CONSOLIDATING FINANCIAL INFORMATION (Tables)

3 Months Ended

Mar. 31, 2014

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Consolidating balance sheet

The following table presents the consolidating balance sheet as of March 31, 2014 (in thousands):

	RAI			RSO		Eliminations			Consolidated
ASSETS
Cash	$	17,210		$	—	$	—		$	17,210
Restricted cash	627			—		—			627
Receivables	660			—		(88		)	572
Receivables from managed entities and related parties, net	37,109			—		(2,603		)	34,506
Investments in real estate, net	17,167			—		—			17,167
Investment securities, at fair value	25,049			—		(15,949		)	9,100
Investments in unconsolidated loan manager	38,181			—		—			38,181
Investments in unconsolidated entities	13,609			—		—			13,609
Assets of consolidated variable interest entities ("VIE") - RSO:
Cash and cash equivalents (including restricted cash)	—			282,638		—			282,638
Investments, at fair value	—			243,538		—			243,538
Loans	—			1,618,618		(558		)	1,618,060
Investments in real estate and unconsolidated entities	—			117,280		—			117,280
Other assets - RSO	—			79,834		(15		)	79,819
Total assets of consolidated VIE - RSO	—			2,341,908		(573		)	2,341,335
Property and equipment, net	5,566			—		—			5,566
Deferred tax assets, net	35,463			—		(8,876		)	26,587
Other assets	5,431			—		—			5,431
Total assets	$	196,072		$	2,341,908	$	(28,089	)	$	2,509,891
LIABILITIES AND EQUITY
Liabilities:
Accrued expenses and other liabilities	$	22,698		$	—	$	—		$	22,698
Payables to managed entities and related parties	3,127			—		(15		)	3,112
Borrowings	21,059			—		(558		)	20,501
Liabilities of consolidated VIE - RSO:
Borrowings	—			1,502,089		177			1,502,266
Other liabilities	—			59,625		(2,691		)	56,934
Total liabilities of consolidated VIE - RSO	—			1,561,714		(2,514		)	1,559,200
Total liabilities	46,884			1,561,714		(3,087		)	1,605,511
Commitments and contingencies
Equity:
Preferred stock	—			—		—			—
Common stock	301			—		—			301
Additional paid-in capital	288,958			—		—			288,958
Accumulated deficit	(21,544		)	—		(4,479		)	(26,023		)
Treasury stock, at cost	(107,905		)	—		—			(107,905		)
Accumulated other comprehensive loss	(10,843		)	—		9,679			(1,164		)
Total stockholders’ equity	148,967			—		5,200			154,167
Noncontrolling interests	221			—		—			221
Noncontrolling interest attributable to RSO	—			780,194		(30,202		)	749,992
Total equity	149,188			780,194		(25,002		)	904,380
	$	196,072		$	2,341,908	$	(28,089	)	$	2,509,891

Consolidating statements of operations

The following table presents the consolidating statement of operations for the three months ended March 31, 2014 (in thousands):

	RAI			RSO			Eliminations			Consolidated
REVENUES:
Real estate	$	13,275		$	—		$	—		$	13,275
Financial fund management	7,075			—			—			7,075
Commercial finance	(99		)	—			—			(99		)
	20,251			—			—			20,251
Revenues from consolidated VIE - RSO	—			31,931			—			31,931
Elimination of consolidated VIE revenues attributed to operating segments	—			—			(2,880		)	(2,880		)
Total revenues	20,251			31,931			(2,880		)	49,302
COSTS AND EXPENSES:
Real estate	8,875			—			—			8,875
Financial fund management	4,389			—			—			4,389
Commercial finance	103			—			—			103
General and administrative	3,154			—			—			3,154
Provision for credit losses	1,208			—			—			1,208
Depreciation and amortization	451			—			—			451
	18,180			—			—			18,180
Expenses from consolidated VIE - RSO	—			13,140			(16		)	13,124
Elimination of consolidated VIE expenses attributed to operating segments	—			—			(2,819		)	(2,819		)
Total expenses	18,180			13,140			(2,835		)	28,485
OPERATING INCOME	2,071			18,791			(45		)	20,817
OTHER INCOME (EXPENSE):
Interest expense	(483		)	—			—			(483		)
Other income, net	737			—			(572		)	165
Other income, net, from consolidated VIE - RSO	—			(1,331		)	—			(1,331		)
Elimination of consolidated VIE other income, net	—			—			18			18
	254			(1,331		)	(554		)	(1,631		)
Income from continuing operations before taxes	2,325			17,460			(599		)	19,186
Income tax provision	1,069			—			16			1,085
Net income	1,256			17,460			(615		)	18,101
Net loss attributable to noncontrolling interests	40			—			—			40
Net income attributable to noncontrolling interests - RSO	—			(2,344		)	(14,807		)	(17,151		)
Net income attributable to common shareholders	$	1,296		$	15,116		$	(15,422	)	$	990
Amounts attributable to common shareholders:
Income from continuing operations	$	1,296		$	15,116		$	(15,422	)	$	990
Discontinued operations	—			—			—			—
Net income	$	1,296		$	15,116		$	(15,422	)	$	990

Consolidating statements of cash flows

The following table presents the consolidating statement of cash flows for the three months ended March 31, 2014 (in thousands):

	RAI			RSO			Eliminations			Consolidated
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income	$	1,256		$	17,460		$	(615	)	$	18,101
Adjustments to reconcile net income to net cash used in operating activities:
Depreciation and amortization	494			—			—			494
Provision for credit losses	1,208			—			—			1,208
Unrealized losses (gains) on trading securities	95			—			(24		)	71
Equity in earnings of unconsolidated entities	(631		)	—			—			(631		)
Distributions from unconsolidated entities	1,510			—			—			1,510
Gain on sale of investment securities, net	(283		)	—			95			(188		)
Deferred income tax provision (benefit)	1,069			—			—			1,069
Equity-based compensation issued	404			—			—			404
Trading securities purchases and sales, net	(442		)	—			—			(442		)
Changes in operating assets and liabilities	(4,980		)	—			—			(4,980		)
Change in cash attributable to operations of consolidated VIE - RSO	—			97,292			(28		)	97,264
Net cash (used in) provided by operating activities	(300		)	114,752			(572		)	113,880
CASH FLOWS FROM INVESTING ACTIVITIES:
Capital expenditures	(42		)	—			—			(42		)
Investments in unconsolidated real estate entities	(79		)	—			—			(79		)
Purchase of loans and securities by consolidated VIE - RSO	—			(217,701		)	—			(217,701		)
Principal payments and proceeds from sales received by consolidated VIE - RSO	—			136,561			—			136,561
Purchase of loans and investments	(678		)	—			—			(678		)
Increase in restricted cash of consolidated VIE - RSO	—			(12,849		)	—			(12,849		)
Other investing activity of consolidated VIE - RSO	—			(24,622		)	(391		)	(25,013		)
Net cash used in investing activities	(799		)	(118,611		)	(391		)	(119,801		)

CASH FLOWS FROM FINANCING ACTIVITIES:
Principal payments on borrowings	(508		)	—			391		(117		)
Net borrowings (repayments) of debt by consolidated VIE - RSO	—			16,209			—		16,209
Dividends paid	(980		)	—			—		(980		)
Dividends paid on common stock by consolidated VIE - RSO	—			(25,536		)	572		(24,964		)
Net proceeds from issuance of common stock by consolidated VIE - RSO	—			15,660			—		15,660
Other	(56		)	—			—		(56		)
Other financing activity of consolidated VIE - RSO	—			(2,474		)	—		(2,474		)
Net cash (used in) provided by financing activities	(1,544		)	3,859			963		3,278
Decrease in cash	(2,643		)	—			—		(2,643		)
Cash, beginning of year	19,853			—			—		19,853
Cash, end of period	$	17,210		$	—		$	—	$	17,210