Quarterly report pursuant to Section 13 or 15(d)

SEGMENT REPORTING

v3.10.0.1
SEGMENT REPORTING
9 Months Ended
Sep. 30, 2018
Segment Reporting [Abstract]  
SEGMENT REPORTING
SEGMENT REPORTING
 
New Residential conducts its business through the following segments: (i) Servicing and Originations, (ii) Residential Securities and Loans, (iii) Consumer Loans and (iv) Corporate. The corporate segment consists primarily of (i) general and administrative expenses, (ii) the management fees and incentive compensation related to the Management Agreement and (iii) corporate cash and related interest income. Securities owned by New Residential (Note 7) that are collateralized by servicer advances and consumer loans are included in the Servicing and Originations and Consumer Loans segments, respectively. Secured corporate loans effectively collateralized by Excess MSRs are included in the Servicing and Originations segment.

During the third quarter of 2018, New Residential changed the composition of its reportable segments primarily to reflect the (i) aggregation of the similar MSR, Excess MSR and Servicer Advance segments as the new Servicing and Originations segment and (ii) incorporation of the Shellpoint Acquisition. Segment information for prior periods has been restated to reflect this change.

Summary financial data on New Residential’s segments is given below, together with a reconciliation to the same data for New Residential as a whole:
 
 
 
Residential Securities and Loans
 
 
 
 
 
 
 
 
Servicing and Originations
 
Real Estate Securities
 
Residential Mortgage Loans
 
Consumer Loans
 
Corporate
 
Total
Three Months Ended September 30, 2018
 
 
 
 
 
 
 
 
 
 
 
 
Interest income
 
$
193,424

 
$
138,197

 
$
42,942

 
$
50,961

 
$

 
$
425,524

Interest expense
 
62,994

 
67,117

 
22,374

 
10,321

 

 
162,806

Net interest income (expense)
 
130,430

 
71,080

 
20,568

 
40,640

 

 
262,718

Impairment
 

 
3,889

 
(4,436
)
 
9,907

 

 
9,360

Servicing revenue, net
 
175,355

 

 

 

 

 
175,355

Gain on sale of originated mortgage loans, net
 
45,732

 

 

 

 

 
45,732

Other income (loss)
 
(92,243
)
 
17,994

 
(12,729
)
 
3,795

 
(115
)
 
(83,298
)
Operating expenses
 
132,542

 
63

 
6,436

 
8,467

 
44,599

 
192,107

Income (Loss) Before Income Taxes
 
126,732

 
85,122

 
5,839

 
26,061

 
(44,714
)
 
199,040

Income tax expense (benefit)
 
495

 

 
3,100

 
(32
)
 

 
3,563

Net Income (Loss)
 
$
126,237

 
$
85,122

 
$
2,739

 
$
26,093

 
$
(44,714
)
 
$
195,477

Noncontrolling interests in income (loss) of consolidated subsidiaries
 
$
1,086

 
$

 
$

 
$
9,783

 
$

 
$
10,869

Net income (loss) attributable to common stockholders
 
$
125,151

 
$
85,122

 
$
2,739

 
$
16,310

 
$
(44,714
)
 
$
184,608


 
 
 
Residential Securities and Loans
 
 
 
 
 
 
 
 
Servicing and Originations
 
Real Estate Securities
 
Residential Mortgage Loans
 
Consumer Loans
 
Corporate
 
Total
Nine Months Ended September 30, 2018
 
 
 
 
 
 
 
 
 
 
 
 
Interest income
 
$
579,824

 
$
354,922

 
$
118,019

 
$
158,631

 
$
1,506

 
$
1,212,902

Interest expense
 
173,759

 
157,195

 
57,299

 
32,856

 

 
421,109

Net interest income (expense)
 
406,065

 
197,727

 
60,720

 
125,775

 
1,506

 
791,793

Impairment
 

 
23,190

 
(8,683
)
 
36,819

 

 
51,326

Servicing revenue, net
 
538,784

 

 

 

 

 
538,784

Gain on sale of originated mortgage loans, net
 
45,732

 

 

 

 

 
45,732

Other income (loss)
 
48,128

 
45,346

 
(27,219
)
 
13,363

 
4,796

 
84,414

Operating expenses
 
235,417

 
1,003

 
25,658

 
26,743

 
130,856

 
419,677

Income (Loss) Before Income Taxes
 
803,292

 
218,880

 
16,526

 
75,576

 
(124,554
)
 
989,720

Income tax expense (benefit)
 
(6,458
)
 

 
289

 
212

 

 
(5,957
)
Net Income (Loss)
 
$
809,750

 
$
218,880

 
$
16,237

 
$
75,364

 
$
(124,554
)
 
$
995,677

Noncontrolling interests in income (loss) of consolidated subsidiaries
 
$
3,525

 
$

 
$

 
$
28,533

 
$

 
$
32,058

Net income (loss) attributable to common stockholders
 
$
806,225

 
$
218,880

 
$
16,237

 
$
46,831

 
$
(124,554
)
 
$
963,619

 
 
 
Residential Securities and Loans
 
 
 
 
 
 
 
 
Servicing and Originations
 
Real Estate Securities
 
Residential Mortgage Loans
 
Consumer Loans
 
Corporate
 
Total
September 30, 2018
 
 
 
 
 
 
 
 
 
 
 
 
Investments
 
$
6,722,697

 
$
11,650,257

 
$
2,775,145

 
$
1,185,556

 
$

 
$
22,333,655

Cash and cash equivalents
 
260,353

 
2,841

 
3,764

 
22,050

 
41,140

 
330,148

Restricted cash
 
119,243

 

 

 
36,506

 

 
155,749

Other assets
 
3,411,968

 
3,631,769

 
48,846

 
42,855

 
86,858

 
7,222,296

Goodwill
 
48,921

 

 

 

 

 
48,921

Total assets
 
$
10,563,182

 
$
15,284,867

 
$
2,827,755

 
$
1,286,967

 
$
127,998

 
$
30,090,769

Debt
 
$
6,824,326

 
$
11,423,562

 
$
2,291,314

 
$
1,102,764

 
$

 
$
21,641,966

Other liabilities
 
476,430

 
1,839,578

 
33,977

 
10,662

 
251,108

 
2,611,755

Total liabilities
 
7,300,756

 
13,263,140

 
2,325,291

 
1,113,426

 
251,108

 
24,253,721

Total equity
 
3,262,426

 
2,021,727

 
502,464

 
173,541

 
(123,110
)
 
5,837,048

Noncontrolling interests in equity of consolidated subsidiaries
 
62,480

 

 

 
31,248

 

 
93,728

Total New Residential stockholders’ equity
 
$
3,199,946

 
$
2,021,727

 
$
502,464

 
$
142,293

 
$
(123,110
)
 
$
5,743,320

Investments in equity method investees
 
$
154,939

 
$

 
$

 
$
44,787

 
$

 
$
199,726

 

 

Residential Securities and Loans







 
Servicing and Originations

Real Estate Securities

Residential Mortgage Loans

Consumer Loans

Corporate

Total
Three Months Ended September 30, 2017
 











Interest income
 
$
188,194


$
114,181


$
31,645


$
63,527


$
175


$
397,722

Interest expense
 
61,418


35,211


15,487


13,162




125,278

Net interest income (expense)
 
126,776


78,970


16,158


50,365


175


272,444

Impairment
 


1,509


14,099


12,601




28,209

Servicing revenue, net
 
58,014

 

 

 

 

 
58,014

Gain on sale of originated mortgage loans, net
 

 

 

 

 

 

Other income (loss)
 
76,745


(6,035
)

2,653


6,796


6,986


87,145

Operating expenses
 
54,998


351


9,759


10,764


41,188


117,060

Income (Loss) Before Income Taxes
 
206,537

 
71,075

 
(5,047
)
 
33,796

 
(34,027
)

272,334

Income tax expense (benefit)
 
42,253

 

 
(9,640
)
 

 


32,613

Net Income (Loss)
 
$
164,284

 
$
71,075

 
$
4,593

 
$
33,796

 
$
(34,027
)

$
239,721

Noncontrolling interests in income (loss) of consolidated subsidiaries
 
$
1,224

 
$

 
$

 
$
12,376

 
$


$
13,600

Net income (loss) attributable to common stockholders
 
$
163,060

 
$
71,075

 
$
4,593

 
$
21,420

 
$
(34,027
)

$
226,121



 
 
 
Residential Securities and Loans
 
 
 
 
 
 
 
Servicing and Originations
 
Real Estate Securities
 
Residential Mortgage Loans
 
Consumer Loans
 
Corporate
 
Total
Nine Months Ended September 30, 2017
 
 
 
 
 
 
 
 
 
 
 
Interest income
$
561,312

 
$
321,464

 
$
75,276

 
$
203,631

 
$
529

 
$
1,162,212

Interest expense
176,678

 
85,663

 
34,655

 
41,668

 

 
338,664

Net interest income (expense)
384,634

 
235,801

 
40,621

 
161,963

 
529

 
823,548

Impairment

 
8,736

 
17,342

 
48,039

 

 
74,117

Servicing revenue, net
269,467

 

 

 

 

 
269,467

Gain on sale of originated mortgage loans, net

 

 

 

 

 

Other income (loss)
126,114

 
(27,005
)
 
22,491

 
12,712

 
6,986

 
141,298

Operating expenses
135,666

 
979

 
24,018

 
33,746

 
130,452

 
324,861

Income (Loss) Before Income Taxes
644,549

 
199,081

 
21,752

 
92,890

 
(122,937
)
 
835,335

Income tax expense (benefit)
128,047

 

 
(7,164
)
 
170

 

 
121,053

Net Income (Loss)
$
516,502

 
$
199,081

 
$
28,916

 
$
92,720

 
$
(122,937
)
 
$
714,282

Noncontrolling interests in income (loss) of consolidated subsidiaries
$
10,372

 
$

 
$

 
$
34,679

 
$

 
$
45,051

Net income (loss) attributable to common stockholders
$
506,130

 
$
199,081

 
$
28,916

 
$
58,041

 
$
(122,937
)
 
$
669,231