans will be repaid, eliminating some of the risk to the lending partners. • The SBA Section 7(a) Program is the SBA’s primary program for providing financing for start-up and existing small businesses – The SBA typically guarantees 75% of qualified loans over $150,000 Attractive Market Opportunity Compelling Risk-adjusted Returns • The SBA achieved a record level of approvals in FY 2015, with more than 63,000 7(a) loans totaling $23.8 billion • This 23% increase in the dollar volume of loans represents the third consecutive year of growth in the financing of businesses through the 7(a) program • Lender participants at lowest level in 8 years • The top 50 lenders by volume provided more than 53% of all SBA 7(a) loans in FY 2015 • Low constant prepayment rates and high demand for quality assets has resulted in premiums near historic highs throughout FY 2015 • Delinquencies for the SBA’s 7(a) loan program declined from a 3.9% peak in January 2009 to 0.6% recorded in July 2015 (1) Credit losses are shared pari passu with SBA guaranteed versus unguaranteed %. Source: SBA.gov; Windsor Advantage27 (2) Premiums above 10% split 50/50 with SBA. … and Delinquencies Decline … As Guaranteed Premiums Hit Record Levels … With Fewer Lender Participants SBA 7(a) Market Continues to Grow … ATTRACTIVE MARKETS: SBA 7(A) OFFERS COMPELLING RISK-ADJUSTED RETURNS

Attractive Markets: Freddie Mac Offers Compelling Risk-adjusted Returns 28 SBL Seller/Servicer Requirements SBL Options & Qualifications Freddie Mac’s SBL program created a platform for approved SBL Sellers/Servicers to originate and sell loans on smaller rental properties. ReadyCap is an approved Seller/Servicer under the program which is advantageous as it allows for a significantly more streamlined sourcing and underwriting process. The process is as follows: (i) an SBL Pricing Grid is distributed to approved Seller/Services weekly, (ii) Seller/Servicers source SBLs that comply with clear cut guidelines (as discussed below), (iii) after submission of loan request to Freddie Mac Seller/Servicers may rate lock, (iv) due diligence is completed which includes a property inspection by Freddie Mac regional staff, (v) loans are closed using joint single counsel and pre-approved documentation, and (vi) Seller/Servicers submit final delivery package, Freddie Mac reviews, approves and purchases the loans. Assessment – Each Seller/Servicer will undergo a comprehensive assessment, evaluating their financial condition and their small loan origination and servicing platform. Origination – Each Seller/Servicer is committed to delivering a minimum of $50 to $75 million in SBLs per quarter. Repurchase – Each Seller/Servicer is required to repurchase any SBL that becomes delinquent (60 days or more) and for certain non-monetary defaults for up to 12 months or securitization. Loss Sharing – Each Seller/Servicer is subject to a 10% top pool-level loss obligation up to securitization. B-Piece Purchase – Each Seller/Servicer is obligated to purchase the B-Piece upon securitization of their loans. Collateral Requirement – Each Seller/Servicer will post collateral to support the SBL repurchase, loss share and B-Piece purchase obligations described above.

States with Funded Loans Headquarters Sales Offices  The ReadyCap origination platform generates an attractive risk spread premium by lending to borrowers that fall just outside of credit guidelines of many banks. The Company uses an extensive network of existing relationships to source origination opportunities Actively Recruiting  ReadyCap’s staff of 123 employees includes professionals who have extensive experience in the conventional SBC and SBA loan origination business and full-time retail loan officers spread across the United States that interact directly with borrowers during the loan origination process  ReadyCap has originated more than $1.2billion in conventional and SBA loans in 33 states since ReadyCap’s inception in September 2012 and through September 30, 2016  Current pipeline of $216 million in originations ReadyCap Commercial ReadyCap Lending NY0 08HT3 / 80 72 14 _1.wor  ReadyCap Commercial is a TRS and market-leading nationwide originator, focused solely on providing SBC loans  In mid-2014, ReadyCap acquired CIT’s Small Business Lending Platform, along with a SBA license, $570 million portfolio, $1.2 billion of SBA 7(a) servicing rights, and technology licenses for both the origination and servicing systems  Unique suite of product offerings, comprising Conventional Loans, Bridge Loans and Mezzanine Loans  Holds one of only 14 non-bank licenses to originate loans guaranteed under the SBA Section 7(a) Program and performs origination, loan management and other functions with respect to SBA loans  Approved Freddie Mac seller / servicer in the recently launched Small Balance Loan (“SBL”) program and it has commenced the origination of loans under such program  ReadyCap Lending can leverage the Company’s deep SBA expertise to provide financing solutions and liquidity to small business owners nationwide 29 ROBUST ORIGINATION AND ACQUISITION PLATFORM

Business Description Origination Volume by Purpose ($MM)  GMFS was founded in 1999 and headquartered in Baton Rouge, Louisiana GMFS provides a wide range of residential mortgage services, including home purchase financing, mortgage refinancing, reverse mortgages, new construction loans and condo financing, primarily in the southeast United States GMFS is licensed in 23 states and is an approved FNMA and FHLMC seller-servicer, GNMA issuer, HUD / FHA / USDA originator and VA lender Operates through its 11 retail branches located in the following states: Louisiana (7), Georgia (2), Mississippi (1) and Texas (1) Employs both a servicing retained and servicing released execution strategy, while retaining approximately 85-90% of current production GMFS has 257 full-time employees, with the majority operating out of the corporate headquarters in Baton Rouge Maintains a portfolio of MSRs with approximately $5.3 billion in UPB as of October 31, 2016, which is currently subserviced by Cenlar $2,000 $636  $1,500 $526 $375 $774 $561 $1,000 9 $980 $735 $382 $500  $361 $532 $333 $190 $0 2010 2011 2012 2013 2014 2015 2016  Purchase Refi MSR Servicing UPB ($B)  $6.0 $5.0 $4.0 $3.0 $2.0 $1.0 $0.0 $5.1 $4.8 $4.4 $4.2  $3.9 $3.6 $3.3  1Q'15 2Q'15 3Q'15 4Q'15 1Q'16 2Q'16 3Q'16 30 $ 1,18 1,09 2 $ GMFS (ACQUIRED THROUGH ZFC MERGER)