Franklin Bsp Realty Trust, Inc. · NYSE:FBRT
Franklin Bsp Realty Trust — Q1 2023 Earnings Presentation
27 slides from Franklin Bsp Realty Trust's earnings presentation, May 4, 2023
Slide 1: Franklin BSP Realty Trust Supplemental Information First Quarter 2023
Franklin BSP Realty Trust Supplemental Information First Quarter 2023
Slide 2: Important Information
Important Information The information herein relates to the Company’s business and financial information as of March 31, 2023 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” in
Slide 3: FBRT 1Q 2023 Financial Update
FBRT 1Q 2023 Financial Update 3
Slide 4: First Quarter 2023 Highlights
FBRT 1Q 2023 Financial Update: First Quarter 2023 Highlights Earnings ― GAAP Net Income of $43.8 million and $0.44 per diluted common share and $0.44 per fully converted share (1) ― Distributable Earnings (2) of $44.8 million and $0.44 per fully converted share (1) ― Declared a cash dividend of $0.3
Slide 5: QTD Highlights
FBRT 1Q 2023 Financial Update: QTD Highlights Income Statement Balance Sheet - Assets (End of Quarter) Net interest income / other income $61.6 Total core portfolio $5,022.8 Operating expenses (1) (18.1) Total real estate securities $246.0 Trading and derivatives gain/(loss) on ARMs/Securities 3.6 C
Slide 6: Earnings and Distributions
FBRT 1Q 2023 Financial Update: Earnings and Distributions Distributable Earnings ($M) (1) GAAP Net Income (Loss) ($M) $44.8 $43.8 $38.8 $35.3 $34.4 $27.2 $30.7 2Q'22 3Q'22 4Q'22 1Q'23 2Q'22 3Q'22 4Q'22 1Q'23 ($25.7) $0.355 $0.355 $0.355 $0.355 Dividend per share Distributable earnings per share, ful
Slide 7: Core Loan Originations
FBRT 1Q 2023 Financial Update: Core Loan Originations 1Q 2023 ($M) (1) (2) Note: All numbers in millions. Numbers in charts above represent principal balance. 1. As of March 31, 2023, future funding remaining on the loans outstanding was $491 million. 7 2. Includes full paydowns, dispositions, parti
Slide 8: Capitalization Overview
FBRT 1Q 2023 Financial Update: Capitalization Overview Financing Sources (1) Net Leverage FBRT average debt cost including financing costs 2.50x was 6.7% in 1Q23 vs. 5.8% last quarter 2.28x Asset Specific Financings Unsecured 2.00x Repo - 3% Debt Securities 2% 6% 1.50x Warehouse 15% $4.1Bn 1.00x Tot
Slide 9: Financing Detail
FBRT 1Q 2023 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 $141 million Ended L + 1.90% Barclays (Warehouse) $500 million BSPRT 2021-FL6 $585 million 9/15/23 L + 1.42% Wells Fargo $500 milli
Slide 10: Liquidity
FBRT 1Q 2023 Financial Update: Liquidity Liquidity ($M) (1) Note: All numbers in millions. 10 1. Represents cash available we can invest at a market advance rate utilizing our available capacity on financing lines.
Slide 11: Portfolio
Portfolio 11
Slide 12: Core Loan Portfolio Composition
Portfolio: Core Loan Portfolio Composition Portfolio Overview Portfolio Summary Collateral Summary − $5.1 billion total portfolio Senior 99.5% Multifamily 76% − 150 senior loans; average size of ~$34 million − 7 mezzanine loans; average size of ~$3 Office million 6% Mezzanine − Two non-performing lo
Slide 13: Core Originations in the Quarter
Portfolio: Core Originations in the Quarter Overview By Collateral − 4 loans; $200 million total commitment ($120 million of initial funding / $80 million of future funding) − 5.80% weighted average spread; 10.60% all-in coupon(1). 1.0% and 1.0% weighted average origination and exit Hospitality fees
Slide 14: Core Portfolio - Case Studies: Watch List Loans (Risk Rating 4&5)
Portfolio: Core Portfolio - Case Studies: Watch List Loans (Risk Rating 4&5) Investment Brooklyn Hotel Single Tenant Retail Portfolio CBD Office Complex Floating Rate Senior Loan Loan Type Floating Rate Senior Loan Floating Rate Senior Loan & Mezzanine Loan Investment Date Q4 2017 Q2 2022 Q1 2020 De
Slide 15: Foreclosure Real Estate Owned (REO)
Portfolio: Foreclosure Real Estate Owned (“REO”) Single Tenant Retail Class A Multifamily Investment Portfolio Property Office Tower Loan Investment Date Q2 2022 Q4 2019 Q3 2018 Foreclosure / Deed-In-Lieu Date Q4 2022 - Q1 2023 Q4 2022 Q4 2022 Collateral Type Retail Multifamily Office 15 Freestandin
Slide 16: Appendix
Appendix 16
Slide 17: Core Portfolio Details – Top Loans
Appendix: Core Portfolio - FBRT Portfolio Details – Top 15 Loans Origination Initial 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 6/1/22 $153 $137 $136 + 3.95% 9.25% 6/9/27 Vari
Slide 18: Core Portfolio - Risk Ratings
Appendix: Core Portfolio - Risk Ratings Average risk rating was 2.1 for the quarter vs. 2.2 last quarter 88.5% 8.4% 0.6% 1.8% 0.8% Risk Rating 1 2 3 4 5 # of Loans 1 133 20 2 1 + vs 4Q22 +1 +6 +8 - - - vs 4Q22 - -14 -3 -2 - +/- vs 4Q22 +1 -8 +5 -2 - Principal $31 $4,491 $425 $90 $38 Balance Non-Accr
Slide 19: Earnings Sensitivity
Appendix: Earnings Sensitivity Positive earnings correlation to rising rates Sensitivity on Index Rates (Annual EPS Impact) As of 4/28/23: 1M LIBOR: 5.06% 1M SOFR: 5.02% $0.32 As of 3/31/23 $0.24 1M LIBOR = 4.86% 1M SOFR = 4.80% $0.16 $0.08 $0.00 ($0.04) -0.25% 3/31/23 +0.50% +1.00% +1.50% +2.00% Ch
Slide 20: Rate Cap Sensitivity
Appendix: Rate Cap Sensitivity 92% of our loans have a rate cap (average of 2.4% rate cap) and 90% were activated as of 3/31/23 Percentage and Number of Loans with Rate Caps Activated All loans with rate caps are activated at +0.50% and above 90%; 142 loans 92%; 145 loans 92%; 145 loans Current +0.5
Slide 21: Core Portfolio – Allowance For Loan Loss
Appendix: Core Portfolio – Allowance For Loan Loss Allowance for Loan Loss by Collateral Type $ millions Other Allowance for Loan Loss Balance at 12/31/22 - Office 1% $26.9 General Reserve 15% Provision for Credit Loss - General Reserve 3.5 Allowance for Loan Loss Balance at 3/31/23 - $30.4 Before A
Slide 22: Segment Reporting Summary
Appendix: Segment Reporting Summary Weighted Average Shares Earnings Daily Average Outstanding, Fully Per Share, Fully Nominal Common Equity Return on Common (3) (3) ($000s) Converted Converted ($000s) Equity GAAP Net Income (Loss) $43,839 88,916,252 $0.44 $1,422,565 11.0% (1) Run-Rate Distributable
Slide 23: GAAP Net Income to Distributable Earnings Reconciliation
Appendix: GAAP Net Income to Distributable Earnings Reconciliation 2Q'22 3Q'22 4Q'22 1Q'23 GAAP Net Income (Loss) (25.7) 35.3 27.2 43.8 Adjustments: CLO Amortization Acceleration/CLO Call (1) 3.2 (1.2) (1.4) (1.5) (2) 19.9 1.1 6.2 0.6 Unrealized (Gain)/Loss Subordinated Performance Fee (3) (3.5) (2.
Slide 24: Book Value Per Share & Shares Outstanding
Appendix: Book Value Per Share & Shares Outstanding March 31, 2023 December 31, 2022 Stockholders' equity applicable to convertible common stock $ 1,400,667 $ 1,398,986 Shares: Common stock 82,572,550 82,479,743 Equity compensation awards (restricted stock and restricted stock units) 791,421 513,041
Slide 25: FBRT Income Statement
Appendix: FBRT Income Statement Three Months Ended March 31, 2023 2022 Income: Interest income $ 130,536 $ 75,258 Less: Interest expense 71,075 22,480 Net interest income 59,461 52,778 Revenue from real estate owned 3,312 2,312 Total income $ 62,773 $ 55,090 Expenses: Asset management and subordinat
Slide 26: FBRT Balance Sheet
Appendix: FBRT Balance Sheet March 31, 2023 December 31, 2022 ASSETS (Unaudited) Cash and cash equivalents $ 230,405 $ 179,314 Restricted cash 6,874 11,173 Commercial mortgage loans, held for investment, net of allowance of $28,751 and $40,848 as of March 31, 2023 and December 31, 2022, respectively
Slide 27: Definitions
Definitions Distributable Earnings and Run-Rate Distributable Earnings Distributable Earnings is a non-GAAP measure, which the Company defines as GAAP net income (loss), adjusted for (i) non-cash CLO amortization acceleration and amortization over the expected useful life of the Company's CLOs, (ii)
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