EXHIBIT 99.1

 

 

 

·	Net loss for the quarter was $1.9 million, and $0.27 per common share;

 

·	Net loss for the quarter includes non-recurring accruals of $1.1 million for contingencies on prior asset sales and related items, and $0.5 million in general and administrative expenses;

 

·	Net income for the nine months ended September 30, 2005 was $8.6 million, or $0.38 per common share;

 

·	Net income for the nine months includes gains of $9.8 million from the sale of selected investments; and

 

·	Common equity book value was $93.9 million, or $7.67 per common share at September 30, 2005, and capital available for investment was $63.9 million.

 

 

The Company’s Board of Directors also authorized a stock repurchase plan under which the Company may repurchase up to one million shares of its common stock. Subject to applicable securities laws, such repurchases will be made at times and in amounts as the Company deems appropriate and may be suspended or discontinued at any time. The Company expects that the funding for the plan will come from available corporate funds. Under the terms of the designation for the Series D Preferred Stock, the Company must have paid or set aside sufficient funds for dividends on the preferred shares for the current dividend period prior to the repurchase of common stock at any time. The preferred stock designation also restricts the Company from redeeming any common shares without the approval of preferred shareholders until its total shareholders’ equity is at least 300% of the aggregate issue price of any outstanding preferred stock. Based on that restriction, the Company may not repurchase its common shares at the present time. However, after the completion of the preferred stock redemption discussed above, the Company expects to meet the shareholders’ equity requirement and will be permitted to repurchase its common shares without the approval of the preferred shareholders.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

At September 30, 2005, the Company’s investment portfolio consisted of $214 million in single-family mortgage loans and securities, the majority of which are floating rate and financed with floating rate liabilities, and $589 million in fixed-rate commercial mortgage loans. Capital available for investment was $64 million at the end of the third quarter, consisting of $45 million in short-term liquid securities, and cash and cash equivalents of $19 million. An additional $16 million of available capital is financing previously redeemed investment securitization financing bonds on an interim basis until the Company reissues these bonds, which the Company expects will occur in the first quarter of 2006. At the end of December 2004, capital available for investment was $52 million. The improvement in 2005 relates primarily to proceeds received from sales of investments and net cash receipts on the investment portfolio.

 

 

 

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		September 30,			December 31,
		2005			2004
ASSETS
Cash and cash equivalents		$	19,214		$	52,522
Other assets			4,807			4,964
			24,021			57,486
Investments:
Securitized finance receivables:
Loans, net			759,386			1,036,123
Debt securities			2,194			206,434
			761,580			1,242,557
Securities			78,890			87,706
Other investments			4,493			7,596
Other loans			3,341			5,589
			848,304			1,343,448
		$	872,325		$	1,400,934
LIABILITIES AND SHAREHOLDERS' EQUITY
LIABILITIES:
Securitization financing:
Non-recourse debt		$	537,385		$	1,177,280
Recourse debt			149,823			-
			687,208			1,177,280
Repurchase agreements			27,830			70,468
Other liabilities			7,753			4,420
			722,791			1,252,168
SHAREHOLDERS' EQUITY:
Preferred stock			55,666			55,666
Common stock			122			122
Additional paid-in capital			366,903			366,896
Accumulated other comprehensive (loss) income			(42	)		3,817
Accumulated deficit			(273,115	)		(277,735	)
			149,534			148,766
		$	872,325		$	1,400,934
Book value per common share		$	7.67		$	7.60