Quarterly report pursuant to Section 13 or 15(d)

INVESTMENTS IN EXCESS MORTGAGE SERVICING RIGHTS, EQUITY METHOD INVESTEES (Tables)

v3.5.0.2
INVESTMENTS IN EXCESS MORTGAGE SERVICING RIGHTS, EQUITY METHOD INVESTEES (Tables)
9 Months Ended
Sep. 30, 2016
Equity Method Investments and Joint Ventures [Abstract]  
Summary of the Financial Results of Excess MSR Joint Ventures, Accounted for as Equity Method Investees
The following tables summarize the financial results of the Excess MSR joint ventures, accounted for as equity method investees, held by New Residential:
 
 
September 30, 2016
 
December 31, 2015
Excess MSR assets
 
$
374,962

 
$
421,999

Other assets
 
16,846

 
12,442

Other liabilities
 

 

Equity
 
$
391,808

 
$
434,441

New Residential’s investment
 
$
195,904

 
$
217,221

 
 
 
 
 
New Residential’s ownership
 
50.0
%
 
50.0
%

 
 
Three Months Ended September 30,
 
Nine Months Ended  
 September 30,
 
 
2016
 
2015
 
2016
 
2015
Interest income
 
$
12,205

 
$
12,399

 
$
24,526

 
$
33,316

Other income (loss)
 
339

 
4,492

 
(7,244
)
 
(348
)
Expenses
 
(22
)
 
(38
)
 
(66
)
 
(82
)
Net income
 
$
12,522

 
$
16,853

 
$
17,216

 
$
32,886


New Residential’s investments in equity method investees changed during the nine months ended September 30, 2016 as follows:
Balance at December 31, 2015
$
217,221

Contributions to equity method investees

Distributions of earnings from equity method investees
(18,025
)
Distributions of capital from equity method investees
(11,900
)
Change in fair value of investments in equity method investees
8,608

Balance at September 30, 2016
$
195,904


Summary of Excess MSR Investments made through Equity Method Investees
The following is a summary of New Residential’s Excess MSR investments made through equity method investees:
 
September 30, 2016
 
Unpaid Principal Balance
 
Investee Interest in Excess MSR(A)
 
New Residential Interest in Investees
 
Amortized Cost Basis(B)
 
Carrying Value(C)
 
Weighted Average Life (Years)(D)
Agency
 
 
 
 
 
 
 
 
 
 
 
Original and Recaptured Pools
$
63,834,062

 
66.7
%
 
50.0
%
 
$
249,388

 
$
314,265

 
5.7
Recapture Agreements

 
66.7
%
 
50.0
%
 
33,156

 
60,697

 
11.7
Total
$
63,834,062

 
 
 
 
 
$
282,544

 
$
374,962

 
6.4
 
(A)
The remaining interests are held by Nationstar.
(B)
Represents the amortized cost basis of the equity method investees in which New Residential holds a 50% interest. The amortized cost basis of the recapture agreements is determined based on the relative fair values of the recapture agreements and related Excess MSRs at the time they were acquired.
(C)
Represents the carrying value of the Excess MSRs held in equity method investees, in which New Residential holds a 50% interest. Carrying value represents the fair value of the pools or recapture agreements, as applicable.
(D)
The weighted average life represents the weighted average expected timing of the receipt of cash flows of each investment.

Summary of the Geographic Distribution of the Underlying Residential Mortgage Loans of the Excess MSR Investments made through Equity Method Investees
The table below summarizes the geographic distribution of the underlying residential mortgage loans of the Excess MSR investments made through equity method investees:
 
 
Percentage of Total Outstanding Unpaid Principal Amount as of
State Concentration
 
September 30, 2016
 
December 31, 2015
California
 
12.8
%
 
12.9
%
Florida
 
7.3
%
 
7.4
%
Texas
 
6.1
%
 
6.1
%
New York
 
6.0
%
 
5.8
%
Georgia
 
5.7
%
 
5.7
%
New Jersey
 
4.2
%
 
4.3
%
Illinois
 
4.1
%
 
4.0
%
Maryland
 
3.3
%
 
3.2
%
Virginia
 
3.2
%
 
3.2
%
Pennsylvania
 
3.2
%
 
3.1
%
Other U.S.
 
44.1
%
 
44.3
%
 
 
100.0
%
 
100.0
%