Third Quarter Highlights:
- Net income of $12.1 million, up 21.1% from $10.0 million for
3Q22. Diluted EPS of $0.35, up $0.06 from $0.29 per share for
3Q22
- Core net income(1) of $12.9 million, up 29.4% from $10.0
million for 3Q22. Core diluted EPS(1) of $0.37, up $0.08 from $0.29
per share for 3Q22
- Loan production of $290.6 million in UPB, a 12.3% increase from
2Q23 and a decrease of 36.5% from 3Q22
- October loan production of $130.8 million with an 11.2%
weighted average coupon (WAC), our strongest monthly volume level
in 12 months
- Total loan portfolio of $3.9 billion in UPB, an increase of
12.9% from September 30, 2022
- Nonperforming loans as a percentage of Held for Investment
(HFI) loans was 10.1%, essentially flat Q/Q and an increase from
7.4% as of September 30, 2022
- Resolutions of nonperforming loans (NPL) and real estate owned
(REO) totaled $65.7 million in UPB,
- Realizing gains of $1.2 million or 101.8% of UPB resolved
- Portfolio net interest margin (NIM) of 3.34%, up 10 bps Q/Q and
down 25 bps from 3.59% for 3Q22
- Initiated hedging strategies for new production to offset
recent Treasury yield moves
- Completed two securitizations - VCC 2023-3 totaling $234.7
million and the VCC 2023-RTL1 totaling $81.6 million of securities
issued
- Liquidity(2) of $60.3 million as of September 30, 2023
- Book value per common share of $13.00 as of September 30, 2023,
an increase from $11.61 as of September 30, 2022
Velocity Financial, Inc. (NYSE: VEL) (Velocity or the Company),
a leader in business purpose loans, reported net income of $12.1
million and core net income of $12.9 million for 3Q23, compared to
net income and core net income of $10.0 million for 3Q22. Earnings
and core earnings per diluted share were $0.35 and $0.37,
respectively, for 3Q23, compared to $0.29 and $0.29 for 3Q22.
“Velocity’s differentiated business model and portfolio
management strategies delivered another strong quarter for
shareholders,” said Chris Farrar, President and CEO. “Our third
quarter results continued to build upon our momentum from the first
half of 2023, with sequential quarter production volume increases
and higher portfolio interest income resulting from continued
portfolio growth. We also successfully increased the coupon on
production volumes again this quarter while capitalizing on the
continued tightening of credit from regulated lenders. The result
was higher net interest margin growth from 2Q23 and growth in
non-interest-related origination income that delivered solid net
income and return on equity this quarter. We also remain focused on
opportunities to expand Velocity’s franchise by growing market
share in our core lending business in addition to exploring
opportunities to expand into other established loan products where
we can leverage our lending expertise and existing infrastructure
as a competitive advantage.”
(1)
Core income and Core EPS are non-GAAP measures that exclude
nonrecurring and unusual activities from GAAP net income.
(2)
Liquidity includes unrestricted cash reserves of $29.4 million and
available liquidity in unfinanced loans of $30.9 million.
Third
Quarter Operating Results
KEY PERFORMANCE INDICATORS ($ in thousands)
3Q 2023
3Q 2022
$ Variance
% Variance
Pretax income
$ 17,239
$ 14,049
$ 3,190
23%
Net income
$ 12,086
$ 9,983
$ 2,103
21%
Diluted earnings per share
$ 0.35
$ 0.29
$ 0.06
19%
Core net income(a)
$ 12,918
$ 9,983
$ 2,935
29%
Core diluted earnings per share(a)
$ 0.37
$ 0.29
$ 0.08
27%
Pretax return on equity
16.82%
15.26%
n.a.
10%
Core pretax return on equity(a)
17.89%
15.26%
n.a.
17%
Net interest margin - portfolio
3.34%
3.59%
n.a.
(7)%
Net interest margin - total company
2.90%
3.09%
n.a.
(6)%
Average common equity
$ 409,954
$ 368,270
$ 41,685
11%
(a)
Core income, core diluted earnings per
share and core pretax return on equity are non-GAAP measures.
Please see the reconciliation to GAAP net income at the end of this
release.
n.a.- not applicable
Discussion of results:
- Net income in 3Q23 was $12.1 million, compared to $10.0 million
for 3Q22
- Driven by higher net interest income resulting from continued
strong portfolio growth and fair value gains on securitizations,
partially offset by unrealized losses on FVO loans and
securitization issuance costs from closing two securitizations in
the quarter
- Core net income(1) was $12.9 million, compared to $10.0 million
for 3Q22
- Core adjustments included equity incentive compensation
expenses and costs related to the Company’s employee stock purchase
plan (ESPP)
- Portfolio NIM in 3Q23 was 3.34%, compared to 3.59% for 3Q22, a
6.9% Y/Y decrease resulting from increased funding costs that have
been mainly offset by rising portfolio yields from higher loan
coupons on recent loan production
- The GAAP pretax return on equity was 16.8% for 3Q23, compared
to 15.3% for 3Q22
TOTAL LOAN PORTFOLIO ($ of UPB in millions)
3Q 2023
3Q 2022
$ Variance
% Variance
Held for Investment Investor
1-4 Rental
$ 2,120
$ 1,777
$ 343
19%
Mixed Use
457
432
25
6%
Multi-Family
305
297
8
3%
Retail
328
304
24
8%
Warehouse
247
228
19
8%
All Other
401
379
22
6%
Total
$ 3,858
$ 3,416
$ 441
13%
Held for Sale Multi-Family
$ 7
$ 17
$ (10)
(60)%
Warehouse
11
-
11
n.m. All Other
1
-
1
n.m.
Total Managed Loan Portfolio UPB
$ 3,877
$ 3,433
$ 444
13%
Key loan portfolio metrics: Total loan count
9,953
8,476
Weighted average loan to value
68.0%
68.7%
Weighted average coupon
8.63%
7.71%
Weighted average total portfolio yield
8.38%
7.88%
Weighted average portfolio debt cost
5.63%
4.81%
n.m. - non meaningful
Discussion of results:
- Velocity’s total loan portfolio was $3.9 billion in UPB as of
September 30, 2023, an increase of 12.9% from $3.4 billion in UPB
as of September 30, 2022
- Primarily driven by 19.3% Y/Y growth in loans collateralized by
Investor 1-4 Rental properties and a combined 8.7% Y/Y growth in
Multifamily and Mixed Use properties
- Approximately 75% of the loans in Velocity’s HFI portfolio are
collateralized by properties that have a housing component
(Investor 1-4 Rental, Multifamily, and Mixed Use)
- Loan prepayments totaled $104.5 million, a decrease of 1.0% Q/Q
and 6.0% Y/Y
- The UPB of Fair Value (FVO) loans was $936.6 million, or 24.3%
of total HFI loans, as of September 30, 2023, an increase from $0.9
million in UPB, or 0.03% as of September 30, 2022
- The company elected fair value accounting treatment for new
loan originations effective October 1, 2022
- The weighted average portfolio loan-to-value ratio was 68.0% as
of September 30, 2023, a modest decrease from 68.7% as of September
30, 2022, and consistent with the five-quarter trailing average of
68.2%
- The weighted average total portfolio yield was 8.38% for 3Q23,
an increase of 50 bps from 3Q22, driven by an average 92 bps
increase in loan coupons from 3Q22
- Portfolio-related debt cost for 3Q23 was 5.63%, an increase of
82 bps from 3Q22, driven by higher interest rates on securitization
and warehouse financing
LOAN PRODUCTION VOLUMES ($ in millions)
3Q 2023
3Q 2022
$ Variance
% Variance
Investor 1-4 Rental
$ 154
$ 278
$ (124)
(44)%
Traditional Commercial
98
133
(36)
(27)%
Short-term loans
39
46
(7)
(16)%
Total loan production
$ 291
$ 457
$ (167)
(36)%
Acquisitions
$ -
$ 10
Discussion of results:
- Loan production in 3Q23 totaled $290.6 million in UPB, a 36.5%
decrease from $457.3 million in UPB in 3Q22
- Driven by higher interest rates and strong real estate price
appreciation. On a Q/Q basis, production volume rose 12.3% from
2Q23.
- The weighted average coupon (WAC) on 3Q23 HFI loan production
was 11.1%, an increase of 189 bps from 3Q22
HFI PORTFOLIO CREDIT PERFORMANCE INDICATORS ($ in thousands)
3Q 2023
3Q 2022
$ Variance % Variance Nonperforming loans(a)
$ 387,725
$ 253,341
$ 134,384
53%
Average Nonperforming Loans
$ 351,848
$ 249,297
$ 102,551
41%
Nonperforming loans % total HFI Loans
10%
7%
n.a.
36%
Total Charge Offs
$ 95.2
$ 155.2
$ (60)
(39)%
Charge-offs as a % of Avg. Nonperforming Loans(b)
0.11%
0.25%
n.a.
(57)%
Loan Loss Reserve
$ 4,684.8
$ 5,330
$ (645)
(12)%
(a)
Nonperforming/Nonaccrual loans include
loans 90+ days past due, loans in foreclosure, bankruptcy and on
nonaccrual.
(b)
Reflects the annualized quarter-to-date
charge-offs to average nonperforming loans for the period.
n.a.- not applicable
Discussion of results:
- Nonperforming loans (NPL) totaled $387.7 million in UPB as of
September 30, 2023, or 10.1% of loans HFI, compared to $253.3
million and 7.4%, respectively, as of September 30, 2022
- NPL growth in 3Q23 was driven by the legacy amortized cost
portfolio and the Company’s collection philosophy that places loans
in foreclosure quickly for early delinquencies
- Charge-offs in 2Q23 totaled $95.2 thousand, compared to $155.2
thousand in 3Q22
- The trailing five-quarter charge-off average was $290.3
thousand
- The loan loss reserve totaled $4.7 million as of September 30,
2023, a 12.1% decrease from $5.3 million as of September 30, 2022
- Resulting from the continued run-off of the amortized cost HFI
loan portfolio
- Loans carried at fair value are not subject to a CECL
reserve
NET REVENUES ($ in thousands)
3Q 2023
3Q 2022
$ Variance
% Variance
Interest income
$ 79,088
$ 63,419
$ 15,669
25%
Interest expense - portfolio related
(47,583)
(34,561)
(13,022)
38%
Net Interest Income - portfolio related
31,505
28,858
2,647
9%
Interest expense - corporate debt
(4,138)
(4,011)
(127)
3%
Net Interest Income
$ 27,367
$ 24,847
$ 2,520
10%
Loan loss provision
(154)
(580)
427
(74)%
Gain on disposition of loans
3,606
399
3,207
803%
Unrealized (loss) gain on fair value loans
(1,284)
453
(1,737)
(383)%
Unrealized gain (loss) on fair value of securitized debt
9,692
-
9,692
n.m. Origination income
3,323
518
2,805
541%
Bank interest income
1,342
-
1,342
n.m. Other operating income (expense)
681
1,656
(976)
(59)%
Total Other operating income (expense)
$ 17,360
$ 3,027
$ 14,333
473%
Net Revenue
$ 44,573
$ 27,294
$ 17,279
63%
n.m. - non meaningful
Discussion of results:
- Net Revenue in 3Q23 was $44.6 million, an increase of 63.3%
compared to $27.3 million for 3Q22
- Total net interest income, including corporate debt interest
expense, was $27.4 million for 3Q23, a 10.1% increase from $24.8
million for 3Q22
- Portfolio net Interest income was $31.5 million for 3Q23, an
increase of 9.2% from 3Q22 resulting from a $15.7 million increase
in interest income, partially offset by $13.0 million of interest
expense growth
- Total other operating income includes gains on the disposition
of loans, unrealized gains/(losses) on fair value loans and
securitized debt, origination fee income, bank interest income on
deposits, and other operating income, and totaled $17.4 million for
3Q23 compared to $3.0 million for 3Q22
- Gain on disposition of loans totaled $3.6 million for 3Q23,
resulting from loans transferred to REO
- Unrealized losses on the fair value of loans totaled $(1.3)
million for 3Q23, primarily driven by the impact of higher
long-term interest rates on the existing FVO portfolio, partially
offset by gains on 3Q23 new production
- Unrealized gains on the fair value of securitized debt totaled
$9.7 million for 3Q23, driven by an increase in long-term rates as
of September 30, 2023
- Origination income totaled $3.3 million, resulting from fee
income realized on loans originated in 3Q23
OPERATING EXPENSES ($ in thousands)
3Q 2023
3Q 2022
$ Variance
% Variance
Compensation and employee benefits
$ 12,523
$ 6,788
$ 5,735
84%
Origination (income)/expense
273
209
64
31%
Securitization expenses
4,930
-
4,930
n.m. Rent and occupancy
472
445
27
6%
Loan servicing
4,901
3,314
1,587
48%
Professional fees
854
664
190
29%
Real estate owned, net
1,239
(195)
1,434
n.m. Other expenses
2,142
2,020
122
6%
Total operating expenses
$ 27,334
$ 13,245
$ 14,089
106%
n.m. - non meaningful
Discussion of results:
- Operating expenses totaled $27.3 million for 3Q23, an increase
of 106.4% from 3Q22. The variance to prior year was higher
compensation expense and securitization expenses, driven by impacts
attributable to our fair value accounting elections and portfolio
growth.
- Compensation expense totaled $12.5 million, compared to $6.8
million for 3Q22.
- In 3Q23, compensation expense related to loan originations was
expensed as incurred under fair value accounting rather than
deferred over the life of the loan under amortized cost accounting
for 3Q22.
- Compensation growth was driven, to a lesser extent, by hires of
business development executives, sales account executives and
operational staff
- Securitization expenses totaled $4.9 million, resulting from
the issuance of the VCC 2023-3 and VCC 2023-RTL1 securitizations
during the quarter. Securitization issuance costs are now expensed
under fair value accounting and were deferred in 3Q22.
- Loan servicing expense totaled $4.9 million, a 47.9% increase
from $3.3 million for 3Q22, driven by the increase in our loan
portfolio and delinquent assets
SECURITIZATIONS ($ in thousands)
Securities
Balance at Balance at Trusts Issued
9/30/2023 W.A. Rate 9/30/2022 W.A. Rate
2016-1 Trust
319,809
$ -
0.00%
$ 24,356
8.10%
2017-2 Trust
245,601
48,206
3.95%
61,224
3.75%
2018-1 Trust
176,816
35,010
3.99%
46,795
3.99%
2018-2 Trust
307,988
80,409
4.43%
99,151
4.49%
2019-1 Trust
235,580
79,215
4.06%
97,620
4.12%
2019-2 Trust
207,020
69,216
3.40%
90,165
3.39%
2019-3 Trust
154,419
60,482
3.29%
75,366
3.22%
2020-1 Trust
248,700
110,958
2.89%
141,423
2.87%
2020-2 Trust
96,352
49,528
4.59%
63,060
4.62%
2021-1 Trust
251,301
176,529
1.76%
206,026
1.74%
2021-2 Trust
194,918
149,431
2.02%
177,993
2.02%
2021-3 Trust
204,205
161,467
2.47%
190,073
2.45%
2021-4 Trust
319,116
250,941
3.24%
282,567
3.18%
2022-1 Trust
273,594
240,733
3.94%
260,454
3.93%
2022-2 Trust
241,388
221,631
5.08%
236,918
5.09%
2022-MC1 Trust
84,967
35,677
6.90%
60,872
6.88%
2022-3 Trust
296,323
262,308
5.71%
285,847
5.64%
2022-4 Trust
308,357
283,270
6.23%
306,365
6.24%
2022-5 Trust
188,754
171,183
7.05%
2023-1 Trust
198,715
181,006
7.01%
2023-1R Trust
64,833
60,515
7.69%
2023-2 Trust
202,210
194,955
7.19%
2023-RTL1 Trust
81,608
81,608
8.23%
2023-3 Trust
234,741
232,802
7.80%
$ 5,137,315
$ 3,237,080
5.01%
$ 2,706,275
4.05%
Discussion of results
The company completed two securitizations during 3Q23 totaling
$316.3 million of securities issued.
- The VCC 2023-3 securitization totaled $234.7 million of
securities issued in August, comprised of long-term
business-purpose loans
- Collapsed the 2016-1 Trust, retiring older, higher cost
debt
- The VCC 2023-RTL1 securitization totaled $81.6 million of
securities issued in August, comprised of short-term interest only
business-purpose loans. The RTL1 transaction is Velocity’s first
securitization collateralized entirely by short-term loans.
Velocity also has the option to replace loans that payoff with new
loans up to the original issued balance for 18 months from
issuance.
- The weighted average rate on Velocity’s outstanding
securitizations was 5.01% as of September 30, 2023, an increase of
96 bps from September 30, 2022
RESOLUTION ACTIVITIES LONG-TERM
LOANS RESOLUTION ACTIVITY THIRD QUARTER
2023 THIRD QUARTER 2022 ($ in thousands)
UPB $
Gain / (Loss) $ UPB $ Gain / (Loss) $ Paid in
full
$ 20,668
$ 758
$ 16,175
$ 967
Paid current
26,950
206
11,410
182
REO sold
6,341
162
3,171
250
Total resolutions
$ 53,959
$ 1,126
$ 30,756
$ 1,399
Resolutions as a % of nonperforming UPB
102.1%
104.5%
SHORT-TERM AND FORBEARANCE
LOANS RESOLUTION ACTIVITY THIRD QUARTER
2023 THIRD QUARTER 2022 ($ in thousands)
UPB $
Gain / (Loss) $ UPB $ Gain / (Loss) $ Paid in
full
$ 2,967
$ 38
$ 8,691
$ 396
Paid current
6,292
-
2,075
-
REO sold
2,434
(11)
3,672
865
Total resolutions
$ 11,693
$ 27
$ 14,438
$ 1,261
Resolutions as a % of nonperforming UPB
100.2%
108.7%
Grand total resolutions
$ 65,652
$ 1,153
$ 45,194
$ 2,660
Grand total resolutions as a % of nonperforming UPB
101.8%
105.9%
Discussion of results:
- NPL resolution totaled 65.7 million in UPB, realizing 101.8% of
UPB resolved compared to $45.2 million in UPB and realization of
105.9% of UPB resolved for 3Q22
- 3Q23 NPL resolutions represented 17.7% of nonperforming loan
UPB as of June 30, 2023
- The UPB of loan resolutions in 3Q23 was higher than the recent
five-quarter resolution average of $45.0 million in UPB
Velocity’s executive management team will host a conference call
and webcast to review 3Q23 financial results on November 2nd, 2023,
at 2:00 p.m. Pacific Time / 5:00 p.m. Eastern Time.
Webcast Information
The conference call will be webcast live in listen-only mode and
can be accessed through the Events and Presentations section of the
Velocity Financial Investor Relations website
https://www.velfinance.com/events-and-presentations. To listen to
the webcast, please visit Velocity’s website at least 15 minutes
before the call to register, download, and install any needed
software. An audio replay of the call will also be available on
Velocity’s website following the completion of the conference
call.
Conference Call Information
To participate by phone, please dial-in 15 minutes before the
start time to allow for wait times to access the conference call.
The live conference call will be accessible by dialing
F1-833-316-0544 in the U.S. and Canada and 1-412-317-5725 for
international callers. Callers should ask to join the Velocity
Financial, Inc. conference call.
A replay of the call will be available through midnight on
November 30, 2023, and can be accessed by dialing 1-877-344-7529 in
the U.S. and 855-669-9658 in Canada or 1-412-317-0088
internationally. The passcode for the replay is #3150552. The
replay will also be available on the Investor Relations section of
the Company's website under "Events and Presentations.”
About Velocity Financial, Inc.
Based in Westlake Village, California, Velocity is a vertically
integrated real estate finance company that primarily originates
and manages business purpose loans secured by 1-4-unit residential
rental and small commercial properties. Velocity originates loans
nationwide across an extensive network of independent mortgage
brokers built and refined over 19 years.
Non-GAAP Financial Measures
To supplement our financial statements presented in accordance
with United States generally accepted accounting principles (GAAP),
the Company uses non-GAAP core net income and core diluted EPS,
which are non-GAAP financial measures.
Non-GAAP core net income and non-GAAP core diluted EPS are
non-GAAP financial measures that represent our net income (loss)
and net income (loss) per diluted share, adjusted to eliminate the
effect of certain costs incurred from activities that are not
normal recurring operating expenses, such as COVID-stressed charges
and recoveries of loan loss provision, nonrecurring debt
amortization, the impact of operational measures taken to address
the COVID-19 pandemic and workforce reduction costs, and costs
associated with acquisitions. To calculate non-GAAP core diluted
EPS, we use the weighted-average number of shares of common stock
outstanding that is used to calculate net income per diluted share
under GAAP.
We have included non-GAAP core net income and non-GAAP core
diluted EPS because they are key measures used by our management to
evaluate our operating performance, generate future operating
plans, and make strategic decisions, including those relating to
operating expenses and the allocation of internal resources.
Accordingly, we believe that non-GAAP core net income and non-GAAP
core diluted EPS provide useful information to investors and others
in understanding and evaluating our operating results in the same
manner as our management and board of directors. In addition, they
provide useful measures for period-to-period comparisons of our
business, as they remove the effect of certain items that we expect
to be nonrecurring.
These non-GAAP financial measures should not be considered in
isolation from, or as a substitute for, financial information
prepared in accordance with GAAP. These non-GAAP financial measures
are not based on any standardized methodology prescribed by GAAP
and are not necessarily comparable to similarly titled measures
presented by other companies.
For more information on Core Income, please refer to the section
of this press release below titled “Adjusted Financial Metric
Reconciliation to GAAP Net Income” at the end of this press
release.
Forward-Looking Statements
Some of the statements contained in this press release may
constitute forward-looking statements within the meaning of the
federal securities laws. Forward-looking statements relate to
anticipated results, expectations, projections, plans and
strategies, anticipated events or trends, and similar expressions
concerning matters that are not historical facts. In some cases,
you can identify forward-looking statements by the use of
forward-looking terminology such as “may,” “will,” “expects,”
“intends,” “plans,” “anticipates,” “believes,” “estimates,”
“predicts,” “goal,” ”position,” or “potential” or the negative of
these words and phrases or similar words or phrases that are
predictions of or indicate future events or trends and which do not
relate solely to historical matters. You can also identify
forward-looking statements by discussions of strategy, plans, or
intentions.
The forward-looking statements contained in this press release
reflect our current views about future events and are subject to
numerous known and unknown risks, uncertainties, assumptions, and
changes in circumstances that may cause actual results to differ
significantly from those expressed or contemplated in any
forward-looking statement. While forward-looking statements reflect
our good faith projections, assumptions, and expectations, they are
not guarantees of future results. Furthermore, we disclaim any
obligation to publicly update or revise any forward-looking
statement to reflect changes in underlying assumptions or factors,
new information, data or methods, future events, or other changes,
except as required by applicable law. Factors that could cause our
results to differ materially include, but are not limited to, (1)
the continued course and severity of the COVID-19 pandemic and its
direct and indirect impacts, (2) general economic and real estate
market conditions, including the risk of recession (3) regulatory
and/or legislative changes, (4) our customers' continued interest
in loans and doing business with us, (5) market conditions and
investor interest in our future securitizations, and (6) the
continued conflict in Ukraine and (7) changes in federal government
fiscal and monetary policies.
Additional information relating to these and other factors that
could cause future results to differ materially from those
expressed or contemplated in any forward-looking statements can be
found in the section titled ‘‘Risk Factors” in our Form 10-Q filed
with the SEC on May 14, 2020, as well as other cautionary
statements we make in our current and periodic filings with the
SEC. Such filings are available publicly on our Investor Relations
web page at www.velfinance.com.
Velocity Financial,
LLC
Consolidated Statements of
Financial Condition
Quarter Ended 9/30/2023
6/30/2023 3/31/2023 12/31/2022
9/30/2022 Unaudited Unaudited Unaudited
Audited Unaudited (In thousands)
Assets Cash
and cash equivalents
$ 29,393
$ 33,987
$ 39,397
$ 45,248
$ 26,372
Restricted cash
17,703
16,786
16,636
16,808
14,533
Loans held for sale, at fair value
19,536
-
18,081
-
16,569
Loans held for investment, at fair value
951,990
705,330
450,732
276,095
926
Loans held for investment
2,945,840
3,057,940
3,169,280
3,272,390
3,445,563
Total loans, net
3,917,366
3,763,270
3,638,093
3,548,485
3,463,058
Accrued interest receivables
24,756
22,602
20,931
20,463
18,333
Receivables due from servicers
70,139
63,896
64,133
65,644
66,992
Other receivables
236
1,306
2,188
1,075
1,962
Real estate owned, net
29,299
20,388
21,778
13,325
13,188
Property and equipment, net
2,861
3,023
3,209
3,356
3,495
Deferred tax asset
705
1,878
2,543
5,033
4,337
Mortgage Servicing Rights, at fair value
9,786
9,445
9,143
9,238
9,868
Derivative assets
1,261
-
-
-
-
Goodwill
6,775
6,775
6,775
6,775
6,775
Other assets
7,028
7,789
12,268
13,525
18,453
Total Assets
$ 4,117,308
$ 3,951,145
$ 3,837,094
$ 3,748,975
$ 3,647,366
Liabilities and members' equity Accounts payable and
accrued expenses
$ 97,869
$ 95,344
$ 84,976
$ 91,525
$ 75,150
Secured financing, net
210,774
210,464
210,155
209,846
209,537
Securitized debt, net
2,504,334
2,622,547
2,657,469
2,736,290
2,651,895
Securitized debt, at fair value
669,139
381,799
194,941
-
-
Warehouse & repurchase facilities
215,176
235,749
298,313
330,814
340,050
Total Liabilities
3,697,292
3,545,903
3,445,854
3,368,475
3,276,632
Stockholders' Equity Stockholders' equity
416,398
401,707
387,624
376,811
366,810
Noncontrolling interest in subsidiary
3,618
3,535
3,616
3,689
3,924
Total equity
420,016
405,242
391,240
380,500
370,734
Total Liabilities and members' equity
$ 4,117,308
$ 3,951,145
$ 3,837,094
$ 3,748,975
$ 3,647,366
Book value per share
$ 13.00
$ 12.57
$ 12.18
$ 11.89
$ 11.61
Shares outstanding
32,314(1)
32,239(2)
32,112(3)
31,996(4)
31,922(5)
(1)
Based on 32,313,744 common shares outstanding as of September 30,
2023, and excludes unvested shares of common stock authorized for
incentive compensation totaling 589,634.
(2)
Based on 32,238,715 common shares outstanding as of June 30, 2023,
and excludes unvested shares of common stock authorized for
incentive compensation totaling 502,913.
(3)
Based on 32,111,906 common shares outstanding as of March 31, 2023,
and excludes unvested shares of common stock authorized for
incentive compensation totaling 490,526.
(4)
Based on 31,955,730 common shares outstanding as of December 31,
2022, and excludes unvested shares of common stock authorized for
incentive compensation totaling 494,139.
(5)
Based on 31,921,721 common shares outstanding as of September 30,
2022, and excludes unvested shares of common stock authorized for
incentive compensation totaling 494,139.
Velocity Financial,
LLC
Consolidated Statements of
Income (Quarters)
Quarter Ended ($ in thousands)
9/30/2023
6/30/2023 3/31/2023 12/31/2022
9/30/2022 Unaudited Unaudited Unaudited
Audited Unaudited Revenues Interest income
$ 79,088
$ 74,897
$ 70,521
$ 65,632
$ 63,419
Interest expense - portfolio related
47,583
45,451
42,029
40,854
34,561
Net interest income - portfolio related
31,505
29,446
28,492
24,778
28,858
Interest expense - corporate debt
4,138
4,139
4,139
4,139
4,011
Net interest income
27,367
25,307
24,353
20,639
24,847
Provision for loan losses
154
298
636
(437)
580
Net interest income after provision for loan losses
27,213
25,009
23,717
21,076
24,267
Other operating income Gain on disposition of loans
3,606
1,237
1,913
391
399
Unrealized gain on fair value loans
(1,284)
2,413
7,354
7,795
453
Unrealized gain (loss) on fair value securitizations
9,692
5,560
(170)
-
-
Origination income
3,323
2,735
2,411
3,521
518
Bank interest income
1,342
1,188
948
-
0
Other income (expense)
681
903
386
(288)
1,656
Total other operating income
17,360
14,036
12,842
11,419
3,027
Net revenue
44,573
39,046
36,560
32,495
27,294
Operating expenses Compensation and employee benefits
12,523
10,670
10,008
11,793
6,788
Origination expenses
273
123
(50)
1,328
209
Securitizations expenses
4,930
2,699
2,584
-
-
Rent and occupancy
472
458
446
435
445
Loan servicing
4,901
4,267
3,828
3,244
3,314
Professional fees
854
1,056
955
1,091
664
Real estate owned, net
1,239
1,018
1,829
552
(195)
Other operating expenses
2,142
1,931
2,202
2,360
2,020
Total operating expenses
27,334
22,222
21,802
20,804
13,245
Income before income taxes
17,239
16,824
14,757
11,692
14,049
Income tax expense
5,070
4,602
4,021
3,465
3,759
Net income
12,169
12,222
10,736
8,227
10,290
Net income attributable to noncontrolling interest
83
39
87
(235)
307
Net income attributable to Velocity Financial, Inc.
12,086
12,183
10,649
8,462
9,983
Less undistributed earnings attributable to participating
securities
183
185
160
127
152
Net earnings attributable to common shareholders
$ 11,903
$ 11,998
$ 10,489
$ 8,335
$ 9,831
Basic earnings (loss) per share
$ 0.37
$ 0.37
$ 0.33
$ 0.26
$ 0.31
Diluted earnings (loss) per common share
$ 0.35
$ 0.36
$ 0.31
$ 0.25
$ 0.29
Basic weighted average common shares outstanding
32,275
32,122
32,098
31,923
31,922
Diluted weighted average common shares outstanding
34,731
34,140
34,052
34,063
34,199
Velocity Financial, Inc.
Net Interest Margin —
Portfolio Related and Total Company
(Unaudited)
Quarter Ended September 30, 2023 Quarter Ended
June 30, 2023 Quarter Ended September 30, 2022
Interest Average Interest Average
Interest Average Average Income /
Yield / Average Income / Yield /
Average Income / Yield / ($ in
thousands) Balance Expense Rate(1)
Balance Expense Rate(1) Balance
Expense Rate(1) Loan portfolio: Loans held for
sale
$ 3,170
$ 3,477
$ 176
Loans held for investment
3,770,460
3,634,093
3,217,264
Total loans
$ 3,773,631
$ 79,088
8.38%
$ 3,637,570
$ 74,897
8.24%
$ 3,217,440
$ 63,419
7.88%
Debt: Warehouse and repurchase facilities
$ 192,855
4,943
10.25%
$ 238,027
5,910
9.93%
$ 226,660
3,798
6.70%
Securitizations
3,186,756
42,640
5.35%
3,020,624
39,541
5.24%
2,644,489
30,763
4.65%
Total debt - portfolio related
3,379,610
47,583
5.63%
3,258,651
45,451
5.58%
2,871,149
34,561
4.81%
Corporate debt
215,000
4,138
7.70%
215,000
4,139
7.70%
215,000
4,011
7.46%
Total debt
$ 3,594,610
$ 51,721
5.76%
$ 3,473,651
$ 49,590
5.71%
$ 3,086,149
$ 38,572
5.00%
Net interest spread - portfolio related (2)
2.75%
2.66%
3.07%
Net interest margin - portfolio related
3.34%
3.24%
3.59%
Net interest spread - total company (3)
2.63%
2.53%
2.88%
Net interest margin - total company
2.90%
2.78%
3.09%
(1)
Annualized.
(2)
Net interest spread — portfolio related is
the difference between the rate earned on our loan portfolio and
the interest rates paid on our portfolio-related debt."
(3)
Net interest spread — total company is the
difference between the rate earned on our loan portfolio and the
interest rates paid on our total debt."
Velocity Financial, Inc.
Adjusted Financial Metric
Reconciliation to GAAP Net Income
(Unaudited)
Quarters:
Core Net Income Quarter Ended ($ in thousands)
9/30/2023 6/30/2023 3/31/2023
12/31/2022 9/30/2022 Net Income
$ 12,086
$ 12,183
$ 10,649
$ 8,462
$ 9,983
Equity award & ESPP costs
832
745
728
656
-
Core Net Income
$ 12,918
$ 12,928
$ 11,376
$ 9,118
$ 9,983
Diluted weighted average common shares outstanding
34,731
34,140
34,052
34,063
34,199
Core diluted earnings per share
$ 0.37
$ 0.38
$ 0.33
$ 0.27
$ 0.29
View source
version on businesswire.com: https://www.businesswire.com/news/home/20231102050710/en/
Investors and Media: Chris Oltmann (818) 532-3708
Velocity Financial (NYSE:VEL)
Gráfico Histórico do Ativo
De Nov 2024 até Dez 2024
Velocity Financial (NYSE:VEL)
Gráfico Histórico do Ativo
De Dez 2023 até Dez 2024