Annual report pursuant to Section 13 and 15(d)

CONSOLIDATED STATEMENTS OF CASH FLOWS

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CONSOLIDATED STATEMENTS OF CASH FLOWS
$ in Thousands
12 Months Ended
Dec. 31, 2019
USD ($)
Dec. 31, 2018
USD ($)
Dec. 31, 2017
USD ($)
Cash Flows From Operating Activities      
Net income $ 605,933 $ 1,004,531 $ 1,014,652
Adjustments to reconcile net income to net cash provided by (used in) operating activities:      
Change in fair value of investments in excess mortgage servicing rights 10,505 58,656 (4,322)
Change in fair value of investments in excess mortgage servicer rights, equity method investees (6,800) (8,357) (12,617)
Change in fair value of investments in mortgage servicing rights financing receivables 189,023 (31,550) (66,394)
Change in fair value of servicer advance investments (10,288) 89,332 (84,418)
Change in fair value of residential mortgage loans, at fair value, and notes and bonds payable, at fair value 50,244 (68,929) 0
(Gain) / loss on settlement of investments, net (225,687) (95,085) (10,310)
Gain on sale of originated mortgage loans, held-for-sale, net (475,455) (96,145) 0
Bargain Purchase Gain (49,539) 0 0
Earnings from investments in consumer loans, equity method investees 1,438 (10,803) (25,617)
Change in fair value of derivative instruments 56,143 108,234 2,190
Changes in fair value of contingent consideration 10,487 1,581 0
Unrealized (gain) / loss on other ABS (2,101) (10,283) (2,883)
(Gain) / loss on transfer of loans to REO (11,842) (19,519) (22,938)
(Gain) / loss on transfer of loans to other assets 1,144 1,977 (488)
(Gain) / loss on Excess MSR recapture agreements (2,294) (979) (2,384)
(Gain) / loss on Ocwen common stock (174) 10,860 (5,346)
Accretion and other amortization (379,129) (701,967) (1,031,384)
Other-than-temporary impairment 25,174 30,017 10,334
Valuation and loss provision, net on loans and real estate owned (REO) 10,403 60,624 75,758
Non-cash portions of servicing revenue, net 712,950 191,245 67,672
Non-cash directors’ compensation 1,055 1,020 699
Deferred tax provision 52,991 (80,054) 168,518
Changes in:      
Servicer advances receivable, net 218,217 381,400 (30,688)
Other assets (338,300) (193,681) (32,174)
Due to affiliates 2,411 12,510 41,613
Accrued expenses and other liabilities 182,153 186,311 26,081
Other operating cash flows:      
Interest received from excess mortgage servicing rights 34,050 45,947 79,612
Interest received from servicer advance investments 28,437 33,821 168,595
Interest received from Non-Agency RMBS 264,694 219,704 211,599
Interest received from PCD residential mortgage loans, held-for-investment 8,485 8,962 8,021
Interest received from PCD consumer loans, held-for-investment 30,588 36,660 52,372
Distributions of earnings, equity method investees 8,999 11,059 13,668
Purchases of residential mortgage loans, held-for-sale (8,610,511) (5,767,172) (5,135,700)
Origination of residential mortgage loans, held-for-sale (19,411,150) (3,385,868) 0
Proceeds from sales of purchased and originated residential mortgage loans, held-for-sale 24,968,751 6,546,613 3,514,108
Principal repayments from purchased residential mortgage loans, held-for-sale 417,840 194,038 106,213
Net cash provided by (used in) operating activities (1,622,548) (1,229,114) (899,718)
Cash Flows From Investing Activities      
Business Acquisitions, net of cash acquired (1,223,233) (123,185) 0
Purchase of servicer advance investments (1,622,808) (2,306,043) (12,168,519)
Purchase of Non-Agency RMBS (885,629) (2,969,308) (2,570,753)
Purchase of derivatives 0 0 (2,350)
Purchase of real estate owned and other assets (68,024) (33,377) (38,127)
Purchase of investment in consumer loans, equity method investees (64,499) (308,050) (470,344)
Purchase of commercial real estate, equity method investees 0 (75,000) 0
Draws on revolving consumer loans (54,375) (63,971) (56,321)
Payments for settlement of derivatives (300,771) (172,152) (164,025)
Return of investments in excess mortgage servicing rights 48,444 53,055 172,395
Return of investments in equity method investments 92,748 300,056 393,722
Principal repayments from servicer advance investments 1,786,394 2,421,334 13,820,019
Principal repayments from Agency RMBS 2,085,283 111,202 107,666
Principal repayments from Non-Agency RMBS 1,294,010 939,690 815,451
Principal repayments from residential mortgage loans 113,602 147,403 94,807
Proceeds from sale of residential mortgage loans 41,622 25,511 13,313
Principal repayments from consumer loans 261,456 311,222 401,403
Principal repayments from MSRs and MSR financing receivables 51,470 0 0
Proceeds from sale of mortgage servicing rights 24,528 13,248  
Proceeds from sale of excess mortgage servicing rights 10,095 19,064 13,505
Proceeds from sale of Agency RMBS 22,173,505 7,528,490 8,880,766
Proceeds from sale of Non-Agency RMBS 1,950,384 86,443 182,384
Proceeds from settlement of derivatives 108,472 242,422 126,319
Proceeds from sale of real estate owned 138,910 140,301 86,241
Net cash used in investing activities (10,948,515) (5,171,090) (1,777,579)
Cash Flows From Financing Activities      
Repayments of repurchase agreements (230,954,107) (93,214,286) (54,289,124)
Margin deposits under repurchase agreements and derivatives (4,567,677) (1,934,868) (1,056,408)
Repayments of notes and bonds payable (9,307,033) (9,892,659) (8,971,523)
Payment of deferred financing fees (6,705) (12,498) (6,610)
Common stock dividends paid (807,788) (661,859) (570,232)
Preferred shareholders stock dividends paid (9,334) 0 0
Borrowings under repurchase agreements 243,316,628 99,662,678 57,762,563
Return of margin deposits under repurchase agreements and derivatives 4,365,946 1,733,387 1,058,791
Borrowings under notes and bonds payable 9,706,864 9,770,909 8,057,720
Issuance of preferred stock 423,444 0 0
Issuance of common stock 752,217 983,149 835,465
Costs related to issuance of common stock (824) (1,087) (936)
Noncontrolling interest in equity of consolidated subsidiaries - contributions 0 0 0
Noncontrolling interest in equity of consolidated subsidiaries - distributions (54,712) (64,559) (84,196)
Payment of contingent consideration (10,000) 0 0
Purchase of noncontrolling interests in the Buyer 0 925 (65,860)
Net cash provided by financing activities 12,846,919 6,369,232 2,669,650
Net Increase (Decrease) in Cash, Cash Equivalents, and Restricted Cash 275,856 (30,972) (7,647)
Cash, Cash Equivalents, and Restricted Cash, Beginning of Period 415,078 446,050 453,697
Cash, Cash Equivalents, and Restricted Cash, End of Period 690,934 415,078 446,050
Supplemental Disclosure of Cash Flow Information      
Cash paid during the period for interest 902,466 564,722 442,287
Cash paid during the period for income taxes 1,479 5,012 5,021
Supplemental Schedule of Non-Cash Investing and Financing Activities      
Dividends declared but not paid 211,732 184,552 153,681
Transfer from residential mortgage loans to real estate owned and other assets 95,640 109,527 141,968
Transfer from residential mortgage loans, held-for-investment to residential mortgage loans, held-for-sale 9,136 23,080 23,080
Contingent consideration 55,222 40,842  
Ditech effective settlement of Preexisting Relationships 4,919 0 0
Real estate securities retained from loan securitizations 1,171,959 900,491 403,270
Residential mortgage loans subject to repurchase 172,336 121,602 0
Ocwen transaction (Note 6) - excess mortgage servicing rights 0 638,567 71,982
Ocwen transaction (Note 6) - servicer advance investments 0 3,175,891 481,220
Ocwen transaction (Note 6) - mortgage servicing rights financing receivables, at fair value 0 1,017,993 64,450
Mortgage Servicing Rights and Servicer Advances      
Cash Flows From Investing Activities      
Purchase of MSRs, MSR financing receivables and servicer advance receivables (1,450,375) (1,194,467) (1,661,608)
Supplemental Schedule of Non-Cash Investing and Financing Activities      
Purchase price holdback (25,245) (697) 40,854
Agency Residential Mortgage Backed Securities      
Cash Flows From Investing Activities      
Purchase of Agency RMBS (35,479,893) (10,200,299) (9,165,868)
Mortgage-backed Securities, Issued by Private Enterprises      
Cash Flows From Investing Activities      
Purchase of residential mortgage loans 0 (85,778) (609,627)
MSRs      
Cash Flows From Investing Activities      
Proceeds from sale of mortgage servicing rights 1,539 5,776 0
Loans and Finance Receivables      
Cash Flows From Investing Activities      
Proceeds from sale of mortgage servicing rights 22,989 7,472 0
Mortgage-backed Securities, Issued by US Government Sponsored Enterprises      
Supplemental Schedule of Non-Cash Investing and Financing Activities      
Purchase of Agency and Non-Agency RMBS, settled after year end 902,081 2,048,348 1,169,896
Sale of investments, primarily Agency RMBS, settled after year end 5,256,014 3,925,198 1,030,850
Consumer Loans      
Other operating cash flows:      
Distributions of earnings, equity method investees 8,607 6,176 6,240
Excess MSRs Investees      
Cash Flows From Investing Activities      
Return of investments in equity method investments 20,169 21,099 21,972
LoanCo      
Supplemental Schedule of Non-Cash Investing and Financing Activities      
Non-cash distributions from LoanCo 0 25,739 44,587
Shellpoint Acquisition      
Cash Flows From Financing Activities      
Payment of contingent consideration (10,000)    
Supplemental Schedule of Non-Cash Investing and Financing Activities      
Purchase price holdback 0 8,173 0
Contingent consideration 0 39,300 0
Guardian Acquisition      
Supplemental Schedule of Non-Cash Investing and Financing Activities      
Contingent consideration $ 13,893 $ 0 $ 0