Franklin Bsp Realty Trust, Inc. · NYSE:FBRT
Franklin Bsp Realty Trust — Q3 2022 Earnings Presentation
26 slides from Franklin Bsp Realty Trust's earnings presentation, Nov 10, 2022
Slide 1: Franklin BSP Realty Trust Supplemental Information Third Quarter 2022
Franklin BSP Realty Trust Supplemental Information Third Quarter 2022
Slide 2: Important Information
Important Information The information herein relates to the Company’s business and financial information as of September 30, 2022 and does not reflect subsequent developments. Risk Factors Investing in and owning our common stock involves a high degree of risk. See the section entitled “Risk Factors
Slide 3: FBRT 3Q 2022 Financial Update
FBRT 3Q 2022 Financial Update 3
Slide 4: Third Quarter 2022 Highlights
FBRT 3Q 2022 Financial Update: Third Quarter 2022 Highlights Earnings ― GAAP Net Income of $35.3 million or $0.34 per fully converted share (1) ― Distributable Earnings (2) of $34.4 million or $0.33 per fully converted share (1) ― Declared a cash dividend of $0.355 per share, representing a yield of
Slide 5: QTD Highlights
FBRT 3Q 2022 Financial Update: QTD Highlights Income Statement Balance Sheet - Assets (End of Quarter) Net interest income / other income $49.7 Total core portfolio $5,281.5 (1) Operating expenses (14.8) Total real estate securities $327.1 Trading and derivatives gain/(loss) on ARMs (2.3) Cash and r
Slide 6: Earnings and Distributions
FBRT 3Q 2022 Financial Update: Earnings and Distributions Distributable Earnings ($M) (1) GAAP Net Income (Loss) ($M) Run-Rate Distributable Earnings (1) $48.2 $38.5 $35.3 $30.0 $40.0 $40.1 $34.6 $34.4 $32.7 $30.7 $34.3 2Q'21 3Q'21 4Q'21 1Q'22 2Q'22 3Q'22 $24.8 ($22.5) ($25.7) $12.1 ($72.9) 2Q'21 3Q
Slide 7: Core Loan Originations
FBRT 3Q 2022 Financial Update: Core Loan Originations 3Q 2022 ($M) YTD 2022 ($M) Total Total Commitment $2,093 Commitment Total Commitment $6,036 $6,036 $5,907 $470 Total Commitment $4,815 +$129M +$1.2Bn Total Total Commitment Commitment (1) (1) Note: All numbers in millions. Numbers in charts above
Slide 8: Loan Vintage and Maturities
FBRT 3Q 2022 Financial Update: Loan Vintage and Maturities 68% of portfolio has been originated in the last fifteen months (1) Origination Vintage ($M) (1) $2,67 4 $1 ,67 0 $434 $255 $22 $1 29 2017 2018 2019 2020 2021 2022 Current Maturities ($M) (1) $2,501 $1 ,847 $350 $253 $1 55 $7 8 4Q22 2023 202
Slide 9: Capitalization Overview
FBRT 3Q 2022 Financial Update: Capitalization Overview Financing Sources (1) Net Leverage FBRT average debt cost including deferred financing 3.00x costs was 4.2% in 3Q22 vs. 2.9% last quarter Asset Specific Unsecured Financings 2.46x Repo - Debt 2.50x 2% 2% Securities 8% 2.00x Warehouse 16% 1.50x $
Slide 10: Financing Detail
FBRT 3Q 2022 Financial Update: Financing Detail CLOs Warehouse/Revolver/Other Reinvest CLO Name Debt Amount (1) End Date Cost of Debt Name Commitment (3) BSPRT 2019-FL5 $263 million Ended L + 1.70% Barclays (Warehouse) $500 million BSPRT 2021-FL6 $585 million 9/15/23 L + 1.42% Wells Fargo $500 milli
Slide 11: Liquidity
FBRT 3Q 2022 Financial Update: Liquidity Liquidity ($M) (1) Note: All numbers in millions. 11 1. Represents cash available we can invest at a market advance rate utilizing our available capacity on financing lines.
Slide 12: Portfolio
Portfolio 12
Slide 13: Core Loan Portfolio Composition
Portfolio: Core Loan Portfolio Composition Portfolio Overview Portfolio Summary Collateral Summary − $5.4 billion total portfolio Senior Multifamily 99.7% 75% − 162 senior loans; average size of ~$33 million − 4 mezzanine loans; average size of ~$4 Office million Other 8% Mezzanine 1% 0.3% Self-Stor
Slide 14: Core Originations in the Quarter
Portfolio: Core Originations in the Quarter Overview By Collateral Manufactured Housing − 8 loans; $470 million total Industrial 3% commitment ($360 million of initial 6% funding / $109 million of future Hospitality 14% funding) − 6.51% weighted average spread; 7.76% all-in coupon. 1.0% and 0.6% wei
Slide 15: Core Portfolio - Case Studies: Watch List Loans (Risk Rating 4&5)
Portfolio: Core Portfolio - Case Studies: Watch List Loans (Risk Rating 4&5) Single Tenant Retail High-Rise Apartment Investment Brooklyn Hotel Office Tower Portfolio Complex Loan Type Floating Rate Senior Loan Floating Rate Senior Loan Floating Rate Senior Loan Floating Rate Senior Loan Investment
Slide 16: Appendix
Appendix 16
Slide 17: Core Portfolio - FBRT Portfolio Details – Top Loans
Appendix: Core Portfolio - FBRT Portfolio Details – Top 15 Loans Origination Total Principal Fully Extended (1) (2) Loan Type Date Commitment Balance Carrying Value Spread All-in Yield Maturity State Collateral Type As-is LTV Loan 1 Senior Loan 9/19/22 $235 $235 $234 + 6.52% 11.83% 4/9/24 Florida Mu
Slide 18: Core Portfolio - Risk Ratings
Appendix: Core Portfolio - Risk Ratings Average risk rating was 2.1 for the quarter vs. 2.1 last quarter 91.4% 4.6% 2.0% 2.0% 0.0% 1 2 3 4 5 # of Loans 0 148 14 3 1 +/- vs 2Q’22 - -8 -2 +2 - Principal $- $4,890 $244 $107 $109 Balance Non-Accrual - - - 1 1 18 Note: Principal balance in millions.
Slide 19: Earnings Sensitivity
Appendix: Earnings Sensitivity Positive earnings correlation to rising rates Sensitivity on Index Rates (Annual EPS Impact) As of 11/4/22: 1M LIBOR: 3.86% $0.28 1M SOFR: 3.81% $0.21 As of 9/30/22 1M LIBOR = 3.14% $0.14 1M SOFR = 3.04% $0.07 $0.00 ($0.04) -0.25% 9/30/22 +0.50% +1.00% +1.50% +2.00% Ch
Slide 20: Rate Cap Sensitivity
Appendix: Rate Cap Sensitivity 93% of our loans have a rate cap (average of 2.1% rate cap) of which 84% were activated as of 9/30/22 Percentage and Number of Loans with Rate Caps Activated All loans with rate caps are activated at +1.00% and beyond 92%; 152 loans 93%; 155 loans 84%; 139 loans Curren
Slide 21: Core Portfolio – Allowance For Loan Loss
Appendix: Core Portfolio – Allowance For Loan Loss Allowance for Loan Loss by Collateral Type – Before Asset-Specific Reserve Office Retail Other $ millions 2% 2% 1% Allowance for Loan Loss Balance at 6/30/22 - $19.2 Hospitality General Reserve 21% Provision for Credit Loss - General Reserve 0.2 All
Slide 22: Segment Reporting Summary
Appendix: Segment Reporting Summary Weighted Average Shares Earnings Daily Average Nominal Outstanding, Fully Per Share, Fully Common Equity Return on (3) (3) ($000s) Converted Converted ($000s) Common Equity GAAP Net Income (Loss) $35,258 89,971,458 $0.34 $1,422,040 8.6% (1) $34,267 89,971,458 $0.3
Slide 23: GAAP Net Income to Distributable Earnings Reconciliation
Appendix: GAAP Net Income to Distributable Earnings Reconciliation 4Q'21 1Q'22 2Q'22 3Q'22 GAAP Net Income (Loss) (72.9) (22.5) (25.7) 35.3 Adjustments: Impairment of Acquired Assets (1) 88.3 - - - CLO Amortization Acceleration/CLO Call (2) 2.7 (1.0) 3.2 (1.2) Unrealized (Gain)/Loss Reversal (3) 13.
Slide 24: Book Value Per Share & Shares Outstanding
Appendix: Book Value Per Share & Shares Outstanding September 30, 2022 December 31, 2021 Stockholders' equity applicable to convertible common stock $ 1,412,024 $ 1,543,550 Shares: Common stock 82,845,521 43,951,382 Equity compensation awards (restricted stock and restricted stock units) 516,830 14,
Slide 25: FBRT Income Statement
Appendix: FBRT Income Statement Nine Months Ended Three Months Ended September 30, September 30, 2022 2021 2022 2021 Income: Interest income $ 94,131 $ 47,747 $ 239,602 $ 138,969 Less: Interest expense 46,157 11,988 101,444 35,994 Net interest income 47,974 35,759 138,158 102,975 Revenue from real e
Slide 26: FBRT Balance Sheet
Appendix: FBRT Balance Sheet September 30, 2022 December 31, 2021 ASSETS (Unaudited) Cash and cash equivalents $ 216,985 $ 154,929 Restricted cash 45,013 13,270 Commercial mortgage loans, held for investment, net of allowance of $46,815 and $15,827 as of September 30, 2022 and December 31, 2021, res
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