Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2019 | Apr. 30, 2019 | |
Document and Entity Information [Abstract] | ||
Entity Registrant Name | Cohen & Co Inc. | |
Entity Central Index Key | 0001270436 | |
Document Type | 10-Q | |
Document Period End Date | Mar. 31, 2019 | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2019 | |
Document Fiscal Period Focus | Q1 | |
Current Fiscal Year End Date | --12-31 | |
Trading Symbol | cohn | |
Entity Emerging Growth Company | false | |
Entity Small Business | true | |
Entity Filer Category | Non-accelerated Filer | |
Entity Common Stock, Shares Outstanding | 1,217,624 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 | |
Assets | |||
Cash and cash equivalents | $ 9,283 | $ 14,106 | |
Receivables from brokers, dealers, and clearing agencies | 104,444 | 129,812 | |
Due from related parties | 625 | 793 | |
Other receivables | 8,196 | 12,072 | |
Investments-trading | 285,473 | 301,235 | |
Other investments, at fair value | 9,440 | 13,768 | |
Receivables under resale agreements | 4,510,389 | 5,171,053 | |
Investment in equity method affiliates | 3,767 | ||
Goodwill | [1] | 7,992 | 7,992 |
Right-of-use asset - operating leases | 8,081 | ||
Other assets | 3,637 | 3,621 | |
Total assets | 4,951,327 | 5,654,452 | |
Liabilities | |||
Payables to brokers, dealers, and clearing agencies | 162,951 | 201,598 | |
Accounts payable and other liabilities | 11,840 | 11,452 | |
Accrued compensation | 1,944 | 5,254 | |
Trading securities sold, not yet purchased | 98,245 | 120,122 | |
Securities sold under agreements to repurchase | 4,560,713 | 5,210,587 | |
Deferred income taxes | 1,903 | 2,017 | |
Lease liability - operating leases | 8,658 | ||
Redeemable financial instruments | 18,679 | 17,448 | |
Debt | 43,658 | 43,536 | |
Total liabilities | 4,908,591 | 5,612,014 | |
Commitments and contingencies (See note 20) | |||
Stockholders' Equity: | |||
Voting Non-Convertible Preferred Stock, $0.001 par value per share, 4,983,557 shares authorized, 4,983,557 shares issued and outstanding (see note 17) | 5 | 5 | |
Common Stock, $0.01 par value per share, 100,000,000 shares authorized, 1,217,624 and 1,204,196 shares issued and outstanding, respectively, including 73,715 and 93,479 unvested or restricted share awards, respectively | 12 | 12 | |
Additional paid-in capital | 68,689 | 68,591 | |
Accumulated other comprehensive loss | (916) | (908) | |
Accumulated deficit | (33,438) | (31,926) | |
Total stockholders' equity | 34,352 | 35,774 | |
Non-controlling interest | 8,384 | 6,664 | |
Total equity | 42,736 | 42,438 | |
Total liabilities and equity | $ 4,951,327 | $ 5,654,452 | |
[1] | Goodwill and intangible assets are allocated to the Capital Markets and Asset Management business segments as indicated in the table above. |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Mar. 31, 2019 | Dec. 31, 2018 |
Common Stock, par value | $ 0.01 | $ 0.01 |
Common Stock, shares authorized | 100,000,000 | 100,000,000 |
Common Stock, shares issued | 1,217,624 | 1,204,196 |
Common Stock, shares outstanding | 1,217,624 | 1,204,196 |
Common Stock, unvested or restricted share awards | 73,715 | 93,479 |
Series E Preferred Stock [Member] | ||
Preferred Stock, par value | $ 0.001 | $ 0.001 |
Preferred Stock, shares authorized | 4,983,557 | 4,983,557 |
Preferred Stock, shares issued | 4,983,557 | 4,983,557 |
Preferred Stock, shares outstanding | 4,983,557 | 4,983,557 |
Consolidated Statements Of Oper
Consolidated Statements Of Operations And Comprehensive Income (Loss) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2019 | Mar. 31, 2018 | ||
Revenues | |||
Principal transactions and other income | $ 414 | $ 647 | |
Total revenues | 11,145 | 9,338 | |
Operating expenses | |||
Compensation and benefits | 6,364 | 5,194 | |
Business development, occupancy, equipment | 811 | 867 | |
Subscriptions, clearing, and execution | 2,273 | 1,834 | |
Professional fee and other operating | 1,679 | 1,742 | |
Depreciation and amortization | 81 | 61 | |
Total operating expenses | 11,208 | 9,698 | |
Operating income (loss) | (63) | (360) | |
Non-operating income (expense) | |||
Interest income (expense) | (1,859) | (1,819) | |
Income (loss) from equity method affiliates | (8) | ||
Income (loss) before income tax expense (benefit) | (1,930) | (2,179) | |
Income tax expense (benefit) | (106) | (28) | |
Net income (loss) | (1,824) | (2,151) | |
Less: Net income (loss) attributable to the non-controlling interest | (622) | (677) | |
Net income (loss) attributable to Cohen & Company Inc. | $ (1,202) | $ (1,474) | |
Income (loss) per common share-basic: | |||
Basic income (loss) per common share | $ (1.06) | $ (1.26) | |
Weighted average shares outstanding-basic | 1,133,166 | 1,172,476 | |
Income (loss) per common share-diluted: | |||
Diluted income (loss) per common share | $ (1.06) | $ (1.26) | |
Weighted average shares outstanding-diluted | [1] | 1,665,575 | 1,704,885 |
Dividends declared per common share | $ 0.20 | $ 0.20 | |
Comprehensive income (loss) | |||
Net income (loss) | $ (1,824) | $ (2,151) | |
Other comprehensive income (loss) item: | |||
Foreign currency translation adjustments, net of tax of $0 | 9 | 107 | |
Other comprehensive income (loss), net of tax of $0 | 9 | 107 | |
Comprehensive income (loss) | (1,815) | (2,044) | |
Less: comprehensive income (loss) attributable to the non-controlling interest | (619) | (644) | |
Comprehensive income (loss) attributable to Cohen & Company Inc. | (1,196) | (1,400) | |
Net Trading [Member] | |||
Revenues | |||
Total revenue | 8,729 | 6,191 | |
Asset Management [Member] | |||
Revenues | |||
Total revenue | $ 2,002 | 1,804 | |
New Issue And Advisory [Member] | |||
Revenues | |||
Total revenue | $ 696 | ||
[1] | For the three months ended March 31, 2019, weighted average common shares outstanding excludes (i) 59,182 shares representing restricted Common Stock and restricted Operating LLC membership units, which when vested can be converted into Common Stock, (ii) 565,469 shares from the assumed conversion of the 2013 Convertible Notes, and (iii) 1,034,483 shares from the assumed conversion of the 2017 Convertible Note because the inclusion of such shares would be anti-dilutive. For the three months ended March 31, 2018, weighted average common shares outstanding excludes (i) 26,691 shares representing restricted Common Stock, (ii) 274,917 shares from the assumed conversion of the 2013 Convertible Notes, and (iii) 1,034,483 shares from the assumed conversion of the 2017 Convertible Note because the inclusion of such shares would be anti-dilutive. |
Consolidated Statements Of Op_2
Consolidated Statements Of Operations And Comprehensive Income (Loss) (Parenthetical) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Consolidated Statements of Operations And Comprehensive Income/(Loss) [Abstract] | ||
Foreign currency translation adjustments, tax | $ 0 | $ 0 |
Other comprehensive income (loss), tax | $ 0 | $ 0 |
Consolidated Statement Of Chang
Consolidated Statement Of Changes In Equity - 3 months ended Mar. 31, 2019 - USD ($) $ in Thousands | Preferred Stock [Member] | Common Stock [Member] | Additional paid-in capital [Member] | Retained Earnings/ (Accumulated Deficit) [Member] | Accumulated Other Comprehensive Income (Loss) [Member] | Total Stockholders' Equity [Member] | Non-controlling Interest [Member] | Total |
Balance at Dec. 31, 2018 | $ 5 | $ 12 | $ 68,591 | $ (31,926) | $ (908) | $ 35,774 | $ 6,664 | $ 42,438 |
Net income (loss) | (1,202) | (1,202) | (622) | (1,824) | ||||
Other comprehensive income (loss) | 6 | 6 | 3 | 9 | ||||
Acquisition / (surrender) of additional units of consolidated subsidiary, net | 133 | (14) | 119 | (119) | ||||
Equity-based compensation and vesting of shares | 117 | 117 | 55 | 172 | ||||
Shares withheld for employee taxes | (87) | (87) | (41) | (128) | ||||
Purchase and retirement of common stock | (65) | (65) | (65) | |||||
Investment in non-controlling interest | 2,550 | 2,550 | ||||||
Dividends/Distributions | (290) | (290) | (106) | (396) | ||||
Balance at Mar. 31, 2019 | $ 5 | $ 12 | $ 68,689 | (33,438) | $ (916) | 34,352 | $ 8,384 | 42,736 |
Cumulative effect adjustment- adoption of ASU 2016-02 | $ (20) | $ (20) | $ (20) |
Consolidated Statements Of Cash
Consolidated Statements Of Cash Flows - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Operating activities | ||
Net income (loss) | $ (1,824) | $ (2,151) |
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: | ||
Equity-based compensation | 172 | 125 |
Accretion of income on other investments, at fair value | (106) | (343) |
Realized loss (gain) on other investments, at fair value | (419) | 206 |
(Income) / loss from equity method affiliates | 8 | |
Change in unrealized (gain) loss on other investments, at fair value | 171 | (357) |
Depreciation and amortization | 81 | 61 |
Amortization of discount on debt | 122 | 226 |
Deferred tax provision (benefit) | (114) | (15) |
Change in operating assets and liabilities, net: | ||
(Increase) decrease in other receivables | 3,894 | 554 |
(Increase) decrease in investments-trading | 15,762 | 30,641 |
(Increase) decrease in other assets | 258 | (403) |
(Increase) decrease in receivables under resale agreement | 660,664 | (385,159) |
Change in receivables from / payables to related parties, net | 168 | 57 |
Increase (decrease) in accrued compensation | (3,310) | (3,264) |
Increase (decrease) in accounts payable and other liabilities | 233 | 982 |
Increase (decrease) in trading securities sold, not yet purchased | (21,877) | 2,968 |
Change in receivables from/ payables to brokers, dealers, and clearing agencies | (13,279) | (60,841) |
Increase (decrease) in securities sold under agreements to repurchase | (649,874) | 421,368 |
Net cash provided by (used in) operating activities | (9,270) | 4,655 |
Investing activities | ||
Purchase of investments-other investments, at fair value | (408) | (16,765) |
Sales and returns of principal-other investments, at fair value | 5,091 | 1,081 |
Investment in equity method affiliates | (3,775) | |
Purchase of furniture, equipment, and leasehold improvements | (20) | (39) |
Net cash provided by (used in) investing activities | 888 | (15,723) |
Financing activities | ||
Proceeds from redeemable financial instrument | 1,268 | |
Cash used to net share settle equity awards | (128) | (75) |
Purchase and retirement of Common Stock | (65) | (71) |
Proceeds from non-controlling interest investment | 2,550 | |
Cohen & Company Inc. dividends | (61) | (40) |
Net cash provided by (used in) financing activities | 3,564 | (186) |
Effect of exchange rate on cash | (5) | 77 |
Net increase (decrease) in cash and cash equivalents | (4,823) | (11,177) |
Cash and cash equivalents, beginning of period | 14,106 | 22,933 |
Cash and cash equivalents, end of period | $ 9,283 | $ 11,756 |
Organization And Nature Of Oper
Organization And Nature Of Operations | 3 Months Ended |
Mar. 31, 2019 | |
Organization And Nature Of Operations [Abstract] | |
Organization And Nature Of Operations | 1. ORGANIZATION AND NATURE OF OPERATIONS Organizational History Cohen Brothers, LLC (“Cohen Brothers”) was formed on October 7, 2004 by Cohen Bros. Financial, LLC (“CBF”). Cohen Brothers was established to acquire the net assets of CBF’s subsidiaries (the “Formation Transaction”): Cohen Bros. & Company, Inc.; Cohen Frères SAS; Dekania Investors, LLC; Emporia Capital Management, LLC; and the majority interest in Cohen Bros. & Toroian Investment Management, Inc. The Formation Transaction was accomplished through a series of transactions occurring between March 4, 2005 and May 31, 2005. From its formation until December 16, 2009, Cohen Brothers operated as a privately-owned limited liability company. On December 16, 2009, Cohen Brothers completed its merger (the “Merger”) with a subsidiary of Alesco Financial Inc. (“AFN”), a publicly traded real estate investment trust. As a result of the Merger, AFN contributed substantially all of its assets into Cohen Brothers in exchange for newly issued membership units directly from Cohen Brothers. In addition, AFN received additional Cohen Brothers membership interests directly from its members in exchange for AFN common stock. In accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”), the Merger was accounted for as a reverse acquisition, and Cohen Brothers was deemed to be the accounting acquirer. As a result, all of AFN’s assets and liabilities were required to be revalued at fair value as of the acquisition date. The remaining membership interests of Cohen Brothers that were not held by AFN were included as a component of non-controlling interest in the consolidated balance sheets. Subsequent to the Merger, AFN was renamed Cohen & Company Inc. In January 2011, it was renamed again as Institutional Financial Markets, Inc. (“IFMI”) and on September 1, 2017, it was renamed again as Cohen & Company Inc. Effective January 1, 2010, the Company ceased to qualify as a REIT. The Company The Company is a financial services company specializing in fixed income markets. As of March 31, 2019 , the Company had $2.78 billion in assets under management (“AUM”) of which 83.1% , or $2.31 billion, was in collateralized debt obligations (“CDOs”). The remaining portion of AUM is from a diversified mix of Investment Vehicles. In these financial statements, the “Company” refers to Cohen & Company Inc. and its subsidiaries on a consolidated basis. Cohen & Company, LLC or the “Operating LLC” refers to the main operating subsidiary of the Company. “Cohen Brothers” refers to the pre-Merger Cohen Brothers, LLC and its subsidiaries. “AFN” refers to the pre-merger Alesco Financial Inc. and its subsidiaries. When the term “Cohen & Company Inc.” is used, it is referring to the parent company itself. “JVB Holdings” refers to J.V.B. Financial Holdings, LLC; “JVB” refers to J.V.B. Financial Group LLC, a broker dealer subsidiary; “CCFL” refers to Cohen & Company Financial Limited (formerly known as EuroDekania Management LTD), a subsidiary regulated by the Financial Conduct Authority (formerly known as Financial Services Authority) in the United Kingdom; and “EuroDekania” refers to EuroDekania (Cayman) Ltd., a Cayman Islands exempted company that is externally managed by CCFL. The Company’s business is organized into the following three business segments. Capital Markets : The Company’s Capital Markets business segment consists primarily of fixed income sales, trading, matched book repurchase agreement (“repo”) financing, new issue placements in corporate and securitized products, and advisory services. The Company’s fixed income sales and trading group provides trade execution to corporate investors, institutional investors, mortgage originators, and other smaller broker-dealers. The Company specializes in a variety of products, including but not limited to: corporate bonds, asset backed securities (“ABS”), mortgage backed securities (“MBS”), residential mortgage backed securities (“RMBS”), CDOs, collateralized loan obligations (“CLOs”), collateralized bond obligations (“CBOs”), collateralized mortgage obligations (“CMOs”), municipal securities, to-be-announced securities (“TBAs”) and other forward agency MBS contracts, Small Business Administration (“SBA”) loans, U.S. government bonds, U.S. government agency securities, brokered deposits and certificates of deposit (“CDs”) for small banks, and hybrid capital of financial institutions including trust preferred securities (“TruPS”), whole loans, and other structured financial instruments. The Company also offers execution and brokerage services for equity products. The Company carries out its capital markets activities primarily through its subsidiaries: JVB in the United States and CCFL in Europe. Asset Management : The Company’s Asset Management business segment manages assets within CDOs, managed accounts, joint ventures, and investment funds (collectively referred to as “Investment Vehicles”). A CDO is a form of secured borrowing. The borrowing is secured by different types of fixed income assets such as corporate or mortgage loans or bonds. The borrowing is in the form of a securitization, which means that the lenders are actually investing in notes backed by the assets. In the event of default, the lenders will have recourse only to the assets securing the loan. The Company’s Asset Management business segment includes its fee-based asset management operations, which include ongoing base and incentive management fees. Principal Investing : The Company’s Principal Investing business segment is comprised of investments that the Company has made for the purpose of earning an investment return rather than investments made to support the Company’s trading, matched book repo, or other Capital Markets business segment activities. These investments are a component of the Company’s other investments, at fair value and investment in equity method affiliates in our consolidated balance sheets. The Company generates its revenue by business segment primarily through the following activities. Capital Markets · Trading activities of the Company, which include execution and brokerage services, riskless trading activities as well as gains and losses (unrealized and realized) and income and expense earned on securities and derivatives classified as trading; · Net interest income on the Company’s matched book repo financing activities; and · New issue and advisory revenue comprised primarily of (i) new issue revenue associated with originating, arranging, or placing newly created financial instruments and (ii) revenue from advisory services. Asset Management · Asset management fees for the Company’s on-going asset management services provided to certain Investment Vehicles, which may include fees both senior and subordinate to the securities in the Investment Vehicle, and incentive management fees earned based on the performance of the various Investment Vehicles. Principal Investing · Gains and losses (unrealized and realized) and income and expense earned on securities classified as other investments, at fair value. |
Basis Of Presentation
Basis Of Presentation | 3 Months Ended |
Mar. 31, 2019 | |
Organization And Nature Of Operations [Abstract] | |
Basis Of Presentation | 2. BASIS OF PRESENTATION The financial statements of the Company included herein were prepared in conformity with U.S. GAAP for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. The information furnished includes all adjustments and accruals of a normal recurring nature, which, in the opinion of management, are necessary for a fair presentation of results for the interim month periods. All intercompany accounts and transactions have been eliminated in consolidation. The results for the three months ended March 31, 2019 and 2018 are not necessarily indicative of the results for the entire year or any subsequent interim period. These financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 201 8 . Capitalized terms used herein without definition have the meanings ascribed to them in the Annual Report on Form 10-K for the year ended December 31, 201 8 . |
Summary Of Significant Accounti
Summary Of Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2019 | |
Summary Of Significant Accounting Policies [Abstract] | |
Summary Of Significant Accounting Policies | 3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES A. Adoption of New Accounting Standards In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers ( Topic 606 ). Subsequent to that date, the FASB has issued additional ASUs clarifying certain aspects of ASU 2014-09 but they did not change the core principal of ASU 2014-09. The new guidance requires entities to recognize revenue in a way that depicts the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The Company adopted the new guidance on January 1, 2018 using the retrospective transition method. This ASU excludes from its scope revenue recognition related to items the Company records as a component of net trading and principal transactions within its consolidated statements of operations and , therefore , this ASU had no impact on these items. In terms of asset management and other revenue, the main impact of Topic 606 related to the timing of the recognition of incentive management fees in certain cases. Prior to the adoption of Topic 606, the Company would recognize incentive fees when they were fixed and determinable. Under Topic 606, the Company is required to recognize incentive fees when they are probable and there is not a significant chance of reversal in the future. For the asset management contracts in place at the time of adoption, this change in policy did not result in any actual change in revenue that had already been recognized and , therefore , there was no transition adjustment necessary. In February 2016, the FASB issued ASU 2016-01, Financial Instruments-Overall (Subtopic 825-10) . The amendments in ASU 2016-01, among other things, require equity investments (except those accounted for under the equity method of accounting or those that result in consolidation of the investee) to be measured at fair value with changes in fair value recognized in net income; require public business entities to use the exit price notion when measuring the fair value of financial instruments for disclosure purposes; require separate presentation of financial assets and liabilities by measurement category and form of financial asset; and eliminate the requirement for public business entities to disclose the methods and significant assumptions used to estimate the fair value that is required to be disclosed for financial instruments measured at amortized cost. The Company’s adoption of the provisions of ASU 2016-01 effective January 1, 2018 did not have a n effect on the Company’s consolidated financial statements In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842). Under the new guidance (subsequently updated with ASU 2018-01, ASU 2018-10, ASU 2018-11, ASU 2018-20 and ASU 2019-01), lessees will be required to recognize the following for all leases with the exception of short-term leases: (i) a lease liability, which is a lessee’s obligation to make lease payments arising from a lease, measured on a discounted basis , and (ii) a right-of-use asset, which is an asset that represents the lessee’s right to use, or control the use of, a specified asset for the lease term. Lessor accounting is largely unchanged . The Company adopted the provisions of the new guidance effective January 1, 2019. The Company recorded the following: (a) a right of use asset of $8,416 , (b) a lease commitment liability of $8,860 , (c) a reduction in retained earnings from cumulative effect of adoption of $20 , (d) an increase in other receivables of $18 , and (e) a reduction in other liabilities of $406 . See note 12. In August 2016, the FASB issued ASU 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments. The amendments in this ASU provide cash flow statement classification guidance on eight specific cash flow presentation issues with the objective of reducing existing diversity in practice. The Company’s adoption of the provisions of ASU 2016-15 effective January 1, 2018 did not have a n effect on the Company’s consolidated financial statements In October 2016, the FASB issued ASU 2016-16, Income Taxes (Topic 740): Intra-Entity Transfers of Assets Other than Inventory . The amendments in this ASU require an entity to recognize the income tax consequences of an intra-entity transfer of an asset other than inventory when the transfer occurs. The amendments eliminate the exception of an intra-entity transfer of an asset other than inventory. The Company’s adoption of the provisions of ASU 2016-16 effective January 1, 2018 did not have a n effect on the Company’s consolidated financial statements In January 2017, the FASB issued ASU 2017-01, Business Combinations (Topic 805): Clarifying the Definition of a Business . The amendments in this ASU clarify the definition of a business and affect all companies and other reporting organizations that must determine whether they have acquired or sold a business. The Company’s adoption of the provisions of ASU 2017-01 effective January 1, 2018 did not have a n effect on the Company’s consolidated financial statements In February 2017, the FASB issued ASU 2017-05 , Other Income – Gains and Losses from the Derecognition of Nonfinancial Assets (Subtopic 610-20): Clarifying the Scope of Asset Derecognition Guidance and Accounting for Partial Sales of Nonfinancial Assets . The amendments in this ASU clarify that a financial asset within the scope of this topic may include nonfinancial assets transferred within a legal entity to counterparty. The amendments clarify that an entity should identify each distinct nonfinancial asset or in substance nonfinancial asset promised to counterparty and derecognize each asset when counterparty obtains control of it. The Company’s adoption of the provisions of ASU 2017-05 effective January 1, 2018 did not have an effect on the Company’s consolidated financial statements. In June 2018, the FASB issued ASU 2018-07, Compensation – Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting . The amendments in this ASU expand the scope of Topic 718, which previously only include d share-based payments to employees, to include share-based payments issued to nonemployees for goods or services. Consequently, the accounting for share-based payments to nonemployees and employees will be substantially aligned. The Company’s adoption of the provisions of ASU 2018-07 effective January 1, 2019 did not have an effect on the Company’s consolidated financial statements. In March 2017, the FASB issued ASU 2017-08, Receivables – Nonrefundable Fees and Other Costs, Premium Amortization on Purchased Callable Debt Securitie s ( Sub-Topic 310-20 ). The amendments in this ASU shorten the amortization period for certain callable debt securities held at a premium. Specifically, the amendments require the premium to be amortized to the earliest call date. The amendments do not require an accounting change for securities held at a discount; the discount continues to be amortized to maturity. The Company’s adoption of the provisions of ASU 2017-08 effective January 1, 2019 did not have an effect on the Company’s consolidated financial statements. In May 2017, the FASB issued ASU 2017-09 , Compensation - Stock Compensation (Topic 718): Scope of Modification Accounting. The amendments in this ASU provide guidance on determining those changes to the terms and conditions of share-based payment awards that require an entity to apply modification accounting. The Company’s adoption of the provisions of ASU 2017-09 effective January 1, 2018 did not have an effect on the Company’s consolidated financial statements. In August 2017, the FASB issued ASU 2017-12, Derivative and Hedging – Targeted Improvements to Accounting for Hedging Activities (Topic 815) . The amendments in this ASU refine and expand hedge accounting for both financial and commodity risks and contain provisions to create more transparency and clarify how economic results are presented. The Company’s adoption of the provisions of ASU 2017-12 effective January 1, 2019 did not have an effect on the Company’s consolidated financial statements. In February 2018, the FASB issued ASU 2018-02, Income Statement – Reporting Comprehensive Income (Topic 220) : Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income. The amendments in this ASU provide the option to reclassify stranded tax effects within accumulated other comprehensive income (“AOCI”) to retained earnings in each period in which the effect of the change in the U.S. federal corporate income tax rate in the Tax Act (or portion thereof) is recorded. The Company’s adoption of the provisions of ASU 2018-02 effective January 1, 2019 did not have an effect on the Company’s consolidated financial statements. B. Recent Accounting Developments In June 2016, the FASB issued ASU 2016-13, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments . The amendments in this ASU require the measurement of all expected credit losses for financial assets held at the reporting date to be based on historical experience, current conditions, and reasonable and supportable forecasts. Financial institutions and other organizations will now use forward-looking information to better inform their credit loss estimates. Many of the loss estimation techniques applied today will still be permitted, although the inputs to those techniques will change to reflect the full amount of expected credit losses. In addition, the ASU amends the accounting for credit losses on available-for-sale debt securities and purchased financial assets with credit deterioration. The amendments in this ASU are effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. Early adoption is permitted beginning after December 15, 2018, including interim periods within those fiscal years. The Company is currently evaluating the new guidance to determine the impact it may have on its consolidated financial statements. In January 2017, the FASB issued ASU 2017-04, Intangibles – Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment . The amendments in this ASU eliminate Step 2 from the goodwill impairment test. The annual or interim goodwill impairment test is performed by comparing the fair value of a reporting unit with its carrying amount. An impairment charge should be recognized for the amount by which the carrying amount exceeds the reporting unit’s fair value; however, the loss recognized should not exceed the total amount of goodwill allocated to that reporting unit. This ASU is effective for fiscal years beginning after December 15, 2019. Early adoption is permitted for interim or annual goodwill impairment tests performed on testing dates after January 1, 2017 and should be applied on a prospective basis. The Company is currently evaluating the new guidance to determine the impact it may have on its consolidated financial statements. In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework –Changes to the Disclosure Requirements for Fair Value Measurement. The ASU modifies the disclosure requirements in Topic 820, by removing certain disclosure requirements related to the fair value hierarchy, modifying existing disclosure requirements related to measurement uncertainty , and adding new disclosure requirements such as disclosing the changes in unrealized gains and losses for the period included in other comprehensive income for recurring level 3 fair value measurements held at the end of the reporting period and disclosing the range and weighted average of significant unobservable inputs used to develop level 3 fair value measurements. This ASU is effective for public companies for annual reporting periods and interim periods within those annual periods beginning after December 15, 2019. Early adoption is permitted. The Company is currently evaluating the new guidance to determine the impact it may have on its consolidated financial statements. In November 2018, the FASB issued ASU 2018-18, Collaborative Arrangements (Topic 808): Clarifying the Interaction Between Topic 808 and Topic 606 . The ASU also provides more comparability in the presentation of revenue for certain transactions between collaborative arrangement participants. It accomplishes this by allowing organizations to only present units of account in collaborative arrangements that are within the scope of the revenue recognition standard together with revenue accounted for under the revenue recognition standard. The parts of the collaborative arrangement that are not in the scope of the revenue recognition standard should be presented separately from revenue accounted for under the revenue recognition. This ASU is effective for public companies for annual reporting periods and interim periods within those annual periods beginning after December 15, 2019. The Company is currently evaluating the new guidance to determine the impact it may have on its consolidated financial statements . C. Fair Value of Financial Instruments The following methods and assumptions were used by the Company in estimating the fair value of its financial instruments. These determinations were based on available market information and appropriate valuation methodologies. Considerable judgment is required to interpret market data to develop the estimates and, therefore, these estimates may not necessarily be indicative of the amount the Company could realize in a current market exchange. The use of different market assumptions and/or estimation methodologies may have a material effect on the estimated fair value amounts. Refer to note 8 for a discussion of the valuation hierarchy with respect to investments-trading; other investments, at fair value; and derivatives held by the Company. Cash equivalents : Cash equivalents are carried at historical cost, which is assumed to approximate fair value. The estimated fair value measurement of cash equivalents is classified within level 1 of the valuation hierarchy . Investments-trading : These amounts are carried at fair value. The fair value is based on either quoted market prices of an active exchange, independent broker market quotations, market price quotations from third party pricing services, or valuation models when quotations are not available. Other investments, at fair value : These amounts are carried at fair value. The fair value is based on quoted market prices of an active exchange, independent broker market quotations, or valuation models when quotations are not available. In the case of investments in alternative investment funds, fair value is generally based on the reported net asset value of the underlying fund. Receivables under resale agreements : Receivables under resale agreements are carried at their contracted resale price, have short-term maturities, and are repriced frequently or bear market interest rates and, accordingly, these contracts are at amounts that approximate fair value. The estimated fair value measurements of receivables under resale agreements are based on observations of actual market activity and are generally classified within level 2 of the valuation hierarchy . Trading securities sold, not yet purchased : These amounts are carried at fair value. The fair value is based on quoted market prices of an active exchange, independent market quotations, market price quotations from third party pricing services, or valuation models when quotations are not available. Securities sold under agreements to repurchase : The liabilities for securities sold under agreements to repurchase are carried at their contracted repurchase price, have short-term maturities, and are repriced frequently with amounts normally due in one month or less and, accordingly, these contracts are carried at amounts that approximate fair value. The estimated fair value measurements of securities sold under agreements to repurchase are based on observations of actual market activity and are generally classified within level 2 of the valuation hierarchy . Redeemable financial instruments : The liabilities for redeemable financial instruments are carried at their redemption value, which approximates fair value. The estimated fair value measurement of the redeemable financial instruments is classified within level 3 of the valuation hierarchy . Debt : These amounts are carried at outstanding principal less unamortized discount and deferred financing costs. However, a substantial portion of the debt was assumed in the Merger and recorded at fair value as of that da te. As of March 31, 2019, and December 31, 2018 , the fair value of the Company’s debt was estimated to be $51,181 and $50,159 , respectively. The estimated fair value measurements of the debt are generally based on discounted cash flow models prepared by the Company’s management primarily using discount rates for similar instruments issued to companies with similar credit risks to the Company and are generally classified within level 3 of the value hierarchy. Derivatives : These amounts are carried at fair value. Derivatives may be included as a component of investments-trading; trading securities sold, not yet purchased; and other investments, at fair value. See notes 8 and 9 . The fair value is generally based on quoted market prices on an exchange that is deemed to be active for derivative instruments such as foreign currency forward contracts and Eurodollar futures. For derivative instruments, such as TBAs and other extended settlement trades, the fair value is generally based on market price quotations from third party pricing services. |
New Business
New Business | 3 Months Ended |
Mar. 31, 2019 | |
New Business [Abstract] | |
New Business | 4. NEW BUSINESS U.S. Insurance JV On May 16, 2018, the Compan y committed to invest up to $3,000 in a newly formed joint venture (the “ U.S. Insurance JV ”) with an outside investor who committed to invest approximately $63,000 of equity in the U.S. Insurance JV . The U.S. Insurance JV was formed for the purposes of investing in debt issued by small and medium sized U.S. and Bermuda insurance and reinsurance companies and is managed by the Company. The Company is required to invest 4.5% of the total equity of the U.S. Insurance JV with an absolute limit of $3,000 . The U.S. Insurance JV may use leverage to grow its assets. The insurance company debt that will be funded by the U.S. Insurance JV may be originated by the Company and there may be origination fees earned in connection with such transactions. The Company will also earn management fees as manager of the U.S. Insurance JV . The Company is entitled to a quarterly base management fee, an annual incentive fee (if certain return hurdles are met), and an additional incentive fee upon the liquidation of the portfolio (if certain return hurdles are met) . The Company has elected the fair value option in accordance with the provisions of FASB ASC 820, Fair Value Measurements (“FASB ASC 820”) to account for its investment in the U.S. Insurance JV. The investment is included in other investments, at fair value, on the consolidated balance sheets, and gains and losses (both realized and unrealized) are recognized in the consolidated statement of operations as a component of principal transactions and other income. Because the U.S. Insurance JV has the attributes of investment companies as described in FASB ASC 946-15-2, the Company will estimate the fair value of its investment using the net asset value (“NAV”) per share (or its equivalent) as of the reporting date in accordance with the “practical expedient” provisions related to investments in certain entities that calculate net asset value per share (or its equivalent) included in FASB ASC 820 for all entities. See note 7. SPAC Fund On August 6, 2018, the Company invested in and became the general partner of a newly formed partnership (the “ SPAC Fund”) for the purposes of investing in the equity interests of special purpose acquisition companies (“SPACs”). T he Company is the manager of the SPAC Fund. The Company has invested $600 in the SPAC Fund . The Company is entitled to a quarterly base management fee based on a percentage of the NAV of the SPAC Fund and an annual incentive allocation based on the actual returns earned by the SPAC Fund . The Company has elected the fair value option in accordance with the provisions of FASB ASC 820 to account for its investment in the SPAC Fund. The investment is included in other investments, at fair value on the consolidated balance sheets, and gains and losses (both realized and unrealized) are recognized in the statement of operations as a component of principal transactions and other revenue. Because the SPAC Fund has the attributes of investment companies as described in FASB ASC 946-15-2, the Company will estimate the fair value of its investment using the NAV per share (or its equivalent) as of the reporting date in accordance with the “practical expedient” provisions related to investments in certain entities that calculate net asset value per share (or its equivalent) included in FASB ASC 820 for all entities. See note 7. ViaNova Capital Group LLC In 2018, the Company formed a wholly - owned subsidiary, ViaNova Capital Group LLC (“ViaNova”) , for the purpose of building a residential transition loan (“ RTL ”) business. RTLs are small balance commercial loans that are secured by first lien mortgages used by professional investors and real estate developers to finance the purchase and rehabilitation of residential properties. The business of ViaNova includes buying, aggregating, and distributing these loans to produce superior risk-adjusted returns through the pursuit of opportunities overlooked by commercial banks. The Company consolidates ViaNova. On November 20, 2018, ViaNova entered into a Warehousing Credit and Security Agreement with LegacyTexas Bank (the “LegacyTexas Credit Facility” with an effective date of November 16, 2018. The LegacyTexas Credit Facility supports the buying, aggregating and distributing of residential loans performed by the business of ViaNova. As of March 31, 2019 , ViaNova has not yet acquired any assets or drawn down under t he LegacyTexas Credit Facility. See Note 16. Insurance Acquisition Corporation (the “Insurance SPAC”) The Company is the sponsor of the Insurance SPAC, a blank check company that will seek to effect a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses (each a “Business Combination”). On March 22, 2019, the Insurance SPAC completed the sale of 15,065,000 units (the “SPAC Units”) in its initial public offering (the “IPO”). Each Unit consists of one share of the SPAC’s Class A common stock, par value $0.0001 per share (“SPAC Common Stock”), and one-half of one warrant (each, a “SPAC Warrant”), where each whole SPAC Warrant entitles the holder to purchase one share of Common Stock for $11.50 per share. The SPAC Units were sold in the IPO at an offering price of $10.00 per SPAC Unit, for gross proceeds of $150,650 (before underwriting discounts and commissions and offering expenses). Pursuant to the underwriting agreement in the IPO, the Insurance SPAC granted the underwriters in the IPO (the “Underwriters”) a 45 -day option to purchase up to 1,965,000 additional SPAC Units solely to cover over-allotments, if any (the “Over-Allotment Option”); and on March 21, 2019, the Underwriters exercised the Over-Allotment Option in full. Immediately following the completion of the IPO, there were an aggregate of 20,653,333 shares of SPAC Common Stock issued and outstanding. If the Insurance SPAC fails to consummate a Business Combination within the first 18 months following the IPO, its corporate existence will cease except for the purposes of winding up its affairs and liquidating its assets. The Operating LLC is the manager and a member of each of two entities: Insurance Acquisition Sponsor, LLC and Dioptra Advisors, LLC (together, the “Sponsor Entities”). The Sponsor Entities purchased 375,000 of the Insurance SPAC’s placement units in a private placement that occurred simultaneously with the IPO for an aggregate purchase price of $3,750 , or $10.00 per placement unit. Each placement unit consists of one share of SPAC Common Stock and one-half of one warrant (the “Placement Warrant”). The placement units are identical to the SPAC Units sold in the IPO except (i) the shares of SPAC Common Stock issued as part of the placement units and the Placement Warrants will not be redeemable by the Insurance SPAC, (ii) the Placement Warrants may be exercised by the holders on a cashless basis, (iii) the shares of SPAC Common Stock issued as part of the placement units, together with the Placement Warrants, are entitled to certain registration rights, and (iv) for so long as they are held by the IPO underwriter, the placement units will not be exercisable more than five years following the effective date of the registration statement filed by the Insurance SPAC in connection with the IPO. Subject to certain limited exceptions, the placement units (including the underlying Placement Warrants and SPAC Common Stock and the shares of SPAC Common Stock issuable upon exercise of the Placement Warrants) will not be transferable, assignable, or salable until 30 days after the completion of our Business Combination. The Sponsor Entities raised $2,550 from third party investors and the remaining investment in the private placement was made by the Company. The Company consolidates the Sponsor Entities and treats its investment in the Insurance SPAC as an equity method investment. The $2,550 raised from third party investors is treated as non-controlling interest. See notes 11 and 17. The proceeds from the placement units were added to the net proceeds from the IPO to be held in a trust account. If the Insurance SPAC does not complete a Business Combination within the first 18 months following the IPO, the proceeds from the sale of the Placement Units will be used to fund the redemption of the SPAC Common Stock sold as part of the Units in the IPO (subject to the requirements of applicable law) and the Placement Warrants will expire worthless. The Sponsor Entities collectively hold 5,103,333 founder shares of the Insurance SPAC. Subject to certain limited exceptions, placement units held by the Sponsor Entities will not be transferable or salable until 30 days following a Business Combination, and founder shares held by the Sponsor Entities will not be transferable or salable except (a) with respect to 20% of such shares, until consummation of a Business Combination, and (b) with respect to additional 20% tranches of such shares, when the closing price of the Common Stock exceeds $12.00 , $13.50 , $15.00 and $17.00 , respectively, for 20 out of any 30 consecutive trading days following the consummation of a Business Combination, in each case subject to certain limited exceptions. |
Net Trading
Net Trading | 3 Months Ended |
Mar. 31, 2019 | |
Net Trading [Abstract] | |
Net Trading | 5. NET TRADING Net trading consisted of the following in the periods presented. NET TRADING (Dollars in Thousands) Three Months Ended March 31, 2019 March 31, 2018 Net realized gains (losses) - trading inventory $ 6,310 $ 4,224 Net unrealized gains (losses) - trading inventory 559 13 Net gains and losses 6,869 4,237 Interest income-trading inventory 1,615 1,356 Interest income-receivables under resale agreements 32,232 9,072 Interest income 33,847 10,428 Interest expense-securities sold under agreements to repurchase (31,130) (8,027) Interest expense-margin payable (857) (447) Interest expense (31,987) (8,474) Net trading $ 8,729 $ 6,191 Trading inventory includes investments classified as investments-trading as well as trading securities sold, not yet purchased. See note 7. See note 10 for discussion of receivables under resale agreements and securities sold under agreements to repurchase. See note 6 for discussion of margin payable. |
Receivables From And Payables T
Receivables From And Payables To Brokers, Dealers, And Clearing Agencies | 3 Months Ended |
Mar. 31, 2019 | |
Receivables From And Payables To Brokers, Dealers, And Clearing Agencies [Abstract] | |
Receivables From And Payables To Brokers, Dealers, And Clearing Agencies | 6. RECEIVABLES FROM AND PAYABLES TO BROKERS, DEALERS, AND CLEARING AGENCIES Amounts receivable from brokers, dealers, and clearing agencies consisted of the following. RECEIVABLES FROM BROKERS, DEALERS, AND CLEARING AGENCIES (Dollars in Thousands) March 31, 2019 December 31, 2018 Deposits with clearing agencies $ 250 $ 250 Unsettled regular way trades, net 5,816 - Receivables from clearing agencies 98,378 129,562 Receivables from brokers, dealers, and clearing agencies $ 104,444 $ 129,812 Amounts payable to brokers, dealers, and clearing agencies consisted of the following. PAYABLES TO BROKERS, DEALERS, AND CLEARING AGENCIES (Dollars in Thousands) March 31, 2019 December 31, 2018 Unsettled regular way trades, net $ - $ 5,822 Margin payable 162,951 195,776 Payables to brokers, dealers, and clearing agencies $ 162,951 $ 201,598 Deposits with clearing agencies represent contractual amounts the Company is required to deposit with its clearing agents. Securities transactions that settle in the regular way are recorded on the trade date, as if they had settled. The related amounts receivable and payable for unsettled securities transactions are recorded net in receivables from or payables to brokers, dealers, and clearing agencies on the Company’s consolidated balance sheets. Receivables from clearing agencies are primarily comprised of (i) cash received by the Company upon execution of short trades that is restricted from withdrawal by the clearing agent and (ii) cash deposited with the FICC to support the Company’s General Collateral Funding (“GCF”) matched book repo business. Margin payable represents amounts borrowed from Pershing, LLC to finance the Company’s trading portfolio. Effectively, all of the Company’s investments-trading and deposits with clearing agencies serve as collateral for the margin payable. See note 5 for interest expense incurred on margin payable. |
Financial Instruments
Financial Instruments | 3 Months Ended |
Mar. 31, 2019 | |
Financial Instruments [Abstract] | |
Financial Instruments | 7. FINANCIAL INSTRUMENTS Investments—Trading Investments-trading consisted of the following. INVESTMENTS - TRADING (Dollars in Thousands) March 31, 2019 December 31, 2018 U.S. government agency MBS and CMOs $ 185,905 $ 149,651 U.S. government agency debt securities 17,027 14,915 RMBS 29 21 U.S. Treasury securities 11,439 4,099 ABS 100 100 SBA loans 11,196 31,496 Corporate bonds and redeemable preferred stock 29,156 44,507 Foreign government bonds 875 117 Municipal bonds 17,281 47,433 Certificates of deposit 1,850 302 Derivatives 10,207 8,212 Equity securities 408 382 Investments-trading $ 285,473 $ 301,235 Trading Securities Sold, Not Yet Purchased Trading securities sold, not yet purchased consisted of the following. TRADING SECURITIES SOLD, NOT YET PURCHASED (Dollars in Thousands) March 31, 2019 December 31, 2018 U.S. government agency MBS and CMOs $ - $ 16 U.S. Treasury securities 42,043 70,010 Corporate bonds and redeemable preferred stock 46,530 43,957 Municipal bonds 20 20 Derivatives 9,652 6,119 Trading securities sold, not yet purchased $ 98,245 $ 120,122 The Company seeks to manage its exposure to changes in interest rates for the interest rate sensitive securities it holds by entering into offsetting short positions for similar fixed rate securities. See note 5 for realized and unrealized gains recognized on investments-trading. Other Investments, at fair value Other investments, at fair value consisted of the following. OTHER INVESTMENTS, AT FAIR VALUE (Dollars in Thousands) March 31, 2019 Amortized Cost Carrying Value Unrealized Gain / (Loss) Equity securities $ 780 $ 1,896 $ 1,116 CLOs 3,155 2,753 (402) CDOs 189 26 (163) EuroDekania 4,489 1,823 (2,666) U.S. Insurance JV 1,900 1,964 64 SPAC Fund 630 646 16 Residential loans 30 316 286 Foreign currency forward contracts - 16 16 Other investments, at fair value $ 11,173 $ 9,440 $ (1,733) December 31, 2018 Amortized Cost Carrying Value Unrealized Gain / (Loss) Equity securities $ 5,016 $ 6,650 $ 1,634 CLOs 3,099 2,730 (369) CDOs 189 26 (163) EuroDekania 4,489 1,533 (2,956) U.S. Insurance JV 1,900 1,925 25 SPAC Fund 600 592 (8) Residential loans 39 325 286 Foreign currency forward contracts - (13) (13) Other investments, at fair value $ 15,332 $ 13,768 $ (1,564) |
Fair Value Disclosures
Fair Value Disclosures | 3 Months Ended |
Mar. 31, 2019 | |
Fair Value Disclosures [Abstract] | |
Fair Value Disclosures | 8. FAIR VALUE DISCLOSURES Fair Value Option The Company has elected to account for certain of its other financial assets at fair value under the fair value option provisions of FASB ASC 825. The primary reason for electing the fair value option was to reduce the burden of monitoring the differences between the cost and the fair value of the Company’s investments, previously classified as available for sale securities, including the assessment as to whether the declines are temporary in nature and to further remove an element of management judgment. Such financial assets accounted for at fair value include: · securities that would otherwise qualify for available for sale treatment; · investments in equity method affiliates where the affiliate has all of the attributes set forth in FASB ASC 946-10-15-2 (commonly referred to as investment companies); and · investments in residential loans. The changes in fair value (realized and unrealized gains and losses) of these instruments for which the Company has elected the fair value option are recorded in principal transactions and other income in the consolidated statements of operations. All of the investments for which the Company has elected the fair value option are included as a component of other investments, at fair value in the consolidated balance sheets. The Company recognized net gains (losses) related to changes in fair value of investme nts of $249 and $151 during the three months ended March 31, 2019 and 2018, respectively. Fair Value Measurements In accordance with FASB ASC 820, the Company has categorized its financial instruments, based on the priority of the inputs to the valuation technique, into a three level fair value hierarchy. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (level 1 measurement) and the lowest priority to unobservable inputs (level 3 measurement). The three levels of the hierarchy under FASB ASC 820 are described below. Level 1 Financial assets and liabilities that have values based on unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities. Level 2 Financial assets and liabilities that have values based on one or more of the following: 1. Quoted prices for similar assets or liabilities in active markets; 2. Quoted prices for identical or similar assets or liabilities in non-active markets; 3. Pricing models whose inputs, other than quoted prices, are observable for substantially the full term of the asset or liability; or 4. Pricing models that have inputs derived principally from or corroborated by observable market data through correlation or other means for substantially the full term of the asset or liability. Level 3 Financial assets and liabilities that have values based on prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable. These inputs reflect management’s own assumptions about the assumptions a market participant would use in pricing the asset or liability. In certain cases, the inputs used to measure fair value may fall into different levels of the valuation hierarchy. In such cases, the level in the fair value hierarchy within which the fair value measurement in its entirety falls has been determined based on the lowest level input that is significant to the fair value measurement in its entirety. The Company’s assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to the asset or liability. Both observable and unobservable inputs may be used to determine the fair value of positions that the Company has classified within the level 3 of the valuation hierarchy. As a result, the unrealized gains and losses for assets and liabilities within the level 3 of the valuation hierarchy presented in the tables below may include changes in fair value that were attributable to both observable (e.g., changes in market interest rates) and unobservable (e.g., changes in unobservable long-dated volatilities) inputs. A review of the valuation hierarchy classifications is conducted on a quarterly basis. Changes in the type of inputs may result in a reclassification for certain financial assets or liabilities . There were no transfers between level 1 and level 2 of the valuation hierarchy during the three months ended March 31, 2019 and 2018 . Reclassifications between levels of the valuation hierarchy are reported as transfers in or transfers out as of the beginning of the quarter in which reclassifications occur. The following tables present information about the Company’s assets and liabilities measured at fair value on a recurring basis as of March 31, 2019 and December 31, 2018 , and indicate the fair value hierarchy of the valuation techniques utilized by the Company to determine such fair value. FAIR VALUE MEASUREMENTS ON A RECURRING BASIS March 31, 2019 (Dollars in Thousands) Significant Significant Quoted Prices in Other Observable Unobservable Active Markets Inputs Inputs Assets Fair Value (Level 1) (Level 2) (Level 3) Investments-trading: U.S. government agency MBS and CMOs $ 185,905 $ - $ 185,905 $ - U.S. government agency debt securities 17,027 - 17,027 - RMBS 29 - 29 - U.S. Treasury securities 11,439 11,439 - - ABS 100 - 100 - SBA loans 11,196 - 11,196 - Corporate bonds and redeemable preferred stock 29,156 - 29,156 - Foreign government bonds 875 - 875 - Municipal bonds 17,281 - 17,281 - Certificates of deposit 1,850 - 1,850 - Derivatives 10,207 - 10,207 - Equity securities 408 - 408 - Total investments - trading $ 285,473 $ 11,439 $ 274,034 $ - Other investments, at fair value: Equity securities $ 1,896 $ 1,043 $ 853 $ - CLOs 2,753 - - 2,753 CDOs 26 - - 26 Residential loans 316 - 316 - Foreign currency forward contracts 16 16 - - 5,007 $ 1,059 $ 1,169 $ 2,779 Investments measured at NAV (1) 4,433 Total other investments, at fair value $ 9,440 Liabilities Trading securities sold, not yet purchased: U.S. Treasury securities $ 42,043 $ 42,043 $ - $ - Corporate bonds and redeemable preferred stock 46,530 - 46,530 - Municipal bonds 20 - 20 - Derivatives 9,652 - 9,652 - Total trading securities sold, not yet purchased $ 98,245 $ 42,043 $ 56,202 $ - (1) As a practical expedient, the Company uses NAV or its equivalent to measure the fair value of its investments in EuroDekania, the U.S. Insurance JV , and the SPAC Fund. EuroDekania invests in hybrid capital securities of European companies. The U.S. Insurance JV invests in debt issued by small and medium sized U.S. and Bermuda insurance and reinsurance companies. The SPAC Fund invests in equity securities of SPACs. According to ASC 820, these investments are not categorized within the fair value hierarchy. FAIR VALUE MEASUREMENTS ON A RECURRING BASIS December 31, 2018 (Dollars in Thousands) Significant Significant Quoted Prices in Other Observable Unobservable Active Markets Inputs Inputs Assets Fair Value (Level 1) (Level 2) (Level 3) Investments-trading: U.S. government agency MBS and CMOs $ 149,651 $ - $ 149,651 $ - U.S. government agency debt securities 14,915 - 14,915 - RMBS 21 - 21 - U.S. Treasury securities 4,099 4,099 - - ABS 100 - 100 - SBA loans 31,496 - 31,496 - Corporate bonds and redeemable preferred stock 44,507 - 44,507 - Foreign government bonds 117 - 117 - Municipal bonds 47,433 - 47,433 - Certificates of deposit 302 - 302 - Derivatives 8,212 - 8,212 - Equity securities 382 - 382 - Total investments - trading $ 301,235 $ 4,099 $ 297,136 $ - Other investments, at fair value: Equity Securities $ 6,650 $ 5,775 $ 875 $ - CLOs 2,730 - - 2,730 CDOs 26 - - 26 Residential loans 325 - 325 - Foreign currency forward contracts (13) (13) - - 9,718 $ 5,762 $ 1,200 $ 2,756 Investments measured at NAV (1) 4,050 Total other investments, at fair value $ 13,768 Liabilities Trading securities sold, not yet purchased: U.S. government agency MBS $ 16 $ - $ 16 $ - U.S. Treasury securities 70,010 70,010 - - Corporate bonds and redeemable preferred stock 43,957 - 43,957 - Municipal bonds 20 - 20 - Derivatives 6,119 - 6,119 - Total trading securities sold, not yet purchased $ 120,122 $ 70,010 $ 50,112 $ - (1) As a practical expedient, the Company uses NAV or its equivalent to measure the fair value of its investments in EuroDekania, the U.S. Insurance JV, and the SPAC Fund. EuroDekania invests in hybrid capital securities of European companies. The U.S. Insurance JV invests in debt issued by small and medium sized U.S. and Bermuda insurance and reinsurance companies. The SPAC Fund invests in equity securities of SPACs. According to ASC 820, these investments are not categorized within the fair value hierarch y. The following provides a brief description of the types of financial instruments the Company holds, the methodology for estimating fair value, and the level within the hierarchy of the estimate. The discussion that follows applies regardless of whether the instrument is included in investments-trading; other investments, at fair value; or trading securities sold, not yet purchased. U.S. Government Agency MBS and CMOs : These are securities that are generally traded over-the-counter. The Company generally values these securities using third party quotations such as unadjusted broker-dealer quoted prices or market price quotations from third party pricing services. These valuations are based on a market approach. The Company classifies the fair value of these securities within level 2 of the valuation hierarchy. U.S. Government Agency Debt Securities : Callable and non-callable U.S. government agency debt securities are measured primarily based on quoted market prices obtained from third party pricing services. Non-callable U.S. government agency debt securities are generally classified within level 1 and callable U.S. government agency debt securities are classified within level 2 of the valuation hierarchy. RMBS : The Company generally values these securities using third party quotations such as unadjusted broker-dealer quoted prices or market price quotations from third party pricing services. These valuations are based on a market approach. The Company generally classifies the fair value of these securities based on third party quotations within level 2 of the valuation hierarchy. U.S. Treasury Securities : U.S. Treasury securities include U.S. Treasury bonds and notes and the fair values of the U.S. Treasury securities are based on quoted prices or market activity in active markets. Valuation adjustments are not applied. The Company classifies the fair value of these securities within level 1 of the valuation hierarchy. CLOs, CDOs, and ABS : CLOs, CDOs, and ABS are interests in securitizations. ABS may include, but are not limited to, securities backed by auto loans, credit card receivables, or student loans. When the Company is able to obtain independent market quotations from at least two broker-dealers and when a price within the range of at least two broker-dealers is used or market price quotations from third party pricing services is used, these interests in securitizations will generally be classified within level 2 of the valuation hierarchy. These valuations are based on a market approach. The independent market quotations from broker-dealers are generally nonbinding. The Company seeks quotations from broker-dealers that historically have actively traded, monitored, issued, and been knowledgeable about the interests in securitizations. The Company generally believes to the extent that it (i) receives two quotations in a similar range from broker-dealers knowledgeable about these interests in securitizations and (ii) considers the broker-dealers gather and utilize observable market information such as new issue activity in the primary market, trading activity in the secondary market, credit spreads versus historical levels, bid-ask spreads, and price consensus among market participants and sources, then classification within level 2 of the valuation hierarchy is appropriate. In the absence of two broker-dealer market quotations, a single broker-dealer market quotation may be used without corroboration of the quote in which case the Company generally classifies the fair value within level 3 of the valuation hierarchy. If quotations are unavailable, prices observed by the Company for recently executed market transactions or valuation models prepared by the Company’s management may be used, which are based on an income approach. These models prepared by the Company’s management include estimates, and the valuations derived from them could differ materially from amounts realizable in an open market exchange. Each CLO and CDO position is evaluated independently taking into consideration available comparable market levels, underlying collateral performance and pricing, deal structures, and liquidity. Fair values based on internal valuation models prepared by the Company’s management are generally classified within level 3 of the valuation hierarchy. Establishing fair value is inherently subjective (given the volatile and sometimes illiquid markets for certain interests in securitizations) and requires management to make a number of assumptions, including assumptions about the future of interest rates, discount rates, and the timing of cash flows. The assumptions the Company applies are specific to each security. Although the Company may rely on internal calculations to compute the fair value of certain interest in securitizations, the Company requests and considers indications of fair value from third party pricing services to assist in the valuation process. SBA Loans : SBA loans include loans and SBA interest only strips. In the case of loans, the Company generally values these securities using third party quotations such as unadjusted broker-dealer quoted prices, internal valuation models using observable inputs, or market price quotations from third party pricing services. The Company generally classifies these investments within level 2 of the valuation hierarchy. These valuations are based on a market approach. SBA interest only strips do not trade in an active market with readily available prices. Accordingly, the Company generally uses valuation models to determine fair value and classifies the fair value of the SBA interest only strips within level 2 or level 3 of the valuation hierarchy depending on whether the model inputs are observable or not. Corporate Bonds and Redeemable Preferred Stock : The Company uses recently executed transactions or third party quotations from independent pricing services to arrive at the fair value of its investments in corporate bonds and redeemable preferred stock. These valuations are based on a market approach. The Company generally classifies the fair value of these bonds within level 2 of the valuation hierarchy. In instances where the fair values of securities are based on quoted prices in active markets (for example with redeemable preferred stock), the Company classifies the fair value of these securities within level 1 of the valuation hierarchy. Foreign Government Bonds : The fair value of foreign government bonds is estimated using valuations provided by third party pricing services and are valued within level 2 of the valuation hierarchy. Municipal Bonds : Municipal bonds, which include obligations of U.S. states, municipalities, and political subdivisions, primarily include bonds or notes issued by U.S. municipalities. The Company generally values these securities using third party quotations such as market price quotations from third party pricing services. The Company generally classifies the fair value of these bonds within level 2 of the valuation hierarchy. The valuations are based on a market approach. In instances where the Company is unable to obtain reliable market price quotations from third party pricing services, the Company will use its own internal valuation models. In these cases, the Company will classify such securities within level 3 of the valuation hierarchy until it is able to obtain third party pricing. Certificates of Deposit : The fair value of certificates of deposit is estimated using valuations provided by third party pricing services. Certificates of deposit are categorized in level 2 of the valuation hierarchy. Residential Loans : Management utilizes home price indices or market indications to value the residential loans. These are considered level 2 in the valuation hierarchy. Equity Securities : The fair value of equity securities that represent unrestricted investments in publicly traded companies (common or preferred shares, options, warrants, and other equity investments) are determined using the closing price of the security as of the reporting date. These are securities that are traded on a recognized liquid exchange and classified within level 1 of the valuation hierarchy. The Company may own an option or warrant where the underlying security is publicly traded but the option or warrant is not. In those cases, the Company may determine fair value using a Black-S c holes model and will generally classify this to be l evel 2 within the valuation hierarchy. The Company may own an equity investment in a publicly traded company that is restricted as to resale. In those cases, the Company may determine fair value by preparing a model. The valuation will be classified within l evel 2 if the inputs to the model are observable. Otherwise, it will be considered a l evel 3 valuation. The Company may own an equity interest in a private company. In those cases, the Company may determine fair value by preparing a model. The model may be either a market based or income - based model , whichever is considered the most appropriate in each case. The valuation will be classified within l evel 2 if the inputs to the model are observable. Otherwise, it will be considered a l evel 3 valuation . Derivatives Foreign Currency Forward Contracts Foreign currency forward contracts are exchange-traded derivatives, which transact on an exchange that is deemed to be active. The fair value of the foreign currency forward contracts is based on current quoted market prices. Valuation adjustments are not applied. These are considered level 1 in the valuation hierarchy. See note 9. TBAs and Other Forward Agency MBS Contracts The Company generally values these securities using third party quotations such as unadjusted broker-dealer quoted prices or market price quotations from third party pricing services. TBAs and other forward agency MBS contracts are generally classified within level 2 of the valuation hierarchy. If there is limited transaction activity or less transparency to observe market based inputs to valuation models, TBAs and other forward agency MBS contracts are classified in level 3 of the valuation hierarchy. U.S. government agency MBS and CMOs include TBAs and other forward agency MBS contracts. Unrealized gains on TBAs and other forward agency MBS contracts are included in investments-trading on the Company’s consolidated balance sheets and unrealized losses on TBAs and other forward agency MBS contracts are included in trading securities sold, not yet purchased on the Company’s consolidated balance sheets. See note 9. Other Extended Settlement Trades When the Company buys or sells a financial instrument that will not settle in the regular time frame, the Company will account for that purchase or sale on the settlement date rather than the trade date. In those cases, the Company accounts for the transaction between trade date and settlement date as a derivative (as either a purchase commitment or sale commitment). The Company will record an unrealized gain or unrealized loss on the derivative for the difference between the fair value of the underlying financial instrument as of the reporting date and the agreed upon transaction price. The Company will determine the fair value of the financial instrument using the methodologies described above. Level 3 Financial Assets and Liabilities Financial Instruments Measured at Fair Value on a Recurring Basis The following table presents additional information about assets measured at fair value on a recurring basis and for which the Company has utilized level 3 inputs to determine fair value. LEVEL 3 ROLLFORWARD Three Months Ended March 31, 2019 2018 Beginning of period $ 2,756 $ 4,511 Gains & losses (1) (33) (9) Accretion of income (1) 106 343 Purchases - 9,600 Sales and returns of capital (50) (169) End of period $ 2,779 $ 14,276 Change in unrealized gains / (losses) (2) $ (33) $ 147 (1) Gains and losses on and accretion of income on other investments , at fair value are recorded as a component of principal transactions and other income in the consolidated statements of operations. (2) Represents the change in unrealized gains and losses for the period included in earnings for assets held at the end of the reporting period. The circumstances that would result in transferring certain financial instruments from level 2 to level 3 of the valuation hierarchy would typically include what the Company believes to be a decrease in the availability, utility, and reliability of observable market information such as new issue activity in the primary market, trading activity in the secondary market, credit spreads versus historical levels, bid-ask spreads, and price consensus among market participants and sources. There were no transfers between level 2 and 3 during the periods presented. The following tables provide the quantitative information about level 3 fair value measurements as of March 31, 2019 and December 31, 2018 . QUANTITATIVE INFORMATION ABOUT LEVEL 3 FAIR VALUE MEASUREMENTS (Dollars in Thousands) Significant Range of Fair Value Valuation Unobservable Weighted Significant March 31, 2019 Technique Inputs Average Inputs Assets Other investments, at fair value CLOs $ 2,753 Discounted Cash Flow Model Yield 17.6% 15.6% - 19.3% Duration-years 6.6 6.1 - 7.3 Default rate 2.0% 2% - 2% QUANTITATIVE INFORMATION ABOUT LEVEL 3 FAIR VALUE MEASUREMENTS (Dollars in Thousands) Significant Range of Fair Value Valuation Unobservable Weighted Significant December 31, 2018 Technique Inputs Average Inputs Assets Other investments, at fair value CLOs $ 2,730 Discounted Cash Flow Model Yield 20.0% 18.1 - 21.6% Duration-years 6.9 6.3 - 7.5 Default rate 2.0% 2.0% Sensitivity of Fair Value to Changes in Significant Unobservable Inputs For recurring fair value measurements categorized within level 3 of the valuation hierarchy, the sensitivity of the fair value measurement to changes in significant unobservable inputs and interrelationships between those unobservable inputs (if any) are described below. · CLOs: The Company uses a discounted cash flow model to determine the fair value of its investments in CLOs. Changes in the yield, duration, and default rate assumptions would impact the fair value determined. The longer the duration, the lower the fair value of the investment. The higher the yield, the lower the fair value of the investment. The higher the default rate, the lower the fair value of the investment. Investments in Certain Entities that Calculate NAV Per Share (or its Equivalent) The following table presents additional information about investments in certain entities that calculate NAV per share (regardless of whether the “practical expedient” provisions of FASB ASC 820 have been applied), which are measured at fair value on a recurring basis at March 31, 2019 and December 31, 2018 . FAIR VALUE MEASUREMENTS OF INVESTMENTS IN CERTAIN ENTITIES THAT CALCULATE NET ASSET VALUE PER SHARE (OR ITS EQUIVALENT) (Dollars in Thousands) Fair Value March 31, 2019 Unfunded Commitments Redemption Frequency Redemption Notice Period Other investments, at fair value EuroDekania (a) $ 1,823 N/A N/A N/A U.S. Insurance JV (b) 1,964 $ 1,100 N/A N/A SPAC Fund (c) 646 N/A Quarterly after 1 year lock up 90 days $ 4,433 Fair Value December 31, 2018 Unfunded Commitments Redemption Frequency Redemption Notice Period Other investments, at fair value EuroDekania (a) $ 1,533 N/A N/A N/A U.S. Insurance JV (b) 1,925 $ 1,100 N/A N/A SPAC Fund (c) 592 N/A Quarterly after 1 year lock up 90 days $ 4,050 N/A Not applicable. (a) EuroDekania owns investments in hybrid capital securities that have attributes of debt and equity, primarily in the form of subordinated debt issued by insurance companies, banks, and bank holding companies based primarily in Western Europe; widely syndicated leveraged loans issued by European corporations; commercial mortgage backed securities (“CMBS”), including subordinated interests in first mortgage real estate loans; and RMBS and ABS backed by consumer and commercial receivables. The majority of the assets are denominated in Euros and U.K. Pounds Sterling. (b) The U.S. Insurance JV invests in debt issued by small and medium sized U.S. and Bermuda insurance and reinsurance companies. (c) The SPAC Fund invests in equity interests of SPACs. |
Derivative Financial Instrument
Derivative Financial Instruments | 3 Months Ended |
Mar. 31, 2019 | |
Derivative Financial Instruments [Abstract] | |
Derivative Financial Instruments | 9. DERIVATIVE FINANCIAL INSTRUMENTS FASB ASC 815, Derivatives and Hedging (“FASB ASC 815”) , provides for optional hedge accounting. When a derivative is deemed to be a hedge and certain documentation and effectiveness testing requirements are met, reporting entities are permitted to record all or a portion of the change in the fair value of a designated hedge as an adjustment to AOCI rather than as a gain or loss in the statements of operations. To date, the Company has not designated any derivatives as hedges under the provisions included in FASB ASC 815. All of the derivatives that the Company enters into contain master netting arrangements. If certain requirements are met, the offsetting provisions included in FASB ASC 210, Balance Sheet (“FASB ASC 210”), allow (but do not require) the reporting entity to net the asset and liability on the consolidated balance sheets. It is the Company’s policy to present the assets and liabilities on a net basis if the conditions of FASB ASC 210 are met. However, in general the Company does not enter into offsetting derivatives with the same counterparties. Therefore, in all of the periods presented, no derivatives are presented on a net basis. Derivative financial instruments are recorded at fair value. If the derivative was entered into as part of the Company’s broker-dealer operations, it will be included as a component of investments-trading or trading securities sold, not yet purchased. If it is entered into to hedge another financial instrument included in other investments, at fair value then the derivative will be included as a component of other investments, at fair value. The Company may, from time to time, enter into derivatives to manage its risk exposures arising from (i) fluctuations in foreign currency rates with respect to the Company’s investments in foreign currency denominated investments; (ii) the Company’s investments in interest sensitive investments; and (iii) the Company’s facilitation of mortgage-backed securities trading. Derivatives entered into by the Company, from time to time, may include (i) foreign currency forward contracts; (ii) purchase and sale agreements of TBAs and other forward agency MBS contracts; and (iii) other extended settlement trades. TBAs are forward contracts to purchase or sell MBS whose collateral remain “to be announced” until just prior to the trade settlement date. In addition to TBAs, the Company sometimes enters into forward purchases or sales of agency MBS where the underlying collateral has been identified. These transactions are referred to as other forward agency MBS contracts. TBAs and other forward agency MBS contracts are accounted for as derivatives by the Company under FASB ASC 815. The settlement of these transactions is not expected to have a material effect on the Company’s consolidated financial statements. In addition to TBAs and other forward agency MBS contracts as part of the Company’s broker-dealer operations, the Company may from time to time enter into other securities or loan trades that do not settle within the normal securities settlement period. In those cases, the purchase or sale of the security or loan is not recorded until the settlement date. However, from the trade date until the settlement date, the Company’s interest in the security is accounted for as a derivative as either a forward purchase commitment or forward sale commitment. Derivatives involve varying degrees of off-balance sheet risk, whereby changes in the level or volatility of interest rates or market values of the underlying financial instruments may result in changes in the value of a particular financial instrument in excess of its carrying amount. Depending on the Company’s investment strategy, realized and unrealized gains and losses are recognized in principal transactions and other income or in net trading in the Company’s consolidated statements of operations on a trade date basis. The Company may, from time to time, enter into the following derivative instruments. Foreign Currency Forward Contracts The Company invests in foreign currency denominated investments that expose it to fluctuations in foreign currency rates, and, therefore, the Company may, from time to time, hedge such exposure by using foreign currency forward contracts. The Company carries foreign currency forward contracts at fair value and includes them as a component of other investments, at fair value in the Company’s consolidated balance sheets . As of March 31, 2019 and December 31, 2018 , the Company had outstanding foreign currency forward contracts with a notional amount of 1.250 million Euros and 1.250 million Euros, respectively. EuroDollar Futures The Company invests in floating rate investments that expose it to fluctuations in interest rates and, therefore, the Company may, from time to time, hedge such exposure using EuroDollar futures. The Company carries such EuroDollar future contracts at fair value and includes them as a component of investments-trading or trading securities sold, not yet purchased in the Company’s consolidated balance sheets. A s of March 31, 2019 a nd December 31, 2018 , the Company had no outstanding EuroDollar future contracts. TBAs and Other Forward Agency MBS Contracts The Company enters into TBAs and other forward agency MBS transactions for three main reasons. (i) The Company trades U.S. government agency obligations. In connection with these activities, the Company may be required to maintain inventory in order to facilitate customer transactions. In order to mitigate exposure to market risk, the Company may enter into the purchase and sale of TBAs and other forward agency MBS contracts. (ii) The Company also enters into TBAs and other forward agency MBS contracts in order to assist clients (generally small to mid-size mortgage loan originators) in hedging the interest rate risk associated with the mortgages owned by these clients. (iii) Finally, the Company may enter into TBAs and other forward agency MBS contracts on a speculative basis. The Company carries the TBAs and other forward agency MBS contracts at fair value and includes them as a component of investments-trading or trading securities sold, not yet purchased in the Company’s consolidated balance sheets. At March 31, 2019 , the Company had open TBA and other forward MBS purchase agreements in the notional amount of $ 1,642,700 and open TBA and other forward MBS sale agreements in the notional amount of $ 1,693,890 . At December 31, 2018 , the Company had open TBA and other forward agency MBS purchase agreements in the notional amount of $1,025,850 and open TBA and other forward agency MBS sale agreements in the notional amount of $1,069,688 . Other Extended Settlement Trades When the Company buys or sells a financial instrument that will not settle in the regular time frame, the Company will account for that purchase and sale on the settlement date rather than the trade date. In those cases, the Company accounts for the transaction between trade date and settlement date as either a forward purchase commitment or a forward sale commitment, both considered derivatives. The Company will record an unrealized gain or unrealized loss on the derivative for the difference between the fair value of the underlying financial instrument as of the reporting date and the agreed upon transaction price. At March 31, 2019 and December 31, 2018 , the Company had open forward purchase commitments in the notional amount of $13,707 and $15,295 , respectively. The following table presents the Company’s derivative financial instruments and the amount and location of the fair value (unrealized gain / (loss)) recognized in the consolidated balance sheets as of March 31, 2019 and December 31, 2018 . DERIVATIVE FINANCIAL INSTRUMENTS-BALANCE SHEET INFORMATION (Dollars in Thousands) Derivative Financial Instruments Not Designated as Hedging Instruments Under FASB ASC 815 Balance Sheet Classification March 31, 2019 December 31, 2018 TBAs and other forward agency MBS Investments-trading $ 10,161 $ 8,142 Other extended settlement trades Investments-trading 46 70 Foreign currency forward contracts Other investments, at fair value 16 (13) TBAs and other forward agency MBS Trading securities sold, not yet purchased (9,652) (6,116) Other extended settlement trades Trading securities sold, not yet purchased - (3) $ 571 $ 2,080 The following table presents the Company’s derivative financial instruments and the amount and location of the net gain / (loss) recognized in the consolidated statements of operations. DERIVATIVE FINANCIAL INSTRUMENTS-STATEMENT OF OPERATIONS INFORMATION (Dollars in Thousands) Derivative Financial Instruments Not Designated as Hedging Instruments Under FASB ASC 815 Income Statement Classification Three Months Ended March 31, 2019 Three Months Ended March 31, 2018 Foreign currency forward contracts Revenue-principal transactions and other income $ 40 $ (19) Other extended settlement trades Revenue-net trading (24) (10) TBAs and other forward agency MBS Revenue-net trading 761 1,959 $ 777 $ 1,930 |
Collateralized Securities Trans
Collateralized Securities Transactions | 3 Months Ended |
Mar. 31, 2019 | |
Collateralized Securities Transactions [Abstract] | |
Collateralized Securities Transactions | 10. COLLATERALIZED SECURITIES TRANSACTIONS Matched Book Repo Business The Company enters into repurchase and reverse repurchase agreements as part of its matched book repo business. In general, the Company will lend money to a counterparty after obtaining collateral securities from that counterparty pursuant to a reverse repurchase agreement. The Company will borrow money from another counterparty using those same collateral securities pursuant to a repurchase agreement. The Company seeks to earn net interest income on these transactions. Currently, the Company categorizes its matched book repo business into two major groups: gestational repo and GCF repo. Gestational Repo For several years, the Company has operated a matched book gestational repo program. Gestational repo involves entering into repurchase and reverse repurchase agreements where the underlying collateral security represents a pool of newly issued mortgage loans. The borrowers (the reverse repurchase agreement counterparties) are generally mortgage originators. The lenders (the repurchase agreement counterparties) are a diverse group of the counterparties comprised of banks, insurance companies, and other financial institutions. The Company’s gestational repo transactions were cleared through Industrial and Commercial Bank of China (“ICBC”) through April 1, 2018. Subsequent to that date, the Company has self-cleared its gestational repo transactions. GCF Repo On October 18, 2017, the Company was notified that it had been approved as a full netting member of the FICC’s Government Securities Division. As a member of the FICC, the Company has access to the FICC’s GCF repo service that provides netting and settlement services for repurchase transactions where the underlying security is general collateral (primarily U.S. Treasuries and U.S. Agency securities). The Company began entering into matched book GCF repo transactions in November 2017. The borrowers (the reverse repurchase agreement counterparties) are a diverse group of financial institutions including hedge funds, registered investment funds, REITs, and other similar counterparties. The lender (the repurchase agreement counterparty) is primarily the FICC itself. The Company uses Bank of New York (“BONY”) as its settlement agent for its GCF repo matched book transactions. The Company is considered self-clearing for this business. In connection with the Company’s full netting membership of the FICC, the Company agreed to establish and maintain a committed line of credit in a minimum amount of $25,000 on or prior to April 30, 2018. The Company entered into the $25,000 MB LOC on April 25, 2018. The line of credit arrangement was subsequently amended. See note 16. Other Repo Transactions In addition to the Company’s matched book repo business, the Company may also enter into reverse repurchase agreements to acquire securities to cover short positions or as an investment. Additionally, the Company may enter into repurchase agreements to finance the Company’s securities positions held in inventory. These repurchase and reverse repurchase agreements are generally cleared on a bilateral or triparty basis; no clearing broker is involved. These transactions are not matched. Repo Information At March 31, 2019 and December 31, 2018 , the Company held reverse repurchase agreements of $ 4,510,389 and $ 5,171,053 , respectively, and the fair value of collateral received under reverse repurchase agreements was $4,744,785 , and $5,444,823 , respectively. As of March 31, 2019 , the reverse repurchase agreement balance was comprised of receivables collateralized by securities with 35 counterparties. As of December 31, 2018 , the reverse repurchase agreements balance was comprised of receivables collateralized by securities with 36 counterparties. At March 31, 2019 and December 31, 2018 , the Company held repurchase agreements of $ 4,560,713 and $ 5,210,587 , respectively, and the fair value of securities and cash pledged as collateral under repurchase agreements was $ 4,610,690 and $ 5,233,017 , respectively. These amounts include collateral for reverse repurchase agreements that were re-pledged as collateral for repurchase agreements. Intraday Lending Facility In conjunction with the Company’s GCF repo business, on October 19, 2018, the Company and BONY renewed an intraday lending facility. This lending facility allows for BONY to advance funds to JVB in order to facilitate the settlement of GCF repo transactions. The total committed amount at March 31, 2019 was $100,000 . Effective April 11, 2019, this commitment amount was be reduced to $75,000 . The reduction was initiated by the Company as a cost savings measure and because an intraday line of $100,000 was not deemed necessary. The termination date of the intraday lending facility is October 19, 2019. It is expected that this facility will be renewed for successive 364 -day periods provided that the Company continues its GCF repo business. The BONY lending facility is structured so that advances are generally repaid before the end of each business day. However, if an advance is not repaid by the end of any business day, the advance is converted to an overnight loan. Intraday loans accrue interest at an annual rate of 0.12% . Interest is charged based on the number of minutes in a day the advance is outstanding. Overnight loans are charged interest at the base rate plus 3% on a daily basis. The base rate is the higher of the federal funds rate plus 0.50% or the prime rate in effect at that time. For the three months ended March 31, 2019 and 2018 , the Company received no advances under the intraday lending facility. Concentration In the matched book repo business, the demand for borrowed funds is generated by the reverse repurchase agreement counterparty and the supply of funds is provided by the repurchase agreement counterparty. On the demand side, the Company does not consider its GCF repo business to be concentrated. The Company’s reverse repo counterparties are a diverse group of financial institutions. On the supply side, the Company obtains nearly all of its funds from the FICC. If the FICC were to reduce its repo lending activities or make significant adverse changes to the cost of such lending, the Company may not be able to replace the FICC funding, or if the Company does so, it may be at a higher cost of funding. Therefore, the Company considers its GCF repo business to be concentrated from the funding side of the business. The gestational repo business has been and continues to be concentrated as to reverse repurchase counterparties. The Company conducts this business with a limited number of reverse repo counterparties. As of March 31, 2019 and December 31, 2018, the Company’s gestational reverse repurchase agreements shown in the tables below represented balances from six counterparties. The Company also has a limited number of repurchase agreement counterparties in the gestational repo business, however, it is primarily a function of the limited number of reverse repurchase agreement counterparties with whom the Company conducts this business rather than a reflection of a limited supply of funds. Therefore, the Company considers the gestational repo business to be concentrated on the demand side. The total net revenue earned by the Company on its matched book repo business (both gestational repo and GCF repo) was $ 1,294 and $1,110 for the three months ended March 31, 2019 and 2 018, respectively. The following tables summarize the remaining contractual maturity of the gross obligations under repurchase agreements accounted for as secured borrowings segregated by the underlying collateral pledged as of each date shown. The table reconciles the gross amounts to the net amounts presented in the statement of financial condition. All gross amounts as well as counterparty cash collateral (see note 13) are subject to master netting arrangements; however, there is no offsetting other than the balances with the FICC, as shown below. SECURED BORROWINGS (Dollars in Thousands) March 31, 2019 Repurchase Agreements Remaining Contractual Maturity of the Agreements Collateral Type: Overnight and Continuous Up to 30 days 30 - 90 days Greater than 90 days Total U.S. government agency MBS (GCF repo) $ 2,486,338 $ 1,726,351 $ 250,579 $ 550,866 $ 5,014,134 MBS (gestational repo) - 436,626 - - 436,626 SBA loans 11,095 - - - 11,095 $ 2,497,433 $ 2,162,977 $ 250,579 $ 550,866 $ 5,461,855 Reverse repurchase agreements with FICC netted with repurchase agreements with FICC $ (901,142) Securities sold under agreements to repurchase $ 4,560,713 Reverse Repurchase Agreements Remaining Contractual Maturity of the Agreements Collateral Type: Overnight and Continuous Up to 30 days 30 - 90 days Greater than 90 days Total U.S. government agency MBS (GCF repo) $ 450,360 $ 1,404,899 $ 2,668,661 $ 449,602 $ 4,973,522 MBS (gestational repo) - 438,009 - - 438,009 SBA loans - - - - - $ 450,360 $ 1,842,908 $ 2,668,661 $ 449,602 $ 5,411,531 Reverse repurchase agreements with FICC netted with repurchase agreements with FICC $ (901,142) Receivables under resale agreements $ 4,510,389 SECURED BORROWINGS (Dollars in Thousands) December 31, 2018 Repurchase Agreements Remaining Contractual Maturity of the Agreements Collateral Type: Overnight and Continuous Up to 30 days 30 - 90 days Greater than 90 days Total U.S. government agency MBS (GCF repo) $ 7,014,758 $ 250,537 $ - $ - $ 7,265,295 MBS (gestational repo) - 287,400 100,918 - 388,318 SBA loans 18,151 - - - 18,151 $ 7,032,909 $ 537,937 $ 100,918 $ - $ 7,671,764 Reverse repurchase agreements with FICC netted with repurchase agreements with FICC $ (2,461,177) Securities sold under agreements to repurchase $ 5,210,587 Reverse Repurchase Agreements Remaining Contractual Maturity of the Agreements Collateral Type: Overnight and Continuous Up to 30 days 30 - 90 days Greater than 90 days Total U.S. government agency MBS (GCF repo) $ 10,864 $ 5,477,247 $ 598,635 $ 1,157,349 $ 7,244,095 MBS (gestational repo) - 287,209 100,926 - 388,135 SBA loans - - - - - $ 10,864 $ 5,764,456 $ 699,561 $ 1,157,349 $ 7,632,230 Reverse repurchase agreements with FICC netted with repurchase agreements with FICC $ (2,461,177) Receivables under resale agreements $ 5,171,053 |
Investment In Equity Method Aff
Investment In Equity Method Affiliate | 3 Months Ended |
Mar. 31, 2019 | |
Investment in Equity Method Affiliate [Abstract] | |
Investment In Equity Method Affiliate | 11. INVESTMENT IN EQUITY METHOD AFFILIATE Equity method accounting requires that the Company record its investment in equity method affiliates on the consolidated balance sheets and recognize its share of the equity method affiliates’ net income as earnings each reporting period. The Company has certain equity method affiliates for which it has elected the fair value option. Those investees are excluded from the table below. Those investees are included as a component of other investments, at fair value in the consolidated balance sheets. All asset management fees and gains and losses (unrealized and realized) from securities classified as other investments, at fair value in the consolidated balance sheets are recorded as a component of asset management and principal transactions and other income in the consolidated statement of operations. See note 23. The following table summarizes the activity and earnings in the Company’s investment that is accounted for under the equity method. See note 4. INVESTMENTS IN EQUITY METHOD AFFILIATES (Dollars in Thousands) Insurance SPAC January 1, 2019 $ - Investments / advances 3,775 Distributions / repayments - Earnings / (loss) realized (8) March 31, 2019 $ 3,767 |
Leases
Leases | 3 Months Ended |
Mar. 31, 2019 | |
Leases [Abstract] | |
Leases | 12. LEASES The Company leases office space and certain computer and related equipment under noncancelable operating leases. The company determines if an arrangement is a lease at the inception date of the contract. The Company measures operating lease liabilities using an estimated incremental borrowing rate as there is no rate implicit in the Company’s operating lease arrangements. An incremental borrowing rate was calculated for each operating lease based on the term of the lease, the U.S. Treasury term interest rate, and an estimated spread to borrow on a secured basis. The Company adopted the provisions of ASC 842 effective January 1, 2019. At adoption, the Company elected to not restate prior periods and rather re cord a cumulative effect of accounting change effective January 1, 2019. The Company recorded the following: (a) a right of use asset of $8,416 , (b) a lease commitment liability of $8,860 , (c) a reduction in retained earnings from cumulative effect of adoption of $20 , (d) an increase in other receivables of $18 , and (e) a reduction in other liabilities of $406 . Rent expense is recognized on a straight-line basis over the lease term and is in included business development, occupancy, and equipment expense. As of March 31, 2019, all of the leases to which the Company was a party were operating leases. The weighted average remaining term of the leases was 8.65 years. The weighted average discount rate for the leases was 5.27% . Summarized information regarding these leases is shown in the following table. FUTURE MATURITY OF LEASE LIABILITIES (Dollars in Thousands) As of March 31, 2019 Lease Payments 2019 - remaining $ 1,290 2020 1,564 2021 1,108 2022 933 2023 950 Thereafter 5,077 Total 10,922 Less imputed interest (2,264) Lease obligation $ 8,658 During the three months ended March 31, 2019, total cash payments of $286 were recorded as a reduction in the operating lease obligation. No cash payments were made to acquire right of use assets. Rent expense, net of sublease income of $65 , was $390 for the three months ended March 31, 2019. |
Other Receivables, Other Assets
Other Receivables, Other Assets And Accounts Payable And Other Liabilities | 3 Months Ended |
Mar. 31, 2019 | |
Other Receivables, Other Assets And Accounts Payable And Other Liabilities [Abstract] | |
Other Receivables, Other Assets And Accounts Payable And Other Liabilities | 13. OTHER RECEIVABLES, OTHER ASSETS, ACCOUNTS PAYABLE AND OTHER LIABILITIES Other receivables consisted of the following at the periods presented . OTHER RECEIVABLES (Dollars in Thousands) March 31, 2019 December 31, 2018 Cash collateral due from counterparties $ 5,508 $ 6,216 Asset management fees receivable 954 947 New issue and advisory fees receivable - 2,100 Accrued interest receivable and dividend receivable 1,254 2,359 Revenue share receivable 96 140 Other receivables 384 310 Other receivables $ 8,196 $ 12,072 When the Company enter s into a reverse repo, it obtain s collateral in excess of the principal amount of the reverse repo. C ollateral can be in the form of liquid securities or cash. To the extent the Company receive s cash collateral, it is included as a component of other liabilities (counterparty cash collateral in the table below) . If the value of the securities receive d as collateral increases, the Company’s reverse repo counterparties may request a return of a portion of their collateral. At times, the Company will return cash instead of securities. In those cases, the cash collateral is included as a component of other receivables. Asset management and new issue and advisory receivables are of a routine and short-term nature. These amounts are generally accrued monthly and paid on a monthly or quarterly basis . Accrued interest and dividends receivable represent interest and dividends accrued on the Company’s investment securities included as a component of investments-trading or other investments, at fair value. Interest payable on securities sold , not yet purchased is included as a component of accounts payable and other liabilities in the table entitled Accounts Payable and Other Liabilities below. Revenue share receivable represents the amount due to the Company for the Company’s share of revenue generated from various entities in which the Company receives a share of the entity’s revenue. Other receivables represent other miscellaneous receivables that are of a short-term nature. Other assets consisted of the following in the periods presented. OTHER ASSETS (Dollars in Thousands) March 31, 2019 December 31, 2018 Deferred costs $ 648 $ 571 Prepaid expenses 1,037 1,009 Prepaid income taxes - 40 Deposits 681 669 Miscellaneous other assets 33 33 Furniture, equipment, and leasehold improvements, net 1,072 1,133 Intangible assets 166 166 Other assets $ 3,637 $ 3,621 Accounts payable and other liabilities consisted of the following at the periods presented. ACCOUNTS PAYABLE AND OTHER LIABILITIES (Dollars in Thousands) March 31, 2019 December 31, 2018 Accounts payable $ 285 $ 359 Redeemable financial instruments accrued interest 352 714 Straight line rent payable - 405 Accrued interest payable 670 674 Accrued interest on securities sold, not yet purchased 992 1,184 Payroll taxes payable 394 721 Counterparty cash collateral 6,437 4,227 Accrued expense and other liabilities 2,710 3,168 Accounts payable and other liabilities $ 11,840 $ 11,452 Aa The redeemable financial instruments accrued interest represents accrued interest the Company’s redeemable financial instruments. See note 1 5 . Subsequent to the adoption of ASC 842, effective January 1, 2019, the Company will no longer have straight line rent payable. See note 12. Counterparty cash collateral represents cash collateral received from our reverse rep o counterparties . This cash is owed to the counterparty. See note 1 0 . |
Variable Interest Entities
Variable Interest Entities | 3 Months Ended |
Mar. 31, 2019 | |
Variable Interest Entities [Abstract] | |
Variable Interest Entities | 14. VARIABLE INTEREST ENTITIES As a general matter, a reporting entity must consolidate a variable interest entity (“VIE”) when it is deemed to be the primary beneficiary. The primary beneficiary is the entity that has both (a) the power to direct the matters that most significantly impact the VIE’s financial performance and (b) a significant variable interest in the VIE. The Company’s Principal Investing Portfolio Included in other investments, at fair value in the consolidated balance sheets are investments in several VIEs. In each case, the Company determined it was not the primary beneficiary. The maximum potential financial statement loss the Company would incur if the VIEs were to default on all their obligations would be the loss of the carrying value of these investments as well as any future investments the Company were to make. As of March 31, 2019 , there were $1,100 of unfunded commitments to VIEs that the Company is invested in. Other than its investment in these entities, the Company did not provide financial support to these VIEs during the three months ended March 31, 2019 and 2018 and had no liabilities, contingent liabilities, or guarantees (implicit or explicit) related to these VIEs at M arch 31, 2019 and December 31, 2018 . See table below. For each investment management contract entered into by the Company, the Company assesses whether the entity being managed is a VIE and if the Company is the primary beneficiary. Certain of the Investment Vehicles managed by the Company are VIEs. Under the current guidance of ASU 2015-12, the Company has concluded that its asset management contracts are not variable interests. Currently, the Company has no other interests in entities it manages that are considered variable interests and are considered significant. Therefore, the Company is not the primary beneficiary of any VIEs that it manages. The Company’s Trading Portfolio From time to time, the Company may acquire an interest in a VIE through the investments it makes as part of its trading operations, which are included as investments-trading or securities sold, not yet purchased in the consolidated balance sheets. Because of the high volume of trading activity in which the Company engages in, the Company does not perform a formal assessment of each individual investment within its trading portfolio to determine if the investee is a VIE and if the Company is a primary beneficiary. Even if the Company were to obtain a variable interest in a VIE through its trading portfolio, the Company would not be deemed to be the primary beneficiary for two main reasons: (a) the Company does not usually obtain the power to direct activities that most significantly impact any investee’s financial performance and (b) a scope exception exists within the consolidation guidance for cases where the reporting entity is a broker-dealer and any control (either as the primary beneficiary of a VIE or through a controlling interest in a voting interest entity) was deemed to be temporary. In the unlikely case that the Company obtained the power to direct activities and obtained a significant variable interest in an investee in its trading portfolio that was a VIE, any such control would be deemed to be temporary due to the rapid turnover within the Company’s trading portfolio. The following table presents the carrying amounts of the assets in the Company’s consolidated balance sheets that relate to the Company’s variable interests in identified VIEs with the exception of (i) the two trust VIEs that hold the Company’s junior subordinated notes (see note 16) and (ii) any security that represents an interest in a VIE that is included in investments-trading or securities sold, not yet purchased in the Company’s consolidated balance sheets. The table below shows the Company’s maximum exposure to loss associated with these identified nonconsolidated VIEs in which it holds variable interests at March 31, 2019 and December 31, 2018 . CARRYING VALUE OF VARIABLE INTERESTS IN NON-CONSOLIDATED VARIABLE INTEREST ENTITIES (Dollars in Thousands) As of March 31, 2019 As of December 31, 2018 Other Investments, at fair value $ 5,389 $ 5,273 Maximum e xposure $ 5,389 $ 5,273 |
Redeemable Financial Instrument
Redeemable Financial Instruments | 3 Months Ended |
Mar. 31, 2019 | |
Redeemable Financial Instruments [Abstract] | |
Redeemable Financial Instruments | 15. REDEEMABLE FINANCIAL INSTRUMENTS Redeemable financial instruments consisted of the following in the periods presented. REDEEMABLE FINANCIAL INSTRUMENTS As of March 31, 2019 (Dollars in Thousands) Outstanding Balance Accrued Interest JKD Capital Partners I LTD $ 8,000 $ 278 DGC Family Fintech Trust / CBF 10,000 74 ViaNova Capital Group, LLC 679 - $ 18,679 $ 352 REDEEMABLE FINANCIAL INSTRUMENTS As of December 31, 2018 (Dollars in Thousands) Outstanding Balance Accrued Interest JKD Capital Partners I LTD $ 6,732 $ 676 DGC Family Fintech Trust / CBF 10,000 38 ViaNova Capital Group, LLC 716 - $ 17,448 $ 714 Redeemable Financial Instrument – JKD Capital Partners I LTD Amendment On October 3, 2016, the Operating LLC entered into an investment agreement (the “JKD Investment Agreement”), by and between Operating LLC and JKD Capital Partners I LTD (the “JKD Investor”), pursuant to which the JKD Investor agreed to invest up to $12,000 in the Operating LLC (the “JKD Investment”), $6,000 of which was invested upon the execution of the JKD Investment Agreement, an additional $1,000 was invested in January 2017 and an additional $1,268 was invested on January 9, 2019. The JKD Investor is owned by Jack DiMaio, the vice chairman of the Company’s board of directors and the vice chairman of the Operating LLC’s board of managers and his spouse. In exchange for the JKD Investment, the Operating LLC agreed to pay to JKD Investor during the term of the JKD Investment Agreement an amount (“JKD Investment Return”) equal to 50% of the difference between (i) the revenues generated during a quarter by the activities of the Institutional Corporate Trading Business of JVB and (ii) certain expenses incurred by such Institutional Corporate Trading Business (the “Institutional Corporate Trading Business Net Revenue”). This JKD Investment Return is recorded monthly as interest expense or (interest income) with the related accrued interest recorded in accounts payable and other accrued liabilities. If the return is negative on an individual quarter, it will reduce the balance of the JKD Investment. Payments of the JKD Investment Return are made on a quarterly basis. The term of the JKD Investment Agreement commenced on October 3, 2016 and will continue until a redemption (as described below) occurs, unless the JKD Investment Agreement is earlier terminated. On March 6, 2019, the JKD Investor and the Operating LLC entered into an amendment to the JKD Investment Agreement (the “JKD Investment Agreement Amendment”), pursuant to which the term “JKD Investment Return” under the JKD Investment Agreement was amended as follows: (a) during the fourth quarter of 2018, an amount equal to 42% of the difference between (i) the revenues generated during a quarter by the activities of the Institutional Corporate Trading Business of JVB and (ii) certain expenses incurred by such Institutional Corporate Trading Business (the “Institutional Corporate Trading Business Net Revenue”), and (b) commencing on January 1, 2019 and for each quarter during the remainder of the term of the JKD Investment Agreement, an amount equal to a percentage of the Institutional Corporate Trading Business Net Revenue, which percentage is based on the JKD Investor’s investment under the JKD Investment Agreement as a percentage of the total capital allocated to Institutional Corporate Trading Business of JVB . The JKD Investor may terminate the JKD Investment Agreement (i) upon 90 days’ prior written notice to the Operating LLC if the Operating LLC or its affiliates modify any of their policies or procedures governing the operation of their businesses or change the way they operate their business and such modification has a material adverse effect on the amounts payable to the JKD Investor pursuant to the JKD Investment Agreement or (ii) upon 60 days’ prior written notice to the Operating LLC if the employment of Lester Brafman, the Company’s chief executive officer, is terminated. The Operating LLC may terminate the JKD Investment Agreement, as amended, upon 60 days’ prior written notice to the JKD Investor if Mr. DiMaio ceases to control the day-to-day operations of the JKD Investor. Upon a termination of the JKD Investment Agreement, as amended, the Operating LLC will pay to the JKD Investor an amount equal to the “Investment Balance” (as such term is defined in the JKD Investment Agreement, as amended) as of the day prior to such termination. At any time following October 3, 2019, the JKD Investor or the Operating LLC may, upon two months’ notice to the other party, cause the Operating LLC to pay a redemption to the JKD Investor in an amount equal to the Investment Balance (as such term is defined in the JKD Investment Agreement, as amended) as of the day prior to such redemption. If the Operating LLC or JVB sells JVB’s Institutional Corporate Trading Business to any unaffiliated third party, and such sale is not part of a larger sale of all or substantially all of the assets or equity securities of the Operating LLC or JVB, the Operating LLC will pay to the JKD Investor an amount equal to 25% of the net consideration paid to the Operating LLC in connection with such sale, after deducting certain amounts and certain expenses incurred by the Operating LLC or JVB in connection with such sale. ViaNova Capital Group LLC On November 16, 2018, and effective as of November 19, 2018, the Operating LLC entered into an investment agreement (the “ViaNova Investment Agreement”) by and among Hancock Funding, LLC (“Hancock”), New Avenue Investments LLC (“New Avenue”), JVB, ViaNova, and the Operating LLC. Pursuant to the ViaNova Investment Agreement, Hancock, New Avenue, the Operating LLC, and JVB agreed to invest $500 , $250 , $500 and $2,750 , respectively, into ViaNova (collectively, the “ViaNova Investment”). Pursuant to the ViaNova Investment Agreement, Hancock, the Operating LLC and JVB invested their respective portions of the ViaNova Investment into ViaNova prior to the effective date of the ViaNova Investment Agreement. In February 2019, New Avenue invested $200 of its portion of the ViaNova Investment (i.e., $250), the remaining $50 is included in due from related parties on the consolidated balance sheets. Pursuant to the ViaNova Investment Agreement, in consideration of the ViaNova Investment, once the Operating LLC is repaid $693 of funded operating costs from net revenue (as defined in the ViaNova Investment Agreement) generated directly by the activities of ViaNova’s RTL business, each party to the ViaNova Investment Agreement is entitled to receive a quarterly payment equal to the net revenue (to the extent positive) generated directly by the activities of ViaNova’s RTL business during such quarter, multiplied by a fraction, the numerator of which is equal to such party’s portion of the ViaNova Investment, the denominator is equal to the entire Via Nova Investment. |
Debt
Debt | 3 Months Ended |
Mar. 31, 2019 | |
Debt [Abstract] | |
Debt | 16. DEBT The Company had the following debt outstanding. DETAIL OF DEBT (Dollars in Thousands) Description As of March 31, 2019 As of December 31, 2018 Interest Rate Terms Interest (4) Maturity Contingent convertible debt: 8.00% convertible senior note (the "2017 Convertible Note") $ 15,000 $ 15,000 Fixed 8.00 % March 2022 (1) 8.00% convertible senior notes (the "2013 Convertible Notes") 6,786 6,786 Fixed 8.00 % September 2019 (2) Less unamortized debt issuance costs (910) (974) 20,876 20,812 Junior subordinated notes (3): Alesco Capital Trust I 28,125 28,125 Variable 6.75 % July 2037 Sunset Financial Statutory Trust I 20,000 20,000 Variable 6.95 % March 2035 Less unamortized discount (25,343) (25,401) 22,782 22,724 MB Financial Bank, N.A. Credit Facility - - Variable N/A April 2021 LegacyTexas Credit Facility - - Variable N/A November 2019 Total $ 43,658 $ 43,536 (1) The holder of the 2017 Convertible Note may convert all or any part of the outstanding principal amount at any time prior to maturity into units of the Operating LLC at a conversion price of $1.45 per unit, subject to customary anti-dilution adjustments. Units of the Operating LLC not held by Cohen & Company Inc. may, with certain restrictions, be redeemed and exchanged into shares of the Common Stock on a ten -for-one basis. Therefore, the 2017 Convertible Note can be converted into Operating LLC units and then redeemed and exchanged into Common Stock at an effective conversion price of $14.50 . See note 1 8 to our Annual Report on Form 10-K for the year ended December 31, 201 8 . (2) The holders of the 2013 Convertible Notes may convert all or any part of the outstanding principal amount at any time prior to maturity into shares of the Company’s Common Stock, at a conversion price of $12.00 per share, subject to certain anti-dilution adjustments . (3) The junior subordinated notes listed represent debt the Company owes to the two trusts noted above. The total par amount owed by the Company to the trusts is $49,614 . However, the Company owns the common stock of the trusts in a total par amount of $1,489 . The Company pays interest (and at maturity, principal) to the trusts on the entire $49,614 junior notes outstanding. However, the Company receives back from the trusts the pro rata share of interest and principal on the common stock held by the Company. These trusts are VIEs and the Company does not consolidate them even though the Company holds the common stock. The Company carries the common stock on its balance sheet at a value of $0 . The junior subordinated notes are recorded at a discount to par. When factoring in the discount, the yield to maturity of the junior subordinated notes as of March 31, 2019 on a combined basis is 16.75% assuming the variable rate in effect on the last day of the reporting period remains in effect until maturity. (4) Represents the interest rate in effect as of the last day of the reporting period. The 2013 Convertible Note s Amendment The original maturity date of the 2013 Convertible Notes was September 25, 2018. Immediately prior to maturity, the 2013 Convertible Notes were held by three holders. On September 25, 2018, the Company fully paid off one holder in the amount of $1,461 . The Company entered into amendments with the remaining two holders: the Edward Cohen IRA and the EBC 2013 Family Trust. Edward E. Cohen is the benefactor of the Edward E. Cohen IRA and is the father of Daniel G. Cohen, the p resident and c hief e xecutive of the Company’s European operations and c hairman of the Company’s board of directors. Daniel G. Cohen is a trustee of the EBC 2013 Family Trust . See note 23. Pursuant to the a mendments, (i) the maturity date of each of the outstanding 2013 Convertible Notes was extended from September 25, 2018 to September 25, 2019 and (ii) the conversion price under each of the outstanding 2013 Convertible Notes was reduced from $30.00 per share of Common Stock to $12.00 per share of Common Stock. The a mendments to the 2013 Convertible Notes each provide that, until the Company’s stockholders approve the issuance of the shares of Common Stock issuable upon conversion of the 2013 Convertible Notes for purposes of Section 713 of the NYSE American’s Company Guide, the 2013 Convertible Notes may not be converted if such conversion would result in the Company issuing a number of shares of Common Stock that, when aggregated with any shares of Common Stock previously issued in connection with any conversion under the 2013 Convertible Notes, equals or exceeds, in the aggregate, 19.99% of the outstanding Common Stock as of September 25, 2018. In addition, the a mendments to the 2013 Convertible Notes provide that (i) the Company is required to cause its stockholders to vote on a proposal (the “Stockholder Proposal”) regarding the issuance of the shares of Common Stock issuable upon conversion of the 2013 Convertible Notes for purposes of Section 713 of the NYSE American’s Company Guide at the 2019 annual meeting of the Company’s s tockholders, (ii) the Company is required to use its reasonable best efforts to solicit proxies for such stockholder approval, and (iii) the Company’s b oard of d irectors is required to recommend to the Company’s stockholders that such stockholders approve the Stockholder Proposal. MB Financial Bank, N.A. Effective on April 25, 2018, the Company, the Operating LLC, and JVB Holdings, as guarantors, and JVB, as borrower, entered into a loan agreement (the “2018 MB LOC”) with MB Financial Bank, N.A. (“MB Financial”) as lender. Pursuant to the terms of the 2018 MB LOC, MB Financial agreed to make loans (each a “Loan” and collectively, the “Loans”) at JVB’s request from time to time in the aggregate amount of up to $25,000 . The Loans (both principal and interest) are scheduled to mature and become immediately due and payable in full on April 10, 2020 . In accordance with the terms of the 2018 MB LOC, JVB paid to MB Financial a commitment fee in the amount of $250 . Loans under the 2018 MB LOC bear interest at a per annum rate equal to LIBOR plus 6.0% . As of March 31, 2019 , JVB had not made any draws against the 2018 MB LOC. The Operating LLC is required to pay an undrawn commitment fee at a per annum rate equal to 0.50% of the undrawn portion of the MB Financial’s $25,000 commitment under the 2018 MB LOC. Pursuant to the 2018 MB LOC, all Loans must be used by JVB for working capital purposes and general liquidity of JVB. Further, under the 2018 MB LOC, JVB may request a reduction of the $25,000 commitment amount in a minimum amount of $1,000 and multiples of $500 thereafter, upon not less than five days prior notice to MB Financial. On January 29, 2019, the 2018 MB LOC was restructured. The total commitment of the 2018 MB LOC was reduced from $25,000 to $7,500 and the maturity date was extended from April 10, 2020 to April 10, 2021 . The other material terms and conditions remained substantially identical. As part of the restructuring, the Company entered into a new subordinated revolving note agreement (the “2019 MB Revolver”). Under the 2019 MB Revolver, the Company can borrow up to $17,500 on a revolving basis. Borrowings under the 2019 MB Revolver must be in minimum amounts of $1,000 or any higher multiple of $500 . The 2019 MB Revolver bears interest at a per annum rate equal to LIBOR plus 6% and the Company is required to pay an undrawn commitment fee at a per annum rate equal to 0.50% per annum on any undrawn amounts. In addition, the Company will pay a commitment fee equal to 0.75% (or $131 ) on April 10, 2020. The 2019 MB Revolver matures on April 10, 2021. On January 30, 2019, JVB received approval from FINRA to treat draws under the 2019 MB Revolver as qualified subordinated debt. As such, draws are treated as an increase in net capital for purposes of FINRA Rule 15(c) 3-1. As of March 31 2019, the Company has not borrowed under the 2018 MB LOC or the 2019 MB Revolver. LegacyTexas Bank On November 20, 2018, ViaNova, as borrower, entered into a Warehousing Credit and Security Agreement (the “LegacyTexas Credit Facility”) with LegacyTexas Bank, as the lender, with an effective date of November 16, 2018. The LegacyTexas Credit Facility supports the buying, aggregating, and distributing of residential transition loans by ViaNova. Pursuant to the terms of the LegacyTexas Credit Facility, LegacyTexas Bank agreed to make loans at ViaNova’s request from time to time in the aggregate amount of up to $12,500 . The loans (both principal and interest) are scheduled to mature and become immediately due and payable in full on November 15, 2019. Loans under the LegacyTexas Credit Facility will bear interest at a per annum rate equal to LIBOR (with a floor of 1.50%) plus 4.0% (for residential transition loans) or 5.0% (for aged residential transition loans). Commencing February 14, 2019, ViaNova became required to pay an undrawn commitment fee at a per annum rate equal to 0.25% of the undrawn portion of the $12,500 commitment under the LegacyTexas Credit Facility; provided, however, that such fee shall be waived for any calendar month (i) in which the used portion for such month is equal to or greater than fifty percent ( 50% ) of the $12,500 commitment amount, or (ii) the aggregate advances funded by LegacyTexas Bank for such calendar month are equal to or greater than the $12,500 commitment amount, as may be in effect from time to time. Loans under the LegacyTexas Credit Facility must be used by ViaNova to provide funding for short-term mortgages to developers for the purchase and renovation of residential 1-4 family properties or to purchase such short-term mortgages from correspondents that originate such short-term mortgages. The obligations of ViaNova under the LegacyTexas Credit Facility are secured by a lien on the mortgages financed by the LegacyTexas Credit Facility. Further, pursuant to the terms of the LegacyTexas Credit Facility, ViaNova deposited cash in an amount equal to 2% of the $12,500 commitment amount in a non-interest-bearing account with LegacyTexas Bank as additional collateral. See note 13. See note 18 to the Company’s consolidated financial statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2018 for a discussion of the Company’s other debt. Interest Expense, net INTEREST EXPENSE (Dollars in Thousands) Three Months Ended March 31, 2019 2018 Junior subordinated notes $ 880 $ 821 2013 Convertible Notes 134 203 2017 Convertible Note 360 354 2018 MB LOC/2019 MB Revolver 92 - LegacyTexas Credit Facility 4 - Redeemable Financial Instrument - DGC Family Fintech Trust / CBF 148 110 Redeemable Financial Instrument - JKD Capital Partners I LTD 278 331 Redeemable Financial Instrument - ViaNova Capital Group, LLC (37) - $ 1,859 $ 1,819 nter In |
Equity
Equity | 3 Months Ended |
Mar. 31, 2019 | |
Equity [Abstract] | |
Equity | 17. EQUITY Stockholders’ Equity Common Equity : The following table reflects the activity for the three months ended March 31, 2019 related to the number of shares of unrestricted Common Stock that the Company had issued. Common Stock Shares December 31, 2018 1,110,717 Vesting of shares 56,639 Shares withheld and retired for employee taxes (15,557) Repurchase and retirement of Common Stock (7,890) March 31, 2019 1,143,909 Series E Voting Non-Convertible Preferred Stock : Each share of the Company’s Series E Voting Non-Convertible Preferred Stock (the “Series E Preferred Stock”) has no economic rights but entitles the holders to vote the Series E Preferred Stock on all matters presented to the Company’s stockholders. For every 10 shares of Series E Preferred Stock, the holders are entitled to one vote on any such matter. Daniel G. Cohen, the Company’s chairman, is the sole holder of all 4,983,557 shares of Series E Preferred Stock outstanding as of March 31, 2019 . The Series E Preferred Stock held by Mr. Cohen gives him the same voting rights he would have if all of the Operating LLC membership units held by him were exchanged for Common Stock on a ten for one basis and effectively gives Mr. Cohen voting rights at the Company in the same proportion as his economic interest (as his membership units of the Operating LLC do not carry voting rights at the Company level). For a more detailed description of these shares see note 19 to the Company’s Annual Report on Form 10-K for the year ended December 31, 2018 . Acquisition and Surrender of Additional Units of the Operating LLC, net : Effective January 1, 2011, Cohen & Company Inc. and the Operating LLC entered into a Unit Issuance and Surrender Agreement (the “UIS Agreement”) that was approved by the board of directors of Cohen & Company Inc. and the board of managers of the Operating LLC. In an effort to maintain a 1 :10 ratio of Common Stock to the number of membership units Cohen & Company Inc. holds in the Operating LLC, the UIS Agreement calls for the issuance of additional membership units of the Operating LLC to Cohen & Company Inc. when Cohen & Company Inc. issues its Common Stock to employees under existing equity compensation plans. In certain cases, the UIS Agreement calls for Cohen & Company Inc. to surrender units to the Operating LLC when certain restricted shares are forfeited by the employee or repurchased by the Company. During the three months ended March 31, 2019 , Cohen & Company Inc. received and surrendered units of the Operating LLC. The following table displays the amount of units surrendered (net of receipts) by Cohen & Company Inc. Operating LLC Membership Units Units related to UIS Agreement 410,820 Units surrendered from retirement of Common Stock (78,900) Total 331,920 The Company recognized a net increase in additional paid in capital of $133 and a net decrease in AOCI of $14 with an offsetting decrease in non-controlling interest of $119 in connection with the acquisition and surrender of additional units of the Operating LLC. The following schedule presents the effects of changes in Cohen & Company Inc.’s ownership interest in the Operating LLC on the equity attributable to Cohen & Company Inc. for the three months ended March 31, 2019 and 2018 . Three Months Ended Three Months Ended March 31, 2019 March 31, 2018 Net income / (loss) attributable to Cohen & Company Inc. $ (1,202) $ (1,474) Transfers (to) from the non-controlling interest: Increase / (decrease) in Cohen & Company Inc. paid in capital for the acquisition / (surrender) of additional units in consolidated subsidiary, net 133 84 Changes from net income / (loss) attributable to Cohen & Company Inc. and transfers (to) from the non-controlling interest $ (1,069) $ (1,390) Repurchases of Shares and Retirement of Treasury Stock On March 19, 2018 and March 17, 2017, the Company entered into letter agreements (the “2018 Letter Agreement” and the “2017 Letter Agreement,” respectively, and together, the “10b5-1 Plan”) with Sandler O’Neill & Partners, L.P. (the “Agent”). The 2017 Letter Agreement was in effect from March 17, 2017 until March 17, 2018. The 2018 Letter Agreement was in effect from March 19, 2018 until March 19, 2019, and was not renewed. Both agreements authorized the Agent to use its commercially reasonable efforts to purchase, on the Company’s behalf, up to an aggregate maximum of $2,000 of Common Stock on any day that the NYSE American Stock Exchange was open for business. Pursuant to the 10b5-1 Plan, purchases of Common Stock could be made in public and private transactions and had to comply with Rule 10b-18 under the Exchange Act. The 10b5-1 Plan was designed to comply with Rule 10b5-1 under the Exchange Act. Pursuant to the 10b5-1 Plans, the Company repurchased 7,890 shares in the open market for a total purchase price of $65 during the three months ended March 31, 2019 and 7,270 shares for a total purchase price of $71 for the three months ended March 31, 2018. The Company currently has no 10b5-1 plan in place. |
Net Capital Requirements
Net Capital Requirements | 3 Months Ended |
Mar. 31, 2019 | |
Net Capital Requirements [Abstract] | |
Net Capital Requirements | 18 . NET CAPITAL REQUIREMENTS JVB is subject to the net capital provision of Rule 15c3-1 under the Exchange Act, which requires the maintenance of minimum net capital, as defined therein. As of March 31, 2019 , JVB’s adjusted net capital was $ 51,111 , which exceeded the minimum requirements by $50,782 . CCFL, a subsidiary of the Company regulated by the FCA, is subject to the net liquid capital provision of the Financial Services and Markets Act 2000, GENPRU 2.140R to 2.1.57R, relating to financial prudence with regards to the European Investment Services Directive and the European Capital Adequacy Directive, which requires the maintenance of minimum liquid capital, as defined therein. As of March 31, 2019 , the total minimum required net liquid capital was $ 869 , and net liquid capital in CCFL was $919 , which exceeded the minimum requirements by $ 50 and was in compliance with the net liquid capital provisions. |
Earnings _ (Loss) Per Common Sh
Earnings / (Loss) Per Common Share | 3 Months Ended |
Mar. 31, 2019 | |
Earnings / (Loss) Per Common Share [Abstract] | |
Earnings / (Loss) Per Common Share | 1 9 . EAR NINGS / (Loss) PER COMMON SHARE The following table presents a reconciliation of basic and diluted earnings / (loss) per common share for the periods indicated. EARNINGS / (LOSS) PER COMMON SHARE (Dollars in Thousands, except share or per share information) Three Months Ended March 31, 2019 2018 Net income / (loss) attributable to Cohen & Company Inc. $ (1,202) $ (1,474) Add/ (deduct): Income / (loss) attributable to non-controlling interest attributable to Operating LLC membership (1) (622) (677) Add / (deduct): Adjustment (2) 53 7 Net income / (loss) on a fully converted basis $ (1,771) $ (2,144) Weighted average common shares outstanding - Basic 1,133,166 1,172,476 Unrestricted Operating LLC membership units exchangeable into Cohen & Company shares (1) 532,409 532,409 Restricted units or shares - - Weighted average common shares outstanding - Diluted (3) 1,665,575 1,704,885 Net income / (loss) per common share - Basic $ (1.06) $ (1.26) Net income / (loss) per common share - Diluted $ (1.06) $ (1.26) (1) The Operating LLC membership units not held by Cohen & Company Inc. (that is, those held by the non-controlling interest for the three months ended March 31, 2019 and 2018 ) may be redeemed and exchanged into shares of the Company on a ten -for-one basis. The Operating LLC membership units not held by Cohen & Company Inc. are redeemable, at the member’s option at any time, for (i) cash in an amount equal to the average of the per share closing prices of the Common Stock for the ten consecutive trading days immediately preceding the date the Company receives the member’s redemption notice, or (ii) at the Company’s option, one tenth of a share of the Common Stock, subject, in each case, to appropriate adjustment upon the occurrence of an issuance of additional shares of the Common Stock as a dividend or other distribution on the Company’s outstanding Common Stock, or a further subdivision or combination of the outstanding shares of the Common Stock. These units are not included in the computation of basic earnings per share. These units enter into the computation of diluted net income (loss) per common share when the effect is not anti-dilutive using the if-converted method. (2) An adjustment is included because the Company would have incurred a higher income tax expense or realized a higher income tax benefit, as applicable , if the Operating LLC membership units had been converted at the beginning of the period,. (3) For the three months ended March 31, 2019 , weighted average common shares outstanding excludes (i) 59,182 shares representing restricted Common Stock and restricted Operating LLC membership units, which when vested can be converted into Common Stock, (ii) 565,469 shares from the assumed conversion of the 2013 Convertible Notes, and (iii) 1,034,483 shares from the assumed conversion of the 2017 Convertible Note because the inclusion of such shares would be anti-dilutive. For the three months ended March 31, 2018 , weighted average common shares outstanding excludes (i) 26,691 shares representing restricted Common Stock , (ii) 274,917 shares from the assumed conversion of the 2013 Convertible Notes, and (iii) 1,034,483 shares from the assumed conversion of the 2017 Convertible Note because the inclusion of such shares would be anti-dilutive. |
Commitments And Contingencies
Commitments And Contingencies | 3 Months Ended |
Mar. 31, 2019 | |
Commitments And Contingencies [Abstract] | |
Commitments And Contingencies | 20. COMMITMENTS AND CONTINGENCIES Legal and Regulatory Proceedings The Company is a party to various routine legal proceedings, claims, and regulatory inquiries arising out of the ordinary course of the Company’s business. Management believes that the results of these routine legal proceedings, claims, and regulatory matters will not have a material adverse effect on the Company’s financial condition, or on the Company’s operations and cash flows. However, the Company cannot estimate the legal fees and expenses to be incurred in connection with these routine matters and, therefore, is unable to determine whether these future legal fees and expenses will have a material impact on the Company’s operations and cash flows. It is the Company’s policy to expense legal and other fees as incurred. |
Segment And Geographic Informat
Segment And Geographic Information | 3 Months Ended |
Mar. 31, 2019 | |
Segment And Geographic Information [Abstract] | |
Segment And Geographic Information | 2 1 . SEGMENT AND GEOGRAPHIC INFORMATION Segment Information The Company operates within three business segments: Capital Markets, Asset Management, and Principal Investing. See note 1. The Company’s business segment information was prepared using the following methodologies and generally represents the information that is relied upon by management in its decision making processes: (a) Revenues and expenses directly associated with each business segment are included in determining net income (loss) by segment, and (b) Indirect expenses (such as general and administrative expenses including executive and indirect overhead costs) not directly associated with specific business segments are not allocated to the business segments’ statements of operations. Accordingly, the Company presents segment information consistent with internal management reporting. See note (1) in the table below for more detail on unallocated items. The following tables present the financial information for the Company’s segments for the periods indicated. SEGMENT INFORMATION Statement of Operations Information Three Months Ended March 31, 2019 Capital Asset Principal Segment Unallocated Markets Management Investing Total (1) Total Net trading $ 8,729 $ - $ - $ 8,729 $ - $ 8,729 Asset management - 2,002 - 2,002 - 2,002 New issue and advisory - - - - - - Principal transactions and other income 1 97 316 414 - 414 Total revenues 8,730 2,099 316 11,145 - 11,145 Total operating expenses 7,458 1,815 100 9,373 1,835 11,208 Operating income (loss) 1,272 284 216 1,772 (1,835) (63) Interest income (expense) 76 (63) - 13 (1,872) (1,859) Income (loss) from equity method affiliates - - (8) (8) - (8) Income (loss) before income taxes 1,348 221 208 1,777 (3,707) (1,930) Income tax expense (benefit) - - - - (106) (106) Net income (loss) 1,348 221 208 1,777 (3,601) (1,824) Less: Net income (loss) attributable to the non-controlling interest - - - - (622) (622) Net income (loss) attributable to Cohen & Company Inc. $ 1,348 $ 221 $ 208 $ 1,777 $ (2,979) $ (1,202) Other statement of operations data Depreciation and amortization (included in total operating expense) $ 5 $ 1 $ - $ 6 $ 75 $ 81 SEGMENT INFORMATION Statement of Operations Information Three Months Ended March 31, 2018 Capital Asset Principal Segment Unallocated Markets Management Investing Total (1) Total Net trading $ 6,191 $ - $ - $ 6,191 $ - $ 6,191 Asset management - 1,804 - 1,804 - 1,804 New issue and advisory 696 - - 696 - 696 Principal transactions and other income - 204 443 647 - 647 Total revenues 6,887 2,008 443 9,338 - 9,338 Total operating expenses 6,651 1,393 96 8,140 1,558 9,698 Operating income (loss) 236 615 347 1,198 (1,558) (360) Interest expense - - - - (1,819) (1,819) Income / (loss) from equity method affiliates - - - - - - Income (loss) before income taxes 236 615 347 1,198 (3,377) (2,179) Income tax expense (benefit) - - - - (28) (28) Net income (loss) 236 615 347 1,198 (3,349) (2,151) Less: Net income (loss) attributable to the non-controlling interest - - - - (677) (677) Net income (loss) attributable to Cohen & Company Inc. $ 236 $ 615 $ 347 $ 1,198 $ (2,672) $ (1,474) Other statement of operations data Depreciation and amortization (included in total operating expense) $ 16 $ 1 $ - $ 17 $ 44 $ 61 (1) Unallocated includes certain expenses incurred by indirect overhead and support departments (such as the executive, finance, legal, information technology, human resources, risk, compliance, and other similar overhead and support departments). Some of the items not allocated include: (1) operating expenses (such as cash compensation and benefits, equity-based compensation expense, professional fees, travel and entertainment, consulting fees, and rent) related to support departments excluding certain departments that directly support the Capital Markets business segment; (2) interest expense on debt; and (3) income taxes. Management does not consider these items necessary for an understanding of the operating results of these business segments and such amounts are excluded in business segment reporting to the chief operating decision maker. BALANCE SHEET DATA As of March 31, 2019 (Dollars in Thousands) Capital Asset Principal Segment Unallocated Markets Management Investing Total (1) Total Total Assets $ 4,922,973 $ 2,106 $ 13,233 $ 4,938,312 $ 13,015 $ 4,951,327 Included within total assets: Goodwill (2) $ 7,937 $ 55 $ - $ 7,992 $ - $ 7,992 Intangible assets (2) $ 166 $ - $ - $ 166 $ - $ 166 BALANCE SHEET DATA December 31, 2018 (Dollars in Thousands) Capital Asset Principal Segment Unallocated Markets Management Investing Total (1) Total Total Assets $ 5,633,806 $ 2,309 $ 13,768 $ 5,649,883 $ 4,569 $ 5,654,452 Included within total assets: Goodwill (2) $ 7,937 $ 55 $ - $ 7,992 $ - $ 7,992 Intangible assets (2) $ 166 $ - $ - $ 166 $ - $ 166 (1) Unallocated assets primarily include: (1) amounts due from related parties; (2) furniture and equipment, net; and (3) other assets that are not considered necessary for an understanding of business segment assets and such amounts are excluded in business segment reporting to the chief operating decision maker. (2) Goodwill and intangible assets are allocated to the Capital Markets and Asset Management business segments as indicated in the table above. Geographic Information The Company conducts its business activities through offices in the following locations: (1) United States and (2) United Kingdom and Other. Total revenues by geographic area are summarized as follows. GEOGRAPHIC DATA (Dollars in Thousands) Three Months Ended March 31, 2019 2018 Total Revenues: United States $ 10,087 $ 7,902 United Kingdom & Other 1,058 1,436 Total $ 11,145 $ 9,338 Long-lived assets attributable to an individual country, other than the United States, are not material. |
Supplemental Cash Flow Disclosu
Supplemental Cash Flow Disclosure | 3 Months Ended |
Mar. 31, 2019 | |
Supplemental Cash Flow Disclosure [Abstract] | |
Supplemental Cash Flow Disclosure | 22 . SUPPLEMENTAL CASH FLOW DISCLOSURE Interest paid by the Company on its debt and redeemable financial instruments was $ 2,070 and $ 1,635 for the three months ended March 31, 2019 and 2018 , respectively. The Company paid income taxes of $ 4 and $ 0 for the three months ended March 31, 2019 and 2018 , respectively. The Company received income tax refunds of $48 and $0 for the three months ended March 31, 2019 and 2018 , respectively. For the three months ended March 31, 2019 , the Company had the following significant non-cash transactions that are not reflected on the statement of cash flows: · The Company net surrendered units of the Operating LLC . The Company recognized a net increase in additional paid-in capital of $ 133 , a net decrease of $ 14 in AOCI, and an decrease of $ 119 in non-controlling interest. See note 17. · The Company recognized an accrual of $335 in accounts payable and other accrued liabilities for dividends and distributions declared on March 6, 2019, which were paid after March 31, 2019. · On January 1, 2019, the Company recorded a right of use asset of $8,416 and a right of use liability of $8,860 , a reduction in retained earnings from cumulative effect of adoption of $20 , an increase in other receivables of $18, and a reduction in other liabilities of $406 , resulting from the adoption of ASU 2016-02. See note 3. F or the three months ended March 31, 2018 , the Company had the following significant non-cash transactions that are not reflected on the statement of cash flows: · The Company surrendered units of the Operating LLC pursuant to the UIS Agreement and in connection with the redemption of vested Operating LLC units by Cohen & Company Inc. The Company recognized a net increase in additional paid-in capital of $84 , a net decrease of $7 in AOCI, and a decrease of $77 in non-controlling interest. See note 17. · The Company recognized an accrual of $342 in accounts payable and other accrued liabilities for dividends and distributions declared on March 6, 2018, which were paid after March 31, 2018. |
Related Party Transactions
Related Party Transactions | 3 Months Ended |
Mar. 31, 2019 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | 23 . RELATED PARTY TRANSACTIONS The Company has identified the following related party transactions for the three months ended March 31, 2019 and 2018 . The transactions are listed by related party and, unless otherwise noted in the text of the description, the amounts are disclosed in the tables at the end of this section. A. The Bancorp, Inc. (“TBBK”) TBBK is identified as a related party because Daniel G. Cohen is chairman of TBBK. As part of the Company’s broker-dealer operations, the Company from time to time purchases securities from third parties and sells those securities to TBBK. The Company may purchase securities from TBBK and ultimately sell those securities to third parties. In either of the cases listed above, the Company includes the trading revenue earned (i.e. the gain or loss realized, or commission earned) by the Company for the entire transaction in the amounts disclosed as part of net trading in the table at the end of this section. From time to time, the Company will enter into repurchase agreements with TBBK as its counterparty. As of March 31, 2019 and December 31, 2018 , the Company had no repurchase agreements with TBBK as the counterparty . The Company incu rred interest expense related to repurchase agreements with TBBK as its counterparty in the amounts of $0 and $414 for the three months ended March 31, 2019 and 2018, respectively, which were included as a component of net trading revenue in the Company’s consolidated statements of operations. These amounts are not disclosed in the tables at the end this section. B. Cohen Bros. Financial, LLC (“CBF”) and EBC 2013 Family Trust (“EBC”) CBF has been identified as a related party because (i) CBF is a non-controlling interest holder of the Company and (ii) CBF is wholly owned by Daniel G. Cohen. EBC has been identified as a related party because Daniel G. Cohen is a trustee of EBC and has sole voting power with respect to all shares of the Company held by EBC. In September 2013, EBC, as an assignee of CBF, made a $4,000 investment in the Company. The Company issued $2,400 in principal amount of the 2013 Convertible Notes and $1,600 of Common Stock to EBC. See note 18 to the Company’s consolidated financial statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2018. The Company incurred interest expense on this debt, which is disclosed as part of interest expense incurred in the table at the end of this section. Also, see note 16 for a description of amendments entered into related to the 2013 Convertible Notes on September 25, 2018. On September 29, 2017, CBF also invested $8,000 of the $10,000 total investment in the Company’s Redeemable Financial Instrument – DGC Family Fintech Trust / CBF. See note 15. The Company incurred interest expense on this instrument, which is disclosed as part of interest expense incurred in the table at the end of this section. See notes 15 and 16. C. The Edward E. Cohen IRA On August 28, 2015, $4,386 in principal amount of the 2013 Convertible Notes originally issued to Mead Park Capital in September 2013 was purchased by the Edward E. Cohen IRA of which Edward E. Cohen is the benefactor. Edward E. Cohen is the father of Daniel G. Cohen. The Company incurred interest expense on this debt, which is disclosed as part of interest expense incurred in the tables at the end of this section. See note 18 to the Company’s consolidated financial statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2018. Also, see note 16 for a description of amendments entered into related to the 2013 Convertible Notes on September 25, 2018. D. JKD Investor The JKD Investor is an entity owned by Jack J. DiMaio, the vice chairman of the board of directors and vice chairman of the Operating LLC’s board of managers, and his spouse. On October 3, 2016, JKD Investor invested $6,000 in the Operating LLC. Additional investments were made in January 2017 and in January 2019 in the amounts of $1,000 and $1,268 , respectively. See note 15. The interest expense incurred on this investment is disclosed in the table at the end of this section. E. DGC Family Fintech Trust DGC Family Fintech Trust was established by Daniel G. Cohen, chairman of the Company’s board of directors and chairman of the Operating LLC board of managers. Daniel G. Cohen does not have any voting or dispositive control of securities held in the interest of the trust. The Company considers DGC Family Fintech Trust a related party because it was established by Daniel G. Cohen. In March 2017, the 2017 Convertible Note was issued to the DGC Family Fintech Trust. The Company incurred interest expense on the 2017 Convertible Note, which is disclosed as part of interest expense incurred in the table at the end of this section. On September 29, 2017, the DGC Family Fintech Trust also invested $2,000 of the $10,000 total investment in the Company’s Redeemable Financial Instrument – DGC Family Fintech Trust / CBF. See note 15. See note 17 to the Company’s consolidated financial statements included in the Company’s Annual Report on Form 10-K. Interest incurred on this instrument is disclosed in the tables at the end of this section. F. Fin Tech Acquisition Corp. II I / Fin Tech Acquisition Corp. II In July 2017, the Operating LLC entered into an agreement with FinTech Acquisition Corp. II whereby the Company would provide certain accounting and administrative services. FinTech Acquisition Corp. II was considered a related party until July 2018 because Daniel G. Cohen was the chief executive and Betsy Cohen, Daniel G. Cohen’s mother, was the chairman of the board of dire c tors of FinTech Acquisition Corp. II during that time period. Income earned on this arrangement is disclosed in the tables below. The agreement terminated in July 2018. In December 2018, the Operating LLC entered into an agreement with Fin Tech Acquisition Corp. III whereby the Company will provide certain accounting and administrative services. Fin Tech Acquisition Corp. III is considered a related party because Daniel G. Cohen is the chief executive officer of FinTech Acquisition III and Betsy Cohen is the chairman of the board of directors of Fintech Acquisition Corp. III. Income earned on this arrangement is disclosed in the tables below. G . FinTech Investor Holdings II, LLC In July 2018, the Operating LLC acquired publicly traded shares of Fintech Acquisition Corp. II from an unrelated third party for a total purchase price of $2,513 . In connection with this purchase, the Operating LLC agreed with Fintech Investor Holdings II, LLC to not redeem these shares in advance of the merger between Fintech Acquisition Corp. II and Intermex Holdings II, LLC . FinTech Investor Holdings II, LLC is considered a related party because Daniel G. Cohen is the manager of the entity . In exchange for this agreement to not redeem these shares prior to the merger, as well as the outlay of capital to purchase the publicly traded shares of Fintech Acquisition Corp. II, the Operating LLC received unregistered, restricted shares of common stock of Fintech Acquisition Corp. II from Fintech Investor Holdings II, LLC . In connection with the merger, Fintech Acquisition Corp. II changed its name to International Money Express, Inc. The Company reco gnized net gains (losses) in principal transactions and other income of $(22) and $0 in connection with the receipt of these shares for the three months ended March 31, 2019 and 2018, respectively. H. Duane Morris, LLP (“Duane Morris”) Duane Morris is an international law firm and serves as legal counsel to the Company. Duane Morris is considered a related party because a partner at Duane Morris is a member of the same household as a director of the Company. Expense incurred by the Company for services provided by Duane Morris are included within professional fees and other operating expense in the consolidated income statement and are disclosed in the table below. I. Investment Vehicle and Other EuroDekania EuroDekania is considered a related party because it is an equity method investment of the Company. The Company has an investment in and a management contract with EuroDekania. Income earned or loss incurred on the investment is included as part of principal transactions and other income in the tables below. Revenue earned on the management contract is included as part of asset management in the tables below. As of March 31, 2019, the Company owned 31% of the equity of EuroDekania. SPAC Fund The SPAC Fund is considered a related party because it is an equity method investment of the Company. The Company has an investment in and a management contract with the SPAC Fund. Income earned or loss incurred on the investment is included as part of principal transactions and other income in the tables below. Revenue earned on the management contract is included as part of asset management in the tables below. As of March 31, 2019, the Company owned 3.9% of the equity of the SPAC Fund. U.S. Insurance JV U.S. Insurance JV is considered a related party because it is an equity method investment of the Company. The Company has an investment in and a management contract with the U.S. Insurance JV. Income earned or loss incurred on the investment is included as part of principal transactions and other income in the tables below. Revenue earned on the management contract is included as part of asset management and are shown in the tables below. As of March 31, 2019, the Company owned 4.5% of the equity of the US Insurance JV. Insurance SPAC The Insurance SPAC is a related party as it is an equity method investment of the Sponsor Entities, which are consolidated by the Company. As of March 31, 2019, the Sponsor Entities owned 26.8% of the equity in Insurance SPAC. Income earned, or loss incurred on equity method investments is included in the tables below. The Operating LLC and the Insurance SPAC entered into an administrative services agreement, dated March 19, 2019, pursuant to which the Operating LLC and the Insurance SPAC agreed that, commencing on the date that the Insurance SPAC’s securities were first listed on the Nasdaq Capital Market through the earlier of the Insurance SPAC’s consummation of a Business Combination and its liquidation, the Insurance SPAC will pay the Operating LLC $10 per month for certain office space, utilities, secretarial support, and administrative services. Revenue earned by the Company from the administrative services agreement is included as part of principal transactions and other income in the tables below. The Company agreed to lend the Insurance SPAC $750 for operating and acquisition related expenses. No amounts have been lent to date under this facility. See note 4. The following tables display the routine transactions recognized in the statements of operations from the identified related parties that are described above . RELATED PARTY TRANSACTIONS Three Months Ended March 31, 2019 (Dollars in Thousands) Net trading Asset management Principal transactions and other income Income (loss) from equity method affiliates Professional fee and other operating Interest expense(income) incurred CBF $ - $ - $ - $ - $ - $ 119 DGC Family Fintech Trust - - - - - 390 Duane Morris - - - - 101 - EBC - - - - - 47 Edward E. Cohen IRA - - - - - 87 EuroDekania - 86 291 - - - Fintech Acquisition Corp. III - - 3 - - - Insurance SPAC - - 4 (8) - - JKD Investor - - - - - 278 SPAC Fund - 31 24 - - - TBBK 2 - - - - - U.S. Insurance JV - 80 39 - - - $ 2 $ 197 $ 361 $ (8) $ 101 $ 921 RELATED PARTY TRANSACTIONS Three Months Ended March 31, 2018 (Dollars in Thousands) Net trading Asset management Principal transactions and other income Income (loss) from equity method affiliates Professional fee and other operating Interest expense(income) incurred CBF $ - $ - $ - $ - $ - $ 88 DGC Family Fintech Trust - - - - - 376 Duane Morris - - - - 208 - EBC - - - - - 59 Edward E. Cohen IRA - - - - - 108 EuroDekania - 33 - - - - Fintech Acquisition Corp. II - - 2 - - - JKD Investor - - - - - 331 TBBK 11 - - - - - $ 11 $ 33 $ 2 $ - $ 208 $ 962 The following related party transactions are non-routine and are not included in the tables above. J. Directors and Employees The Company has entered into employment agreements with Daniel G. Cohen and Joseph W. Pooler, Jr., its chief financial officer. The Company has entered into its standard indemnification agreement with each of its directors and executive officers. The Company maintains a 401(k) savings plan covering substantially all of its employees. The Company matches 50% of employee contributions for all participants not to exceed 3% of their salary. Contributions made on behalf of the Company were $91 and $61 for the three months ended March 31, 2019 and 2018 , respectively . The Company has a sublease agreement for certain office space with Bezuco Capital, LLC. Bezuco Capital, LLC is a related party because Betsy Cohen, the mother of Daniel G. Cohen, is affiliated with Bezuco Capital, LLC. The Company received payments under this agreement. The payments are recorded as a reduction in rent expenses. This sublease agreement commenced on August 1, 2018. It has an annual term that auto-renews if not cancelled earlier. It can be cancelled by either party upon 90 days’ notice. The Company recorded a reduction in rent expense in the amount of $6 and $0 for the three months ending March 31, 2019 and 2018, respectively. The Company lease s office space from Zucker and Moore, LLC. Zucker and Moore, LLC is partially owned by Jack DiMaio , Jr., the vice chairman of the Company’s board of directors. The Company recorded $24 and $24 of rent expense for the three months ended March 31, 2019 and 2018, respectively. |
Due From _ Due To Related Parti
Due From / Due To Related Parties | 3 Months Ended |
Mar. 31, 2019 | |
Due From / Due To Related Parties [Abstract] | |
Due From / Due To Related Parties | 24 . DUE FROM / DUE TO RELATED PARTIES The following table summarizes the outstanding due from / to related parties as of each date shown. These amounts may result from normal operating advances, employee advances, or from timing differences between the transactions disclosed in note 23 and final settlement of those transactions in cash. All amounts are primarily non-interest bearing. DUE FROM/DUE TO RELATED PARTIES (Dollars in Thousands) March 31, 2019 December 31, 2018 Employees & other $ 625 $ 793 Due from r elated p arties $ 625 $ 793 |
Summary Of Significant Accoun_2
Summary Of Significant Accounting Policies (Policy) | 3 Months Ended |
Mar. 31, 2019 | |
Summary Of Significant Accounting Policies [Abstract] | |
Adoption Of New Accounting Standards | A. Adoption of New Accounting Standards In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers ( Topic 606 ). Subsequent to that date, the FASB has issued additional ASUs clarifying certain aspects of ASU 2014-09 but they did not change the core principal of ASU 2014-09. The new guidance requires entities to recognize revenue in a way that depicts the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The Company adopted the new guidance on January 1, 2018 using the retrospective transition method. This ASU excludes from its scope revenue recognition related to items the Company records as a component of net trading and principal transactions within its consolidated statements of operations and , therefore , this ASU had no impact on these items. In terms of asset management and other revenue, the main impact of Topic 606 related to the timing of the recognition of incentive management fees in certain cases. Prior to the adoption of Topic 606, the Company would recognize incentive fees when they were fixed and determinable. Under Topic 606, the Company is required to recognize incentive fees when they are probable and there is not a significant chance of reversal in the future. For the asset management contracts in place at the time of adoption, this change in policy did not result in any actual change in revenue that had already been recognized and , therefore , there was no transition adjustment necessary. In February 2016, the FASB issued ASU 2016-01, Financial Instruments-Overall (Subtopic 825-10) . The amendments in ASU 2016-01, among other things, require equity investments (except those accounted for under the equity method of accounting or those that result in consolidation of the investee) to be measured at fair value with changes in fair value recognized in net income; require public business entities to use the exit price notion when measuring the fair value of financial instruments for disclosure purposes; require separate presentation of financial assets and liabilities by measurement category and form of financial asset; and eliminate the requirement for public business entities to disclose the methods and significant assumptions used to estimate the fair value that is required to be disclosed for financial instruments measured at amortized cost. The Company’s adoption of the provisions of ASU 2016-01 effective January 1, 2018 did not have a n effect on the Company’s consolidated financial statements In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842). Under the new guidance (subsequently updated with ASU 2018-01, ASU 2018-10, ASU 2018-11, ASU 2018-20 and ASU 2019-01), lessees will be required to recognize the following for all leases with the exception of short-term leases: (i) a lease liability, which is a lessee’s obligation to make lease payments arising from a lease, measured on a discounted basis , and (ii) a right-of-use asset, which is an asset that represents the lessee’s right to use, or control the use of, a specified asset for the lease term. Lessor accounting is largely unchanged . The Company adopted the provisions of the new guidance effective January 1, 2019. The Company recorded the following: (a) a right of use asset of $8,416 , (b) a lease commitment liability of $8,860 , (c) a reduction in retained earnings from cumulative effect of adoption of $20 , (d) an increase in other receivables of $18 , and (e) a reduction in other liabilities of $406 . See note 12. In August 2016, the FASB issued ASU 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments. The amendments in this ASU provide cash flow statement classification guidance on eight specific cash flow presentation issues with the objective of reducing existing diversity in practice. The Company’s adoption of the provisions of ASU 2016-15 effective January 1, 2018 did not have a n effect on the Company’s consolidated financial statements In October 2016, the FASB issued ASU 2016-16, Income Taxes (Topic 740): Intra-Entity Transfers of Assets Other than Inventory . The amendments in this ASU require an entity to recognize the income tax consequences of an intra-entity transfer of an asset other than inventory when the transfer occurs. The amendments eliminate the exception of an intra-entity transfer of an asset other than inventory. The Company’s adoption of the provisions of ASU 2016-16 effective January 1, 2018 did not have a n effect on the Company’s consolidated financial statements In January 2017, the FASB issued ASU 2017-01, Business Combinations (Topic 805): Clarifying the Definition of a Business . The amendments in this ASU clarify the definition of a business and affect all companies and other reporting organizations that must determine whether they have acquired or sold a business. The Company’s adoption of the provisions of ASU 2017-01 effective January 1, 2018 did not have a n effect on the Company’s consolidated financial statements In February 2017, the FASB issued ASU 2017-05 , Other Income – Gains and Losses from the Derecognition of Nonfinancial Assets (Subtopic 610-20): Clarifying the Scope of Asset Derecognition Guidance and Accounting for Partial Sales of Nonfinancial Assets . The amendments in this ASU clarify that a financial asset within the scope of this topic may include nonfinancial assets transferred within a legal entity to counterparty. The amendments clarify that an entity should identify each distinct nonfinancial asset or in substance nonfinancial asset promised to counterparty and derecognize each asset when counterparty obtains control of it. The Company’s adoption of the provisions of ASU 2017-05 effective January 1, 2018 did not have an effect on the Company’s consolidated financial statements. In June 2018, the FASB issued ASU 2018-07, Compensation – Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting . The amendments in this ASU expand the scope of Topic 718, which previously only include d share-based payments to employees, to include share-based payments issued to nonemployees for goods or services. Consequently, the accounting for share-based payments to nonemployees and employees will be substantially aligned. The Company’s adoption of the provisions of ASU 2018-07 effective January 1, 2019 did not have an effect on the Company’s consolidated financial statements. In March 2017, the FASB issued ASU 2017-08, Receivables – Nonrefundable Fees and Other Costs, Premium Amortization on Purchased Callable Debt Securitie s ( Sub-Topic 310-20 ). The amendments in this ASU shorten the amortization period for certain callable debt securities held at a premium. Specifically, the amendments require the premium to be amortized to the earliest call date. The amendments do not require an accounting change for securities held at a discount; the discount continues to be amortized to maturity. The Company’s adoption of the provisions of ASU 2017-08 effective January 1, 2019 did not have an effect on the Company’s consolidated financial statements. In May 2017, the FASB issued ASU 2017-09 , Compensation - Stock Compensation (Topic 718): Scope of Modification Accounting. The amendments in this ASU provide guidance on determining those changes to the terms and conditions of share-based payment awards that require an entity to apply modification accounting. The Company’s adoption of the provisions of ASU 2017-09 effective January 1, 2018 did not have an effect on the Company’s consolidated financial statements. In August 2017, the FASB issued ASU 2017-12, Derivative and Hedging – Targeted Improvements to Accounting for Hedging Activities (Topic 815) . The amendments in this ASU refine and expand hedge accounting for both financial and commodity risks and contain provisions to create more transparency and clarify how economic results are presented. The Company’s adoption of the provisions of ASU 2017-12 effective January 1, 2019 did not have an effect on the Company’s consolidated financial statements. In February 2018, the FASB issued ASU 2018-02, Income Statement – Reporting Comprehensive Income (Topic 220) : Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income. The amendments in this ASU provide the option to reclassify stranded tax effects within accumulated other comprehensive income (“AOCI”) to retained earnings in each period in which the effect of the change in the U.S. federal corporate income tax rate in the Tax Act (or portion thereof) is recorded. The Company’s adoption of the provisions of ASU 2018-02 effective January 1, 2019 did not have an effect on the Company’s consolidated financial statements. |
Recent Accounting Developments | B. Recent Accounting Developments In June 2016, the FASB issued ASU 2016-13, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments . The amendments in this ASU require the measurement of all expected credit losses for financial assets held at the reporting date to be based on historical experience, current conditions, and reasonable and supportable forecasts. Financial institutions and other organizations will now use forward-looking information to better inform their credit loss estimates. Many of the loss estimation techniques applied today will still be permitted, although the inputs to those techniques will change to reflect the full amount of expected credit losses. In addition, the ASU amends the accounting for credit losses on available-for-sale debt securities and purchased financial assets with credit deterioration. The amendments in this ASU are effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. Early adoption is permitted beginning after December 15, 2018, including interim periods within those fiscal years. The Company is currently evaluating the new guidance to determine the impact it may have on its consolidated financial statements. In January 2017, the FASB issued ASU 2017-04, Intangibles – Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment . The amendments in this ASU eliminate Step 2 from the goodwill impairment test. The annual or interim goodwill impairment test is performed by comparing the fair value of a reporting unit with its carrying amount. An impairment charge should be recognized for the amount by which the carrying amount exceeds the reporting unit’s fair value; however, the loss recognized should not exceed the total amount of goodwill allocated to that reporting unit. This ASU is effective for fiscal years beginning after December 15, 2019. Early adoption is permitted for interim or annual goodwill impairment tests performed on testing dates after January 1, 2017 and should be applied on a prospective basis. The Company is currently evaluating the new guidance to determine the impact it may have on its consolidated financial statements. In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework –Changes to the Disclosure Requirements for Fair Value Measurement. The ASU modifies the disclosure requirements in Topic 820, by removing certain disclosure requirements related to the fair value hierarchy, modifying existing disclosure requirements related to measurement uncertainty , and adding new disclosure requirements such as disclosing the changes in unrealized gains and losses for the period included in other comprehensive income for recurring level 3 fair value measurements held at the end of the reporting period and disclosing the range and weighted average of significant unobservable inputs used to develop level 3 fair value measurements. This ASU is effective for public companies for annual reporting periods and interim periods within those annual periods beginning after December 15, 2019. Early adoption is permitted. The Company is currently evaluating the new guidance to determine the impact it may have on its consolidated financial statements. In November 2018, the FASB issued ASU 2018-18, Collaborative Arrangements (Topic 808): Clarifying the Interaction Between Topic 808 and Topic 606 . The ASU also provides more comparability in the presentation of revenue for certain transactions between collaborative arrangement participants. It accomplishes this by allowing organizations to only present units of account in collaborative arrangements that are within the scope of the revenue recognition standard together with revenue accounted for under the revenue recognition standard. The parts of the collaborative arrangement that are not in the scope of the revenue recognition standard should be presented separately from revenue accounted for under the revenue recognition. This ASU is effective for public companies for annual reporting periods and interim periods within those annual periods beginning after December 15, 2019. The Company is currently evaluating the new guidance to determine the impact it may have on its consolidated financial statements . |
Fair Value Of Financial Instruments | C. Fair Value of Financial Instruments The following methods and assumptions were used by the Company in estimating the fair value of its financial instruments. These determinations were based on available market information and appropriate valuation methodologies. Considerable judgment is required to interpret market data to develop the estimates and, therefore, these estimates may not necessarily be indicative of the amount the Company could realize in a current market exchange. The use of different market assumptions and/or estimation methodologies may have a material effect on the estimated fair value amounts. Refer to note 8 for a discussion of the valuation hierarchy with respect to investments-trading; other investments, at fair value; and derivatives held by the Company. Cash equivalents : Cash equivalents are carried at historical cost, which is assumed to approximate fair value. The estimated fair value measurement of cash equivalents is classified within level 1 of the valuation hierarchy . Investments-trading : These amounts are carried at fair value. The fair value is based on either quoted market prices of an active exchange, independent broker market quotations, market price quotations from third party pricing services, or valuation models when quotations are not available. Other investments, at fair value : These amounts are carried at fair value. The fair value is based on quoted market prices of an active exchange, independent broker market quotations, or valuation models when quotations are not available. In the case of investments in alternative investment funds, fair value is generally based on the reported net asset value of the underlying fund. Receivables under resale agreements : Receivables under resale agreements are carried at their contracted resale price, have short-term maturities, and are repriced frequently or bear market interest rates and, accordingly, these contracts are at amounts that approximate fair value. The estimated fair value measurements of receivables under resale agreements are based on observations of actual market activity and are generally classified within level 2 of the valuation hierarchy . Trading securities sold, not yet purchased : These amounts are carried at fair value. The fair value is based on quoted market prices of an active exchange, independent market quotations, market price quotations from third party pricing services, or valuation models when quotations are not available. Securities sold under agreements to repurchase : The liabilities for securities sold under agreements to repurchase are carried at their contracted repurchase price, have short-term maturities, and are repriced frequently with amounts normally due in one month or less and, accordingly, these contracts are carried at amounts that approximate fair value. The estimated fair value measurements of securities sold under agreements to repurchase are based on observations of actual market activity and are generally classified within level 2 of the valuation hierarchy . Redeemable financial instruments : The liabilities for redeemable financial instruments are carried at their redemption value, which approximates fair value. The estimated fair value measurement of the redeemable financial instruments is classified within level 3 of the valuation hierarchy . Debt : These amounts are carried at outstanding principal less unamortized discount and deferred financing costs. However, a substantial portion of the debt was assumed in the Merger and recorded at fair value as of that da te. As of March 31, 2019, and December 31, 2018 , the fair value of the Company’s debt was estimated to be $51,181 and $50,159 , respectively. The estimated fair value measurements of the debt are generally based on discounted cash flow models prepared by the Company’s management primarily using discount rates for similar instruments issued to companies with similar credit risks to the Company and are generally classified within level 3 of the value hierarchy. Derivatives : These amounts are carried at fair value. Derivatives may be included as a component of investments-trading; trading securities sold, not yet purchased; and other investments, at fair value. See notes 8 and 9 . The fair value is generally based on quoted market prices on an exchange that is deemed to be active for derivative instruments such as foreign currency forward contracts and Eurodollar futures. For derivative instruments, such as TBAs and other extended settlement trades, the fair value is generally based on market price quotations from third party pricing services. |
Net Trading (Tables)
Net Trading (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Net Trading [Abstract] | |
Schedule Of Net Trading | NET TRADING (Dollars in Thousands) Three Months Ended March 31, 2019 March 31, 2018 Net realized gains (losses) - trading inventory $ 6,310 $ 4,224 Net unrealized gains (losses) - trading inventory 559 13 Net gains and losses 6,869 4,237 Interest income-trading inventory 1,615 1,356 Interest income-receivables under resale agreements 32,232 9,072 Interest income 33,847 10,428 Interest expense-securities sold under agreements to repurchase (31,130) (8,027) Interest expense-margin payable (857) (447) Interest expense (31,987) (8,474) Net trading $ 8,729 $ 6,191 |
Receivables From And Payables_2
Receivables From And Payables To Brokers, Dealers, And Clearing Agencies (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Receivables From And Payables To Brokers, Dealers, And Clearing Agencies [Abstract] | |
Schedule Of Due To (From) Broker-Dealers And Clearing Organizations | Amounts receivable from brokers, dealers, and clearing agencies consisted of the following. RECEIVABLES FROM BROKERS, DEALERS, AND CLEARING AGENCIES (Dollars in Thousands) March 31, 2019 December 31, 2018 Deposits with clearing agencies $ 250 $ 250 Unsettled regular way trades, net 5,816 - Receivables from clearing agencies 98,378 129,562 Receivables from brokers, dealers, and clearing agencies $ 104,444 $ 129,812 Amounts payable to brokers, dealers, and clearing agencies consisted of the following. PAYABLES TO BROKERS, DEALERS, AND CLEARING AGENCIES (Dollars in Thousands) March 31, 2019 December 31, 2018 Unsettled regular way trades, net $ - $ 5,822 Margin payable 162,951 195,776 Payables to brokers, dealers, and clearing agencies $ 162,951 $ 201,598 |
Financial Instruments (Tables)
Financial Instruments (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Financial Instruments [Abstract] | |
Schedule Of Trading Securities | INVESTMENTS - TRADING (Dollars in Thousands) March 31, 2019 December 31, 2018 U.S. government agency MBS and CMOs $ 185,905 $ 149,651 U.S. government agency debt securities 17,027 14,915 RMBS 29 21 U.S. Treasury securities 11,439 4,099 ABS 100 100 SBA loans 11,196 31,496 Corporate bonds and redeemable preferred stock 29,156 44,507 Foreign government bonds 875 117 Municipal bonds 17,281 47,433 Certificates of deposit 1,850 302 Derivatives 10,207 8,212 Equity securities 408 382 Investments-trading $ 285,473 $ 301,235 |
Schedule Of Trading Securities Sold, Not Yet Purchased | TRADING SECURITIES SOLD, NOT YET PURCHASED (Dollars in Thousands) March 31, 2019 December 31, 2018 U.S. government agency MBS and CMOs $ - $ 16 U.S. Treasury securities 42,043 70,010 Corporate bonds and redeemable preferred stock 46,530 43,957 Municipal bonds 20 20 Derivatives 9,652 6,119 Trading securities sold, not yet purchased $ 98,245 $ 120,122 |
Schedule Of Other Investments | OTHER INVESTMENTS, AT FAIR VALUE (Dollars in Thousands) March 31, 2019 Amortized Cost Carrying Value Unrealized Gain / (Loss) Equity securities $ 780 $ 1,896 $ 1,116 CLOs 3,155 2,753 (402) CDOs 189 26 (163) EuroDekania 4,489 1,823 (2,666) U.S. Insurance JV 1,900 1,964 64 SPAC Fund 630 646 16 Residential loans 30 316 286 Foreign currency forward contracts - 16 16 Other investments, at fair value $ 11,173 $ 9,440 $ (1,733) December 31, 2018 Amortized Cost Carrying Value Unrealized Gain / (Loss) Equity securities $ 5,016 $ 6,650 $ 1,634 CLOs 3,099 2,730 (369) CDOs 189 26 (163) EuroDekania 4,489 1,533 (2,956) U.S. Insurance JV 1,900 1,925 25 SPAC Fund 600 592 (8) Residential loans 39 325 286 Foreign currency forward contracts - (13) (13) Other investments, at fair value $ 15,332 $ 13,768 $ (1,564) |
Fair Value Disclosures (Tables)
Fair Value Disclosures (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Fair Value Disclosures [Abstract] | |
Schedule Of Assets And Liabilities Measured At Fair Value On A Recurring Basis | FAIR VALUE MEASUREMENTS ON A RECURRING BASIS March 31, 2019 (Dollars in Thousands) Significant Significant Quoted Prices in Other Observable Unobservable Active Markets Inputs Inputs Assets Fair Value (Level 1) (Level 2) (Level 3) Investments-trading: U.S. government agency MBS and CMOs $ 185,905 $ - $ 185,905 $ - U.S. government agency debt securities 17,027 - 17,027 - RMBS 29 - 29 - U.S. Treasury securities 11,439 11,439 - - ABS 100 - 100 - SBA loans 11,196 - 11,196 - Corporate bonds and redeemable preferred stock 29,156 - 29,156 - Foreign government bonds 875 - 875 - Municipal bonds 17,281 - 17,281 - Certificates of deposit 1,850 - 1,850 - Derivatives 10,207 - 10,207 - Equity securities 408 - 408 - Total investments - trading $ 285,473 $ 11,439 $ 274,034 $ - Other investments, at fair value: Equity securities $ 1,896 $ 1,043 $ 853 $ - CLOs 2,753 - - 2,753 CDOs 26 - - 26 Residential loans 316 - 316 - Foreign currency forward contracts 16 16 - - 5,007 $ 1,059 $ 1,169 $ 2,779 Investments measured at NAV (1) 4,433 Total other investments, at fair value $ 9,440 Liabilities Trading securities sold, not yet purchased: U.S. Treasury securities $ 42,043 $ 42,043 $ - $ - Corporate bonds and redeemable preferred stock 46,530 - 46,530 - Municipal bonds 20 - 20 - Derivatives 9,652 - 9,652 - Total trading securities sold, not yet purchased $ 98,245 $ 42,043 $ 56,202 $ - (1) As a practical expedient, the Company uses NAV or its equivalent to measure the fair value of its investments in EuroDekania, the U.S. Insurance JV , and the SPAC Fund. EuroDekania invests in hybrid capital securities of European companies. The U.S. Insurance JV invests in debt issued by small and medium sized U.S. and Bermuda insurance and reinsurance companies. The SPAC Fund invests in equity securities of SPACs. According to ASC 820, these investments are not categorized within the fair value hierarchy. FAIR VALUE MEASUREMENTS ON A RECURRING BASIS December 31, 2018 (Dollars in Thousands) Significant Significant Quoted Prices in Other Observable Unobservable Active Markets Inputs Inputs Assets Fair Value (Level 1) (Level 2) (Level 3) Investments-trading: U.S. government agency MBS and CMOs $ 149,651 $ - $ 149,651 $ - U.S. government agency debt securities 14,915 - 14,915 - RMBS 21 - 21 - U.S. Treasury securities 4,099 4,099 - - ABS 100 - 100 - SBA loans 31,496 - 31,496 - Corporate bonds and redeemable preferred stock 44,507 - 44,507 - Foreign government bonds 117 - 117 - Municipal bonds 47,433 - 47,433 - Certificates of deposit 302 - 302 - Derivatives 8,212 - 8,212 - Equity securities 382 - 382 - Total investments - trading $ 301,235 $ 4,099 $ 297,136 $ - Other investments, at fair value: Equity Securities $ 6,650 $ 5,775 $ 875 $ - CLOs 2,730 - - 2,730 CDOs 26 - - 26 Residential loans 325 - 325 - Foreign currency forward contracts (13) (13) - - 9,718 $ 5,762 $ 1,200 $ 2,756 Investments measured at NAV (1) 4,050 Total other investments, at fair value $ 13,768 Liabilities Trading securities sold, not yet purchased: U.S. government agency MBS $ 16 $ - $ 16 $ - U.S. Treasury securities 70,010 70,010 - - Corporate bonds and redeemable preferred stock 43,957 - 43,957 - Municipal bonds 20 - 20 - Derivatives 6,119 - 6,119 - Total trading securities sold, not yet purchased $ 120,122 $ 70,010 $ 50,112 $ - (1) As a practical expedient, the Company uses NAV or its equivalent to measure the fair value of its investments in EuroDekania, the U.S. Insurance JV, and the SPAC Fund. EuroDekania invests in hybrid capital securities of European companies. The U.S. Insurance JV invests in debt issued by small and medium sized U.S. and Bermuda insurance and reinsurance companies. The SPAC Fund invests in equity securities of SPACs. According to ASC 820, these investments are not categorized within the fair value hierarch y. |
Schedule Of Assets And Liabilities Measured With Level 3 Inputs | LEVEL 3 ROLLFORWARD Three Months Ended March 31, 2019 2018 Beginning of period $ 2,756 $ 4,511 Gains & losses (1) (33) (9) Accretion of income (1) 106 343 Purchases - 9,600 Sales and returns of capital (50) (169) End of period $ 2,779 $ 14,276 Change in unrealized gains / (losses) (2) $ (33) $ 147 (1) Gains and losses on and accretion of income on other investments , at fair value are recorded as a component of principal transactions and other income in the consolidated statements of operations. (2) Represents the change in unrealized gains and losses for the period included in earnings for assets held at the end of the reporting period. |
Quantitative Information About Level 3 Fair Value Measurements | QUANTITATIVE INFORMATION ABOUT LEVEL 3 FAIR VALUE MEASUREMENTS (Dollars in Thousands) Significant Range of Fair Value Valuation Unobservable Weighted Significant March 31, 2019 Technique Inputs Average Inputs Assets Other investments, at fair value CLOs $ 2,753 Discounted Cash Flow Model Yield 17.6% 15.6% - 19.3% Duration-years 6.6 6.1 - 7.3 Default rate 2.0% 2% - 2% QUANTITATIVE INFORMATION ABOUT LEVEL 3 FAIR VALUE MEASUREMENTS (Dollars in Thousands) Significant Range of Fair Value Valuation Unobservable Weighted Significant December 31, 2018 Technique Inputs Average Inputs Assets Other investments, at fair value CLOs $ 2,730 Discounted Cash Flow Model Yield 20.0% 18.1 - 21.6% Duration-years 6.9 6.3 - 7.5 Default rate 2.0% 2.0% |
Fair Value, Investments, Entities That Calculate Net Asset Value Per Share | FAIR VALUE MEASUREMENTS OF INVESTMENTS IN CERTAIN ENTITIES THAT CALCULATE NET ASSET VALUE PER SHARE (OR ITS EQUIVALENT) (Dollars in Thousands) Fair Value March 31, 2019 Unfunded Commitments Redemption Frequency Redemption Notice Period Other investments, at fair value EuroDekania (a) $ 1,823 N/A N/A N/A U.S. Insurance JV (b) 1,964 $ 1,100 N/A N/A SPAC Fund (c) 646 N/A Quarterly after 1 year lock up 90 days $ 4,433 Fair Value December 31, 2018 Unfunded Commitments Redemption Frequency Redemption Notice Period Other investments, at fair value EuroDekania (a) $ 1,533 N/A N/A N/A U.S. Insurance JV (b) 1,925 $ 1,100 N/A N/A SPAC Fund (c) 592 N/A Quarterly after 1 year lock up 90 days $ 4,050 N/A Not applicable. (a) EuroDekania owns investments in hybrid capital securities that have attributes of debt and equity, primarily in the form of subordinated debt issued by insurance companies, banks, and bank holding companies based primarily in Western Europe; widely syndicated leveraged loans issued by European corporations; commercial mortgage backed securities (“CMBS”), including subordinated interests in first mortgage real estate loans; and RMBS and ABS backed by consumer and commercial receivables. The majority of the assets are denominated in Euros and U.K. Pounds Sterling. (b) The U.S. Insurance JV invests in debt issued by small and medium sized U.S. and Bermuda insurance and reinsurance companies. (c) The SPAC Fund invests in equity interests of SPACs. |
Derivative Financial Instrume_2
Derivative Financial Instruments (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Derivative Financial Instruments [Abstract] | |
Balance Sheet Information | DERIVATIVE FINANCIAL INSTRUMENTS-BALANCE SHEET INFORMATION (Dollars in Thousands) Derivative Financial Instruments Not Designated as Hedging Instruments Under FASB ASC 815 Balance Sheet Classification March 31, 2019 December 31, 2018 TBAs and other forward agency MBS Investments-trading $ 10,161 $ 8,142 Other extended settlement trades Investments-trading 46 70 Foreign currency forward contracts Other investments, at fair value 16 (13) TBAs and other forward agency MBS Trading securities sold, not yet purchased (9,652) (6,116) Other extended settlement trades Trading securities sold, not yet purchased - (3) $ 571 $ 2,080 |
Statement Of Operations Information | DERIVATIVE FINANCIAL INSTRUMENTS-STATEMENT OF OPERATIONS INFORMATION (Dollars in Thousands) Derivative Financial Instruments Not Designated as Hedging Instruments Under FASB ASC 815 Income Statement Classification Three Months Ended March 31, 2019 Three Months Ended March 31, 2018 Foreign currency forward contracts Revenue-principal transactions and other income $ 40 $ (19) Other extended settlement trades Revenue-net trading (24) (10) TBAs and other forward agency MBS Revenue-net trading 761 1,959 $ 777 $ 1,930 |
Collateralized Securities Tra_2
Collateralized Securities Transactions (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Collateralized Securities Transactions [Abstract] | |
Schedule Of Repurchase Agreements Accounted For As Secured Borrowings | SECURED BORROWINGS (Dollars in Thousands) March 31, 2019 Repurchase Agreements Remaining Contractual Maturity of the Agreements Collateral Type: Overnight and Continuous Up to 30 days 30 - 90 days Greater than 90 days Total U.S. government agency MBS (GCF repo) $ 2,486,338 $ 1,726,351 $ 250,579 $ 550,866 $ 5,014,134 MBS (gestational repo) - 436,626 - - 436,626 SBA loans 11,095 - - - 11,095 $ 2,497,433 $ 2,162,977 $ 250,579 $ 550,866 $ 5,461,855 Reverse repurchase agreements with FICC netted with repurchase agreements with FICC $ (901,142) Securities sold under agreements to repurchase $ 4,560,713 Reverse Repurchase Agreements Remaining Contractual Maturity of the Agreements Collateral Type: Overnight and Continuous Up to 30 days 30 - 90 days Greater than 90 days Total U.S. government agency MBS (GCF repo) $ 450,360 $ 1,404,899 $ 2,668,661 $ 449,602 $ 4,973,522 MBS (gestational repo) - 438,009 - - 438,009 SBA loans - - - - - $ 450,360 $ 1,842,908 $ 2,668,661 $ 449,602 $ 5,411,531 Reverse repurchase agreements with FICC netted with repurchase agreements with FICC $ (901,142) Receivables under resale agreements $ 4,510,389 SECURED BORROWINGS (Dollars in Thousands) December 31, 2018 Repurchase Agreements Remaining Contractual Maturity of the Agreements Collateral Type: Overnight and Continuous Up to 30 days 30 - 90 days Greater than 90 days Total U.S. government agency MBS (GCF repo) $ 7,014,758 $ 250,537 $ - $ - $ 7,265,295 MBS (gestational repo) - 287,400 100,918 - 388,318 SBA loans 18,151 - - - 18,151 $ 7,032,909 $ 537,937 $ 100,918 $ - $ 7,671,764 Reverse repurchase agreements with FICC netted with repurchase agreements with FICC $ (2,461,177) Securities sold under agreements to repurchase $ 5,210,587 Reverse Repurchase Agreements Remaining Contractual Maturity of the Agreements Collateral Type: Overnight and Continuous Up to 30 days 30 - 90 days Greater than 90 days Total U.S. government agency MBS (GCF repo) $ 10,864 $ 5,477,247 $ 598,635 $ 1,157,349 $ 7,244,095 MBS (gestational repo) - 287,209 100,926 - 388,135 SBA loans - - - - - $ 10,864 $ 5,764,456 $ 699,561 $ 1,157,349 $ 7,632,230 Reverse repurchase agreements with FICC netted with repurchase agreements with FICC $ (2,461,177) Receivables under resale agreements $ 5,171,053 |
Investment In Equity Method A_2
Investment In Equity Method Affiliate (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Investment in Equity Method Affiliate [Abstract] | |
Schedule Of Investments In Equity Method Affiliates | INVESTMENTS IN EQUITY METHOD AFFILIATES (Dollars in Thousands) Insurance SPAC January 1, 2019 $ - Investments / advances 3,775 Distributions / repayments - Earnings / (loss) realized (8) March 31, 2019 $ 3,767 |
Leases (Tables)
Leases (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Leases [Abstract] | |
Schedule Of Future Maturity Of Lease Liabilities | FUTURE MATURITY OF LEASE LIABILITIES (Dollars in Thousands) As of March 31, 2019 Lease Payments 2019 - remaining $ 1,290 2020 1,564 2021 1,108 2022 933 2023 950 Thereafter 5,077 Total 10,922 Less imputed interest (2,264) Lease obligation $ 8,658 |
Other Assets And Accounts Payab
Other Assets And Accounts Payable And Other Liabilities (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Other Receivables, Other Assets And Accounts Payable And Other Liabilities [Abstract] | |
Schedule Of Other Assets | OTHER ASSETS (Dollars in Thousands) March 31, 2019 December 31, 2018 Deferred costs $ 648 $ 571 Prepaid expenses 1,037 1,009 Prepaid income taxes - 40 Deposits 681 669 Miscellaneous other assets 33 33 Furniture, equipment, and leasehold improvements, net 1,072 1,133 Intangible assets 166 166 Other assets $ 3,637 $ 3,621 |
Schedule Of Accounts Payable And Other Liabilities | ACCOUNTS PAYABLE AND OTHER LIABILITIES (Dollars in Thousands) March 31, 2019 December 31, 2018 Accounts payable $ 285 $ 359 Redeemable financial instruments accrued interest 352 714 Straight line rent payable - 405 Accrued interest payable 670 674 Accrued interest on securities sold, not yet purchased 992 1,184 Payroll taxes payable 394 721 Counterparty cash collateral 6,437 4,227 Accrued expense and other liabilities 2,710 3,168 Accounts payable and other liabilities $ 11,840 $ 11,452 Aa The redeemable financial instruments accrued interest represents accrued interest the Company’s redeemable financial instruments. See note 1 5 . Subsequent to the adoption of ASC 842, effective January 1, 2019, the Company will no longer have straight line rent payable. See note 12. Counterparty cash collateral represents cash collateral received from our reverse rep o counterparties . This cash is owed to the counterparty. See note 1 0 . |
Variable Interest Entities (Tab
Variable Interest Entities (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Variable Interest Entities [Abstract] | |
Schedule Of Variable Interest Entities | CARRYING VALUE OF VARIABLE INTERESTS IN NON-CONSOLIDATED VARIABLE INTEREST ENTITIES (Dollars in Thousands) As of March 31, 2019 As of December 31, 2018 Other Investments, at fair value $ 5,389 $ 5,273 Maximum e xposure $ 5,389 $ 5,273 |
Redeemable Financial Instrume_2
Redeemable Financial Instruments (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Redeemable Financial Instruments [Abstract] | |
Schedule Of Redeemable Financial Instruments | REDEEMABLE FINANCIAL INSTRUMENTS As of March 31, 2019 (Dollars in Thousands) Outstanding Balance Accrued Interest JKD Capital Partners I LTD $ 8,000 $ 278 DGC Family Fintech Trust / CBF 10,000 74 ViaNova Capital Group, LLC 679 - $ 18,679 $ 352 REDEEMABLE FINANCIAL INSTRUMENTS As of December 31, 2018 (Dollars in Thousands) Outstanding Balance Accrued Interest JKD Capital Partners I LTD $ 6,732 $ 676 DGC Family Fintech Trust / CBF 10,000 38 ViaNova Capital Group, LLC 716 - $ 17,448 $ 714 |
Debt (Tables)
Debt (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Debt [Abstract] | |
Debt Outstanding | DETAIL OF DEBT (Dollars in Thousands) Description As of March 31, 2019 As of December 31, 2018 Interest Rate Terms Interest (4) Maturity Contingent convertible debt: 8.00% convertible senior note (the "2017 Convertible Note") $ 15,000 $ 15,000 Fixed 8.00 % March 2022 (1) 8.00% convertible senior notes (the "2013 Convertible Notes") 6,786 6,786 Fixed 8.00 % September 2019 (2) Less unamortized debt issuance costs (910) (974) 20,876 20,812 Junior subordinated notes (3): Alesco Capital Trust I 28,125 28,125 Variable 6.75 % July 2037 Sunset Financial Statutory Trust I 20,000 20,000 Variable 6.95 % March 2035 Less unamortized discount (25,343) (25,401) 22,782 22,724 MB Financial Bank, N.A. Credit Facility - - Variable N/A April 2021 LegacyTexas Credit Facility - - Variable N/A November 2019 Total $ 43,658 $ 43,536 (1) The holder of the 2017 Convertible Note may convert all or any part of the outstanding principal amount at any time prior to maturity into units of the Operating LLC at a conversion price of $1.45 per unit, subject to customary anti-dilution adjustments. Units of the Operating LLC not held by Cohen & Company Inc. may, with certain restrictions, be redeemed and exchanged into shares of the Common Stock on a ten -for-one basis. Therefore, the 2017 Convertible Note can be converted into Operating LLC units and then redeemed and exchanged into Common Stock at an effective conversion price of $14.50 . See note 1 8 to our Annual Report on Form 10-K for the year ended December 31, 201 8 . (2) The holders of the 2013 Convertible Notes may convert all or any part of the outstanding principal amount at any time prior to maturity into shares of the Company’s Common Stock, at a conversion price of $12.00 per share, subject to certain anti-dilution adjustments . (3) The junior subordinated notes listed represent debt the Company owes to the two trusts noted above. The total par amount owed by the Company to the trusts is $49,614 . However, the Company owns the common stock of the trusts in a total par amount of $1,489 . The Company pays interest (and at maturity, principal) to the trusts on the entire $49,614 junior notes outstanding. However, the Company receives back from the trusts the pro rata share of interest and principal on the common stock held by the Company. These trusts are VIEs and the Company does not consolidate them even though the Company holds the common stock. The Company carries the common stock on its balance sheet at a value of $0 . The junior subordinated notes are recorded at a discount to par. When factoring in the discount, the yield to maturity of the junior subordinated notes as of March 31, 2019 on a combined basis is 16.75% assuming the variable rate in effect on the last day of the reporting period remains in effect until maturity. (4) Represents the interest rate in effect as of the last day of the reporting period. |
Schedule Of Interest Expense By Debt Instrument | INTEREST EXPENSE (Dollars in Thousands) Three Months Ended March 31, 2019 2018 Junior subordinated notes $ 880 $ 821 2013 Convertible Notes 134 203 2017 Convertible Note 360 354 2018 MB LOC/2019 MB Revolver 92 - LegacyTexas Credit Facility 4 - Redeemable Financial Instrument - DGC Family Fintech Trust / CBF 148 110 Redeemable Financial Instrument - JKD Capital Partners I LTD 278 331 Redeemable Financial Instrument - ViaNova Capital Group, LLC (37) - $ 1,859 $ 1,819 |
Equity (Tables)
Equity (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Equity [Abstract] | |
Schedule Of Unrestricted Common Stock Activity | Common Stock Shares December 31, 2018 1,110,717 Vesting of shares 56,639 Shares withheld and retired for employee taxes (15,557) Repurchase and retirement of Common Stock (7,890) March 31, 2019 1,143,909 |
Operating LLC Membership Units | Operating LLC Membership Units Units related to UIS Agreement 410,820 Units surrendered from retirement of Common Stock (78,900) Total 331,920 |
Schedule Of Effects Of Changes In Ownership Interest Subsidiary | Three Months Ended Three Months Ended March 31, 2019 March 31, 2018 Net income / (loss) attributable to Cohen & Company Inc. $ (1,202) $ (1,474) Transfers (to) from the non-controlling interest: Increase / (decrease) in Cohen & Company Inc. paid in capital for the acquisition / (surrender) of additional units in consolidated subsidiary, net 133 84 Changes from net income / (loss) attributable to Cohen & Company Inc. and transfers (to) from the non-controlling interest $ (1,069) $ (1,390) |
Earnings _ (Loss) Per Common _2
Earnings / (Loss) Per Common Share (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Earnings / (Loss) Per Common Share [Abstract] | |
Schedule Of Earnings / (Loss) Per Common Share | EARNINGS / (LOSS) PER COMMON SHARE (Dollars in Thousands, except share or per share information) Three Months Ended March 31, 2019 2018 Net income / (loss) attributable to Cohen & Company Inc. $ (1,202) $ (1,474) Add/ (deduct): Income / (loss) attributable to non-controlling interest attributable to Operating LLC membership (1) (622) (677) Add / (deduct): Adjustment (2) 53 7 Net income / (loss) on a fully converted basis $ (1,771) $ (2,144) Weighted average common shares outstanding - Basic 1,133,166 1,172,476 Unrestricted Operating LLC membership units exchangeable into Cohen & Company shares (1) 532,409 532,409 Restricted units or shares - - Weighted average common shares outstanding - Diluted (3) 1,665,575 1,704,885 Net income / (loss) per common share - Basic $ (1.06) $ (1.26) Net income / (loss) per common share - Diluted $ (1.06) $ (1.26) (1) The Operating LLC membership units not held by Cohen & Company Inc. (that is, those held by the non-controlling interest for the three months ended March 31, 2019 and 2018 ) may be redeemed and exchanged into shares of the Company on a ten -for-one basis. The Operating LLC membership units not held by Cohen & Company Inc. are redeemable, at the member’s option at any time, for (i) cash in an amount equal to the average of the per share closing prices of the Common Stock for the ten consecutive trading days immediately preceding the date the Company receives the member’s redemption notice, or (ii) at the Company’s option, one tenth of a share of the Common Stock, subject, in each case, to appropriate adjustment upon the occurrence of an issuance of additional shares of the Common Stock as a dividend or other distribution on the Company’s outstanding Common Stock, or a further subdivision or combination of the outstanding shares of the Common Stock. These units are not included in the computation of basic earnings per share. These units enter into the computation of diluted net income (loss) per common share when the effect is not anti-dilutive using the if-converted method. (2) An adjustment is included because the Company would have incurred a higher income tax expense or realized a higher income tax benefit, as applicable , if the Operating LLC membership units had been converted at the beginning of the period,. (3) For the three months ended March 31, 2019 , weighted average common shares outstanding excludes (i) 59,182 shares representing restricted Common Stock and restricted Operating LLC membership units, which when vested can be converted into Common Stock, (ii) 565,469 shares from the assumed conversion of the 2013 Convertible Notes, and (iii) 1,034,483 shares from the assumed conversion of the 2017 Convertible Note because the inclusion of such shares would be anti-dilutive. For the three months ended March 31, 2018 , weighted average common shares outstanding excludes (i) 26,691 shares representing restricted Common Stock , (ii) 274,917 shares from the assumed conversion of the 2013 Convertible Notes, and (iii) 1,034,483 shares from the assumed conversion of the 2017 Convertible Note because the inclusion of such shares would be anti-dilutive. |
Segment And Geographic Inform_2
Segment And Geographic Information (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Segment And Geographic Information [Abstract] | |
Schedule Of Segment Reporting Information | SEGMENT INFORMATION Statement of Operations Information Three Months Ended March 31, 2019 Capital Asset Principal Segment Unallocated Markets Management Investing Total (1) Total Net trading $ 8,729 $ - $ - $ 8,729 $ - $ 8,729 Asset management - 2,002 - 2,002 - 2,002 New issue and advisory - - - - - - Principal transactions and other income 1 97 316 414 - 414 Total revenues 8,730 2,099 316 11,145 - 11,145 Total operating expenses 7,458 1,815 100 9,373 1,835 11,208 Operating income (loss) 1,272 284 216 1,772 (1,835) (63) Interest income (expense) 76 (63) - 13 (1,872) (1,859) Income (loss) from equity method affiliates - - (8) (8) - (8) Income (loss) before income taxes 1,348 221 208 1,777 (3,707) (1,930) Income tax expense (benefit) - - - - (106) (106) Net income (loss) 1,348 221 208 1,777 (3,601) (1,824) Less: Net income (loss) attributable to the non-controlling interest - - - - (622) (622) Net income (loss) attributable to Cohen & Company Inc. $ 1,348 $ 221 $ 208 $ 1,777 $ (2,979) $ (1,202) Other statement of operations data Depreciation and amortization (included in total operating expense) $ 5 $ 1 $ - $ 6 $ 75 $ 81 SEGMENT INFORMATION Statement of Operations Information Three Months Ended March 31, 2018 Capital Asset Principal Segment Unallocated Markets Management Investing Total (1) Total Net trading $ 6,191 $ - $ - $ 6,191 $ - $ 6,191 Asset management - 1,804 - 1,804 - 1,804 New issue and advisory 696 - - 696 - 696 Principal transactions and other income - 204 443 647 - 647 Total revenues 6,887 2,008 443 9,338 - 9,338 Total operating expenses 6,651 1,393 96 8,140 1,558 9,698 Operating income (loss) 236 615 347 1,198 (1,558) (360) Interest expense - - - - (1,819) (1,819) Income / (loss) from equity method affiliates - - - - - - Income (loss) before income taxes 236 615 347 1,198 (3,377) (2,179) Income tax expense (benefit) - - - - (28) (28) Net income (loss) 236 615 347 1,198 (3,349) (2,151) Less: Net income (loss) attributable to the non-controlling interest - - - - (677) (677) Net income (loss) attributable to Cohen & Company Inc. $ 236 $ 615 $ 347 $ 1,198 $ (2,672) $ (1,474) Other statement of operations data Depreciation and amortization (included in total operating expense) $ 16 $ 1 $ - $ 17 $ 44 $ 61 (1) Unallocated includes certain expenses incurred by indirect overhead and support departments (such as the executive, finance, legal, information technology, human resources, risk, compliance, and other similar overhead and support departments). Some of the items not allocated include: (1) operating expenses (such as cash compensation and benefits, equity-based compensation expense, professional fees, travel and entertainment, consulting fees, and rent) related to support departments excluding certain departments that directly support the Capital Markets business segment; (2) interest expense on debt; and (3) income taxes. Management does not consider these items necessary for an understanding of the operating results of these business segments and such amounts are excluded in business segment reporting to the chief operating decision maker. |
Reconciliation Of Assets From Segment To Consolidated | BALANCE SHEET DATA As of March 31, 2019 (Dollars in Thousands) Capital Asset Principal Segment Unallocated Markets Management Investing Total (1) Total Total Assets $ 4,922,973 $ 2,106 $ 13,233 $ 4,938,312 $ 13,015 $ 4,951,327 Included within total assets: Goodwill (2) $ 7,937 $ 55 $ - $ 7,992 $ - $ 7,992 Intangible assets (2) $ 166 $ - $ - $ 166 $ - $ 166 BALANCE SHEET DATA December 31, 2018 (Dollars in Thousands) Capital Asset Principal Segment Unallocated Markets Management Investing Total (1) Total Total Assets $ 5,633,806 $ 2,309 $ 13,768 $ 5,649,883 $ 4,569 $ 5,654,452 Included within total assets: Goodwill (2) $ 7,937 $ 55 $ - $ 7,992 $ - $ 7,992 Intangible assets (2) $ 166 $ - $ - $ 166 $ - $ 166 (1) Unallocated assets primarily include: (1) amounts due from related parties; (2) furniture and equipment, net; and (3) other assets that are not considered necessary for an understanding of business segment assets and such amounts are excluded in business segment reporting to the chief operating decision maker. (2) Goodwill and intangible assets are allocated to the Capital Markets and Asset Management business segments as indicated in the table above. |
Revenue By Geographic Area | GEOGRAPHIC DATA (Dollars in Thousands) Three Months Ended March 31, 2019 2018 Total Revenues: United States $ 10,087 $ 7,902 United Kingdom & Other 1,058 1,436 Total $ 11,145 $ 9,338 |
Related Party Transactions (Tab
Related Party Transactions (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Related Party Transactions [Abstract] | |
Schedule Of Related Party Transactions | . RELATED PARTY TRANSACTIONS Three Months Ended March 31, 2019 (Dollars in Thousands) Net trading Asset management Principal transactions and other income Income (loss) from equity method affiliates Professional fee and other operating Interest expense(income) incurred CBF $ - $ - $ - $ - $ - $ 119 DGC Family Fintech Trust - - - - - 390 Duane Morris - - - - 101 - EBC - - - - - 47 Edward E. Cohen IRA - - - - - 87 EuroDekania - 86 291 - - - Fintech Acquisition Corp. III - - 3 - - - Insurance SPAC - - 4 (8) - - JKD Investor - - - - - 278 SPAC Fund - 31 24 - - - TBBK 2 - - - - - U.S. Insurance JV - 80 39 - - - $ 2 $ 197 $ 361 $ (8) $ 101 $ 921 RELATED PARTY TRANSACTIONS Three Months Ended March 31, 2018 (Dollars in Thousands) Net trading Asset management Principal transactions and other income Income (loss) from equity method affiliates Professional fee and other operating Interest expense(income) incurred CBF $ - $ - $ - $ - $ - $ 88 DGC Family Fintech Trust - - - - - 376 Duane Morris - - - - 208 - EBC - - - - - 59 Edward E. Cohen IRA - - - - - 108 EuroDekania - 33 - - - - Fintech Acquisition Corp. II - - 2 - - - JKD Investor - - - - - 331 TBBK 11 - - - - - $ 11 $ 33 $ 2 $ - $ 208 $ 962 |
Due From _ Due To Related Par_2
Due From / Due To Related Parties (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Due From / Due To Related Parties [Abstract] | |
Schedule Of Due From / Due To Related Parties | DUE FROM/DUE TO RELATED PARTIES (Dollars in Thousands) March 31, 2019 December 31, 2018 Employees & other $ 625 $ 793 Due from r elated p arties $ 625 $ 793 |
Organization And Nature Of Op_2
Organization And Nature Of Operations (Narrative) (Details) $ / shares in Units, $ in Millions | 3 Months Ended | |
Mar. 31, 2019USD ($)segment$ / shares | Dec. 31, 2018$ / shares | |
Securities [Line Items] | ||
Common Stock, par value | $ / shares | $ 0.01 | $ 0.01 |
Assets under management | $ 2,780 | |
Number of Operating Segments | segment | 3 | |
CDOs [Member] | ||
Securities [Line Items] | ||
Assets under management | $ 2,310 | |
Assets under management which are collateralized debt obligations percentage | 83.10% |
Summary Of Significant Accoun_3
Summary Of Significant Accounting Policies (Narrative) (Details) - USD ($) $ in Thousands | Jan. 01, 2019 | Mar. 31, 2019 | Mar. 31, 2018 | Dec. 31, 2018 |
Summary Of Significant Accounting Policies [Line Items] | ||||
Other assets | $ 3,637 | $ 3,621 | ||
Maximum normal term for resale agreements | 1 month | |||
Estimated debt in fair value | $ 51,181 | $ 50,159 | ||
Right of use asset | 8,081 | |||
Lease commitment liability | 8,658 | |||
Increase in other receivables | $ (3,894) | $ (554) | ||
Accounting Standards Update 2016-02 [Member] | ||||
Summary Of Significant Accounting Policies [Line Items] | ||||
Right of use asset | $ 8,416 | |||
Lease commitment liability | 8,860 | |||
Reduction in retained earnings from cumulative effect of adoption | 20 | |||
Increase in other receivables | 18 | |||
Reduction in other liabilities | $ 406 |
New Business (Narrative) (Detai
New Business (Narrative) (Details) - USD ($) $ / shares in Units, $ in Thousands | Mar. 22, 2019 | May 16, 2018 | Mar. 31, 2019 | Dec. 31, 2018 | Aug. 06, 2018 | |||
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items] | ||||||||
Net asset value | $ 4,433 | $ 4,050 | ||||||
Common Stock, par value | $ 0.01 | $ 0.01 | ||||||
Common Stock, shares issued | 1,217,624 | 1,204,196 | ||||||
Common Stock, shares outstanding | 1,217,624 | 1,204,196 | ||||||
Investments Measured At NAV [Member] | ||||||||
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items] | ||||||||
Net asset value | [1] | $ 4,433 | $ 4,050 | |||||
U.S. Insurance JV [Member] | ||||||||
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items] | ||||||||
Required investment percentage of total equity | 4.50% | |||||||
Net asset value | [2] | 1,964 | 1,925 | |||||
U.S. Insurance JV [Member] | Maximum [Member] | ||||||||
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items] | ||||||||
Net asset value | $ 3,000 | |||||||
U.S. Insurance JV [Member] | Investor [Member] | ||||||||
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items] | ||||||||
Net asset value | $ 63,000 | |||||||
SPAC Fund [Member] | ||||||||
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items] | ||||||||
Net asset value | $ 646 | [3] | $ 592 | [3] | $ 600 | |||
Insurance SPAC [Member] | IPO [Member] | ||||||||
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items] | ||||||||
Sale of Stock, Number of Shares Issued in Transaction | 15,065,000 | |||||||
Common Stock, par value | $ 0.0001 | |||||||
Sale of Stock, Price Per Share | $ 10 | |||||||
Sale of Stock, Consideration Received on Transaction | $ 150,650 | |||||||
Option period | 45 days | |||||||
Sale of Stock, Number Of Shares For Additional Purchase | 1,965,000 | |||||||
Common Stock, shares issued | 20,653,333 | |||||||
Common Stock, shares outstanding | 20,653,333 | |||||||
Insurance SPAC [Member] | IPO [Member] | SPAC Warrant [Member] | ||||||||
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items] | ||||||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ 11.50 | |||||||
Sponsor Entities [Member] | Insurance SPAC [Member] | ||||||||
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items] | ||||||||
Period Of Required Business Combination To Occur Following IPO For Proceeds To Not Expire | 18 months | |||||||
Investment Owned, Balance, Shares | 5,103,333 | |||||||
Period Shares Held From Private Placement Will Not Be Transferable Or Salable | 30 days | |||||||
Exception Percentage Of Total Shares That Can Be Transferable Or Salable | 20.00% | |||||||
Period Out Of Consecutive 30 Trading Days For Transferable Or Salable Price Tranches To Hit | 20 days | |||||||
Sponsor Entities [Member] | Insurance SPAC [Member] | Closing Price Tranche 1 [Member] | ||||||||
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items] | ||||||||
Sale of Stock, Price Per Share | $ 12 | |||||||
Sponsor Entities [Member] | Insurance SPAC [Member] | Closing Price Tranche 2 [Member] | ||||||||
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items] | ||||||||
Sale of Stock, Price Per Share | 13.50 | |||||||
Sponsor Entities [Member] | Insurance SPAC [Member] | Closing Price Tranche 3 [Member] | ||||||||
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items] | ||||||||
Sale of Stock, Price Per Share | 15 | |||||||
Sponsor Entities [Member] | Insurance SPAC [Member] | Closing Price Tranche 4 [Member] | ||||||||
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items] | ||||||||
Sale of Stock, Price Per Share | $ 17 | |||||||
Sponsor Entities [Member] | Insurance SPAC [Member] | Private Placement [Member] | ||||||||
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items] | ||||||||
Sale of Stock, Number of Shares Issued in Transaction | 375,000 | |||||||
Sale of Stock, Price Per Share | $ 10 | |||||||
Sale of Stock, Consideration Received on Transaction | $ 3,750 | |||||||
Period Of Private Placement Shares Not To Be Transferable, Assignable, Or Salable | 30 days | |||||||
Sponsor Entities [Member] | Insurance SPAC [Member] | Investor [Member] | ||||||||
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items] | ||||||||
Net asset value | $ 2,550 | |||||||
[1] | As a practical expedient, the Company uses NAV or its equivalent to measure the fair value of its investments in EuroDekania, the U.S. Insurance JV, and the SPAC Fund. EuroDekania invests in hybrid capital securities of European companies. The U.S. Insurance JV invests in debt issued by small and medium sized U.S. and Bermuda insurance and reinsurance companies. The SPAC Fund invests in equity securities of SPACs. According to ASC 820, these investments are not categorized within the fair value hierarchy. | |||||||
[2] | The U.S. Insurance JV invests in debt issued by small and medium sized U.S. and Bermuda insurance and reinsurance companies. | |||||||
[3] | The SPAC Fund invests in equity interests of SPACs. |
Net Trading (Schedule Of Net Tr
Net Trading (Schedule Of Net Trading) (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Net Trading [Abstract] | ||
Net realized gains (losses) - trading inventory | $ 6,310 | $ 4,224 |
Net unrealized gains (losses) - trading inventory | 559 | 13 |
Net gains and losses | 6,869 | 4,237 |
Interest income-trading inventory | 1,615 | 1,356 |
Interest income-receivables under resale agreements | 32,232 | 9,072 |
Interest income | 33,847 | 10,428 |
Interest expense-securities sold under agreements to repurchase | (31,130) | (8,027) |
Interest expense-margin payable | (857) | (447) |
Interest expense | (31,987) | (8,474) |
Net Trading | $ 8,729 | $ 6,191 |
Receivables From And Payables_3
Receivables From And Payables To Brokers, Dealers, And Clearing Agencies (Schedule Of Due To (From) Broker-Dealers And Clearing Organizations) (Details) - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 |
Receivables from Brokers-Dealers and Clearing Agencies [Abstract] | ||
Deposits with clearing agencies | $ 250 | $ 250 |
Unsettled regular way trades, net | 5,816 | |
Receivable from clearing agencies | 98,378 | 129,562 |
Receivables from brokers, dealers, and clearing agencies | 104,444 | 129,812 |
Payables to Broker-Dealers and Clearing Agencies [Abstract] | ||
Unsettled regular way trades, net | 5,822 | |
Margin payable | 162,951 | 195,776 |
Payables to brokers, dealers, and clearing agencies | $ 162,951 | $ 201,598 |
Financial Instruments (Schedule
Financial Instruments (Schedule Of Trading Securities) (Details) - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 |
Schedule of Trading Securities and Other Trading Assets [Line Items] | ||
Investments-trading | $ 285,473 | $ 301,235 |
U.S. government agency MBS and CMOs [Member] | ||
Schedule of Trading Securities and Other Trading Assets [Line Items] | ||
Investments-trading | 185,905 | 149,651 |
U.S. government agency debt securities [Member] | ||
Schedule of Trading Securities and Other Trading Assets [Line Items] | ||
Investments-trading | 17,027 | 14,915 |
RMBS [Member] | ||
Schedule of Trading Securities and Other Trading Assets [Line Items] | ||
Investments-trading | 29 | 21 |
U.S. Treasury securities [Member] | ||
Schedule of Trading Securities and Other Trading Assets [Line Items] | ||
Investments-trading | 11,439 | 4,099 |
ABS [Member] | ||
Schedule of Trading Securities and Other Trading Assets [Line Items] | ||
Investments-trading | 100 | 100 |
SBA loans [Member] | ||
Schedule of Trading Securities and Other Trading Assets [Line Items] | ||
Investments-trading | 11,196 | 31,496 |
Corporate bonds and redeemable preferred stock [Member] | ||
Schedule of Trading Securities and Other Trading Assets [Line Items] | ||
Investments-trading | 29,156 | 44,507 |
Foreign government bonds [Member] | ||
Schedule of Trading Securities and Other Trading Assets [Line Items] | ||
Investments-trading | 875 | 117 |
Municipal bonds [Member] | ||
Schedule of Trading Securities and Other Trading Assets [Line Items] | ||
Investments-trading | 17,281 | 47,433 |
Certificates of deposit [Member] | ||
Schedule of Trading Securities and Other Trading Assets [Line Items] | ||
Investments-trading | 1,850 | 302 |
Derivatives [Member] | ||
Schedule of Trading Securities and Other Trading Assets [Line Items] | ||
Investments-trading | 10,207 | 8,212 |
Equity securities [Member] | ||
Schedule of Trading Securities and Other Trading Assets [Line Items] | ||
Investments-trading | $ 408 | $ 382 |
Financial Instruments (Schedu_2
Financial Instruments (Schedule Of Trading Securities Sold, Not Yet Purchased) (Details) - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 |
Security Owned and Sold, Not yet Purchased, at Fair Value [Line Items] | ||
Trading securities sold, not yet purchased | $ 98,245 | $ 120,122 |
U.S. government agency MBS and CMOs [Member] | ||
Security Owned and Sold, Not yet Purchased, at Fair Value [Line Items] | ||
Trading securities sold, not yet purchased | 16 | |
U.S. Treasury securities [Member] | ||
Security Owned and Sold, Not yet Purchased, at Fair Value [Line Items] | ||
Trading securities sold, not yet purchased | 42,043 | 70,010 |
Corporate bonds and redeemable preferred stock [Member] | ||
Security Owned and Sold, Not yet Purchased, at Fair Value [Line Items] | ||
Trading securities sold, not yet purchased | 46,530 | 43,957 |
Municipal bonds [Member] | ||
Security Owned and Sold, Not yet Purchased, at Fair Value [Line Items] | ||
Trading securities sold, not yet purchased | 20 | 20 |
Derivatives [Member] | ||
Security Owned and Sold, Not yet Purchased, at Fair Value [Line Items] | ||
Trading securities sold, not yet purchased | $ 9,652 | $ 6,119 |
Financial Instruments (Schedu_3
Financial Instruments (Schedule Of Other Investments) (Details) - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 |
Schedule of Investments [Line Items] | ||
Other investments, Amortized Cost | $ 11,173 | $ 15,332 |
Other investments, Carry Value | 9,440 | 13,768 |
Other investments, Unrealized Gain / (Loss) | (1,733) | (1,564) |
EuroDekania [Member] | ||
Schedule of Investments [Line Items] | ||
Other investments, Amortized Cost | 4,489 | 4,489 |
Other investments, Carry Value | 1,823 | 1,533 |
Other investments, Unrealized Gain / (Loss) | (2,666) | (2,956) |
U.S. Insurance JV [Member] | ||
Schedule of Investments [Line Items] | ||
Other investments, Amortized Cost | 1,900 | 1,900 |
Other investments, Carry Value | 1,964 | 1,925 |
Other investments, Unrealized Gain / (Loss) | 64 | 25 |
SPAC Fund [Member] | ||
Schedule of Investments [Line Items] | ||
Other investments, Amortized Cost | 630 | 600 |
Other investments, Carry Value | 646 | 592 |
Other investments, Unrealized Gain / (Loss) | 16 | (8) |
Equity securities [Member] | ||
Schedule of Investments [Line Items] | ||
Other investments, Amortized Cost | 780 | 5,016 |
Other investments, Carry Value | 1,896 | 6,650 |
Other investments, Unrealized Gain / (Loss) | 1,116 | 1,634 |
CLOs [Member] | ||
Schedule of Investments [Line Items] | ||
Other investments, Amortized Cost | 3,155 | 3,099 |
Other investments, Carry Value | 2,753 | 2,730 |
Other investments, Unrealized Gain / (Loss) | (402) | (369) |
CDOs [Member] | ||
Schedule of Investments [Line Items] | ||
Other investments, Amortized Cost | 189 | 189 |
Other investments, Carry Value | 26 | 26 |
Other investments, Unrealized Gain / (Loss) | (163) | (163) |
Residential Loans [Member] | ||
Schedule of Investments [Line Items] | ||
Other investments, Amortized Cost | 30 | 39 |
Other investments, Carry Value | 316 | 325 |
Other investments, Unrealized Gain / (Loss) | 286 | 286 |
Foreign currency forward contracts [Member] | ||
Schedule of Investments [Line Items] | ||
Other investments, Carry Value | 16 | (13) |
Other investments, Unrealized Gain / (Loss) | $ 16 | $ (13) |
Fair Value Disclosures (Narrati
Fair Value Disclosures (Narrative) (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Fair Value Disclosures [Abstract] | ||
Fair Value, Assets, Level 1 to Level 2 Transfers, Amount | $ 0 | $ 0 |
Fair Value, Liabilities, Level 1 to Level 2 Transfers, Amount | 0 | 0 |
Fair value, option, changes in fair value, gains (losses) | $ 249,000 | $ 151,000 |
Fair Value Disclosures (Schedul
Fair Value Disclosures (Schedule Of Assets And Liabilities Measured At Fair Value On A Recurring Basis) (Details) - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total investments-trading | $ 285,473 | $ 301,235 | |
Other investments, measured using hierarchy | 5,007 | 9,718 | |
Other investments, at fair value | 4,433 | 4,050 | |
Other investments, Carrying Value | 9,440 | 13,768 | |
Trading securities sold, not yet purchased | 98,245 | 120,122 | |
Quoted Prices In Active Markets (Level 1) [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total investments-trading | 11,439 | 4,099 | |
Other investments, measured using hierarchy | 1,059 | 5,762 | |
Trading securities sold, not yet purchased | 42,043 | 70,010 | |
Significant Other Observable Inputs (Level 2) [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total investments-trading | 274,034 | 297,136 | |
Other investments, measured using hierarchy | 1,169 | 1,200 | |
Trading securities sold, not yet purchased | 56,202 | 50,112 | |
Significant Unobservable Inputs (Level 3) [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Other investments, measured using hierarchy | 2,779 | 2,756 | |
Investments Measured At NAV [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Other investments, at fair value | [1] | 4,433 | 4,050 |
U.S. government agency MBS and CMOs [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total investments-trading | 185,905 | 149,651 | |
Trading securities sold, not yet purchased | 16 | ||
U.S. government agency MBS and CMOs [Member] | Significant Other Observable Inputs (Level 2) [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total investments-trading | 185,905 | 149,651 | |
U.S. government agency debt securities [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total investments-trading | 17,027 | 14,915 | |
U.S. government agency debt securities [Member] | Significant Other Observable Inputs (Level 2) [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total investments-trading | 17,027 | 14,915 | |
U.S. government agency MBS [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Trading securities sold, not yet purchased | 16 | ||
U.S. government agency MBS [Member] | Significant Other Observable Inputs (Level 2) [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Trading securities sold, not yet purchased | 16 | ||
RMBS [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total investments-trading | 29 | 21 | |
RMBS [Member] | Significant Other Observable Inputs (Level 2) [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total investments-trading | 29 | 21 | |
U.S. Treasury securities [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total investments-trading | 11,439 | 4,099 | |
Trading securities sold, not yet purchased | 42,043 | 70,010 | |
U.S. Treasury securities [Member] | Quoted Prices In Active Markets (Level 1) [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total investments-trading | 11,439 | 4,099 | |
Trading securities sold, not yet purchased | 42,043 | 70,010 | |
ABS [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total investments-trading | 100 | 100 | |
ABS [Member] | Significant Other Observable Inputs (Level 2) [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total investments-trading | 100 | 100 | |
SBA loans [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total investments-trading | 11,196 | 31,496 | |
SBA loans [Member] | Significant Other Observable Inputs (Level 2) [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total investments-trading | 11,196 | 31,496 | |
Corporate bonds and redeemable preferred stock [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total investments-trading | 29,156 | 44,507 | |
Trading securities sold, not yet purchased | 46,530 | 43,957 | |
Corporate bonds and redeemable preferred stock [Member] | Significant Other Observable Inputs (Level 2) [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total investments-trading | 29,156 | 44,507 | |
Trading securities sold, not yet purchased | 46,530 | 43,957 | |
Foreign government bonds [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total investments-trading | 875 | 117 | |
Foreign government bonds [Member] | Significant Other Observable Inputs (Level 2) [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total investments-trading | 875 | 117 | |
Municipal bonds [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total investments-trading | 17,281 | 47,433 | |
Trading securities sold, not yet purchased | 20 | 20 | |
Municipal bonds [Member] | Significant Other Observable Inputs (Level 2) [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total investments-trading | 17,281 | 47,433 | |
Trading securities sold, not yet purchased | 20 | 20 | |
Certificates of deposit [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total investments-trading | 1,850 | 302 | |
Certificates of deposit [Member] | Significant Other Observable Inputs (Level 2) [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total investments-trading | 1,850 | 302 | |
Derivatives [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total investments-trading | 10,207 | 8,212 | |
Trading securities sold, not yet purchased | 9,652 | 6,119 | |
Derivatives [Member] | Significant Other Observable Inputs (Level 2) [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total investments-trading | 10,207 | 8,212 | |
Trading securities sold, not yet purchased | 9,652 | 6,119 | |
Equity securities [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total investments-trading | 408 | 382 | |
Other investments, measured using hierarchy | 1,896 | 6,650 | |
Other investments, Carrying Value | 1,896 | 6,650 | |
Equity securities [Member] | Quoted Prices In Active Markets (Level 1) [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Other investments, measured using hierarchy | 1,043 | 5,775 | |
Equity securities [Member] | Significant Other Observable Inputs (Level 2) [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total investments-trading | 408 | 382 | |
Other investments, measured using hierarchy | 853 | 875 | |
CLOs [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Other investments, measured using hierarchy | 2,753 | 2,730 | |
CLOs [Member] | Significant Unobservable Inputs (Level 3) [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Other investments, measured using hierarchy | 2,753 | 2,730 | |
CDOs [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Other investments, measured using hierarchy | 26 | 26 | |
CDOs [Member] | Significant Unobservable Inputs (Level 3) [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Other investments, measured using hierarchy | 26 | 26 | |
Residential Loans [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Other investments, measured using hierarchy | 316 | 325 | |
Residential Loans [Member] | Significant Other Observable Inputs (Level 2) [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Other investments, measured using hierarchy | 316 | 325 | |
Foreign currency forward contracts [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Other investments, measured using hierarchy | 16 | (13) | |
Foreign currency forward contracts [Member] | Quoted Prices In Active Markets (Level 1) [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Other investments, measured using hierarchy | 16 | (13) | |
EuroDekania [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Other investments, at fair value | [2] | 1,823 | 1,533 |
Other investments, Carrying Value | $ 1,823 | $ 1,533 | |
[1] | As a practical expedient, the Company uses NAV or its equivalent to measure the fair value of its investments in EuroDekania, the U.S. Insurance JV, and the SPAC Fund. EuroDekania invests in hybrid capital securities of European companies. The U.S. Insurance JV invests in debt issued by small and medium sized U.S. and Bermuda insurance and reinsurance companies. The SPAC Fund invests in equity securities of SPACs. According to ASC 820, these investments are not categorized within the fair value hierarchy. | ||
[2] | EuroDekania owns investments in hybrid capital securities that have attributes of debt and equity, primarily in the form of subordinated debt issued by insurance companies, banks, and bank holding companies based primarily in Western Europe; widely syndicated leveraged loans issued by European corporations; commercial mortgage backed securities ("CMBS"), including subordinated interests in first mortgage real estate loans; and RMBS and ABS backed by consumer and commercial receivables. The majority of the assets are denominated in Euros and U.K. Pounds Sterling. |
Fair Value Disclosures (Sched_2
Fair Value Disclosures (Schedule Of Assets And Liabilities Measured With Level 3 Inputs) (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2019 | Mar. 31, 2018 | ||
Schedule of additional information about assets and liabilities measured at fair value on a recurring basis level 3 inputs | |||
Level 3 inputs, Beginning balance | $ 2,756 | $ 4,511 | |
Accretion of income | [1] | 106 | 343 |
Purchases | 9,600 | ||
Sales and returns of capital | (50) | (169) | |
Level 3 inputs, Ending balance | 2,779 | 14,276 | |
Change in unrealized gains /(losses) | [2] | (33) | 147 |
Gains and Losses [Member] | |||
Schedule of additional information about assets and liabilities measured at fair value on a recurring basis level 3 inputs | |||
Transactions included in income - Gains and Losses | [1] | $ (33) | $ (9) |
[1] | Gains and losses on and accretion of income on other investments, at fair value are recorded as a component of principal transactions and other income in the consolidated statements of operations. | ||
[2] | Represents the change in unrealized gains and losses for the period included in earnings for assets held at the end of the reporting period. |
Fair Value Disclosures (Quantit
Fair Value Disclosures (Quantitative Information About Level 3 Fair Value Measurements) (Details) - Significant Unobservable Inputs (Level 3) [Member] - CLOs [Member] - USD ($) | Mar. 31, 2019 | Dec. 31, 2018 |
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Fair Value | $ 2,753,000 | $ 2,730,000 |
Measurement Input | 2 | |
Yield [Member] | Minimum [Member] | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Measurement Input | 15.6 | 18.1 |
Yield [Member] | Maximum [Member] | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Measurement Input | 19.3 | 21.6 |
Yield [Member] | Weighted Average [Member] | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Measurement Input | 17.6 | 20 |
Duration [Member] | Minimum [Member] | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Measurement Term | 6 years 1 month 6 days | 6 years 3 months 18 days |
Duration [Member] | Maximum [Member] | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Measurement Term | 7 years 3 months 18 days | 7 years 6 months |
Duration [Member] | Weighted Average [Member] | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Measurement Term | 6 years 7 months 6 days | 6 years 10 months 24 days |
Default Rate [Member] | Minimum [Member] | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Measurement Input | 2 | |
Default Rate [Member] | Maximum [Member] | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Measurement Input | 2 | |
Default Rate [Member] | Weighted Average [Member] | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Measurement Input | 2 | 2 |
Fair Value Disclosures (Fair Va
Fair Value Disclosures (Fair Value, Investments, Entities That Calculate Net Asset Value Per Share) (Details) - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 | Aug. 06, 2018 | |||
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items] | ||||||
Other investments, at fair value | $ 4,433 | $ 4,050 | ||||
EuroDekania [Member] | ||||||
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items] | ||||||
Other investments, at fair value | [1] | 1,823 | 1,533 | |||
U.S. Insurance JV [Member] | ||||||
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items] | ||||||
Other investments, at fair value | [2] | 1,964 | 1,925 | |||
Unfunded commitments | [2] | 1,100 | 1,100 | |||
SPAC Fund [Member] | ||||||
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items] | ||||||
Other investments, at fair value | $ 646 | [3] | $ 592 | [3] | $ 600 | |
[1] | EuroDekania owns investments in hybrid capital securities that have attributes of debt and equity, primarily in the form of subordinated debt issued by insurance companies, banks, and bank holding companies based primarily in Western Europe; widely syndicated leveraged loans issued by European corporations; commercial mortgage backed securities ("CMBS"), including subordinated interests in first mortgage real estate loans; and RMBS and ABS backed by consumer and commercial receivables. The majority of the assets are denominated in Euros and U.K. Pounds Sterling. | |||||
[2] | The U.S. Insurance JV invests in debt issued by small and medium sized U.S. and Bermuda insurance and reinsurance companies. | |||||
[3] | The SPAC Fund invests in equity interests of SPACs. |
Derivative Financial Instrume_3
Derivative Financial Instruments (Narrative) (Details) € in Thousands | Mar. 31, 2019EUR (€) | Mar. 31, 2019USD ($) | Dec. 31, 2018EUR (€) | Dec. 31, 2018USD ($) |
TBA And Other Forward Agency MBS [Member] | Short [Member] | ||||
Derivative [Line Items] | ||||
Derivative, Notional Amount | $ 1,693,890,000 | $ 1,069,688,000 | ||
TBA And Other Forward Agency MBS [Member] | Long [Member] | ||||
Derivative [Line Items] | ||||
Derivative, Notional Amount | 1,642,700,000 | 1,025,850,000 | ||
Foreign currency forward contracts [Member] | ||||
Derivative [Line Items] | ||||
Derivative, Notional Amount | € | € 1,250 | € 1,250 | ||
EuroDollar futures contracts [Member] | ||||
Derivative [Line Items] | ||||
Derivative, Notional Amount | 0 | 0 | ||
Other Extended Settlement Trades [Member] | ||||
Derivative [Line Items] | ||||
Forward purchase commitment | $ 13,707,000 | $ 15,295,000 |
Derivative Financial Instrume_4
Derivative Financial Instruments (Balance Sheet Information) (Details) - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 |
Derivatives, Fair Value [Line Items] | ||
Derivative fair value | $ 571 | $ 2,080 |
Investments-trading [Member] | TBAs and Other Forward Agency MBS [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Derivative fair value | 10,161 | 8,142 |
Investments-trading [Member] | Other Extended Settlement Trades [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Derivative fair value | 46 | 70 |
Other Investment At Fair Value [Member] | Foreign currency forward contracts [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Derivative fair value | 16 | (13) |
Trading securities sold, not yet purchased [Member] | TBAs and Other Forward Agency MBS [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Derivative fair value | $ (9,652) | (6,116) |
Trading securities sold, not yet purchased [Member] | Other Extended Settlement Trades [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Derivative fair value | $ (3) |
Derivative Financial Instrume_5
Derivative Financial Instruments (Statement Of Operations Information) (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Derivative [Line Items] | ||
Derivative financial instruments, net gain (loss) recognized | $ 777 | $ 1,930 |
Principal Transactions And Other Income [Member] | Not Designated as Hedging Instruments [Member] | Foreign currency forward contracts [Member] | ||
Derivative [Line Items] | ||
Derivative financial instruments, net gain (loss) recognized | 40 | (19) |
Revenues - net trading [Member] | Not Designated as Hedging Instruments [Member] | Other Extended Settlement Trades [Member] | ||
Derivative [Line Items] | ||
Derivative financial instruments, net gain (loss) recognized | (24) | (10) |
Revenues - net trading [Member] | Not Designated as Hedging Instruments [Member] | TBAs and Other Forward Agency MBS [Member] | ||
Derivative [Line Items] | ||
Derivative financial instruments, net gain (loss) recognized | $ 761 | $ 1,959 |
Collateralized Securities Tra_3
Collateralized Securities Transactions (Narrative) (Details) $ in Thousands | 3 Months Ended | 12 Months Ended | |||
Mar. 31, 2019USD ($)itementity | Mar. 31, 2018USD ($) | Dec. 31, 2018USD ($)entity | Apr. 11, 2019USD ($) | Apr. 25, 2018USD ($) | |
Concentration Risk [Line Items] | |||||
Securities reverse repurchase agreements | $ 4,510,389 | $ 5,171,053 | |||
Fair value of securities received as collateral under reverse repurchase agreements | $ 4,744,785 | $ 5,444,823 | |||
Number of counterparties related to reverse repurchase agreements | entity | 35 | 36 | |||
Securities sold under agreements to repurchase | $ 4,560,713 | $ 5,210,587 | |||
Fair value of securities pledged as collateral under repurchase agreements | 4,610,690 | $ 5,233,017 | |||
Intraday lending facility, commitment amount | $ 100,000 | $ 75,000 | |||
Intraday lending facility, termination date | Oct. 19, 2019 | ||||
Intraday lending facility, renewal period | 364 days | ||||
Intraday lending facility, annual interest rate | 0.12% | ||||
Revenues | $ 11,145 | $ 9,338 | |||
Gestational Repo Business [Member] | |||||
Concentration Risk [Line Items] | |||||
Number of counterparties related to reverse repurchase agreements | item | 6 | ||||
Base Rate [Member] | |||||
Concentration Risk [Line Items] | |||||
Intraday lending facility, basis spread on variable rate | 3.00% | ||||
Feds Fund Rate [Member] | |||||
Concentration Risk [Line Items] | |||||
Intraday lending facility, basis spread on variable rate | 0.50% | ||||
FICC [Member] | Minimum [Member] | |||||
Concentration Risk [Line Items] | |||||
Line of credit, borrowing capacity | $ 25,000 | ||||
Product Concentration Risk [Member] | |||||
Concentration Risk [Line Items] | |||||
Revenues | $ 1,294 | $ 1,110 |
Collateralized Securities Tra_4
Collateralized Securities Transactions (Schedule Of Repurchase Agreements Accounted For As Secured Borrowings) (Details) - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 |
Assets Sold under Agreements to Repurchase [Line Items] | ||
Securities sold under agreements to repurchase | $ 4,560,713 | $ 5,210,587 |
Receivables under resale agreements | 4,510,389 | 5,171,053 |
Repurchase Agreements [Member] | ||
Assets Sold under Agreements to Repurchase [Line Items] | ||
Gross amount of recognized liabilities for repurchase agreements | 5,461,855 | 7,671,764 |
Reverse repurchase agreements with FICC netted with repurchase agreements with FICC | (901,142) | (2,461,177) |
Securities sold under agreements to repurchase | 4,560,713 | 5,210,587 |
Repurchase Agreements [Member] | Overnight and Continuous [Member] | ||
Assets Sold under Agreements to Repurchase [Line Items] | ||
Gross amount of recognized liabilities for repurchase agreements | 2,497,433 | 7,032,909 |
Repurchase Agreements [Member] | Up to 30 Days [Member] | ||
Assets Sold under Agreements to Repurchase [Line Items] | ||
Gross amount of recognized liabilities for repurchase agreements | 2,162,977 | 537,937 |
Repurchase Agreements [Member] | 30 to 90 Days [Member] | ||
Assets Sold under Agreements to Repurchase [Line Items] | ||
Gross amount of recognized liabilities for repurchase agreements | 250,579 | 100,918 |
Repurchase Agreements [Member] | Greater than 90 Days [Member] | ||
Assets Sold under Agreements to Repurchase [Line Items] | ||
Gross amount of recognized liabilities for repurchase agreements | 550,866 | |
Repurchase Agreements [Member] | U.S. government agency MBS [Member] | ||
Assets Sold under Agreements to Repurchase [Line Items] | ||
Gross amount of recognized liabilities for repurchase agreements | 5,014,134 | 7,265,295 |
Repurchase Agreements [Member] | U.S. government agency MBS [Member] | Overnight and Continuous [Member] | ||
Assets Sold under Agreements to Repurchase [Line Items] | ||
Gross amount of recognized liabilities for repurchase agreements | 2,486,338 | 7,014,758 |
Repurchase Agreements [Member] | U.S. government agency MBS [Member] | Up to 30 Days [Member] | ||
Assets Sold under Agreements to Repurchase [Line Items] | ||
Gross amount of recognized liabilities for repurchase agreements | 1,726,351 | 250,537 |
Repurchase Agreements [Member] | U.S. government agency MBS [Member] | 30 to 90 Days [Member] | ||
Assets Sold under Agreements to Repurchase [Line Items] | ||
Gross amount of recognized liabilities for repurchase agreements | 250,579 | |
Repurchase Agreements [Member] | U.S. government agency MBS [Member] | Greater than 90 Days [Member] | ||
Assets Sold under Agreements to Repurchase [Line Items] | ||
Gross amount of recognized liabilities for repurchase agreements | 550,866 | |
Repurchase Agreements [Member] | MBS (Gestational Repo) [Member] | ||
Assets Sold under Agreements to Repurchase [Line Items] | ||
Gross amount of recognized liabilities for repurchase agreements | 436,626 | 388,318 |
Repurchase Agreements [Member] | MBS (Gestational Repo) [Member] | Up to 30 Days [Member] | ||
Assets Sold under Agreements to Repurchase [Line Items] | ||
Gross amount of recognized liabilities for repurchase agreements | 436,626 | 287,400 |
Repurchase Agreements [Member] | MBS (Gestational Repo) [Member] | 30 to 90 Days [Member] | ||
Assets Sold under Agreements to Repurchase [Line Items] | ||
Gross amount of recognized liabilities for repurchase agreements | 100,918 | |
Repurchase Agreements [Member] | SBA loans [Member] | ||
Assets Sold under Agreements to Repurchase [Line Items] | ||
Gross amount of recognized liabilities for repurchase agreements | 11,095 | 18,151 |
Repurchase Agreements [Member] | SBA loans [Member] | Overnight and Continuous [Member] | ||
Assets Sold under Agreements to Repurchase [Line Items] | ||
Gross amount of recognized liabilities for repurchase agreements | 11,095 | 18,151 |
Reverse Repurchase Agreements [Member] | ||
Assets Sold under Agreements to Repurchase [Line Items] | ||
Gross amount of recognized assets for reverse repurchase agreements | 5,411,531 | 7,632,230 |
Reverse repurchase agreements with FICC netted with repurchase agreements with FICC | (901,142) | (2,461,177) |
Receivables under resale agreements | 4,510,389 | 5,171,053 |
Reverse Repurchase Agreements [Member] | Overnight and Continuous [Member] | ||
Assets Sold under Agreements to Repurchase [Line Items] | ||
Gross amount of recognized assets for reverse repurchase agreements | 450,360 | 10,864 |
Reverse Repurchase Agreements [Member] | Up to 30 Days [Member] | ||
Assets Sold under Agreements to Repurchase [Line Items] | ||
Gross amount of recognized assets for reverse repurchase agreements | 1,842,908 | 5,764,456 |
Reverse Repurchase Agreements [Member] | 30 to 90 Days [Member] | ||
Assets Sold under Agreements to Repurchase [Line Items] | ||
Gross amount of recognized assets for reverse repurchase agreements | 2,668,661 | 699,561 |
Reverse Repurchase Agreements [Member] | Greater than 90 Days [Member] | ||
Assets Sold under Agreements to Repurchase [Line Items] | ||
Gross amount of recognized assets for reverse repurchase agreements | 449,602 | 1,157,349 |
Reverse Repurchase Agreements [Member] | U.S. government agency MBS [Member] | ||
Assets Sold under Agreements to Repurchase [Line Items] | ||
Gross amount of recognized assets for reverse repurchase agreements | 4,973,522 | 7,244,095 |
Reverse Repurchase Agreements [Member] | U.S. government agency MBS [Member] | Overnight and Continuous [Member] | ||
Assets Sold under Agreements to Repurchase [Line Items] | ||
Gross amount of recognized assets for reverse repurchase agreements | 450,360 | 10,864 |
Reverse Repurchase Agreements [Member] | U.S. government agency MBS [Member] | Up to 30 Days [Member] | ||
Assets Sold under Agreements to Repurchase [Line Items] | ||
Gross amount of recognized assets for reverse repurchase agreements | 1,404,899 | 5,477,247 |
Reverse Repurchase Agreements [Member] | U.S. government agency MBS [Member] | 30 to 90 Days [Member] | ||
Assets Sold under Agreements to Repurchase [Line Items] | ||
Gross amount of recognized assets for reverse repurchase agreements | 2,668,661 | 598,635 |
Reverse Repurchase Agreements [Member] | U.S. government agency MBS [Member] | Greater than 90 Days [Member] | ||
Assets Sold under Agreements to Repurchase [Line Items] | ||
Gross amount of recognized assets for reverse repurchase agreements | 449,602 | 1,157,349 |
Reverse Repurchase Agreements [Member] | MBS (Gestational Repo) [Member] | ||
Assets Sold under Agreements to Repurchase [Line Items] | ||
Gross amount of recognized assets for reverse repurchase agreements | 438,009 | 388,135 |
Reverse Repurchase Agreements [Member] | MBS (Gestational Repo) [Member] | Up to 30 Days [Member] | ||
Assets Sold under Agreements to Repurchase [Line Items] | ||
Gross amount of recognized assets for reverse repurchase agreements | $ 438,009 | 287,209 |
Reverse Repurchase Agreements [Member] | MBS (Gestational Repo) [Member] | 30 to 90 Days [Member] | ||
Assets Sold under Agreements to Repurchase [Line Items] | ||
Gross amount of recognized assets for reverse repurchase agreements | $ 100,926 |
Investment in Equity Method A_3
Investment in Equity Method Affiliate (Schedule Of Investments In Equity Method Affiliates) (Details) - Insurance SPAC [Member] $ in Thousands | 3 Months Ended |
Mar. 31, 2019USD ($) | |
Schedule of Equity Method Investments [Line Items] | |
Begining Balance | |
Investments / advances | 3,775 |
Distributions/repayments | |
Earnings / (loss) realized | (8) |
Ending Balance | $ 3,767 |
Leases (Narrative) (Details)
Leases (Narrative) (Details) - USD ($) | Jan. 01, 2019 | Mar. 31, 2019 | Mar. 31, 2018 |
Right of use asset | $ 8,081,000 | ||
Lease commitment liability | 8,658,000 | ||
Increase in other receivables | $ (3,894,000) | $ (554,000) | |
Weighted average remaining term | 8 years 7 months 24 days | ||
Weighted average discount rate | 5.27% | ||
Operating lease cash payments | $ 286,000 | ||
Cash payments to acquire right of use assets | 0 | ||
Sublease Income | 65,000 | ||
Operating Leases, Rent Expense, Net | $ 390,000 | ||
Accounting Standards Update 2016-02 [Member] | |||
Right of use asset | $ 8,416,000 | ||
Lease commitment liability | 8,860,000 | ||
Reduction in retained earnings from cumulative effect of adoption | 20,000 | ||
Increase in other receivables | 18,000 | ||
Reduction in other liabilities | $ 406,000 |
Leases (Schedule Of Future Matu
Leases (Schedule Of Future Maturity Of Lease Liabilities) (Details) $ in Thousands | Mar. 31, 2019USD ($) |
Leases [Abstract] | |
2019 - remaining | $ 1,290 |
2020 | 1,564 |
2021 | 1,108 |
2022 | 933 |
2023 | 950 |
Thereafter | 5,077 |
Total | 10,922 |
Less imputed interest | (2,264) |
Lease obligation | $ 8,658 |
Other Receivables, Other Asse_2
Other Receivables, Other Assets And Accounts Payable And Other Liabilities (Schedule Of Other Receivables) (Details) - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 |
Other Receivables, Other Assets And Accounts Payable And Other Liabilities [Abstract] | ||
Cash collateral due from counterparties | $ 5,508 | $ 6,216 |
Asset management fees receivable | 954 | 947 |
New issue and advisory fees receivable | 2,100 | |
Accrued interest and dividends receivable | 1,254 | 2,359 |
Revenue share receivable | 96 | 140 |
Other | 384 | 310 |
Other receivables | $ 8,196 | $ 12,072 |
Other Receivables, Other Asse_3
Other Receivables, Other Assets And Accounts Payable And Other Liabilities (Schedule Of Other Assets) (Details) - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 |
Schedule of other assets | ||
Deferred costs | $ 648 | $ 571 |
Prepaid expenses | 1,037 | 1,009 |
Prepaid income taxes | 40 | |
Deposits | 681 | 669 |
Miscellaneous other assets | 33 | 33 |
Furniture, equipment and leasehold improvements, net | 1,072 | 1,133 |
Intangible assets | 166 | 166 |
Other assets | $ 3,637 | $ 3,621 |
Other Receivables, Other Asse_4
Other Receivables, Other Assets And Accounts Payable And Other Liabilities (Schedule Of Accounts Payable And Other Liabilities) (Details) - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 |
Schedule of accounts payable and other liabilities | ||
Accounts payable | $ 285 | $ 359 |
Redeemable financial instruments accrued interest | 352 | 714 |
Rent payable | 405 | |
Accrued interest payable | 670 | 674 |
Accrued interest on securities sold, not yet purchased | 992 | 1,184 |
Payroll taxes payable | 394 | 721 |
Counterparty cash collateral | 6,437 | 4,227 |
Accrued expense and other liabilities | 2,710 | 3,168 |
Accounts payable and other liabilities | $ 11,840 | $ 11,452 |
Variable Interest Entities (Nar
Variable Interest Entities (Narrative) (Details) - USD ($) | Mar. 31, 2019 | Dec. 31, 2018 | |
Variable Interest Entity [Line Items] | |||
VIE liabilities, contingent liabilities, and guarantees | $ 0 | $ 0 | |
Managed Variable Interest Entity [Member] | |||
Variable Interest Entity [Line Items] | |||
Unfunded commitments | 1,100,000 | ||
U.S. Insurance JV [Member] | |||
Variable Interest Entity [Line Items] | |||
Unfunded commitments | [1] | $ 1,100,000 | $ 1,100,000 |
[1] | The U.S. Insurance JV invests in debt issued by small and medium sized U.S. and Bermuda insurance and reinsurance companies. |
Variable Interest Entities (Sch
Variable Interest Entities (Schedule Of Variable Interest Entities) (Details) - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 | Mar. 31, 2018 | Dec. 31, 2017 |
Variable Interest Entity [Line Items] | ||||
Other investments, fair value | $ 2,779 | $ 2,756 | $ 14,276 | $ 4,511 |
Maximum Exposure | 5,389 | 5,273 | ||
Alternative Investments [Member] | ||||
Variable Interest Entity [Line Items] | ||||
Other investments, fair value | $ 5,389 | $ 5,273 |
Redeemable Financial Instrume_3
Redeemable Financial Instruments (Narrative) (Details) - USD ($) $ in Thousands | Nov. 16, 2018 | Mar. 31, 2019 | Dec. 31, 2018 | Mar. 31, 2018 | Feb. 28, 2019 |
Related Party Transaction [Line Items] | |||||
Redeemable financial instrument | $ 18,679 | $ 17,448 | |||
Due from Related Parties | 625 | 793 | |||
Net interest expense | $ (1,859) | $ (1,819) | |||
Investment agreement, written notice period for termination | 90 days | ||||
Investment agreement, alternative period of required prior written notice contingency | 60 days | ||||
Proceeds from redeemable financial instrument | $ 1,268 | ||||
DGC Family Fintech Trust/CBF [Member] | |||||
Related Party Transaction [Line Items] | |||||
Redeemable financial instrument | 10,000 | $ 10,000 | |||
JKD Capital Partners I, LTD [Member] | |||||
Related Party Transaction [Line Items] | |||||
Percentage of difference between revenues generated by activities of redeemable financial instrument | 42.00% | ||||
Redeemable financial instrument | $ 8,000 | $ 6,732 | |||
JVB's [Member] | |||||
Related Party Transaction [Line Items] | |||||
Redeemable financial instrument | $ 2,750 | ||||
Potential percent of consideration owed to investor on qualified sale | 25.00% | ||||
Hancock [Member] | |||||
Related Party Transaction [Line Items] | |||||
Redeemable financial instrument | 500 | ||||
New Avenue [Member] | |||||
Related Party Transaction [Line Items] | |||||
Redeemable financial instrument | 250 | ||||
COHN, LLC [Member] | |||||
Related Party Transaction [Line Items] | |||||
Redeemable financial instrument | 500 | ||||
ViaNova Investment [Member] | New Avenue [Member] | |||||
Related Party Transaction [Line Items] | |||||
Redeemable financial instrument | $ 200 | ||||
ViaNova Investment [Member] | COHN, LLC [Member] | |||||
Related Party Transaction [Line Items] | |||||
Revenue threshold | 693 | ||||
Redeemable Financial Instrument Payment Due [Member] | New Avenue [Member] | |||||
Related Party Transaction [Line Items] | |||||
Due from Related Parties | $ 50 |
Redeemable Financial Instrume_4
Redeemable Financial Instruments (Schedule Of Redeemable Financial Instruments) (Details) - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 |
Related Party Transaction [Line Items] | ||
Outstanding balance | $ 18,679 | $ 17,448 |
Accrued Interest | 352 | 714 |
JKD Capital Partners I, LTD [Member] | ||
Related Party Transaction [Line Items] | ||
Outstanding balance | 8,000 | 6,732 |
Accrued Interest | 278 | 676 |
DGC Family Fintech Trust/CBF [Member] | ||
Related Party Transaction [Line Items] | ||
Outstanding balance | 10,000 | 10,000 |
Accrued Interest | 74 | 38 |
Via Nova Capital Group, LLC [Member] | ||
Related Party Transaction [Line Items] | ||
Outstanding balance | $ 679 | $ 716 |
Debt (Narrative) (Details)
Debt (Narrative) (Details) - USD ($) | Apr. 10, 2020 | Mar. 31, 2019 | Dec. 31, 2018 | |
Debt Instrument [Line Items] | ||||
Principal amount of debt outstanding | $ 43,658,000 | $ 43,536,000 | ||
Payment of convertible debt | $ 1,461,000 | |||
Alesco Capital Trust I [Member] | Junior subordinated debt [Member] | ||||
Debt Instrument [Line Items] | ||||
Stated interest rate | [1] | 6.75% | ||
Sunset Financial Statutory Trust I [Member] | Junior subordinated debt [Member] | ||||
Debt Instrument [Line Items] | ||||
Fair value of common securities | $ 0 | |||
Stated interest rate | [1] | 6.95% | ||
8.00% Contingent Convertible Senior Notes Due 2022 [Member] | Contingent Convertible Senior Notes [Member] | ||||
Debt Instrument [Line Items] | ||||
Principal amount of debt outstanding | $ 15,000,000 | 15,000,000 | ||
Stated interest rate | 8.00% | |||
Maturity | [2] | Mar. 31, 2022 | ||
Conversion price per unit | $ 1.45 | |||
Debt Instrument, Convertible, Conversion Ratio | 10 | |||
Debt instrument, noncontrolling interests, convertible price | $ 14.50 | |||
8.00% Contingent Convertible Senior Notes Due 2018 [Member] | ||||
Debt Instrument [Line Items] | ||||
Conversion price per unit | 30 | |||
8.00% Contingent Convertible Senior Notes Due 2019 [Member] | ||||
Debt Instrument [Line Items] | ||||
Conversion price per unit | $ 12 | |||
Contingency shares outstanding threshold for conversion | 19.99% | |||
8.00% Contingent Convertible Senior Notes Due 2019 [Member] | Contingent Convertible Senior Notes [Member] | ||||
Debt Instrument [Line Items] | ||||
Principal amount of debt outstanding | $ 6,786,000 | 6,786,000 | ||
Stated interest rate | 8.00% | |||
Maturity | [3] | Sep. 25, 2019 | ||
Conversion price per unit | $ 12 | |||
MB Financial Bank, N.A. (2018 MB LOC) [Member] | ||||
Debt Instrument [Line Items] | ||||
Principal amount of debt outstanding | $ 0 | |||
Maturity date | Apr. 10, 2021 | |||
Undrawn commitment fee percentage | 0.50% | |||
Line of Credit Facility, possible request of reduction in borrowing commitment | $ 1,000,000 | |||
Line of Credit Facility, possible request of reduction in borrowing commitment multiple after initial request | $ 500,000 | |||
Line of Credit Facility, request reduction notice period | 5 days | |||
MB Financial Bank, N.A. (2018 MB LOC) [Member] | London Interbank Offered Rate (LIBOR) [Member] | ||||
Debt Instrument [Line Items] | ||||
Basis spread | 6.00% | |||
MB Financial Bank, N.A. (2018 MB LOC) [Member] | Credit Facility [Member] | ||||
Debt Instrument [Line Items] | ||||
Aggregate borrowing capacity | $ 7,500,000 | $ 25,000,000 | ||
Maturity date | Apr. 10, 2020 | |||
Commitment fee amount | $ 250,000 | |||
2019 MB Revolver [Member] | ||||
Debt Instrument [Line Items] | ||||
Basis spread | 6.00% | |||
Undrawn commitment fee percentage | 0.50% | |||
Line of Credit Facility, possible request of reduction in borrowing commitment | $ 1,000,000 | |||
Line of Credit Facility, possible request of reduction in borrowing commitment multiple after initial request | $ 500,000 | |||
2019 MB Revolver [Member] | Scenario, Forecast [Member] | ||||
Debt Instrument [Line Items] | ||||
Commitment fee amount | $ 131,000 | |||
Undrawn commitment fee percentage | 0.75% | |||
2019 MB Revolver [Member] | Credit Facility [Member] | ||||
Debt Instrument [Line Items] | ||||
Maturity | Apr. 10, 2021 | |||
Aggregate borrowing capacity | $ 17,500,000 | |||
Legacy Texas [Member] | Credit Facility [Member] | ||||
Debt Instrument [Line Items] | ||||
Maturity | Nov. 15, 2019 | |||
Aggregate borrowing capacity | $ 12,500,000 | |||
Undrawn commitment fee percentage | 0.25% | |||
Commitment fee threshold | 50.00% | |||
Legacy Texas [Member] | Credit Facility [Member] | Via Nova Capital Group, LLC [Member] | ||||
Debt Instrument [Line Items] | ||||
Percentage of commitment amount deposit | 2.00% | |||
Legacy Texas [Member] | Credit Facility [Member] | LIBOR (with a floor of 1.50%) [Member] | ||||
Debt Instrument [Line Items] | ||||
Basis spread | 4.00% | |||
Legacy Texas [Member] | Credit Facility [Member] | LIBOR (with a floor of 1.50%) [Member] | Maximum [Member] | ||||
Debt Instrument [Line Items] | ||||
Basis spread | 5.00% | |||
[1] | The junior subordinated notes listed represent debt the Company owes to the two trusts noted above. The total par amount owed by the Company to the trusts is $49,614. However, the Company owns the common stock of the trusts in a total par amount of $1,489. The Company pays interest (and at maturity, principal) to the trusts on the entire $49,614 junior notes outstanding. However, the Company receives back from the trusts the pro rata share of interest and principal on the common stock held by the Company. These trusts are VIEs and the Company does not consolidate them even though the Company holds the common stock. The Company carries the common stock on its balance sheet at a value of $0. The junior subordinated notes are recorded at a discount to par. When factoring in the discount, the yield to maturity of the junior subordinated notes as of March 31, 2019 on a combined basis is 16.75% assuming the variable rate in effect on the last day of the reporting period remains in effect until maturity. | |||
[2] | The holder of the 2017 Convertible Note may convert all or any part of the outstanding principal amount at any time prior to maturity into units of the Operating LLC at a conversion price of $1.45 per unit, subject to customary anti-dilution adjustments. Units of the Operating LLC not held by Cohen & Company Inc. may, with certain restrictions, be redeemed and exchanged into shares of the Common Stock on a ten-for-one basis. Therefore, the 2017 Convertible Note can be converted into Operating LLC units and then redeemed and exchanged into Common Stock at an effective conversion price of $14.50. See note 18 to our Annual Report on Form 10-K for the year ended December 31, 2018. | |||
[3] | The holders of the 2013 Convertible Notes may convert all or any part of the outstanding principal amount at any time prior to maturity into shares of the Company's Common Stock, at a conversion price of $12.00 per share, subject to certain anti-dilution adjustments. |
Debt (Debt Outstanding) (Detail
Debt (Debt Outstanding) (Details) $ / shares in Units, $ in Thousands | 3 Months Ended | |||
Mar. 31, 2019USD ($)item$ / shares | Mar. 31, 2018 | Dec. 31, 2018USD ($) | ||
Debt Instrument [Line Items] | ||||
Long-term Debt, Gross | $ 43,658 | $ 43,536 | ||
Less unamortized debt issuance costs | (910) | (974) | ||
Less unamortized discount | [1] | (25,343) | (25,401) | |
Long term debt less debt discount | $ 43,658 | 43,536 | ||
Redeemable noncontrolling interest, membership units not held, share ratio | 10 | 10 | ||
Number of trusts holding notes | item | 2 | |||
Contingent Convertible Senior Notes [Member] | ||||
Debt Instrument [Line Items] | ||||
Long term debt less debt discount | $ 20,876 | 20,812 | ||
Junior subordinated debt [Member] | ||||
Debt Instrument [Line Items] | ||||
Junior subordinated notes | [1] | 22,782 | 22,724 | |
Junior subordinated notes | 49,614 | |||
Ownership value of common stock of trusts | $ 1,489 | |||
Yield to maturities | 16.75% | |||
8.00% Contingent Convertible Senior Notes Due 2022 [Member] | Contingent Convertible Senior Notes [Member] | ||||
Debt Instrument [Line Items] | ||||
Long-term Debt, Gross | $ 15,000 | 15,000 | ||
Interest Rate | 8.00% | |||
Maturity | [2] | Mar. 31, 2022 | ||
Debt Instrument, Convertible, Conversion Price | $ / shares | $ 1.45 | |||
Debt instrument, noncontrolling interests, convertible price | $ / shares | $ 14.50 | |||
Debt Instrument, Convertible, Conversion Ratio | 10 | |||
8.00% Contingent Convertible Senior Notes Due 2019 [Member] | ||||
Debt Instrument [Line Items] | ||||
Debt Instrument, Convertible, Conversion Price | $ / shares | $ 12 | |||
8.00% Contingent Convertible Senior Notes Due 2019 [Member] | Contingent Convertible Senior Notes [Member] | ||||
Debt Instrument [Line Items] | ||||
Long-term Debt, Gross | $ 6,786 | 6,786 | ||
Interest Rate | 8.00% | |||
Maturity | [3] | Sep. 25, 2019 | ||
Debt Instrument, Convertible, Conversion Price | $ / shares | $ 12 | |||
Alesco Capital Trust I [Member] | Junior subordinated debt [Member] | ||||
Debt Instrument [Line Items] | ||||
Junior subordinated notes | [1] | $ 28,125 | 28,125 | |
Interest Rate | [1] | 6.75% | ||
Sunset Financial Statutory Trust I [Member] | Junior subordinated debt [Member] | ||||
Debt Instrument [Line Items] | ||||
Junior subordinated notes | [1] | $ 20,000 | $ 20,000 | |
Interest Rate | [1] | 6.95% | ||
Fair value of common securities | $ 0 | |||
2019 MB Revolver [Member] | Credit Facility [Member] | ||||
Debt Instrument [Line Items] | ||||
Maturity | Apr. 10, 2021 | |||
Legacy Texas [Member] | Credit Facility [Member] | ||||
Debt Instrument [Line Items] | ||||
Maturity | Nov. 15, 2019 | |||
[1] | The junior subordinated notes listed represent debt the Company owes to the two trusts noted above. The total par amount owed by the Company to the trusts is $49,614. However, the Company owns the common stock of the trusts in a total par amount of $1,489. The Company pays interest (and at maturity, principal) to the trusts on the entire $49,614 junior notes outstanding. However, the Company receives back from the trusts the pro rata share of interest and principal on the common stock held by the Company. These trusts are VIEs and the Company does not consolidate them even though the Company holds the common stock. The Company carries the common stock on its balance sheet at a value of $0. The junior subordinated notes are recorded at a discount to par. When factoring in the discount, the yield to maturity of the junior subordinated notes as of March 31, 2019 on a combined basis is 16.75% assuming the variable rate in effect on the last day of the reporting period remains in effect until maturity. | |||
[2] | The holder of the 2017 Convertible Note may convert all or any part of the outstanding principal amount at any time prior to maturity into units of the Operating LLC at a conversion price of $1.45 per unit, subject to customary anti-dilution adjustments. Units of the Operating LLC not held by Cohen & Company Inc. may, with certain restrictions, be redeemed and exchanged into shares of the Common Stock on a ten-for-one basis. Therefore, the 2017 Convertible Note can be converted into Operating LLC units and then redeemed and exchanged into Common Stock at an effective conversion price of $14.50. See note 18 to our Annual Report on Form 10-K for the year ended December 31, 2018. | |||
[3] | The holders of the 2013 Convertible Notes may convert all or any part of the outstanding principal amount at any time prior to maturity into shares of the Company's Common Stock, at a conversion price of $12.00 per share, subject to certain anti-dilution adjustments. |
Debt (Schedule Of Interest Expe
Debt (Schedule Of Interest Expense By Debt Instrument) (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Debt Instrument [Line Items] | ||
Interest income (expense) | $ 1,859 | $ 1,819 |
Junior subordinated notes [Member] | ||
Debt Instrument [Line Items] | ||
Interest income (expense) | 880 | 821 |
2013 Convertibe Notes [Member] | ||
Debt Instrument [Line Items] | ||
Interest income (expense) | 134 | 203 |
2017 Convertible Note [Member] | ||
Debt Instrument [Line Items] | ||
Interest income (expense) | 360 | 354 |
2018 MB LOC/2019 MB Revolver [Member] | ||
Debt Instrument [Line Items] | ||
Interest income (expense) | 92 | |
Legacy Texas [Member] | ||
Debt Instrument [Line Items] | ||
Interest income (expense) | 4 | |
Redeemable Financial Instrument - DGC Family Fintech Trust / CBF [Member] | ||
Debt Instrument [Line Items] | ||
Interest income (expense) | 148 | 110 |
Redeemable Financial Instrument - JKD Capital Partners I LTD [Member] | ||
Debt Instrument [Line Items] | ||
Interest income (expense) | 278 | $ 331 |
Redeemable Financial Instrument - ViaNova Capital Group, LLC [Member] | ||
Debt Instrument [Line Items] | ||
Interest income (expense) | $ (37) |
Equity (Narrative) (Details)
Equity (Narrative) (Details) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2019USD ($)shares | Mar. 31, 2018USD ($)shares | Dec. 31, 2018shares | |
Permanent Equity [Line Items] | |||
Ratio of Common Stock to membership units | 0.1 | ||
Series E Preferred Stock [Member] | |||
Permanent Equity [Line Items] | |||
Ratio of shares to vote | 10 | ||
Preferred Stock, shares outstanding | shares | 4,983,557 | 4,983,557 | |
10b5-1 Plan [Member] | |||
Permanent Equity [Line Items] | |||
Repurchase amount authorized | $ 2,000 | ||
Purchase of common stock, shares | shares | 7,890 | 7,270 | |
Treasury Stock, Value, Acquired, Par Value Method | $ 65 | $ 71 | |
Accumulated Other Comprehensive Income (Loss) [Member] | |||
Permanent Equity [Line Items] | |||
Redemption of non-controlling interest, net | 14 | 7 | |
Additional paid-in capital [Member] | |||
Permanent Equity [Line Items] | |||
Redemption of non-controlling interest, net | (133) | (84) | |
Non-controlling Interest [Member] | |||
Permanent Equity [Line Items] | |||
Redemption of non-controlling interest, net | $ 119 | $ 77 |
Equity (Preferred Stock) (Detai
Equity (Preferred Stock) (Details) - Series E Preferred Stock [Member] | 3 Months Ended | |
Mar. 31, 2019shares | Dec. 31, 2018shares | |
Permanent Equity [Line Items] | ||
Preferred Stock, Shares Outstanding | 4,983,557 | 4,983,557 |
Ratio of shares to vote | 10 |
Equity (Schedule Of Unrestricte
Equity (Schedule Of Unrestricted Common Stock Activity) (Details) | 3 Months Ended |
Mar. 31, 2019shares | |
Equity [Abstract] | |
Shares, Beginning | 1,110,717 |
Vesting of shares | 56,639 |
Shares withheld and retired for employee taxes | (15,557) |
Repurchase and retirement of common stock | (7,890) |
Shares, Ending | 1,143,909 |
Equity (Operating LLC Membershi
Equity (Operating LLC Membership Units) (Details) | 3 Months Ended |
Mar. 31, 2019shares | |
Issuance of Units under UIS, net | 331,920 |
Unit Issuance And Surrender Agreement [Member] | |
Issuance of Units under UIS, net | 410,820 |
Retirement of Common Stock [Member] | |
Issuance of Units under UIS, net | (78,900) |
Equity (Schedule Of Effects Of
Equity (Schedule Of Effects Of Changes In Ownership Interest Subsidiary) (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Equity [Abstract] | ||
Net income (loss) attributable to Cohen & Company Inc. | $ (1,202) | $ (1,474) |
Increase / (decrease) in Cohen & Company Inc. paid in capital for the acquisition / (surrender) of additional units in consolidated subsidiary, net | 133 | 84 |
Changes from net income / (loss) attributable to Cohen & Company Inc. and transfers (to) from non-controlling interest | $ (1,069) | $ (1,390) |
Net Capital Requirements (Sched
Net Capital Requirements (Schedule Of Net Capital Requirements) (Details) $ in Thousands | Mar. 31, 2019USD ($) |
JVB's [Member] | |
Net Capital Requirements [Line Items] | |
Actual Net Capital or Liquid Capital | $ 51,111 |
Excess | 50,782 |
Cohen and Company Financial Limited [Member] | |
Net Capital Requirements [Line Items] | |
Actual Net Capital or Liquid Capital | 919 |
Amount Required | 869 |
Excess | $ 50 |
Earnings _ (Loss) Per Common _3
Earnings / (Loss) Per Common Share (Schedule of Earnings / (Loss) Per Common Share) (Details) $ / shares in Units, $ in Thousands | 3 Months Ended | ||
Mar. 31, 2019USD ($)$ / sharesshares | Mar. 31, 2018USD ($)$ / sharesshares | ||
Earnings Per Share [Line Items] | |||
Net income / (loss) attributable to Cohen & Company | $ | $ (1,202) | $ (1,474) | |
Add/ (deduct): Income / (loss) attributable to non-controlling interest attributable to Operating LLC membership | $ | [1] | (622) | (677) |
Add / (deduct): Adjustment | $ | [2] | 53 | 7 |
Net income / (loss) on a fully converted basis | $ | $ (1,771) | $ (2,144) | |
Weighted average common shares outstanding - Basic | 1,133,166 | 1,172,476 | |
Unrestricted Operating LLC membership units exchangeable into Cohen & Company shares | [1] | 532,409 | 532,409 |
Weighted average common shares outstanding - Diluted | [3] | 1,665,575 | 1,704,885 |
Net income / (loss) per common share - Basic | $ / shares | $ (1.06) | $ (1.26) | |
Net income / (loss) per common share - Diluted | $ / shares | $ (1.06) | $ (1.26) | |
Redeemable noncontrolling interest, membership units not held, share ratio | 10 | 10 | |
Antidilutive securities excluded from computation of earnings per share | 59,182 | 26,691 | |
Convertible Debt Securities [Member] | 8.00% Contingent Convertible Senior Notes Due 2019 [Member] | |||
Earnings Per Share [Line Items] | |||
Antidilutive securities excluded from computation of earnings per share | 565,469 | 274,917 | |
Convertible Debt Securities [Member] | 8.00% Contingent Convertible Senior Notes Due 2022 [Member] | |||
Earnings Per Share [Line Items] | |||
Antidilutive securities excluded from computation of earnings per share | 1,034,483 | 1,034,483 | |
[1] | The Operating LLC membership units not held by Cohen & Company Inc. (that is, those held by the non-controlling interest for the three months ended March 31, 2019 and 2018) may be redeemed and exchanged into shares of the Company on a ten-for-one basis. The Operating LLC membership units not held by Cohen & Company Inc. are redeemable, at the member’s option at any time, for (i) cash in an amount equal to the average of the per share closing prices of the Common Stock for the ten consecutive trading days immediately preceding the date the Company receives the member’s redemption notice, or (ii) at the Company’s option, one tenth of a share of the Common Stock, subject, in each case, to appropriate adjustment upon the occurrence of an issuance of additional shares of the Common Stock as a dividend or other distribution on the Company’s outstanding Common Stock, or a further subdivision or combination of the outstanding shares of the Common Stock. These units are not included in the computation of basic earnings per share. These units enter into the computation of diluted net income (loss) per common share when the effect is not anti-dilutive using the if-converted method. | ||
[2] | An adjustment is included because the Company would have incurred a higher income tax expense or realized a higher income tax benefit, as applicable, if the Operating LLC membership units had been converted at the beginning of the period,. | ||
[3] | For the three months ended March 31, 2019, weighted average common shares outstanding excludes (i) 59,182 shares representing restricted Common Stock and restricted Operating LLC membership units, which when vested can be converted into Common Stock, (ii) 565,469 shares from the assumed conversion of the 2013 Convertible Notes, and (iii) 1,034,483 shares from the assumed conversion of the 2017 Convertible Note because the inclusion of such shares would be anti-dilutive. For the three months ended March 31, 2018, weighted average common shares outstanding excludes (i) 26,691 shares representing restricted Common Stock, (ii) 274,917 shares from the assumed conversion of the 2013 Convertible Notes, and (iii) 1,034,483 shares from the assumed conversion of the 2017 Convertible Note because the inclusion of such shares would be anti-dilutive. |
Segment And Geographic Inform_3
Segment And Geographic Information (Narrative) (Details) | 3 Months Ended |
Mar. 31, 2019segment | |
Segment And Geographic Information [Abstract] | |
Number of Operating Segments | 3 |
Segment And Geographic Inform_4
Segment And Geographic Information (Schedule Of Segment Reporting Information) (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2019 | Mar. 31, 2018 | ||
Segment Reporting Information [Line Items] | |||
Principal transactions and other income | $ 414 | $ 647 | |
Total revenues | 11,145 | 9,338 | |
Total operating expenses | 11,208 | 9,698 | |
Operating income (loss) | (63) | (360) | |
Interest income (expense) | (1,859) | (1,819) | |
Income (loss) from equity method affiliates | (8) | ||
Income (loss) before income tax expense (benefit) | (1,930) | (2,179) | |
Income tax expense (benefit) | (106) | (28) | |
Net income (loss) | (1,824) | (2,151) | |
Less: Net income (loss) attributable to the non-controlling interest | (622) | (677) | |
Net income (loss) attributable to Cohen & Company Inc. | (1,202) | (1,474) | |
Depreciation and amortization (included in total operating expense) | 81 | 61 | |
Operating Segments [Member] | |||
Segment Reporting Information [Line Items] | |||
Principal transactions and other income | 414 | 647 | |
Total revenues | 11,145 | 9,338 | |
Total operating expenses | 9,373 | 8,140 | |
Operating income (loss) | 1,772 | 1,198 | |
Interest income (expense) | 13 | ||
Income (loss) from equity method affiliates | (8) | ||
Income (loss) before income tax expense (benefit) | 1,777 | 1,198 | |
Net income (loss) | 1,777 | 1,198 | |
Net income (loss) attributable to Cohen & Company Inc. | 1,777 | 1,198 | |
Depreciation and amortization (included in total operating expense) | 6 | 17 | |
Unallocated [Member] | |||
Segment Reporting Information [Line Items] | |||
Total operating expenses | 1,835 | 1,558 | [1] |
Operating income (loss) | (1,835) | (1,558) | [1] |
Interest income (expense) | (1,872) | (1,819) | [1] |
Income (loss) before income tax expense (benefit) | (3,707) | (3,377) | [1] |
Income tax expense (benefit) | (106) | (28) | [1] |
Net income (loss) | (3,601) | (3,349) | [1] |
Less: Net income (loss) attributable to the non-controlling interest | (622) | (677) | [1] |
Net income (loss) attributable to Cohen & Company Inc. | (2,979) | (2,672) | [1] |
Depreciation and amortization (included in total operating expense) | 75 | 44 | [1] |
Capital Markets [Member] | Operating Segments [Member] | |||
Segment Reporting Information [Line Items] | |||
Principal transactions and other income | 1 | ||
Total revenues | 8,730 | 6,887 | |
Total operating expenses | 7,458 | 6,651 | |
Operating income (loss) | 1,272 | 236 | |
Interest income (expense) | 76 | ||
Income (loss) before income tax expense (benefit) | 1,348 | 236 | |
Net income (loss) | 1,348 | 236 | |
Net income (loss) attributable to Cohen & Company Inc. | 1,348 | 236 | |
Depreciation and amortization (included in total operating expense) | 5 | 16 | |
Asset Management [Member] | Operating Segments [Member] | |||
Segment Reporting Information [Line Items] | |||
Principal transactions and other income | 97 | 204 | |
Total revenues | 2,099 | 2,008 | |
Total operating expenses | 1,815 | 1,393 | |
Operating income (loss) | 284 | 615 | |
Interest income (expense) | (63) | ||
Income (loss) before income tax expense (benefit) | 221 | 615 | |
Net income (loss) | 221 | 615 | |
Net income (loss) attributable to Cohen & Company Inc. | 221 | 615 | |
Depreciation and amortization (included in total operating expense) | 1 | 1 | |
Principal Investing [Member] | Operating Segments [Member] | |||
Segment Reporting Information [Line Items] | |||
Principal transactions and other income | 316 | 443 | |
Total revenues | 316 | 443 | |
Total operating expenses | 100 | 96 | |
Operating income (loss) | 216 | 347 | |
Income (loss) from equity method affiliates | (8) | ||
Income (loss) before income tax expense (benefit) | 208 | 347 | |
Net income (loss) | 208 | 347 | |
Net income (loss) attributable to Cohen & Company Inc. | 208 | 347 | |
Net Trading [Member] | |||
Segment Reporting Information [Line Items] | |||
Total revenue | 8,729 | 6,191 | |
Net Trading [Member] | Operating Segments [Member] | |||
Segment Reporting Information [Line Items] | |||
Total revenue | 8,729 | 6,191 | |
Net Trading [Member] | Capital Markets [Member] | Operating Segments [Member] | |||
Segment Reporting Information [Line Items] | |||
Total revenue | 8,729 | 6,191 | |
Asset Management [Member] | |||
Segment Reporting Information [Line Items] | |||
Total revenue | 2,002 | 1,804 | |
Asset Management [Member] | Operating Segments [Member] | |||
Segment Reporting Information [Line Items] | |||
Total revenue | 2,002 | 1,804 | |
Asset Management [Member] | Asset Management [Member] | Operating Segments [Member] | |||
Segment Reporting Information [Line Items] | |||
Total revenue | $ 2,002 | 1,804 | |
New Issue And Advisory [Member] | |||
Segment Reporting Information [Line Items] | |||
Total revenue | 696 | ||
New Issue And Advisory [Member] | Operating Segments [Member] | |||
Segment Reporting Information [Line Items] | |||
Total revenue | 696 | ||
New Issue And Advisory [Member] | Capital Markets [Member] | Operating Segments [Member] | |||
Segment Reporting Information [Line Items] | |||
Total revenue | $ 696 | ||
[1] | Unallocated includes certain expenses incurred by indirect overhead and support departments (such as the executive, finance, legal, information technology, human resources, risk, compliance, and other similar overhead and support departments). Some of the items not allocated include: (1) operating expenses (such as cash compensation and benefits, equity-based compensation expense, professional fees, travel and entertainment, consulting fees, and rent) related to support departments excluding certain departments that directly support the Capital Markets business segment; (2) interest expense on debt; and (3) income taxes. Management does not consider these items necessary for an understanding of the operating results of these business segments and such amounts are excluded in business segment reporting to the chief operating decision maker. |
Segment And Geographic Inform_5
Segment And Geographic Information (Reconciliation Of Assets From Segment To Consolidated) (Details) - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 | |
Segment Reporting, Asset Reconciling Item [Line Items] | |||
Total Assets | $ 4,951,327 | $ 5,654,452 | |
Goodwill | [1] | 7,992 | 7,992 |
Intangible assets | [1] | 166 | 166 |
Operating Segments [Member] | |||
Segment Reporting, Asset Reconciling Item [Line Items] | |||
Total Assets | 4,938,312 | 5,649,883 | |
Goodwill | [1] | 7,992 | 7,992 |
Intangible assets | [1] | 166 | 166 |
Operating Segments [Member] | Capital Markets [Member] | |||
Segment Reporting, Asset Reconciling Item [Line Items] | |||
Total Assets | 4,922,973 | 5,633,806 | |
Goodwill | [1] | 7,937 | 7,937 |
Intangible assets | [1] | 166 | 166 |
Operating Segments [Member] | Asset Management [Member] | |||
Segment Reporting, Asset Reconciling Item [Line Items] | |||
Total Assets | 2,106 | 2,309 | |
Goodwill | [1] | 55 | 55 |
Operating Segments [Member] | Principal Investing [Member] | |||
Segment Reporting, Asset Reconciling Item [Line Items] | |||
Total Assets | 13,233 | 13,768 | |
Unallocated [Member] | |||
Segment Reporting, Asset Reconciling Item [Line Items] | |||
Total Assets | [2] | $ 13,015 | $ 4,569 |
[1] | Goodwill and intangible assets are allocated to the Capital Markets and Asset Management business segments as indicated in the table above. | ||
[2] | Unallocated assets primarily include: (1) amounts due from related parties; (2) furniture and equipment, net; and (3) other assets that are not considered necessary for an understanding of business segment assets and such amounts are excluded in business segment reporting to the chief operating decision maker. |
Segment And Geographic Inform_6
Segment And Geographic Information (Revenue By Geographic Area) (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Total revenue | $ 11,145 | $ 9,338 |
United States [Member] | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Total revenue | 10,087 | 7,902 |
United Kingdom & Other [Member] | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Total revenue | $ 1,058 | $ 1,436 |
Supplemental Cash Flow Disclo_2
Supplemental Cash Flow Disclosure (Narrative) (Details) - USD ($) $ in Thousands | Jan. 01, 2019 | Mar. 31, 2019 | Mar. 31, 2018 |
Debt Conversion [Line Items] | |||
Interest paid | $ 2,070 | $ 1,635 | |
Income taxes paid | 4 | 0 | |
Income tax refunds | 48 | 0 | |
Proceeds from redeemable financial instrument | 1,268 | ||
Accrual in accounts payable and other accrued liabilities for dividends and distributions declared | 335 | 342 | |
Right-of-use asset - operating leases | 8,081 | ||
Lease liability - operating leases | 8,658 | ||
Increase in other receivables | (3,894) | (554) | |
Accounting Standards Update 2016-02 [Member] | |||
Debt Conversion [Line Items] | |||
Right-of-use asset - operating leases | $ 8,416 | ||
Lease liability - operating leases | 8,860 | ||
Reduction in retained earnings from cumulative effect of adoption | 20 | ||
Increase in other receivables | 18 | ||
Reduction in other liabilities | $ 406 | ||
Additional paid-in capital [Member] | |||
Debt Conversion [Line Items] | |||
Redemption of non-controlling interest, net | 133 | 84 | |
Accumulated Other Comprehensive Income (Loss) [Member] | |||
Debt Conversion [Line Items] | |||
Redemption of non-controlling interest, net | (14) | (7) | |
Non-controlling Interest [Member] | |||
Debt Conversion [Line Items] | |||
Redemption of non-controlling interest, net | $ (119) | $ (77) |
Related Party Transactions (Nar
Related Party Transactions (Narrative) (Details) - USD ($) $ in Thousands | Sep. 29, 2017 | Oct. 03, 2016 | Jan. 31, 2019 | Jul. 31, 2018 | Jan. 31, 2017 | Mar. 31, 2019 | Mar. 31, 2018 | Dec. 31, 2015 | Dec. 31, 2013 |
Related Party Transaction [Line Items] | |||||||||
Proceeds from redeemable financial instrument | $ 1,268 | ||||||||
Company matching percent | 50.00% | ||||||||
Percent of employees gross salary qualifying for matching contributions | 3.00% | ||||||||
Company plan contributions | $ 91 | $ 61 | |||||||
Insurance SPAC [Member] | |||||||||
Related Party Transaction [Line Items] | |||||||||
Investments / advances | 3,775 | ||||||||
Net gains (losses) in principal transactions and other income | $ (8) | ||||||||
EuroDekania [Member] | |||||||||
Related Party Transaction [Line Items] | |||||||||
Ownership percentage of equity method affiliate | 31.00% | ||||||||
U.S. Insurance JV [Member] | |||||||||
Related Party Transaction [Line Items] | |||||||||
Ownership percentage of equity method affiliate | 4.50% | ||||||||
SPAC Fund [Member] | |||||||||
Related Party Transaction [Line Items] | |||||||||
Ownership percentage of equity method affiliate | 3.90% | ||||||||
EBC Family Trust [Member] | |||||||||
Related Party Transaction [Line Items] | |||||||||
Notes payable, related parties | $ 2,400 | ||||||||
Value of shares issued | 1,600 | ||||||||
Related Party Transaction, Amounts of Transaction | $ 4,000 | ||||||||
TBBK [Member] | |||||||||
Related Party Transaction [Line Items] | |||||||||
Interest Expense, Related Party | $ 0 | 414 | |||||||
JKD Capital Partners I, LTD [Member] | |||||||||
Related Party Transaction [Line Items] | |||||||||
Investments / advances | $ 6,000 | $ 1,268 | $ 1,000 | ||||||
CBF Cohen Bros. Financial [Member] | |||||||||
Related Party Transaction [Line Items] | |||||||||
Related Party Transaction, Amounts of Transaction | $ 8,000 | ||||||||
DGC Family Fintech Trust/CBF [Member] | |||||||||
Related Party Transaction [Line Items] | |||||||||
Related Party Transaction, Amounts of Transaction | 10,000 | ||||||||
DGC Family Fintech Trust [Member] | |||||||||
Related Party Transaction [Line Items] | |||||||||
Related Party Transaction, Amounts of Transaction | $ 2,000 | ||||||||
Zucker and Moore, LLC [Member] | |||||||||
Related Party Transaction [Line Items] | |||||||||
Related Party Transaction, Expenses from Transactions with Related Party | 24 | 24 | |||||||
Bezuco Capital, LLC [Member] | |||||||||
Related Party Transaction [Line Items] | |||||||||
Reduction in rent expenses | 6 | 0 | |||||||
Insurance SPAC [Member] | |||||||||
Related Party Transaction [Line Items] | |||||||||
Related Party Transaction, Expenses from Transactions with Related Party | 750 | ||||||||
Related Party Transaction, Amounts of Transaction | 10 | ||||||||
COHN, LLC [Member] | Fin Tech Acquisition Corp II [Member] | |||||||||
Related Party Transaction [Line Items] | |||||||||
Related Party Transaction, Amounts of Transaction | $ 2,513 | ||||||||
Net gains (losses) in principal transactions and other income | $ (22) | $ 0 | |||||||
Sponsor Entities [Member] | Insurance SPAC [Member] | |||||||||
Related Party Transaction [Line Items] | |||||||||
Ownership percentage of equity method affiliate | 26.80% | ||||||||
Contingent Convertible Senior Notes [Member] | Edward E. Cohen IRA [Member] | |||||||||
Related Party Transaction [Line Items] | |||||||||
Convertible notes purchased | $ 4,386 |
Related Party Transactions (Sch
Related Party Transactions (Schedule Of Related Party Transactions) (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Related Party Transaction [Line Items] | ||
Net trading | $ 8,729 | $ 6,191 |
Principal transactions and other income | 414 | 647 |
Income (loss) from equity method affiliates | (8) | |
CBF [Member] | ||
Related Party Transaction [Line Items] | ||
Interest expense (income) incurred | 119 | 88 |
DGC Family Fintech Trust [Member] | ||
Related Party Transaction [Line Items] | ||
Interest expense (income) incurred | 390 | 376 |
Duane Morris [Member] | ||
Related Party Transaction [Line Items] | ||
Professional fee and other operating | 101 | 208 |
E.B.C. [Member] | ||
Related Party Transaction [Line Items] | ||
Interest expense (income) incurred | 47 | 59 |
Edward E. Cohen IRA [Member] | ||
Related Party Transaction [Line Items] | ||
Interest expense (income) incurred | 87 | 108 |
EuroDekania [Member] | ||
Related Party Transaction [Line Items] | ||
Asset management | 86 | 33 |
Principal transactions and other income | 291 | |
Fin Tech Acquisition Corp II [Member] | ||
Related Party Transaction [Line Items] | ||
Principal transactions and other income | 2 | |
Fintech Acquisition Corp III [Member] | ||
Related Party Transaction [Line Items] | ||
Principal transactions and other income | 3 | |
Insurance SPAC [Member] | ||
Related Party Transaction [Line Items] | ||
Principal transactions and other income | 4 | |
Income (loss) from equity method affiliates | (8) | |
JKD Capital Partners I, LTD [Member] | ||
Related Party Transaction [Line Items] | ||
Interest expense (income) incurred | 278 | 331 |
SPAC Fund [Member] | ||
Related Party Transaction [Line Items] | ||
Asset management | 31 | |
Principal transactions and other income | 24 | |
TBBK [Member] | ||
Related Party Transaction [Line Items] | ||
Net trading | 2 | 11 |
U.S. Insurance JV [Member] | ||
Related Party Transaction [Line Items] | ||
Asset management | 80 | |
Principal transactions and other income | 39 | |
Affiliated Entity [Member] | ||
Related Party Transaction [Line Items] | ||
Net trading | 2 | 11 |
Asset management | 197 | 33 |
Principal transactions and other income | 361 | 2 |
Income (loss) from equity method affiliates | (8) | |
Professional fee and other operating | 101 | 208 |
Interest expense (income) incurred | $ 921 | $ 962 |
Due From _ Due To Related Par_3
Due From / Due To Related Parties (Details) - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 |
Related Party Transaction [Line Items] | ||
Due from Related Parties | $ 625 | $ 793 |
Employees & Other [Member] | ||
Related Party Transaction [Line Items] | ||
Due from Related Parties | $ 625 | $ 793 |