CONSOLIDATING FINANCIAL INFORMATION (Tables)

9 Months Ended

Sep. 30, 2014

Organization, Consolidation and Presentation of Financial Statements [Abstract]

The following table presents the consolidating balance sheet as of September 30, 2014 (in thousands):



	RAI			RSO		Eliminations			Consolidated
ASSETS
Cash	$	26,428		$	—	$	—		$	26,428
Restricted cash	704			—		—			704
Receivables	1,175			—		(124		)	1,051
Receivables from managed entities and related parties, net	35,178			—		(2,541		)	32,637
Investments in real estate, net	17,091			—		—			17,091
Investment securities, at fair value	23,782			—		(13,937		)	9,845
Investments in unconsolidated loan manager	39,048			—		—			39,048
Investments in unconsolidated entities	19,385			—		(6,113		)	13,272
Assets of consolidated VIE-RSO:
Cash and cash equivalents (including restricted cash)	—			246,873		—			246,873
Investments, at fair value	—			290,205		—			290,205
Loans	—			1,840,453		(558		)	1,839,895
Investments in real estate and unconsolidated entities	—			90,121		—			90,121
Other assets-RSO	—			124,729		(2,810		)	121,919
Total assets of consolidated VIE-RSO	—			2,592,381		(3,368		)	2,589,013
Property and equipment, net	5,177			—		—			5,177
Deferred tax assets, net	32,486			—		(9,678		)	22,808
Other assets	6,028			—		—			6,028
Total assets	$	206,482		$	2,592,381	$	(35,761	)	$	2,763,102

LIABILITIES AND EQUITY
Liabilities:
Accrued expenses and other liabilities	$	21,827		$	—	$	(2,800	)	$	19,027
Payables to managed entities and related parties	3,705			—		(10		)	3,695
Borrowings	21,009			—		(558		)	20,451
Liabilities of consolidated VIE-RSO:
Borrowings	—			1,590,958		283			1,591,241
Other liabilities	—			57,507		(2,665		)	54,842
Total liabilities of consolidated VIE-RSO	—			1,648,465		(2,382		)	1,646,083
Total liabilities	46,541			1,648,465		(5,750		)	1,689,256
Commitments and contingencies

Equity:
Preferred stock	—			—		—			—
Common stock	334			—		—			334
Additional paid-in capital	307,412			—		—			307,412
Accumulated deficit	(18,232		)	—		(5,808		)	(24,040		)
Treasury stock, at cost	(117,881		)	—		—			(117,881		)
Accumulated other comprehensive loss	(11,946		)	—		10,880			(1,066		)
Total stockholders’ equity	159,687			—		5,072			164,759
Noncontrolling interests	254			—		—			254
Noncontrolling interests attributable to consolidated VIE-RSO	—			943,916		(35,083		)	908,833
Total equity	159,941			943,916		(30,011		)	1,073,846
	$	206,482		$	2,592,381	$	(35,761	)	$	2,763,102

Consolidating statements of operations

The following table presents the consolidating statement of operations for the three months ended September 30, 2014 (in thousands):



	RAI			RSO			Eliminations			Consolidated
REVENUES:
Real estate	$	14,289		$	—		$	—		$	14,289
Financial fund management	5,557			—			—			5,557
Commercial finance	(17		)	—			—			(17		)
	19,829			—			—			19,829
Revenues from consolidated VIE-RSO	—			34,716			—			34,716
Elimination of consolidated VIE-RSO revenues attributed to operating segments	—			—			(4,136		)	(4,136		)
Total revenues	19,829			34,716			(4,136		)	50,409
COSTS AND EXPENSES:
Real estate	9,384			—			—			9,384
Financial fund management	2,812			—			—			2,812
Commercial finance	125			—			—			125
General and administrative	2,426			—			—			2,426
Provision for credit losses	559			—			—			559
Depreciation and amortization	453			—			—			453
	15,759			—			—			15,759
Expenses of consolidated VIE-RSO	—			18,449			237			18,686
Elimination of consolidated VIE-RSO expenses attributed to operating segments	—			—			(3,502		)	(3,502		)
Total expenses	15,759			18,449			(3,265		)	30,943
OPERATING INCOME	4,070			16,267			(871		)	19,466

OTHER INCOME (EXPENSE):
Gain on sales of investment securities, net	69			—			—			69
Interest expense	(467		)	—			—			(467		)
Other income, net	652			—			(572		)	80
Other income, net, from consolidated VIE-RSO	—			(1,936		)	—			(1,936		)
Elimination of consolidated VIE-RSO other expense, net	—			—			11			11
	254			(1,936		)	(561		)	(2,243		)
Income from continuing operations before taxes	4,324			14,331			(1,432		)	17,223
Income tax provision	1,741			—			(237		)	1,504
Net income	2,583			14,331			(1,195		)	15,719
Net loss attributable to noncontrolling interests	11			—			—			11
Net income attributable to noncontrolling interests-RSO	—			(7,003		)	(7,211		)	(14,214		)
Net income attributable to common shareholders	$	2,594		$	7,328		$	(8,406	)	$	1,516

. The following table presents the consolidating statement of operations for the three months ended September 30, 2013 (in thousands):



	RAI			RSO			Eliminations			Consolidated
REVENUES:
Real estate	$	15,950		$	—		$	—		$	15,950
Financial fund management	8,502			—			—			8,502
Commercial finance	(30		)	—			—			(30		)
	24,422			—			—			24,422
Revenues from consolidated VIE-RSO	—			23,786			—			23,786
Elimination of consolidated VIE-RSO revenues attributed to operating segments	—			—			(5,183		)	(5,183		)
Total revenues	24,422			23,786			(5,183		)	43,025
COSTS AND EXPENSES:
Real estate	11,178			—			—			11,178
Financial fund management	3,547			—			—			3,547
Commercial finance	75			—			—			75
General and administrative	2,505			—			—			2,505
Provision for credit losses	1,808			—			—			1,808
Depreciation and amortization	413			—			—			413
	19,526			—			—			19,526
Expenses of consolidated VIE-RSO	—			16,276			(722		)	15,554
Elimination of consolidated VIE-RSO expenses attributed to operating segments	—			—			(4,861		)	(4,861		)
Total expenses	19,526			16,276			(5,583		)	30,219
OPERATING INCOME	4,896			7,510			400			12,806

OTHER INCOME (EXPENSE):
Interest expense	(530		)	—			—			(530		)
Other income, net	684			—			(556		)	128
Other income, net, from consolidated VIE-RSO	—			16,607			—			16,607
Elimination of consolidated VIE-RSO other expense, net	—			—			162			162
	154			16,607			(394		)	16,367
Income from continuing operations before taxes	5,050			24,117			6			29,173
Income tax provision	1,261			—			722			1,983
Net income	3,789			24,117			(716		)	27,190
Net income attributable to noncontrolling interests	(40		)	—			—			(40		)
Net income attributable to noncontrolling interests-RSO	—			(1,996		)	(21,712		)	(23,708		)
Net income attributable to common shareholders	$	3,749		$	22,121		$	(22,428	)	$	3,442

The following table presents the consolidating statement of operations for the nine months ended September 30, 2014 (in thousands):



	RAI			RSO			Eliminations			Consolidated
REVENUES:
Real estate	$	41,012		$	—		$	—		$	41,012
Financial fund management	20,773			—			—			20,773
Commercial finance	(158		)	—			—			(158		)
	61,627			—			—			61,627
Revenues from consolidated VIE-RSO	—			100,604			—			100,604
Elimination of consolidated VIE-RSO revenues attributed to operating segments	—			—			(10,056		)	(10,056		)
Total revenues	61,627			100,604			(10,056		)	152,175
COSTS AND EXPENSES:
Real estate	27,364			—			—			27,364
Financial fund management	9,980			—			—			9,980
Commercial finance	351			—			—			351
General and administrative	8,309			—			—			8,309
Provision for credit losses	3,342			—			—			3,342
Depreciation and amortization	1,369			—			—			1,369
	50,715			—			—			50,715
Expenses of consolidated VIE-RSO	—			50,353			667			51,020
Elimination of consolidated VIE-RSO expenses attributed to operating segments	—			—			(9,374		)	(9,374		)
Total expenses	50,715			50,353			(8,707		)	92,361
OPERATING INCOME	10,912			50,251			(1,349		)	59,814

OTHER INCOME (EXPENSE):
Gain on sale of investment securities, net	439			—			—			439
Interest expense	(1,447		)	—			—			(1,447		)
Other income, net	1,979			—			(1,716		)	263
Other income, net, from consolidated VIE-RSO	—			(758		)	—			(758		)
Elimination of consolidated VIE-RSO other income, net	—			—			29			29
	971			(758		)	(1,687		)	(1,474		)
Income from continuing operations before taxes	11,883			49,493			(3,036		)	58,340
Income tax provision	4,991			—			(667		)	4,324
Net income	6,892			49,493			(2,369		)	54,016
Net income attributable to noncontrolling interests	(33		)	—			—			(33		)
Net income attributable to noncontrolling interests-RSO	—			(12,372		)	(36,387		)	(48,759		)
Net income attributable to common shareholders	$	6,859		$	37,121		$	(38,756	)	$	5,224

Consolidating statements of cash flows

The following table presents the consolidating statement of cash flows for the nine months ended September 30, 2014 (in thousands):



	RAI			RSO			Eliminations			Consolidated
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income	$	6,892		$	49,493		$	(2,369	)	$	54,016
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	1,469			—			—			1,469
Provision for credit losses	3,342			—			—			3,342
Unrealized losses on trading securities	133			—			(22		)	111
Equity in earnings of unconsolidated entities	(2,789		)	—			491			(2,298		)
Distributions from unconsolidated entities	5,134			—			—			5,134
Gain on sale of investment securities, net	(1,940		)	—			95			(1,845		)
Gain on sale of leases and loans	(22		)	—			—			(22		)
Loss on sale of assets	439			—			—			439
Deferred income tax provision	4,838			—			—			4,838
Equity-based compensation issued	1,322			—			—			1,322
Trading securities purchases and sales, net	973			—			—			973
Changes in operating assets and liabilities	(10,255		)	—			(2,800		)	(13,055		)
Adjustments to reconcile net income and operating cash flows to net income of consolidated VIE-RSO	—			39,646			2,714			42,360
Net cash provided by operating activities	9,536			89,139			(1,891		)	96,784
CASH FLOWS FROM INVESTING ACTIVITIES:
Capital expenditures	(291		)	—			—			(291		)
Payments received on real estate loans and real estate	25			—			—			25
Principal payments on leases and loans	22			—			—			22
Investments in real estate and unconsolidated real estate entities	(1,561		)	—			—			(1,561		)
Purchase of loans and securities by consolidated VIE-RSO	—			(812,912		)	—			(812,912		)
Principal payments and proceeds from sales of loans and securities by consolidated VIE-RSO	—			552,913			—			552,913
Purchase of loans and investments	(7,320		)	—			—			(7,320		)
Proceeds from sale of loans and investments	721			—			—			721
Decrease in restricted cash of consolidated VIE-RSO	—			18,328			—			18,328
Other investing activity of consolidated VIE-RSO	—			(10,633		)	(391		)	(11,024		)
Net cash used in investing activities	(8,404		)	(252,304		)	(391		)	(261,099		)



	RAI			RSO			Eliminations		Consolidated
CASH FLOWS FROM FINANCING ACTIVITIES:
Increase in borrowings	2,520			—			—		2,520
Principal payments on borrowings	(3,204		)	—			391		(2,813		)
Net borrowings by consolidated VIE-RSO	—			67,954			—		67,954
Dividends paid	(2,952		)	—			—		(2,952		)
Dividends paid on common stock by consolidated VIE-RSO	—			(77,636		)	1,716		(75,920		)
Proceeds from issuance of common stock	17,570			—			—		17,570
Net proceeds from issuance of common stock by consolidated VIE-RSO	—			177,568			—		177,568
Repurchases of common stock	(8,358		)	—			—		(8,358		)
Increase in restricted cash	(133		)	—			—		(133		)
Other financing activity of consolidated VIE - RSO	—			(4,721		)	175		(4,546		)
Net cash provided by financing activities	5,443			163,165			2,282		170,890

Decrease in cash	6,575			—			—		6,575
Cash, beginning of year	19,853			—			—		19,853
Cash, end of period	$	26,428		$	—		$	—	$	26,428