Franklin Bsp Realty Trust, Inc. · NYSE:FBRT
Franklin Bsp Realty Trust — Q1 2022 Earnings Presentation
25 slides from Franklin Bsp Realty Trust's earnings presentation, May 5, 2022
Slide 1: Franklin BSP Realty Trust Supplemental Information First Quarter 2022
Franklin BSP Realty Trust Supplemental Information First Quarter 2022
Slide 2: Important Information
Important Information The information herein relates to the Company’s business and financial information as of March 31, 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” in
Slide 3: FBRT 1Q 2022 Financial Update
FBRT 1Q 2022 Financial Update 3
Slide 4: First Quarter 2022 Highlights
FBRT 1Q 2022 Financial Update: First Quarter 2022 Highlights Earnings ― GAAP Net Income (Loss) of ($22.5) million or ($0.30) per fully converted share (1) ― Distributable Earnings before trading and derivatives gain/loss on ARMs (2) (“Run-Rate Distributable Earnings”) of $40.1M or $0.39 per fully co
Slide 5: QTD Highlights
FBRT 1Q 2022 Financial Update: QTD Highlights Income Statement Balance Sheet Net interest income / other income $54.6 Core loan total commitment in the quarter $602.8 (1) Operating expenses (20.0) Total core portfolio - end of quarter $4,530.5 Trading and derivatives gain/loss on ARMs (58.0) Other i
Slide 6: Earnings and Distributions
FBRT 1Q 2022 Financial Update: Earnings and Distributions Distributable Earnings ($M) (1) GAAP Net Income (Loss) ($M) Run-Rate Distributable Earnings (1) $48.2 $38.5 $40.1 $32.8 $30.1 $30.0 $40.0 $34.6 $32.7 $31.3 $26.6 4Q'20 1Q'21 2Q'21 3Q'21 4Q'21 1Q'22 ($22.5) $12.1 ($72.9) 4Q'20 1Q'21 2Q'21 3Q'2
Slide 7: Earnings Sensitivity
FBRT 1Q 2022 Financial Update: Earnings Sensitivity − Positive earnings correlation to rising rates Sensitivity on Index Rates Base (as of 3/31/22): (Annual EPS Impact) 1M LIBOR = 0.46% 1M SOFR = 0.30% $0.22 $0.17 As of 5/3/22: $0.12 1M LIBOR: 0.80% 1M SOFR: 0.81% $0.08 $0.04 $0.01 $0.00 $0.00 -0.25
Slide 8: Core Loan Originations
FBRT 1Q 2022 Financial Update: Core Loan Originations 1Q 2022 Total Commitment Total $5,070 Commitment $603 $4,815 (1) Note: All numbers in millions. Numbers in charts above represent principal balance. 8 1. Includes full paydowns, dispositions, partial paydowns and amortization.
Slide 9: Capitalization Overview
FBRT 1Q 2022 Financial Update: Capitalization Overview Net Leverage Financing Lines Commitment (1) 3.50x Warehouse/Revolver/Other 2.95x 3.00x JP Morgan $400 million 2.50x Wells Fargo $450 million 2.00x Credit Suisse $300 million 1.50x 1.30x Barclays (Warehouse) $500 million 1.00x 0.50x Barclays (Sec
Slide 10: Portfolio
Portfolio 10
Slide 11: Portfolio: ARMs Securities
Portfolio: ARMs Securities ARMs Portfolio Balances ($M) and Marks $8 , 00 Balance Marks 130 .0 $7,134 $7 , 00 $6,841 $6,295 125 .0 $6 , 00 120 .0 $4,779 $4,567 $5 , 00 $4 , 00 $3,771 115 .0 $3 , 00 $2,431 110 .0 $1,949 $2 , 00 105 .0 $1 , 00 $649 $104.1 $103.5 $103.6 $103.2 $103.0 $102.4 $102.2 $0 $
Slide 12: 2Q 2022 ARMs Update
Portfolio: 2Q 2022 ARMs Update Update on ARMs portfolio: ‒ From April 1, 2022 to May 3, 2022, the value of the ARMs portfolio was reduced by $1.3 billion ‒ As of May 3, 2022, value of the ARMs portfolio was $649 million compared to $7.1 billion at September 30, 2021, which represents a 91% reduction
Slide 13: Core Loan Portfolio Composition
Portfolio: Core Loan Portfolio Composition Portfolio Overview Portfolio Summary Collateral Summary − Total portfolio of $4.6 Senior Multifamily 99% 72% billion, 166 loans with average size of ~$27 million − 160 senior loans with Office average size of ~$28 10% Other million Mezzanine 1% 1% Self-Stor
Slide 14: Core Originations in the Quarter
Portfolio: Core Originations in the Quarter Overview By Collateral Other − Originated 16 loans for a 7% Industrial total commitment of $603 million ($578 10% million of initial funding and $26 million of future funding) − Weighted average spread of 3.77% with Hospitality 16% an all-in coupon of 3.84
Slide 15: Appendix
Appendix 15
Slide 16: Core Portfolio - FBRT Portfolio Details – Top Loans
Appendix: Core Portfolio - FBRT Portfolio Details – Top 15 Loans Origination Total Principal Fully Extended Loan Type Date Commitment Balance Carrying Value Spread All-in Yield (1) Maturity State Collateral Type As-is LTV Loan 1 Senior Loan 10/8/21 $89 $89 $88 + 2.75% + 3.07% 10/9/26 District of Col
Slide 17: Core Portfolio - Risk Ratings
Appendix: Core Portfolio - Risk Ratings Our average risk rating was 2.1 for the quarter vs. 2.1 last quarter 93.6% 5.1% 0.0% 1.3% 0.0% 1 2 3 4 5 # of Loans 0 150 15 1 0 +/- vs 4Q’21 - +2 -1 - - Principal $- $4,272 $233 $57 $- Balance Non-Accrual - - - 1 - 17 Note: Principal balance in millions.
Slide 18: Core Portfolio - Index Floors
Appendix: Core Portfolio - Index Floors − As of 3/31/2022, 41 floating rate loans out of 163(1) floating rate loans in our portfolio have index floors activated (all floating rate loans have either 1-month LIBOR or 1-month SOFR as reference index) − The weighted average index floor of our portfolio
Slide 19: Core Portfolio - Case Study: Watch List Loans (Risk Rating 4&5)
Appendix: Core Portfolio - Case Study: Watch List Loans (Risk Rating 4&5) Investment Brooklyn Hotel Loan Type Floating Rate Senior Loan Investment Date 12/1/2017 Default Date 6/9/2019 Collateral 147-Key Hotel Loan Purpose Refinance Location Brooklyn, New York Total Commitment $57 million Current Pri
Slide 20: Core Portfolio – Allowance For Loan Loss
Appendix: Core Portfolio – Allowance For Loan Loss Allowance for Loan Loss by Collateral Type $ millions Retail Other Office 4% 2% Allowance for Loan Loss Balance at 12/31/21 $16.1 5% Hospitality 25% Reversal of Provision for Credit Loss (1.0) Allowance for Loan Loss Balance at 3/31/22 $15.1 Portfol
Slide 21: 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) ($22,507) 89,850,478 ($0.30) $1,519,569 (7.2%) (1) $40,145 89,850,47
Slide 22: GAAP Net Income to Distributable Earnings Reconciliation
Appendix: GAAP Net Income to Distributable Earnings Reconciliation 2Q'21 3Q'21 4Q'21 1Q'22 GAAP Net Income (Loss) 30.0 38.5 (72.9) (22.5) Adjustments: Impairment of Acquired Assets (1) - - 88.3 - CLO Amortization Acceleration/CLO Call (2) (0.8) (0.9) 2.7 (1.0) Unrealized (Gain)/Loss Reversal (3) 2.5
Slide 23: Book Value Per Share & Shares Outstanding
Appendix: Book Value Per Share & Shares Outstanding March 31, 2022 December 31, 2021 Stockholders' equity applicable to convertible common stock $ 1,484,962 $ 1,543,550 Shares Common stock 43,957,363 43,951,382 Restricted stock 513,764 14,546 Series C convertible preferred stock 418,880 418,880 Seri
Slide 24: FBRT Income Statement
Appendix: FBRT Income Statement Three Months Ended March 31, 2022 2021 Income: Interest income $ 75,258 $ 42,237 Less: Interest expense 22,480 11,369 Net interest income 52,778 30,868 Revenue from real estate owned 2,312 716 Total income $ 55,090 $ 31,584 Expenses: Asset management and subordinated
Slide 25: FBRT Balance Sheet
Appendix: FBRT Balance Sheet March 31, 2022 December 31, 2021 ASSETS (Unaudited) Cash and cash equivalents $ 117,064 $ 154,929 Restricted cash 12,467 13,270 Commercial mortgage loans, held for investment, net of allowance of $14,933 and $15,827 as of March 31, 2022 and December 31, 4,530,451 4,211,0
Franklin BSP Realty Trust — Q1 2022 Earnings Presentation on 6ix