- GAAP LOSS PER COMMON SHARE FROM CONTINUING OPERATIONS OF $(1.46) -
- DISTRIBUTABLE LOSS PER COMMON SHARE OF $(0.43) -
- DISTRIBUTABLE LOSS PER COMMON SHARE BEFORE REALIZED LOSSES OF $(0.09) -
NEW YORK, Feb. 26, 2026 (GLOBE NEWSWIRE) -- Ready Capital Corporation ("Ready Capital" or the "Company") $(RC)$, a multi-strategy real estate finance company that originates, acquires, finances, and services lower-to-middle-market ("LMM") investor and owner-occupied commercial real estate loans, today reported financial results for the quarter ended December 31, 2025.
"We continue to execute on our liquidity plan with a focus on meeting our corporate obligations and repositioning the Company's equity away from Covid-vintage production", said Thomas Capasse, Ready Capital's Chairman and Chief Executive Officer. "The equity drawdown associated with these actions is significant but represents an important step toward addressing the financial pressure experienced since the onset of the commercial real estate cycle. We believe the execution of our plan will improve our liquidity profile and support greater financial stability going forward."
Fourth Quarter Highlights
-- LMM commercial real estate originations of $235 million
-- Small Business Lending ("SBL") loan originations of $140 million,
including $84 million of Small Business Administration 7(a) loans and $18
million of United States Department of Agriculture loans
-- Book value of $8.79 per share of common stock as of December 31, 2025
Full Year Highlights
-- Total originations of $1.8 billion across all products
-- Completed the acquisition of United Development Funding IV, a real estate
investment trust providing capital solutions to residential real estate
developers and regional homebuilders
-- Completed the sale of GMFS, our Residential Mortgage Banking business
-- Secured ownership and control of the Portland, OR mixed-use asset via a
consensual deed-in-lieu arrangement
Subsequent Events
-- Completed the sale of 34 loans with an unpaid principal balance of $855.3
million
-- Retired the remaining outstanding amount on the 5.75% Senior Unsecured
Note due February 2026
Use of Non-GAAP Financial Information
In addition to the results presented in accordance with U.S. GAAP, this press release includes distributable earnings, formerly referred to as core earnings, which is a non-U.S. GAAP financial measure. The Company defines distributable earnings as net income adjusted for unrealized gains and losses related to certain mortgage backed securities ("MBS") not retained by us as part of our loan origination business, realized gains and losses on sales of certain MBS, unrealized changes in our current expected credit loss reserve and valuation allowance, unrealized gains or losses on de-designated cash flow hedges, unrealized gains or losses on foreign exchange hedges, unrealized gains or losses on certain unconsolidated joint ventures, non-cash compensation expense related to our stock-based incentive plan, unrealized gains or losses on preferred equity, at fair value, unrealized gain or losses or other non-cash items related to real estate owned and one-time non-recurring gains or losses, such as gains or losses on discontinued operations, bargain purchase gains, or merger related expenses.
The Company believes that this non-U.S. GAAP financial information, in addition to the related U.S. GAAP measures, provides investors greater transparency into the information used by management in its financial and operational decision-making, including the determination of dividends. However, because distributable 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 distributable earnings may not be comparable to other similarly-titled measures of other companies.
In calculating distributable earnings, Net Income (in accordance with U.S. GAAP) is adjusted to exclude unrealized gains and losses on MBS acquired by the Company in the secondary market but is not adjusted to exclude unrealized gains and losses on MBS retained by Ready Capital as part of its loan origination businesses, where the Company transfers originated loans into an MBS securitization and the Company retains an interest in the securitization. In calculating distributable earnings, the Company does not adjust Net Income (in accordance with U.S. GAAP) to take into account unrealized gains and losses on MBS retained by us as part of the loan origination businesses because the unrealized gains and losses that are generated in the loan origination and securitization process are considered to be a fundamental part of this business and an indicator of the ongoing performance and credit quality of the Company's historical loan originations. In calculating distributable earnings, Net Income (in accordance with U.S. GAAP) is adjusted to exclude realized gains and losses on certain MBS securities considered to be non-distributable. Certain MBS positions are considered to be non-distributable due to a variety of reasons which may include collateral type, duration, and size.
Servicing rights relating to the Company's small business commercial business are accounted for under ASC 860, Transfer and Servicing. In calculating distributable earnings, the Company does not exclude realized gains or losses on commercial MSRs, as servicing income is a fundamental part of Ready Capital's business and is an indicator of the ongoing performance.
To qualify as a REIT, the Company must distribute to its stockholders each calendar year at least 90% of its REIT taxable income (including certain items of non-cash income), determined without regard to the deduction for dividends paid and excluding net capital gain. There are certain items, including net income generated from the creation of MSRs, that are included in distributable earnings but are not included in the calculation of the current year's taxable income. These differences may result in certain items that are recognized in the current period's calculation of distributable earnings not being included in taxable income, and thus not subject to the REIT dividend distribution requirement until future years.
The table below reconciles Net Income computed in accordance with U.S. GAAP to Distributable Earnings.
Three Months Ended Year Ended
(in thousands) December 31, 2025 December 31, 2025
---------------------------- -------------------- ----------------------
Net Loss $ (232,612) $ (221,061)
Reconciling items:
Unrealized loss on MSR -
discontinued
operations -- 8,952
Unrealized loss on joint
ventures 523 2,845
Increase in CECL reserve 113,974 35,178
Increase (decrease) in
valuation allowance 23,318 (15,443)
Non-recurring REO
impairment 15,027 23,653
Non-cash compensation 797 5,807
Unrealized loss on
preferred equity, at
fair value 10,645 12,923
Merger transaction costs
and other non-recurring
expenses 3,102 11,976
(Gain) loss on bargain
purchase 3,013 (109,549)
Depreciation and
amortization on real
estate owned 1,712 2,812
Realized losses on sale
of investments 64,987 282,479
---------------------------- --------------- ---------------
Total reconciling items $ 237,098 $ 261,633
---------------------------- --------------- ---------------
Income tax adjustments (14,556) (61,376)
---------------------------- --------------- ---------------
Distributable loss before
realized losses $ (10,070) $ (20,804)
---------------------------- --------------- ---------------
Realized losses on sale
of investments, net of
tax (55,209) (225,243)
---------------------------- --------------- ---------------
Distributable loss $ (65,279) $ (246,047)
---------------------------- --------------- ---------------
Less: Distributable earnings
attributable to
non-controlling interests 1,926 7,345
Less: Income attributable to
participating shares 2,015 8,667
---------------------------- --------------- ---------------
Distributable loss
attributable to common
stockholders $ (69,220) $ (262,059)
---------------------------- --------------- ---------------
Distributable loss before
realized losses on
investments, net of tax per
common share - basic and
diluted $ (0.09) $ (0.23)
---------------------------- --------------- ---------------
Distributable loss per
common share - basic and
diluted $ (0.43) $ (1.59)
---------------------------- --------------- ---------------
U.S. GAAP return on equity is based on U.S. GAAP net income, while distributable return on equity is based on distributable earnings, which adjusts U.S. GAAP net income for the items in the distributable earnings reconciliation above.
Webcast and Earnings Conference Call
Management will host a webcast and conference call on Friday, February 27, 2026 at 8:30am ET to provide a general business update and discuss the financial results for the quarter ended December 31, 2025. During the conference call, the Company may discuss and answer questions concerning business and financial developments and trends that have occurred after quarter-end. The Company's responses to questions, as well as other matters discussed during the conference call, may contain or constitute information that has not been disclosed previously.
The Company encourages use of the webcast due to potential extended wait times to access the conference call via dial-in. The webcast of the conference call will be available in the Investor Relations section of the Company's website at www.readycapital.com. To listen to a live broadcast, go to the site at least 15 minutes prior to the scheduled start time in order to register, download and install any necessary audio software.
To Participate in the Telephone Conference Call:
Dial in at least five minutes prior to start time.
Domestic: 1-877-407-0792
International: 1-201-689-8263
Conference Call Playback:
Domestic: 1-844-512-2921
International: 1-412-317-6671
Replay Pin #: 13757494
The playback can be accessed through March 13, 2026.
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; 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 most recent Annual Report on Form 10-K filed with the SEC, 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.
About Ready Capital Corporation
Ready Capital Corporation (NYSE: RC) is a multi-strategy real estate finance company that originates, acquires, finances and services lower-to-middle-market investor and owner occupied commercial real estate loans. The Company specializes in loans backed by commercial real estate, including agency multifamily, investor, construction, and bridge as well as U.S. Small Business Administration loans under its Section 7(a) program and government guaranteed loans focused on the United States Department of Agriculture. Headquartered in New York, New York, the Company employs approximately 450 professionals nationwide.
Contact
Investor Relations
Ready Capital Corporation
212-257-4666
InvestorRelations@readycapital.com
Additional information can be found on the Company's website at www.readycapital.com.
READY CAPITAL CORPORATION
UNAUDITED CONSOLIDATED BALANCE SHEETS
(in thousands) December 31, 2025 December 31, 2024
Assets
Cash and cash equivalents $ 207,841 $ 143,803
Restricted cash 39,746 30,560
Loans, net (including $737
and $3,533 held at fair
value) 3,500,298 3,378,149
Loans, held for sale
(including $73,094 and
$128,531 held at fair
value and net of
valuation allowance of
$67,612 and $97,620) 585,820 241,626
Mortgage-backed securities 34,501 31,006
Investment in
unconsolidated joint
ventures (including
$5,737 and $6,577 held at
fair value) 161,424 161,561
Derivative instruments 6,740 7,963
Servicing rights 126,279 128,440
Real estate owned 620,225 193,437
Other assets 508,238 362,486
Assets of consolidated
VIEs 1,978,684 5,175,295
Assets held for sale -- 287,595
------------------------------
Total Assets $ 7,769,796 $ 10,141,921
------------------------------ -------------- --------------
Liabilities
Secured borrowings 2,788,926 2,035,176
Securitized debt
obligations of
consolidated VIEs, net 1,174,785 3,580,513
Senior secured notes, net 722,729 437,847
Corporate debt, net 652,487 895,265
Guaranteed loan financing 524,091 691,118
Contingent consideration 18,698 573
Derivative instruments 1,432 352
Dividends payable 3,633 43,168
Loan participations sold 56,616 95,578
Due to third parties 3,135 1,442
Accounts payable and other
accrued liabilities 171,636 188,051
Liabilities held for sale -- 228,735
------------------------------
Total Liabilities $ 6,118,168 $ 8,197,818
------------------------------ -------------- --------------
Preferred stock Series C,
liquidation preference
$25.00 per share 8,361 8,361
Commitments & contingencies
Stockholders' Equity
Preferred stock Series E,
liquidation preference
$25.00 per share 111,378 111,378
Common stock, $0.0001 par
value, 500,000,000 shares
authorized, 163,010,012
and 162,792,372 shares
issued and outstanding,
respectively 17 17
Additional paid-in capital 2,264,355 2,250,291
Retained deficit (807,522) (505,089)
Accumulated other
comprehensive loss (24,196) (18,552)
------------------------------
Total Ready Capital
Corporation equity 1,544,032 1,838,045
Non-controlling
interests 99,235 97,697
------------------------------
Total Stockholders' Equity $ 1,643,267 $ 1,935,742
------------------------------ -------------- --------------
Total Liabilities, Redeemable
Preferred Stock, and
Stockholders' Equity $ 7,769,796 $ 10,141,921
------------------------------ -------------- --------------
READY CAPITAL CORPORATION
UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except share Three Months Ended Year Ended
data) December 31, 2025 December 31, 2025
Interest income $ 123,973 $ 569,166
Interest expense (110,851) (514,125)
---------------------------- --------------- ---------------
Net interest income before
provision for loan losses $ 13,122 $ 55,041
---------------------------- --------------- ---------------
Provision for loan losses (149,989) (87,038)
---------------------------- --------------- ---------------
Net interest loss after
provision for loan losses $ (136,867) $ (31,997)
---------------------------- --------------- ---------------
Non-interest income
Net realized gain (loss)
on financial instruments
and real estate owned (10,599) (142,112)
Net unrealized gain (loss)
on financial instruments (12,703) (13,153)
Valuation recovery
(allowance), loans held
for sale (23,318) 15,443
Servicing income, net of
amortization and
impairment of $7,237 and
$29,919 5,042 18,703
Gain (loss) on bargain
purchase (3,013) 109,549
Income on unconsolidated
joint ventures 1,271 4,562
Other income 16,049 53,716
---------------------------- --------------- ---------------
Total non-interest income
(expense) $ (27,271) $ 46,708
---------------------------- --------------- ---------------
Non-interest expense
Employee compensation and
benefits (23,923) (89,487)
Allocated employee
compensation and benefits
from related party (4,350) (14,828)
Professional fees (12,973) (30,837)
Management fees -- related
party (4,543) (20,348)
Loan servicing expense (4,605) (41,258)
Transaction related
expenses (807) (6,050)
Impairment on real estate (15,027) (23,503)
Other operating expenses (33,821) (90,956)
---------------------------- --------------- ---------------
Total non-interest expense $ (100,049) $ (317,267)
---------------------------- --------------- ---------------
Loss from continuing
operations before benefit
for income taxes (264,187) (302,556)
Income tax benefit 31,622 86,703
---------------------------- --------------- ---------------
Net loss from continuing
operations $ (232,565) $ (215,853)
---------------------------- --------------- ---------------
Discontinued operations
Loss from discontinued
operations before income
tax benefit (63) (6,944)
Income tax benefit 16 1,736
---------------------------- --------------- ---------------
Net loss from discontinued
operations $ (47) $ (5,208)
---------------------------- --------------- ---------------
Net loss $ (232,612) $ (221,061)
---------------------------- --------------- ---------------
Less: Dividends on preferred
stock 1,999 7,996
Less: Net income
attributable to
non-controlling interest 1,572 7,854
---------------------------- --------------- ---------------
Net loss attributable to
Ready Capital Corporation $ (236,183) $ (236,911)
---------------------------- --------------- ---------------
Earnings per common share
from continuing operations
- basic $ (1.46) $ (1.41)
Earnings per common share
from discontinued
operations - basic $ 0.00 $ (0.03)
---------------------------- --------------- ---------------
Total earnings per common
share - basic $ (1.46) $ (1.44)
---------------------------- --------------- ---------------
Earnings per common share
from continuing operations
- diluted $ (1.46) $ (1.41)
Earnings per common share
from discontinued
operations - diluted $ 0.00 $ (0.03)
---------------------------- --------------- ---------------
Total earnings per common
share - diluted $ (1.46) $ (1.44)
---------------------------- --------------- ---------------
Weighted-average shares
outstanding
Basic 161,734,869 164,544,350
Diluted 164,450,230 167,259,712
---------------------------- --------------- ---------------
Dividends declared per share
of common stock $ 0.01 $ 0.385
---------------------------- --------------- ---------------
READY CAPITAL CORPORATION
UNAUDITED SEGMENT REPORTING
Three Months Ended December 31, 2025
LMM
Commercial Small
Real Business
(in thousands) Estate Lending Corporate-Other Consolidated
----------- ------------------- ----------------
Interest income $ 94,713 $ 29,260 $ -- $ 123,973
Interest
expense (91,745) (19,106) -- (110,851)
-----------------
Net interest
income before
provision for
loan losses $ 2,968 $ 10,154 $ -- $ 13,122
Provision for
loan losses (143,540) (6,449) -- (149,989)
-----------------
Net interest
income (loss)
after provision
for loan losses $ (140,572) $ 3,705 $ -- $ (136,867)
Non-interest
income
Net realized
gain (loss) on
financial
instruments
and real
estate owned (470) (10,129) -- (10,599)
Net unrealized
gain (loss) on
financial
instruments (8,797) (3,913) 7 (12,703)
Valuation
allowance,
loans held for
sale (23,318) -- -- (23,318)
Servicing
income, net 1,868 3,174 -- 5,042
Loss on bargain
purchase -- -- (3,013) (3,013)
Income on
unconsolidated
joint
ventures 1,258 13 -- 1,271
Other income 12,757 2,005 1,287 16,049
-----------------
Total
non-interest
income
(expense) $ (16,702) $ (8,850) $ (1,719) $ (27,271)
----------------- --------- --------- --- --------- ---------
Non-interest
expense
Employee
compensation
and benefits (7,204) (14,554) (2,165) (23,923)
Allocated
employee
compensation
and benefits
from related
party (435) -- (3,915) (4,350)
Professional
fees (6,538) (2,986) (3,449) (12,973)
Management fees
-- related
party -- -- (4,543) (4,543)
Loan servicing
expense (3,557) (1,048) -- (4,605)
Transaction
related
expenses -- -- (807) (807)
Impairment on
real estate (15,027) -- -- (15,027)
Other operating
expenses (20,880) (9,549) (3,392) (33,821)
-----------------
Total
non-interest
expense $ (53,641) $ (28,137) $ (18,271) $ (100,049)
----------------- --------- --------- --- --------- ---------
Loss before
provision for
income taxes $ (210,915) $ (33,282) $ (19,990) $ (264,187)
----------------- --------- --------- --- --------- ---------
Total assets $5,937,031 $1,280,903 $ 551,862 $ 7,769,796
----------------- --------- --------- --- --------- --- ---------
READY CAPITAL CORPORATION
UNAUDITED SEGMENT REPORTING
Year Ended December 31, 2025
---------------------------------------------------------------
LMM
Commercial Small
Real Business
(in thousands) Estate Lending Corporate-Other Consolidated
----------------- ----------- ----------- ------------------- ----------------
Interest income $ 447,810 $ 121,356 $ -- $ 569,166
Interest
expense (434,743) (79,382) -- (514,125)
----------------- --------- --------- --- --------- --- ---------
Net interest
income before
provision for
loan losses $ 13,067 $ 41,974 $ -- $ 55,041
Provision for
loan losses (61,725) (25,313) -- (87,038)
----------------- --------- --------- --- --------- --- ---------
Net interest
income (loss)
after provision
for loan losses $ (48,658) $ 16,661 $ -- $ (31,997)
Non-interest
income
Net realized
gain (loss) on
financial
instruments
and real
estate owned (191,583) 49,471 -- (142,112)
Net unrealized
gain (loss) on
financial
instruments (11,250) (834) (1,069) (13,153)
Valuation
recovery,
loans held for
sale 15,443 -- -- 15,443
Servicing
income, net 6,369 12,334 -- 18,703
Gain on bargain
purchase -- -- 109,549 109,549
Income on
unconsolidated
joint
ventures 4,508 54 -- 4,562
Other income 25,807 23,264 4,645 53,716
----------------- --------- --------- --- --------- --- ---------
Total
non-interest
income
(loss) $ (150,706) $ 84,289 $ 113,125 $ 46,708
----------------- --------- --------- --- --------- --- ---------
Non-interest
expense
Employee
compensation
and benefits (24,577) (58,232) (6,678) (89,487)
Allocated
employee
compensation
and benefits
from related
party (1,483) -- (13,345) (14,828)
Professional
fees (9,075) (12,437) (9,325) (30,837)
Management fees
-- related
party -- -- (20,348) (20,348)
Loan servicing
expense (37,715) (3,543) -- (41,258)
Transaction
related
expenses -- -- (6,050) (6,050)
Impairment on
real estate (23,503) -- -- (23,503)
Other operating
expenses (41,710) (40,071) (9,175) (90,956)
----------------- --------- --------- --- --------- ---------
Total
non-interest
expense $ (138,063) $ (114,283) $ (64,921) $ (317,267)
----------------- --------- --------- --- --------- ---------
Income (loss)
before provision
for income
taxes $ (337,427) $ (13,333) $ 48,204 $ (302,556)
----------------- --------- --------- --- --------- --- ---------
Total assets $5,937,031 $1,280,903 $ 551,862 $ 7,769,796
----------------- --------- --------- --- --------- --- -
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