DOCUMENT AND ENTITY INFORMATION
DOCUMENT AND ENTITY INFORMATION - shares | 3 Months Ended | |
Mar. 31, 2018 | May 08, 2018 | |
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Mar. 31, 2018 | |
Document Fiscal Year Focus | 2,018 | |
Document Fiscal Period Focus | Q1 | |
Entity Registrant Name | Bimini Capital Management, Inc. | |
Entity Central Index Key | 1,275,477 | |
Entity Current Reporting Status | Yes | |
Entity Voluntary Filers | No | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Smaller Reporting Company | |
Entity Well Known Seasoned Issuer | No | |
Trading Symbol | BMNM | |
Class A Common Stock [Member] | ||
Entity Common Stock Shares Outstanding | 12,732,059 | |
Class B Common Stock [Member] | ||
Entity Common Stock Shares Outstanding | 31,938 | |
Class C Common Stock [Member] | ||
Entity Common Stock Shares Outstanding | 31,938 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) | Mar. 31, 2018 | Dec. 31, 2017 |
Mortgage Backed Securities At Fair Value [Abstract] | ||
Pledged to counterparties | $ 204,728,276 | $ 209,269,791 |
Unpledged | 100,670 | 422,341 |
Total mortgage-backed securities | 204,828,946 | 209,692,132 |
Cash and cash equivalents | 4,976,440 | 6,103,250 |
Restricted cash | 908,530 | 2,649,610 |
Orchid Island Capital, Inc. common stock, at fair value | 11,202,665 | 14,105,934 |
Retained interests in securitizations | 271,738 | 653,380 |
Accrued interest receivable | 739,221 | 746,121 |
Property and equipment, net | 3,355,256 | 3,359,312 |
Deferred tax assets, net | 45,421,066 | 44,524,584 |
Other assets | 3,265,193 | 2,754,474 |
Total Assets | 274,969,055 | 284,588,797 |
Liabilities | ||
Outstanding repurchase obligations | 193,819,649 | 200,182,751 |
Junior subordinated notes due to Bimini Capital Trust II | 26,804,440 | 26,804,440 |
Accrued interest payable | 178,976 | 346,444 |
Other Liabilities | 1,544,642 | 1,562,914 |
Total Liabilities | 222,347,707 | 228,896,549 |
Stockholders' Equity | ||
Preferred stock | 0 | 0 |
Common stock | 12,808 | 12,725 |
Additional paid in capital | 335,081,562 | 334,878,779 |
Accumulated deficit | (282,473,022) | (279,199,256) |
Stockholders Equity | 52,621,348 | 55,692,248 |
Total Liabilities and Stockholders' Equity | 274,969,055 | 284,588,797 |
Class A Common Stock [Member] | ||
Stockholders' Equity | ||
Common stock | 12,744 | 12,661 |
Class B Common Stock [Member] | ||
Stockholders' Equity | ||
Common stock | 32 | 32 |
Class C Common Stock [Member] | ||
Stockholders' Equity | ||
Common stock | 32 | 32 |
Residential Mortgage Backed Securities [Member] | ||
Mortgage Backed Securities At Fair Value [Abstract] | ||
Pledged to counterparties | 204,728,276 | 209,269,791 |
Unpledged | 100,670 | 422,341 |
Total mortgage-backed securities | $ 204,828,946 | $ 209,692,132 |
CONDENSED CONSOLIDATED BALANCE3
CONDENSED CONSOLIDATED BALANCE SHEETS (Parentheticals) - USD ($) | Mar. 31, 2018 | Dec. 31, 2017 |
Class of Stock [Line Items] | ||
Preferred Stock Par Or Stated Value Per Share | $ 0.001 | $ 0.001 |
Preferred Shares Authorized | 10,000,000 | 10,000,000 |
Preferred Shares Issued | 0 | 0 |
Preferred Shares Outstanding | 0 | 0 |
Preferred Stock Value | $ 0 | $ 0 |
Common Stock Par Or Stated Value Per Share | $ 0.001 | $ 0.001 |
Common Stock Value Outstanding | $ 12,808 | $ 12,725 |
Class A Common Stock [Member] | ||
Class of Stock [Line Items] | ||
Common Stock Par Or Stated Value Per Share | $ 0.001 | $ 0.001 |
Common Stock Shares Authorized | 98,000,000 | 98,000,000 |
Common Stock Shares Issued | 12,743,959 | 12,660,627 |
Common Stock Shares Outstanding | 12,743,959 | 12,660,627 |
Common Stock Value Outstanding | $ 12,744 | $ 12,661 |
Class B Common Stock [Member] | ||
Class of Stock [Line Items] | ||
Common Stock Par Or Stated Value Per Share | $ 0.001 | $ 0.001 |
Common Stock Shares Authorized | 1,000,000 | 1,000,000 |
Common Stock Shares Issued | 31,938 | 31,938 |
Common Stock Shares Outstanding | 31,938 | 31,938 |
Common Stock Value Outstanding | $ 32 | $ 32 |
Class C Common Stock [Member] | ||
Class of Stock [Line Items] | ||
Common Stock Par Or Stated Value Per Share | $ 0.001 | $ 0.001 |
Common Stock Shares Authorized | 1,000,000 | 1,000,000 |
Common Stock Shares Issued | 31,938 | 31,938 |
Common Stock Shares Outstanding | 31,938 | 31,938 |
Common Stock Value Outstanding | $ 32 | $ 32 |
Preferred Undesignated [Member] | ||
Class of Stock [Line Items] | ||
Preferred Stock Par Or Stated Value Per Share | $ 0.001 | $ 0.001 |
Preferred Shares Authorized | 9,900,000 | 9,900,000 |
Preferred Shares Issued | 0 | 0 |
Preferred Shares Outstanding | 0 | 0 |
SeriesAPreferredStockMember | ||
Class of Stock [Line Items] | ||
Preferred Stock Par Or Stated Value Per Share | $ 0.001 | $ 0.001 |
Preferred Shares Authorized | 100,000 | 100,000 |
Preferred Shares Issued | 0 | 0 |
Preferred Shares Outstanding | 0 | 0 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Revenues | ||
Advisory services | $ 2,093,465 | $ 1,670,001 |
Interest income | 2,080,266 | 1,292,676 |
Orchid Island Capital, Inc. dividends | 471,211 | 603,415 |
Total revenues | 4,644,942 | 3,566,092 |
Interest expense on repurchase agreements | 809,266 | 283,194 |
Interest expense on junior subordinated notes | 337,333 | 292,184 |
Net revenues | 3,498,343 | 2,990,714 |
Other income: | ||
Unrealized (losses) gains on mortgage-backed securities | (4,879,806) | (437,113) |
Realized gains on mortgage-backed securities | 0 | (689) |
Unrealized losses on Orchid Island Capital, Inc. common stock | (2,903,269) | (1,127,315) |
(Losses) gains on derivative instruments | 1,740,712 | 21,500 |
Gains on retained interests in securitizations | (82,664) | (193,942) |
Other expense, net | 606 | 455 |
Total other income | (6,124,421) | (1,737,104) |
Expenses | ||
Compensation and related benefits | 1,066,455 | 935,911 |
Directors fees and liability insurance | 160,613 | 167,175 |
Audit, legal and other professional fees | 175,752 | 137,124 |
Administrative and other expenses | 336,158 | 359,333 |
Total expenses | 1,738,978 | 1,599,543 |
Net (loss) income before income tax provision (benefit) | (4,365,056) | (345,933) |
Income tax provision (benefit) | (1,091,290) | (131,716) |
Net (loss) income | $ (3,273,766) | $ (214,217) |
Class A Common Stock [Member] | ||
Basic and Diluted Net (Loss) Income Per Share of: | ||
Basic | $ (0.26) | $ (0.02) |
Diluted | $ (0.26) | $ (0.02) |
Weighted Average Shares Outstanding | ||
Weighted Average Shares - Basic and Diluted | 12,730,070 | 12,631,627 |
Class B Common Stock [Member] | ||
Basic and Diluted Net (Loss) Income Per Share of: | ||
Basic | $ (0.26) | $ (0.02) |
Diluted | $ (0.26) | $ (0.02) |
Weighted Average Shares Outstanding | ||
Weighted Average Shares - Basic and Diluted | 31,938 | 31,938 |
CONDENSED CONSOLIDATED STATEME5
CONDENSED CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY - 3 months ended Mar. 31, 2018 - USD ($) | Total | Common Stock [Member] | Additional Paid In Capital [Member] | Retained Earnings [Member] |
Beginning Balances at Dec. 31, 2017 | $ 55,692,248 | $ 12,725 | $ 334,878,779 | $ (279,199,256) |
Increase (Decrease) in Stockholders' Equity | ||||
Net income | (3,273,766) | 0 | 0 | (3,273,766) |
Class A common shares sold directly to employees | 199,997 | 83 | 199,914 | 0 |
Amortization of stock based compensation | 2,869 | 0 | 2,869 | 0 |
Ending Balances at Mar. 31, 2018 | $ 52,621,348 | $ 12,808 | $ 335,081,562 | $ (282,473,022) |
CONDENSED CONSOLIDATED STATEME6
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS - USD ($) | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
CASH FLOWS FROM OPERATING ACTIVITIES | ||
Net (loss) income | $ (3,273,766) | $ (214,217) |
Adjustments to reconcile net (loss) income to net cash provided by (used in) operating activities: | ||
Stock based compensation | 2,869 | 7,172 |
Depreciation | 19,449 | 20,508 |
Deferred income tax provision (benefit) | (896,482) | (144,367) |
Losses (gains) on mortgage-backed securities | 4,879,806 | 437,802 |
Gains on retained interests in securitizations | 82,664 | 193,942 |
Unrealized losses on Orchid Island Capital, Inc. common stock | (2,903,269) | (1,127,315) |
Realized and unrealized losses on TBA securities | (523,438) | 0 |
Changes in operating assets and liabilities | ||
Accrued interest receivable | 6,900 | 21,929 |
Other assets | (510,719) | (312,913) |
Accrued interest payable | (167,468) | 75,873 |
Other liabilities | (541,710) | (938,571) |
NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES | 3,028,250 | 274,473 |
From mortgage-backed securities investments | ||
Purchases | (5,080,712) | 0 |
Sales | 0 | 1,654,834 |
Principal repayments | 5,064,092 | 2,315,731 |
Payments received on retained interests in securitizations | 298,978 | 418,769 |
Purchases of property and equipment | (15,393) | (10,300) |
Purchases of Orchid Island Capital Inc., common stock | 0 | 1,204,235 |
NET CASH PROVIDED BY (USED IN) INVESTING ACTIVITIES | 266,965 | 3,174,799 |
CASH FLOWS FROM FINANCING ACTIVITIES | ||
Proceeds from repurchase agreements | 439,403,535 | 184,776,630 |
Principal payments on repurchase agreements | (445,766,637) | (188,555,259) |
Class A common shares sold directly to employees | 199,997 | 0 |
NET CASH (USED IN) PROVIDED BY FINANCING ACTIVITIES | (6,163,105) | (3,778,629) |
NET INCREASE IN CASH, CASH EQUIVALENTS AND RESTRICTED CASH | (2,867,890) | (329,357) |
CASH, CASH EQUIVALENTS AND RESTRICTED CASH, beginning of period | 8,752,860 | 5,651,437 |
CASH, CASH EQUIVALENTS AND RESTRICTED CASH, end of period | 5,884,970 | 5,322,080 |
Cash paid during the period for: | ||
Interest | 1,314,067 | 499,505 |
Income Taxes | $ 281,808 | $ 105,137 |
ORGANIZATION AND SIGNIFICANT AC
ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES | 3 Months Ended |
Mar. 31, 2018 | |
Accounting Policies [Abstract] | |
Organization and Significant Accounting Policies | NOTE 1 . ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES Business Description Bimini Capital Management, Inc., a Maryland corporation (“Bimini Capital” or the “Company”) formed in September 2003, is a holding company. The Company’s principal operating subsidiaries are Bimini Advisors Holdings, LLC and Royal Palm Capital, LLC. Bimini Advisors Holdings, LLC and its wholly-owned subsidiar y, Bimini Advisors, LLC (a registered investment advisor), are collectively referred to as "Bimini Advisors." Bimini Advisors manages a residential mortgage-backed securities (“MBS”) portfolio for Orchid Island Capital, Inc. ("Orchid") and receives fees f or providing these services. Royal Palm Capital, LLC maintains an investment portfolio, consisting primarily of MBS investments, for its own benefit. Royal Palm Capital, LLC and its wholly-owned subsidiaries are collectively referred to as "Royal Palm." Consolidation The accompanying consolidated financial statements include the accounts of Bimini Capital, Bimini Advisors and Royal Palm. All inter-company accounts and transactions have been eliminated from the consolidated financial statements. Financial Accounting Standards Board (the "FASB") Accounting Standards Codification ("ASC") Topic 810, Consolidation, requires the consolidation of a variable interest entity ("VIE") by an enterprise if it is deemed the primary beneficiary of the VIE. Bimi ni Capital has a common share investment in a trust used in connection with the issuance of Bimini Capital's junior subordinated notes. See Note 9 for a description of the accounting used for this VIE. Basis of Presentation The accompanying unaudit ed condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) for interim financial information and with the instructions to Form 10-Q and Article 8 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presen tation have been included. Operating results fo r the three month period ended March 31, 2018 are not necessarily indicative of the results that may be expected for the year end ing December 31, 2018 . The consolidated balance sheet at December 31, 2017 has been derived from the audited financial statements at that date but does not include all of the information and footnotes required by GAAP for complete consolidated financial statements. For further information, refer to the financial statement s and footnotes thereto included in the Company’s A nnual R eport on Form 10-K for the year ended December 31, 2017 . Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and t he reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Significant estimates affecting the accompanying consolidated financial statements include determining the fair values of MBS, inve stment in Orchid common shares, derivatives and retained interests, determining the amounts of asset valuation allowances, and the computation of the income tax provision or benefit and the deferred tax asset allowances recorded for each accounting period. Statement of Comprehensive Income In accordance with ASC Topic 220, Comprehensive Income , a statement of comprehensive income has not been included as the Company has no items of other comprehensive income (loss) . Comprehensive loss is the same as net loss for all periods presented. Segment Reporting The Company’s operations are classified into two principal reportable segments: the asset management segment and the investment portfolio segment. These segments are evaluated by management in deciding how to allocate resources and in assessing performance. The accounting policies of the operating segments are the same as the Company’s accounting policies described in this note with the exception that inter-segment revenues and ex penses are included in the presentation of segment results. For further information see Note 16 . Cash and Cash Equivalents and Restricted Cash Cash and cash equivalents include cash on deposit with financial institutions and highly liquid investments with original maturities of three months or less at the time of purchase. Restricted cash includes cash pledged as collateral for repurchase agreeme nts and derivative instruments. The following table presents the Company’s cash, cash equivalents and restricted cash as of March 31, 2018 and December 31, 2017 . (in thousands) March 31, 2018 December 31, 2017 Cash and cash equivalents $ 4,976,440 $ 6,103,250 Restricted cash 908,530 2,649,610 Total cash, cash equivalents and restricted cash $ 5,884,970 $ 8,752,860 The Company maintains cash balances at several banks and, at times, these balances may exceed federally insured limits. The Company has not experienced any losses related to these balances. The Federal Deposit Insurance Corporation insures eligible accounts up to $250,000 per depositor at each financial institution. At March 31, 2018 , the Company’s cash deposits exceeded federally insured limits by approximately $4.3 million. The Company also maintains excess margin in accounts with d erivative exchanges. Restricted cash balances are uninsured, but are held in separate customer accounts that are segregated from the general funds of the counterparty. The Company limits uninsured balances to only large, well-known bank s and derivative c ounterparties and believes that it is not exposed to significant credit risk on cash and cash equivalents or restricted cash balances. Advisory Services Orchid is externally managed and advised by Bimini Advisors pursuant to the terms of a management agreement. Under the terms of the management agreement , Orchid is obligated to pay Bimini Advisors a monthly management fee and a pro rata portion of certain overhead costs and to reimburse the Company for any direct expenses incurred on its behalf. Mort gage-Backed Securities The Company invests primarily in mortgage pass-through (“PT”) certificates, collateralized mor tgage obligations, and interest- only (“IO”) securities and inverse interest- only (“IIO”) securities representing interest in or obligations backed by pools of mortgage-backed loans. The Company has elected to account for its investment in MBS under the fair value option. Electing the fair value option requires the Company to record changes in fair value in the consolidated stateme nt of operations, which, in management’s view, more appropriately reflects the results of our operations for a particular reporting period and is consistent with the underlying economics and how the portfolio is managed. The Company records MBS transactions on the trade date. Security purchases that have not settled as of the balance sheet date are included in the MBS balance with an offsetting liability recorded, whereas securit ies sold that have not settled as of the balance sheet date are rem oved from the MBS balance with an offsetting receivable recorded. The fair value of the Company’s investment in MBS is governed by ASC Topic 820, Fair Value Measurement . The definition of fair value in ASC Topic 820 focuses on the price that would be rec eived to sell the asset or paid to transfer the liability in an orderly transaction between market participants at the measurement date. The fair value measurement assumes that the transaction to sell the asset or transfer the liability either occurs in t he principal market for the asset or liability, or in the absence of a principal market, occurs in the most advantageous market for the asset or liability. Estimated fair values for MBS are based on independent pricing sources and/or third-party broker quo tes, when available. Income on PT MBS is based on the stated interest rate of the security. Premiums or discounts present at the date of purchase are not amortized. Premium lost and discount accretion resulting from monthly principal repayments are refl ected in unrealize d gains on MBS in the c ons olidated statements of operations. For IO securities, the income is accrued based on the carrying value and the effective yield. The difference between income accrued and the interest received on the security is characterized as a return of investment and serves to reduce the asset’s carrying value. At each reporting date, the effective yield is adjusted prospectively from the reporting period based on the new estimate of prepayments and the contractual terms of the security. For IIO securities, effective yield and income recognition calculations also take into account the index value applicable to the security. Changes in fair value of MBS during each reporting period are recorded in earnings and reported as un realized gains or losses on mortgage-backed securities in the accompanying consolidated statements of operations. The amount reported as unrealized gains or losses on mortgage backed securities thus captures the net effect of changes in the fair market val ue of securities caused by market developments and any premium or discount lost as a result of principal repayments during the period. Orchid Island Capital, Inc. Common Stock The Company has elected the fair value option for its investment in Orchid common shares. The change in the fair value of this investment and dividends received on this investment are reflected in the consolidated statements of operations. We estimate the fair value of our investment in Orchid on a market approach using “Level 1” inputs based on the quoted market price of Orchid’s common stock on a national stock exchange. Electing the fair value option requires the Company to record changes in fair value in the consolid ated statement s of operations, which, in management’s view, mo re appropriately reflects the results of our operations for a particular reporting period and is consistent with how the investment is managed. Retained Interests in Securitizations Retained i nterests in the subordinated tranches of securities created in securitization transactions were initially recorded at their fair value when issued by Royal Palm. Subsequent adjustments to fair value are reflected in the consolidated statements of operation s. Quoted market prices for these assets are generally not available, so the Company estimates fair value based on the present value of expected future cash flows using management’s best estimates of key assumptions, which include expected credit losses, p repayment speeds, weighted-average life, and discount rates commensurate with the inherent risks of the asset. Derivative Financial Instruments The Company uses derivative instruments to manage interest rate risk, facilitate asset/liability strategies an d manage other exposures, and it may continue to do so in the future. The principal instruments that the Company has used to date are Treasury Note (“T-Note”) and Eurodollar futures contracts, and “to-be-announced” (“TBA”) securities transactions, but it m ay enter into other derivatives in the future. The Company purchases a portion of its MBS through forward settling transactions, including TBA securities transactions. At times when market conditions are conducive, the Company may choose to move the sett lement of these TBA securities transactions out to a later date by entering into an offsetting short position, which is then net settled for cash, and simultaneously entering into a substantially similar TBA securities trade for a later settlement date. S uch a set of transactions is referred to as a TBA “dollar roll” transaction. The TBA securities purchased at the later settlement date are typically priced at a discount to securities for settlement in the current month. This difference is referred to as the “price drop.” The price drop represents compensation to the Company for foregoing net interest margin and is referred to as TBA “dollar roll income.” The Company accounts for TBA securities as derivative instruments if either the TBA securities do n ot settle in the shortest period of time possible or if the Company cannot assert that it is probable at inception of the TBA transaction, or throughout its term, that it will take physical delivery of the MBS for a long position, or make delivery of the M BS for a short position, upon settlement of the trade. The Company accounts for TBA dollar roll transactions as a series of derivative transactions. Gains, losses and dollar roll income associated with TBA securities transactions and dollar roll transactio ns are reported in gain (loss) on derivative instruments in the accompanying consolidated statements of operations. The fair value of TBA securities is estimated based on similar methods used to value MBS securities. The Company has elected not to treat any of its derivative financial instruments as hedges in order to align the accounting treatment of its derivative instruments with the treatment of its portfolio assets under the fair value option. FASB ASC Topic 815, Derivatives and Hedging , requires th at all derivative instruments be carried at fair value. Changes in fair value are recorded in the consolidated operations for each period. Holding derivatives creates exposure to credit risk related to the potential for failure on the part of counterpart ies to honor their commitments. In addition, the Company may be required to post collateral based on any declines in the market value of the derivatives. In the event of default by a counterparty, the Company may have difficulty recovering its collateral and may not receive payments provided for under the terms of the agreement. To mitigate this risk, the Company uses only well-established commercial banks as counterparties. Financial Instruments ASC Topic 825 , Financial Instruments , requires disclos ure of the fair value of financial instruments for which it is practicable to estimate that value, either in the body of the financial statements or in the accompanying notes. MBS, Orchid common stock, Eurodollar futures contracts, interest rate swaptions and retained interests in securitization transactions are accounted for at fair value in the consolidated balance sheets. The methods and assumptions used to estimate fair value for these instruments are presented in Note 15 of the consolidated financial statements. The estimated fair value of cash and cash equivalents, restricted cash, accrued interest receivable, other assets, repurchase agreements, accrued interest payable and other liabilities generally approximates their carrying value as of March 31, 2018 and December 31, 2017 , due to the short-term nature of these financial instruments. It is impractical to estimate the fair value of the Company’s junior subordinated notes. Currently, there is a limited market for these types of instruments and the Company is unable to ascertain what interest rates would be available to the Company for similar financial instruments. Information regarding carrying amount and effective interest rate for these instruments is presented in Note 9 to the consolidat ed financial statements. Property and Equipment, net Property and equipment, net, consists of computer equipment with a depreciable life of 3 years, office furniture and equipment with depreciable lives of 8 to 20 years, land which has no depreciable lif e, and buildings and improvements with depreciable lives of 30 years. Property and equipment is recorded at acquisition cost and depreciated using the straight-line method over the estimated useful lives of the assets. Repurchase Agreements The Company finances the acquisition of the majority of its PT MBS through the use of repurchase agreements under master repurchase agreements. Pursuant to ASC Topic 860, Transfers and Servicing , the Company account s for repurchase transactions as collater alized financing transactions, which are carried at their contractual amounts, including accrued interest, as specified in the respective agreements . Share-Based Compensation The Company follows the provisions of ASC Topic 718, Compensation – Stock Compe nsation , to account for stock and stock-based awards. For stock and stock-based awards issued to employees, a compensation charge is recorded against earnings over the vesting period based on the fair value of the award. The Company applies a zero forfeiture rate for its equity based awards, as such awards have been granted to a limited number of employees and historical forfeitures have been minimal. A significant forfeiture, or an indication that significant forfeitures may occur, would result in a revised forfeiture rate which would be accounted for prospectively as a change in an estimate. For transactions with non-employees in which services are performed in exchange for the Company’s common stock or other equity instruments, the transactions a re recorded on the basis of the fair value of the service received or the fair value of the equity instruments issued, whichever is more readily measurable at the date of the issuance of the common stock. Earnings Per Share The Company follows the provis ions of ASC Topic 260, Earnings Per Share , which requires companies with complex capital structures, common stock equivalents or two (or more) classes of securities that participate in dividend distributions to present both basic and diluted earnings per s hare (“EPS”) on the face of the consolidated statement of operations. Basic EPS is calculated as income available to common stockholders divided by the weighted average number of common shares outstanding during the period. Diluted EPS is calculated using the treasury stock or two-class method, as applicable for common stock equivalents. However, the common stock equivalents are not included in computing diluted EPS if the result is anti-dilutive. Outstanding shares of Class B Common Stock, participating a nd convertible into Class A Common Stock, are entitled to receive dividends in an amount equal to the dividends declared , if any, on each share of Class A Common Stock . Accordingly, shares of the Class B Common Stock are included in the computation of basic EPS using the two-class method and, consequently, are presented separately from Class A Common Stock. The shares of Class C Common Stock are not included in the basic EPS computation as these shares do not have participation rights. The outstanding shares of Class B and Class C Common Stock are not included in the computation of diluted EPS for the Class A Common Stock as the conditions for conversion into shares of Class A Common Stock were not met. Income Taxes Income taxes are provided for using the asset and liability method. Deferred tax assets and liabilities represent the differences between the financial statement and income tax bases of assets and liabilities using enacted tax rates. The measurement of net deferred tax assets is adjust ed by a valuation allowance if, based on the Company’s evaluation, it is more likely than not that they will not be realized. The Company’s U.S. federal income tax returns for years ended on or after December 31, 2014 remain open for examination. Although management believes its calculations for tax returns are correct and the positions taken thereon are reasonable, the final outcome of tax audits could be materially different from the tax returns filed by the Company, and those differences could result in significant costs or benefits to the Company. For tax filing purposes, Bimini Capital and Bimini Advisors are consolidated as a single tax paying entity. Royal Palm files as a separate tax paying entity. The Company measures, recognizes and presents its uncertain tax positions in accordance with ASC Topic 740, Income Taxes . Under that guidance, the Company assesses the likelihood, based on their technical merit, that tax positions will be sustained upon examination based on the facts, circumstances and i nformation available at the end of each period. The measurement of uncertain tax positions is adjusted when new information is available, or when an event occurs that requires a change. The Company recognizes tax positions in the financial statements only when it is more likely than not that the position will be sustained upon examination by the relevant taxing authority based on the technical merits of the position. A position that meets this standard is measured at the largest amount of benefit that will more likely than not be realized upon settlement. The difference between the benefit recognized and the tax benefit claimed on a tax return is referred to as an unrecognized tax benefit and is recorded as a liability in the consolidated balance sheets. Th e Company records income tax-related interest and penalties, if applicable, within the income tax provision. On December 22, 2017, the U.S. Tax Cuts and Jobs Act (the “Tax Reform Act”) was signed into law by President Trump. The Tax Reform Act significant ly revised the U.S. corporate income tax code by, among other things, lowering the U.S. corporate tax rate from 35% to 21% effective January 1, 2018. On the same date, the Securities and Exchange Commission issued Staff Accounting Bulletin No. 118 which sp ecifies, among other things, that reasonable estimates of the income tax effects of the Tax Reform Act should be used, if determinable. The Company has accounted for the effects of the Tax Reform Act using reasonable estimates based on currently available information and its interpretations thereof. This accounting may change due to, among other things, changes in interpretations the Company has made and the issuance of new tax or accounting guidance. GAAP requires that the effects of a change in tax rate o n the value of deferred tax assets and deferred tax liabilities be recognized upon enactment . Reclassifications Certain prior period amounts have been reclassified to conform to current period presentations. Recent Accounting Pronouncements In November 2016, the FASB issued Accounting Standards Update (“ASU”) 2016-18, Statement of Cash Flows – (Topic 230): Restricted Cash. ASU 2016-18 requires that restricted cash and restricted cash equivalents be included as components of total cash and cas h equivalents as presented on the statement of cash flows. ASU 2016-18 is effective for fiscal years, and for interim periods within those years, beginning after December 15, 2017. Early application is permitted. The Company early adopted the ASU beginni ng with the first quarter of 2017. In August 2016, the FASB issued ASU 2016-15, Statement of Cash Flows – (Topic 230): Classification of Certain Cash Receipts and Cash Payments. ASU 2016-15 addresses eight specific cash flow issues with the objective of reducing the existing diversity in practice. ASU 2016-15 is effective for fiscal years, and for interim periods within those years, beginning after December 15, 2017. Early application is permitted. The Company’s adoption of this ASU did not have a mater ial impact on its consolidated financial statements. In June 2016, the FASB issued ASU 2016-13, Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. ASU 2016-13 requires credit losses on most financial assets measured at amortized cost and certain other instruments to be measured using an expected credit loss model (referred to as the current expected credit loss (CECL) model). ASU 2016-13 is effective for fiscal years, and for interim periods within tho se years, beginning after December 15, 2019. Early application is permitted for fiscal periods beginning after December 15, 2018. The Company is currently evaluating the potential effect of this ASU on its consolidated financial statements. In January 2 016, the FASB issued ASU 2016-01, Financial Instruments-Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities. ASU 2016-01 provides guidance for the recognition, measurement, presentation and disclosure of fi nancial assets and financial liabilities. ASU 2016-01 is effective for fiscal years, and for interim periods within those years, beginning after December 15, 2017 and, for most provisions, is effective using the cumulative-effect transition approach. Ear ly application is permitted for certain provisions. The Company ’s adoption of this ASU did not have a material impact on its consolidated financial statements . In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers, which impl ements a common revenue standard and clarifies the principles used for recognizing revenue. The amendments in the ASU clarify that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflec ts the consideration to which the entity expects to be entitled in exchange for those goods or services. The amendments in ASU No. 2014-09 became effective for annual reporting periods beginning after December 15, 2017, including interim reporting periods within that reporting period. Interest income from MBS and dividend income for investment in Orchid are scoped out of the new revenue recognition standard. Management fee income is within the scope of the new revenue recognition standard. As a result of th e new revenue recognition standard there is no change to the recognition of management fees revenue as management fees are still recognized on a pro-rata basis during the period which the service is provided. Therefore the adoption of this ASU did not have a material impact on its consolidated financial statements. |
ADVISORY SERVICES
ADVISORY SERVICES | 3 Months Ended |
Mar. 31, 2018 | |
Advisory Services [Abstract] | |
Advisory Services [Text Block] | NOTE 2 . ADVISORY SERVICES Bimini Advisors serves as the manager and advisor for Orchid pursuant to the terms of a management agreement. As Manager, Bimini Advisors is responsible for administering Orchid's business activities and day-to-day operations. Pursuant to the terms of the management agreement, Bimini Advisors provides Orchid with its management team, including its officers, along with appropriate support personnel. Bimini Advisors is at all times subject to the supervision and overs ight of Orchid's board of directors and has only such functions and authority as delegated to it. Bimini Advisors receives a monthly management fee in the amount of: One-twelfth of 1.5% of the first $250 million of the Orchid’s equity, as defined in the m anagement agreement, One-twelfth of 1.25% of the Orchid’s equity that is greater than $250 million and less than or equal to $500 million, and One-twelfth of 1.00% of the Orchid’s equity that is greater than $500 million. Orchid is obligated to reimburse Bimini Advisors for any direct expenses incurred on its behalf and to pay to Bimini Advisors an amount equal to Orchid's pro rata portion of certain overhead costs set forth in the management agreement. The management agreement has been renewed through Feb ruary 20, 2019 and provides for automatic one-year extension options thereafter. Should Orchid terminate the management agreement without cause, it will pay to Bimini Advisors a termination fee equal to three times the average annual management fee, as de fined in the management agreement, before or on the last day of the current automatic renewal term. The following table summarizes the advisory services revenue from Orchid for the three months ended March 31, 2018 and 2017 . (in thousands) Three Months Ended March 31, 2018 2017 Management fee $ 1,712 $ 1,302 Allocated overhead 381 368 Total $ 2,093 $ 1,670 At March 31, 2018 and December 31, 2017 , the net amount due from Orchid was approximately $0.8 million and $0. 8 million, respectively . These amounts are included in “other assets” in the consolidated balance sheets. |
MORTGAGE-BACKED SECURITIES
MORTGAGE-BACKED SECURITIES | 3 Months Ended |
Mar. 31, 2018 | |
Mortgage Backed Securities [Abstract] | |
Mortgage-Backed Securities | NOTE 3 . MORTGAGE-BACKED SECURITIES The following table presents the Company’s MBS portfolio as of March 31, 2018 and December 31, 2017 : (in thousands) March 31, 2018 December 31, 2017 Pass-Through MBS: Fixed-rate Mortgages $ 202,393 $ 207,179 Total Pass-Through MBS 202,393 207,179 Structured MBS: Interest-Only Securities 1,525 1,476 Inverse Interest-Only Securities 911 1,037 Total Structured MBS 2,436 2,513 Total $ 204,829 $ 209,692 At March 31, 2018 and December 31, 2017 , the portfolio consisted entirely of securities with contractual maturities in excess of ten years. Actual maturities of MBS investments are generally shorter than stated contractual maturities and are affected by the contractual lives of the underlying mortgages, periodic payments of principal, and prepayments of principal. |
RETAINED INTERESTS IN SECURITIZ
RETAINED INTERESTS IN SECURITIZATIONS | 3 Months Ended |
Mar. 31, 2018 | |
Retained Interests In Securitizations [Abstract] | |
Retained Interests In Securitizations | NOTE 4 . RETAINED INTERESTS IN SECURITIZATIONS The following table summarizes the estimated fair value of the Company’s re tained interests in asset backed securities as of March 31, 2018 and December 31, 2017 : (in thousands) Series Issue Date March 31, 2018 December 31, 2017 HMAC 2004-3 June 30, 2004 $ 3 $ 177 HMAC 2004-4 August 16, 2004 235 386 HMAC 2004-5 September 28, 2004 34 90 Total $ 272 $ 653 |
REPURCHASE AGREEMENTS
REPURCHASE AGREEMENTS | 3 Months Ended |
Mar. 31, 2018 | |
Disclosure of Repurchase Agreements [Abstract] | |
Repurchase Agreements | NOTE 5 . REPURCHASE AGREEMENTS As of March 31, 2018 , the Company had outstanding repurchase agreement obligations of approximately $193.8 million with a net weighted average borrowing rate of 1.94% . These agreements were collateralized by MBS with a fair value, including accrued interest, of approximately $205.5 million, and cash pledged to counterpart ies of approximately $0.1 million . As of December 31, 2017 , the Company had outst anding repurchase agreement obligations of approximately $200.2 million with a net weighted average borrowing rate of 1.52% . These agreements were collateralized by MBS with a fair value , including accrued interest, of approximately $210.0 million , and cash pledged to counterpart ies of approximately $2.2 million. . As of March 31, 2018 and December 31, 2017 , the Company’s repurchase agreements had remaining maturities as summarized below: ($ in thousands) OVERNIGHT BETWEEN 2 BETWEEN 31 GREATER (1 DAY OR AND AND THAN LESS) 30 DAYS 90 DAYS 90 DAYS TOTAL March 31, 2018 Fair value of securities pledged, including accrued interest receivable $ - $ 159,408 $ 46,055 $ - $ 205,463 Repurchase agreement liabilities associated with these securities $ - $ 150,261 $ 43,559 $ - $ 193,820 Net weighted average borrowing rate - 1.96% 1.88% - 1.94% December 31, 2017 Fair value of securities pledged, including accrued interest receivable $ - $ 94,649 $ 115,350 $ - $ 209,999 Repurchase agreement liabilities associated with these securities $ - $ 90,686 $ 109,497 $ - $ 200,183 Net weighted average borrowing rate - 1.47% 1.56% - 1.52% If, during the term of a repurchase agreement, a lender file s for bankruptcy, the Company might experience difficulty recovering its pledged assets , which could result in an unsecured claim against the lender for the difference between the amount loaned to the Company plus interest due to the counterparty and the fair value of the collateral pledged to such lender , including the accrued interest recei vable , and cash posted by the Company as collateral, if any. At March 31, 2018 and December 31, 2017 , the Company had an aggregate amount at risk (the difference between the amount loaned to the Company, including interest payable, and the fair value of s ecurities and cash pledged (if any), including accrued interest on such securities) with all counterparties of approximately $11.8 million and $11.7 million, respectively. The Company did not have an amount at risk with any individual coun terpart y greater than 10% of the Company’s equity at March 31, 2018 or December 31, 2017 . |
DERIVATIVE FINANCIAL INSTRUMENT
DERIVATIVE FINANCIAL INSTRUMENTS | 3 Months Ended | |
Mar. 31, 2018 | ||
Derivative Instruments and Hedging Activities Disclosure [Abstract] | ||
Derivative Financial Instruments | NOTE 6 . DERIVATIVE FINANCIAL INSTRUMENTS In connection with its interest rate risk management strategy, the Company economically hedges a portion of the cost of its repurchase agreement funding and junior subordinated notes by entering into derivative s and other hedging contracts. To date the Company has entered into Eurodollar and T-Note futures contracts, but may enter into other contracts in the future . The Company has not elected hedging treatment under GAAP, and as s uch all gains or losses (realized and unrealized) on these instruments are reflected in earnings for all periods presented. In addition, the Company utilizes TBA securities as a means of investing in and financing MBS or as a means of reducing its exposur e to MBS. The Company accounts for TBA securities as derivative instruments if either the TBA securities do not settle in the shortest period of time possible or if the Company cannot assert that it is probable at inception and throughout the term of the T BA securities that it will take physical delivery of the MBS for a long position, or make delivery of the MBS for a short position, upon settlement of the trade. Derivative Assets (Liabilities), at Fair Value The table below summarizes fair value information about our derivative assets and liabilities as of March 31, 2018 and December 31, 2017 . (in thousands) Derivative Instruments and Related Accounts Balance Sheet Location March 31, 2018 December 31, 2017 Liabilities TBA Securities Other liabilities $ 523 $ - Total derivative liabilities, at fair value $ 523 $ - Margin Balances Posted to (from) Counterparties Futures contracts Restricted cash $ 561 $ 442 TBA securities Restricted cash 281 - Total margin balances on derivative contracts $ 842 $ 442 Eurodollar and T-Note futures are cash settled futures contracts on an interest rate, with gains and losses credited or charged to the Company’s cash accounts on a daily basis. A minimum balance, or “margin”, is required to be maintained in the account on a daily basis. The tables below present information related to the Company’s Eurodollar positions at March 31, 2018 and December 31, 2017 . ($ in thousands) As of March 31, 2018 Repurchase Agreement Funding Hedges Average Weighted Weighted Contract Average Average Notional Entry Effective Open Expiration Year Amount Rate Rate Equity (1) 2018 $ 73,333 2.03% 2.41% $ 206 2019 100,000 2.41% 2.69% 284 2020 100,000 2.64% 2.81% 166 2021 100,000 2.80% 2.84% 39 Total / Weighted Average $ 94,667 2.53% 2.72% $ 695 ($ in thousands) As of March 31, 2018 Junior Subordinated Debt Funding Hedges Average Weighted Weighted Contract Average Average Notional Entry Effective Open Expiration Year Amount Rate Rate Equity (1) 2018 $ 26,000 1.71% 2.39% $ 133 2019 26,000 1.63% 2.69% 276 2020 26,000 1.95% 2.81% 225 2021 26,000 2.22% 2.84% 162 Total / Weighted Average $ 26,000 1.89% 2.70% $ 796 ($ in thousands) As of December 31, 2017 Repurchase Agreement Funding Hedges Average Weighted Weighted Contract Average Average Notional Entry Effective Open Expiration Year Amount Rate Rate Equity (1) 2018 $ 60,000 1.90% 1.97% $ 41 2019 60,000 2.32% 2.27% (31) 2020 60,000 2.60% 2.36% (145) 2021 60,000 2.80% 2.42% (230) Total / Weighted Average $ 60,000 2.41% 2.25% $ (365) ($ in thousands) As of December 31, 2017 Junior Subordinated Debt Funding Hedges Average Weighted Weighted Contract Average Average Notional Entry Effective Open Expiration Year Amount Rate Rate Equity (1) 2018 $ 26,000 1.84% 1.97% $ 33 2019 26,000 1.63% 2.27% $ 166 2020 26,000 1.95% 2.36% $ 107 2021 26,000 2.22% 2.42% $ 51 Total / Weighted Average $ 26,000 1.91% 2.25% $ 357 The following table summarizes our contracts to purchase and sell TBA securities as of March 31, 2018 . ($ in thousands) Notional Net Amount Cost Market Carrying Long (Short) (1) Basis (2) Value (3) Value (4) March 31, 2018 30-Year TBA Securities: 3.0% $ (50,000) $ 48,180 $ 47,657 $ (523) Notional amount represents the par value (or principal balance) of the underlying Agency RMBS . Cost basis represents the forward price to be paid (received) for the underlying Agency RMBS. Market value represents the current market value of the TBA securities (or of the underlying Agency RMBS) as of period-end . Net carrying value represents the difference between the market value and the cost basis of the TBA securities as of period-end and is reported in derivative assets (liabilities), at fair valu e in our consolidated balance sheets . Gains On Derivative Instruments The table below presents the effect of the Company’s derivative financial instruments on the consolidated statements of operations for the three months ended March 31, 2018 and 2017 (in thousands) Three Months Ended March 31, 2018 2017 Eurodollar futures contracts (short positions) Repurchase agreement funding hedges $ 1,090 $ 15 Junior subordinated debt funding hedges 415 7 T-Note futures contracts (short positions) Repurchase agreement funding hedges 759 - Net TBA securities (523) - Gains on derivative instruments $ 1,741 $ 22 Credit Risk-Related Contingent Features The use of derivatives creates exposure to credit risk relating to potential losses that could be recognized in the event that the counterparties to these instruments fail to perform their obligations under the contracts. The Company attempts to minimize this risk in several ways. For instruments which are not centrally cleared on a registered exchange , the Company limits its counterparties to major financial institutions with acceptable credit ratings , and by m onitoring positions with individual counterparties. In addition, the Company may be required to pledge assets as collateral for its derivatives, whose amounts vary over time based on the market value, notional amount and remaining term of the derivative co ntract. In the event of a default by a counterparty, the Company may not receive payments provided for under the terms of its derivative agreements, and may have difficulty recovering its assets pledged as collateral for its derivatives. The cash and cash e quivalents pledged as collateral for the Company’s derivative instruments are included in restricted cash on the consolidated balance sheets. | [1] |
[1] | Open equity represents the cumulative gains (losses) recorded on open futures positions from inception. |
PLEDGED ASSETS
PLEDGED ASSETS | 3 Months Ended |
Mar. 31, 2018 | |
Financial Instruments Pledged as Collateral [Abstract] | |
Pledged Assets [Text Block] | NOTE 7 . PLEDGED ASSETS Assets Pledged to Counterparties The table s below summarize our assets pledged as collateral under our repurchase agreements and derivative agreements pledged related to securities sold but not yet settled, as of March 31, 2018 and December 31, 2017 . ($ in thousands) As of March 31, 2018 Repurchase Derivative Assets Pledged to Counterparties Agreements Agreements Total PT MBS - at fair value $ 202,393 $ - $ 202,393 Structured MBS - at fair value 2,335 - 2,335 Accrued interest on pledged securities 735 - 735 Restricted cash 67 842 909 Total $ 205,530 $ 842 $ 206,372 ($ in thousands) As of December 31, 2017 Repurchase Derivative Assets Pledged to Counterparties Agreements Agreements Total PT MBS - at fair value $ 207,179 $ - $ 207,179 Structured MBS - at fair value 2,091 - 2,091 Accrued interest on pledged securities 730 - 730 Restricted cash 2,208 442 2,650 Total $ 212,208 $ 442 $ 212,650 Assets Pledged from Counterparties The table below summarizes assets pledged to us from counterparties under our repurchase agreements as of March 31, 2018 and December 31, 2017 . Cash received as margin is recognized in cash and cash equivalents with a corresponding amount recognized as an increase in repurchase agreements in the consolidated balance sheets. ($ in thousands) Assets Pledged to Bimini March 31, 2018 December 31, 2017 PT MBS - at fair value $ 174 $ - Cash 26 - Total $ 200 $ - |
OFFSETTING ASSETS AND LIABILITI
OFFSETTING ASSETS AND LIABILITIES | 3 Months Ended |
Mar. 31, 2018 | |
Offsetting [Abstract] | |
Offsetting Assets And Liabilities [Text Block] | NOTE 8 . OFFSETTING ASSETS AND LIABILITIES The Company’s derivatives and repurchase agreements are subject to underlying agreements with master netting or similar arrangements, which provide for the right of offset in the event of default or in the event of bankruptcy of either party to the transactions. The Company reports its assets and liabilities subject to these arrangements on a gross basis. The following table presents information regarding those assets and liabilities subject to such arrang ements as if the Company had presented them on a net basis as of March 31, 2018 and December 31, 2017 . (in thousands) Offsetting of Liabilities Gross Amount Not Offset in the Net Amount Consolidated Balance Sheet Gross Amount of Liabilities Financial Gross Amount Offset in the Presented in the Instruments Cash of Recognized Consolidated Consolidated Posted as Posted as Net Liabilities Balance Sheet Balance Sheet Collateral Collateral Amount March 31, 2018 Repurchase Agreements $ 193,820 $ - $ 193,820 $ (193,753) $ (67) $ - TBA securities 523 - 523 - 281 804 $ 194,343 $ - $ 194,343 $ (193,753) $ 214 $ 804 December 31, 2017 Repurchase Agreements $ 200,183 $ - $ 200,183 $ (197,975) $ (2,208) $ - The amounts disclosed for collateral received by or posted to the same counterparty are limited to the amount sufficient to reduce the asset or liability presented in the consolidated balance sheet to zero in accordance with ASU No. 2011-11, as amended by ASU No. 2013-01. The fair value of the actual collateral received by or posted to the same counterparty typically exceeds the amounts presented. See Note 7 for a discussion of collateral posted for, or received against, repurchase obliga tions and derivative instruments. |
TRUST PREFERRED SECURITIES
TRUST PREFERRED SECURITIES | 3 Months Ended |
Mar. 31, 2018 | |
Trust Preferred Securities [Abstract] | |
Trust Preferred Securities | NOTE 9 . TRUST PREFERRED SECURITIES During 2005, Bimini Capital sponsored the formation of a statutory trust, known as Bimini Capital Trust II (“BCTII”) of which 100% of the common eq uity is owned by Bimini Capital. It was formed for the purpose of issuing trust preferred capital securities to third-party investors and investing the proceeds from the sale of such capital securities solely in junior subordinated debt securities of Bimini Capital. The debt securities held by BCTII are the sole assets of BCTII . As of March 31, 2018 and December 31, 2017 , the outstanding principal balance on the junior subordinated debt securities owed to BCTII was $26.8 million. The BCTII trust preferred securities and Bimini Capital's BCTII Junior Subordinated Notes have a rate of interest that floats at a spread of 3.50% over the prevailing three-month LIBOR rate. As of March 31, 2018 , the interest rate was 5.62% . The BCTII trust preferred securities and Bimini Capital's BCTII Junior Subordinated Notes require quarterly interest distributions and are redeemable at Bimini Capital's option, in whole or in part and without penalty. Bimini Capital's BCTII Junior Subordinated Notes are subordinate and junior in right of payment to all prese nt and future senior indebtedness. BCTII is a VIE because the holders of the equity investment at risk do not have adequate decision making ability over BCTII’s activities. Since Bimini Capital's investment in BCTII’s common equity securities was finance d directly by BCTII as a result of its loan of the proceeds to Bimini Capital, that investment is not considered to be an equity investment at risk. Since Bimini Capital's common share investment in BCTII is not a variable interest, Bimini Capital is not t he primary beneficiary of BCTII. Therefore, Bimini Capital has not consolidated the financial statements of BCTII into its consolidated financial statements, and this investment is accounted for on the equity method. The accompanying consolidated financia l statements present Bimini Capital's BCTII Junior Subordinated Notes issued to BCTII as a liability and Bimini Capital's investment in the common equity securities of BCTII as an asset (included in other assets). For financial statement purposes, Bimini Capital records payments of interest on the Junior Subordinated Notes issued to BCTII as interest expense. |
CAPITAL STOCK
CAPITAL STOCK | 3 Months Ended |
Mar. 31, 2018 | |
Capital Stock [Abstract] | |
Capital Stock | NOTE 10 . COMMON STOCK The table below presents information related to Bimini Capital’s Class A Common Stock issued during the three months ended March 31, 2018 and 2017 . Three Months Ended March 31, Shares Issued Related To: 2018 2017 Shares sold directly to employees 83,332 - Total shares of Class A Common Stock issued 83,332 - There were no issuances of Bimini Capital 's Class B Common Stock and Class C Common Stock during the three months ended March 31, 2018 and 2017 . Stock Repurchase Plan On March 26, 2018, the Board of Directors of Bimini Capital Management, Inc. (the “Company”) approved a S tock Repurchase Plan (“Repurchase Plan”) . Pursuant to Repurchase Plan, the Company may purchase up to 500,000 shares of its Class A Common Stock from time to time , subject to certain limitations imposed by Rule 10 b-18 of the Securities Exchange Act of 1934 . Share repurchases may be executed through various means, including, without limitation, open market transactions. The Repurchase Plan does not ob ligate the Company to purchase any shares, and it expires on November 15, 2018. The authorization for the Share Repurchase Plan may be terminated, increased or decreased by the Company’s Board of Directors in its discretion at any time. Through March 31, 2018 , the Company had not repurchased any shares under the Repurchase Plan. Subsequent to that date, and through May 8, 2018 , the Company has repurchased 11,900 shares for a net cost of approximately $26,000 and a weighted average price of $2.20 per sh are. |
STOCK INCENTIVE PLANS
STOCK INCENTIVE PLANS | 3 Months Ended |
Mar. 31, 2018 | |
Employee Benefits And Share Based Compensation [Abstract] | |
Stock incentive Plans | NOTE 11 . STOCK INCENTIVE PLANS On August 12, 2011, Bimini Capital’s shareholders approved the 2011 Long Term Compensation Plan (the “2011 Plan”) to assist the Company in recruiting and retaining employees, directors and other service providers by enabling them to participate in the success of Bimini Capital and to associate their interest s with those of the Company and its stockholders. The 2011 Plan is intended to permit the grant of stock options, stock appreciation rights (“SARs”), stock awards , performance units and other equity-based and incentive awards. The maximum aggregate number of shares of common stock that may be issued under the 2011 Plan pursuant to the exercise of options and SARs, the grant of stock awards or other equity-based aw ards and the settlement of incentive awards and performance units is equal to 4,000,000 shares. Performance Units The Compensation Committee of the Board of Directors of Bimini Capital (the "Committee") may issue Performance Units under the 2011 Plan to certain officers and employees. “Performance Units” represent the participant’s right to receive an amount, based on the value of a specified number of shares of common stock, if the terms and conditions prescribed by the Committee are satisfied. The Committee will determine the requirements that must be satisfied before Performance Units are earned, including but not limited to any applicable performance period and perf ormance goals. Performance goals may relate to the Company’s financial performance or the participant’s performance or such other criteria determined by the Committee, including goals stated with reference to the performance measures discussed below. If Performance Units are earned, they will be settled in cash, shares of common stock or a combination thereof. The following table presents the activity related to Performance Units during the three months ended March 31, 2018 and 2017 : ($ in thousands, except per share data) Three Months Ended March 31, 2018 2017 Weighted Weighted Average Average Grant Date Grant Date Fair Value Fair Value Shares Per Share Shares Per Share Unvested, beginning of period 41,000 $ 0.84 70,000 $ 1.23 Granted - - - - Vested and issued - - - - Unvested, end of period 41,000 $ 0.84 70,000 $ 1.23 Compensation expense during the period $ 3 $ 7 Unrecognized compensation expense at period end $ 8 $ 32 Weighted-average remaining vesting term (in years) 0.7 1.3 Intrinsic value of unvested shares at period end $ 96 $ 186 |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 3 Months Ended |
Mar. 31, 2018 | |
Commitments And Contingencies Disclosure [Abstract] | |
Commitments And Contingencies | NOTE 12 . COMMITMENTS AND CONTINGENCIES From time to time, the Company may become involved in various claims and legal actions arising in the ordinary course of business. Management is not aware of any significant reported or unreported contingencies at March 31, 2018 . |
INCOME TAXES
INCOME TAXES | 3 Months Ended |
Mar. 31, 2018 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | NOTE 13 . INCOME TAXES The total income tax benefit recorded for the three months ended March 31, 2018 and 2017 was $ 1.1 million and $0.1 million, respectively, on consolidated pre-tax book loss of $ 4.4 million and $ 0.3 million in the three months ended March 31, 2018 and 2017 , respectively. On December 22, 2017, the Tax Reform Act was signed into law by President Trump. The Tax Reform Act significantly revised the U.S. corporate income tax code by, among other things, lowering the U.S. corporate tax rate from 35% to 21% effective January 1, 2018. On the same date, the Securities and Exchange Commission issued Staff Accounting Bulletin No. 118 which specifies, among other things, that reasonable estimates of the income tax effects of the Tax Reform Act should be used, if determinable . The tax provision for the three months ended March 31, 2018 represents the Company’s current best estimate based on management’s current interpretation of the Tax Reform Act and may change as the Company receives additional clarification and implementation guidance. The Company ’s tax provision is based on a projected effective rate based annualized amounts and includes the expected realiz ation of a portion of the tax benefits of federal and state net ope rating losses carryforwards (“NOLs”) . In assessing the realizability of deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of capit al loss and NOL carryforwards is dependent upon the generation of future capital gains and taxable income in periods prior to their expiration. The Company currently provides a valuation allowance against a portion of the NOLs since the Company believes that it is more likely than not that some of the benefits will not be realized in the future. The Company will continue to assess the need for a valuati on allowance at each reporting date. |
EARNINGS PER SHARE
EARNINGS PER SHARE | 3 Months Ended |
Mar. 31, 2018 | |
Earnings Per Share [Abstract] | |
Earnings Per Share (EPS) | NOTE 14 . EARNINGS PER SHARE Shares of Class B common stock , participating and convertible into Class A common stock , are entitled to receive dividends in an amount equal to the dividends declared on each share of Class A common stock if, and when, authorized and declared by the Board of Directors. Following the provisions of FASB ASC 260, the Class B common stock is included in the computation of basic EPS using the two-class method, and consequently is presented separately from Class A common stock . Shares of Class B common stock are not included in the computation of diluted Class A EPS as the conditions for conversion to Class A common stock were not met at March 31, 2018 and 2017 . Shares of Class C common stock are not included in the basic EPS computation as these shares do not have participation rights. Shares of Class C common stock are not included in the computation of diluted Class A EPS as the conditions for conversion to Class A common stock were not met at March 31, 2018 and 2017 . The Company has dividend eligible stock incentive plan shares that were outstanding during the three months ended March 31, 2018 . The basic and diluted per share computations include these unvested incentive plan shares if there is income available to Class A common stock , as they have dividend participation rights. The stock incentive plan shares have no contractual obligation to share in losses. Because there is no such obligation, the incentive plan shares are not includ ed in the basic and diluted EPS computations when no income is available to Class A common stock even though they are considered participating securities. The table below reconciles the numerator and denominator of EPS for the three months ended March 31, 2018 and 2017 . (in thousands, except per-share information) 2018 2017 Basic and diluted EPS per Class A common share: Loss attributable to Class A common shares: Basic and diluted $ (3,266) $ (213) Weighted average common shares: Class A common shares outstanding at the balance sheet date 12,744 12,632 Effect of weighting (14) - Weighted average shares-basic and diluted 12,730 12,632 Loss per Class A common share: Basic and diluted $ (0.26) $ (0.02) (in thousands, except per-share information) 2018 2017 Basic and diluted EPS per Class B common share: Loss attributable to Class B common shares: Basic and diluted $ (8) $ (1) Weighted average common shares: Class B common shares outstanding at the balance sheet date 32 32 Effect of weighting - - Weighted average shares-basic and diluted 32 32 Loss per Class B common share: Basic and diluted $ (0.26) $ (0.02) |
FAIR VALUE
FAIR VALUE | 3 Months Ended |
Mar. 31, 2018 | |
Fair Value Disclosures [Abstract] | |
Fair Value | NOTE 15 . FAIR VALUE Authoritative accounting literature establishes a framework for using fair value to measure assets and liabilities and defines fair value as the price that would be received to sell an asset or paid to transfer a liability (an exit price) as opposed to the price that would be paid to acquire the asset or received to assume the liability (an entry price). A fair value measure should reflect the assumptions that market participants would use in pricing the asset or liability, incl uding the assumptions about the risk inherent in a particular valuation technique, the effect of a restriction on the sale or use of an asset and the risk of non-performance. Required disclosures include stratification of balance sheet amounts measured at fair value based on inputs the Company uses to derive fair value measurements. These stratifications are: Level 1 valuations, where the valuation is based on quoted market prices for identical assets or liabilities traded in active markets (which include exchanges and over-the-counter markets with sufficient volume), Level 2 valuations, where the valuation is based on quoted market prices for similar instruments traded in active markets, quoted prices for identical or similar instruments in markets that ar e not active and model-based valuation techniques for which all significant assumptions are observable in the market, and Level 3 valuations, where the valuation is generated from model-based techniques that use significant assumptions not observable in th e market, but observable based on Company-specific data. These unobservable assumptions reflect the Company’s own estimates for assumptions that market participants would use in pricing the asset or liability. Valuation techniques typically include option pricing models, discounted cash flow models and similar techniques, but may also include the use of market prices of assets or liabilities that are not directly comparable to the subject asset or liability. The Company’s MBS are valued using Level 2 valua tions, and such valuations are determined by the Company based on independent pricing sources and/or third-party broker quotes, when available. Because the price estimates may vary, the Company must make certain judgments and assumptions about the appropri ate price to use to calculate the fair values. Alternatively, the Company could opt to have the value of all of its MBS positions determined by either an independent third-party or could do so internally. MBS, Orchid common stock, retained interests and TBA securities were all recorded at fair value on a recurring basis during the three months ended March 31, 2018 and 2017 . When determining fair value measurements, the Company considers the principal or most advantageous market in which it would transact and considers assumptions that market participants would use when pricing the asset. When possible, the Company looks to active and observable markets to price identical assets. When identical assets are not traded in active markets, the Company looks to market observable data for similar assets. Fair value measurements for the retained interests are generated by a model that requires management to make a significant number of assumptions. The following table presents financial assets and liab ilities measured at fair value on a recurring basis as of March 31, 2018 and December 31, 2017 : (in thousands) Quoted Prices in Active Significant Markets for Other Significant Identical Observable Unobservable Fair Value Assets Inputs Inputs Measurements (Level 1) (Level 2) (Level 3) March 31, 2018 Mortgage-backed securities $ 204,829 $ - $ 204,829 $ - Orchid Island Capital, Inc. common stock 11,203 11,203 - - TBA securities (523) - (523) - Retained interests in securitizations 272 - - 272 December 31, 2017 Mortgage-backed securities $ 209,692 $ - $ 209,692 $ - Orchid Island Capital, Inc. common stock 14,106 14,106 - - Retained interests in securitizations 653 - - 653 The following table illustrates a roll forward for all assets measured at fair value on a recurring basis using significant unobservable inputs (Level 3) for the three months ended March 31, 2018 and 2017 : (in thousands) Retained Interests in Securitizations Three Months Ended March 31, 2018 2017 Balances, January 1 $ 653 $ 1,114 Loss included in earnings (83) (194) Collections (298) (419) Balances, March 31 $ 272 $ 501 During the three months ended March 31, 2018 and 2017 , there were no transfers of financial assets or liabilities between levels 1, 2 or 3. Our retained interests are valued based on a discounted cash flow approach. These values are sensitive to changes in unobservable inputs, including: estimated prepayment speeds, default rates and loss severity, weighted-average life, and discount rates. Significant increases or decreases in any of these inputs may result in significantly different fair value measurements. The following table summarizes the significant quantitative information about our level 3 fair value measurements as of March 31, 2018 . Retained interests in securitzations, at fair value (in thousands) $ 272 CPR Range Prepayment Assumption (Weighted Average) Constant Prepayment Rate 10% (10%) Severity Default Assumptions Probability of Default (Weighted Average) Range Of Loss Timing Real Estate Owned 100% 30.3% Next 10 Months Loans in Foreclosure 100% 30.3% Month 4 - 13 Loans 90 Day Delinquent 100% 45% Month 11-28 Loans 60 Day Delinquent 85% 45% Month 11-28 Loans 30 Day Delinquent 75% 45% Month 11-28 Current Loans 3.9% 45% Month 29 and Beyond Remaining Life Range Discount Rate Range Cash Flow Recognition Valuation Technique (Weighted Average) (Weighted Average) Nominal Cash Flows Discounted Cash Flow 11.9 - 16.5 (12.3) 27.50% (27.50%) Discounted Cash Flows Discounted Cash Flow 0.8 - 16.2 (2.6) 27.50% (27.50%) |
SEGMENT INFORMATION
SEGMENT INFORMATION | 3 Months Ended |
Mar. 31, 2018 | |
Segment Reporting [Abstract] | |
Segment Reporting Disclosure [Text Block] | NOTE 16 . SEGMENT INFORMATION The Company’s operations are classified into two principal reportable segments: the asset management segment and the investment portfolio segment. The asset management segment includes the investment advisory services provided by Bimini Advisors to Orchid and Royal Palm. As discussed in Note 2 , the revenues of the asset management segment consist of management fees and overhead reimbursements received pursuant to a management agreement with Orchid. Total revenues r eceived under this management agreement for the three months ended March 31, 2018 and 2017 , were approximately $2.1 million and $1.7 million, respectively, accounting for approximately 45% and 4 7 % of consolidated revenues, respectively. The investme nt portfolio segment includes the investment activities conducted by Bimini Capital and Royal Palm. The investment portfolio segment receives revenue in the form of interest and dividend income on its investments. Segment information for the three months ended March 31, 2018 and 2017 is as follows: (in thousands) Asset Investment Management Portfolio Corporate Eliminations Total 2018 Advisory services, external customers $ 2,093 $ - $ - $ - $ 2,093 Advisory services, other operating segments (1) 58 - - (58) - Interest and dividend income - 2,551 - - 2,551 Interest expense - (809) (337) (2) - (1,146) Net revenues 2,151 1,742 (337) (58) 3,498 Other income - (6,457) 333 (3) - (6,124) Operating expenses (4) (761) (978) - - (1,739) Intercompany expenses (1) - (58) - 58 - Income (loss) before income taxes $ 1,390 $ (5,751) $ (4) $ - $ (4,365) Asset Investment Management Portfolio Corporate Eliminations Total 2017 Advisory services, external customers $ 1,670 $ - $ - $ - $ 1,670 Advisory services, other operating segments (1) 50 - - (50) - Interest and dividend income - 1,896 - - 1,896 Interest expense - (283) (292) (2) - (575) Net revenues 1,720 1,613 (292) (50) 2,991 Other income - (1,550) (187) (3) - (1,737) Operating expenses (4) (747) (852) - - (1,599) Intercompany expenses (1) - (50) - 50 - Income (loss) before income taxes $ 973 $ (839) $ (479) $ - $ (345) Assets in each reportable segment were as follows: (in thousands) Asset Investment Management Portfolio Corporate Total March 31, 2018 $ 1,761 $ 258,286 $ 14,922 $ 274,969 December 31, 2017 1,632 267,429 15,528 284,589 March 31, 2017 2,249 195,915 19,859 218,023 |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 3 Months Ended |
Mar. 31, 2018 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | NOTE 17 . RELATED PARTY TRANSACTIONS Relationships with Orchid At both March 31, 2018 and December 31, 2017 , the Company owned 1, 520,036 shares of Orchid common stock , representing approximately 2.9 % of the outstanding shares. T he Company received dividends on this common stock investment of approximately $0.5 million and $ 0.6 million d uring the three months ended March 31, 2018 and 2017 , respectively. Robert Cauley, the Chief Executive Officer and Chairman of the Board of Directors of the Company, also serves as Chief Executive Of ficer and Chairman of the Board of Directors of Orchid, receives compensation from Orchid, and owns shares of common stock of Orchid. In addition, Hunter Haas, the Chief Financial Officer, Chief Investment Officer and Treasurer of the Company, also serves as Chief Financial Officer, Chief Investment Officer and Secretary of Orchid, is a member of Orchid’s Board of Directors, receives compensation from Orchid, and owns shares of common stock of Orchid. Robert J. Dwyer and Frank E. Jaumot, our independent di rectors, each own shares of common stock of Orchid. |
BASIS OF PRESENTATION (Policies
BASIS OF PRESENTATION (Policies) | 3 Months Ended |
Mar. 31, 2018 | |
Accounting Policies [Abstract] | |
Consolidation | Consolidation The accompanying consolidated financial statements include the accounts of Bimini Capital, Bimini Advisors and Royal Palm. All inter-company accounts and transactions have been eliminated from the consolidated financial statements. Financial Accounting Standards Board (the "FASB") Accounting Standards Codification ("ASC") Topic 810, Consolidation, requires the consolidation of a variable interest entity ("VIE") by an enterprise if it is deemed the primary beneficiary of the VIE. Bimi ni Capital has a common share investment in a trust used in connection with the issuance of Bimini Capital's junior subordinated notes. See Note 9 for a description of the accounting used for this VIE. |
Basis of Presentation | Basis of Presentation The accompanying unaudit ed condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) for interim financial information and with the instructions to Form 10-Q and Article 8 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presen tation have been included. Operating results fo r the three month period ended March 31, 2018 are not necessarily indicative of the results that may be expected for the year end ing December 31, 2018 . The consolidated balance sheet at December 31, 2017 has been derived from the audited financial statements at that date but does not include all of the information and footnotes required by GAAP for complete consolidated financial statements. For further information, refer to the financial statement s and footnotes thereto included in the Company’s A nnual R eport on Form 10-K for the year ended December 31, 2017 . |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and t he reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Significant estimates affecting the accompanying consolidated financial statements include determining the fair values of MBS, inve stment in Orchid common shares, derivatives and retained interests, determining the amounts of asset valuation allowances, and the computation of the income tax provision or benefit and the deferred tax asset allowances recorded for each accounting period. |
Statement of Comprehensive Income | Statement of Comprehensive Income In accordance with ASC Topic 220, Comprehensive Income , a statement of comprehensive income has not been included as the Company has no items of other comprehensive income (loss) . Comprehensive loss is the same as net loss for all periods presented. |
Segment Reporting Policy [Policy Text Block] | Segment Reporting The Company’s operations are classified into two principal reportable segments: the asset management segment and the investment portfolio segment. These segments are evaluated by management in deciding how to allocate resources and in assessing performance. The accounting policies of the operating segments are the same as the Company’s accounting policies described in this note with the exception that inter-segment revenues and ex penses are included in the presentation of segment results. For further information see Note 16 . |
Cash and Cash Equivalents and Restricted Cash | Cash and Cash Equivalents and Restricted Cash Cash and cash equivalents include cash on deposit with financial institutions and highly liquid investments with original maturities of three months or less at the time of purchase. Restricted cash includes cash pledged as collateral for repurchase agreeme nts and derivative instruments. The following table presents the Company’s cash, cash equivalents and restricted cash as of March 31, 2018 and December 31, 2017 . (in thousands) March 31, 2018 December 31, 2017 Cash and cash equivalents $ 4,976,440 $ 6,103,250 Restricted cash 908,530 2,649,610 Total cash, cash equivalents and restricted cash $ 5,884,970 $ 8,752,860 The Company maintains cash balances at several banks and, at times, these balances may exceed federally insured limits. The Company has not experienced any losses related to these balances. The Federal Deposit Insurance Corporation insures eligible accounts up to $250,000 per depositor at each financial institution. At March 31, 2018 , the Company’s cash deposits exceeded federally insured limits by approximately $4.3 million. The Company also maintains excess margin in accounts with d erivative exchanges. Restricted cash balances are uninsured, but are held in separate customer accounts that are segregated from the general funds of the counterparty. The Company limits uninsured balances to only large, well-known bank s and derivative c ounterparties and believes that it is not exposed to significant credit risk on cash and cash equivalents or restricted cash balances. |
Advisory Services [Policy Tex Block] | Advisory Services Orchid is externally managed and advised by Bimini Advisors pursuant to the terms of a management agreement. Under the terms of the management agreement , Orchid is obligated to pay Bimini Advisors a monthly management fee and a pro rata portion of certain overhead costs and to reimburse the Company for any direct expenses incurred on its behalf. |
Mortgage-Backed Securities | Mort gage-Backed Securities The Company invests primarily in mortgage pass-through (“PT”) certificates, collateralized mor tgage obligations, and interest- only (“IO”) securities and inverse interest- only (“IIO”) securities representing interest in or obligations backed by pools of mortgage-backed loans. The Company has elected to account for its investment in MBS under the fair value option. Electing the fair value option requires the Company to record changes in fair value in the consolidated stateme nt of operations, which, in management’s view, more appropriately reflects the results of our operations for a particular reporting period and is consistent with the underlying economics and how the portfolio is managed. The Company records MBS transactions on the trade date. Security purchases that have not settled as of the balance sheet date are included in the MBS balance with an offsetting liability recorded, whereas securit ies sold that have not settled as of the balance sheet date are rem oved from the MBS balance with an offsetting receivable recorded. The fair value of the Company’s investment in MBS is governed by ASC Topic 820, Fair Value Measurement . The definition of fair value in ASC Topic 820 focuses on the price that would be rec eived to sell the asset or paid to transfer the liability in an orderly transaction between market participants at the measurement date. The fair value measurement assumes that the transaction to sell the asset or transfer the liability either occurs in t he principal market for the asset or liability, or in the absence of a principal market, occurs in the most advantageous market for the asset or liability. Estimated fair values for MBS are based on independent pricing sources and/or third-party broker quo tes, when available. Income on PT MBS is based on the stated interest rate of the security. Premiums or discounts present at the date of purchase are not amortized. Premium lost and discount accretion resulting from monthly principal repayments are refl ected in unrealize d gains on MBS in the c ons olidated statements of operations. For IO securities, the income is accrued based on the carrying value and the effective yield. The difference between income accrued and the interest received on the security is characterized as a return of investment and serves to reduce the asset’s carrying value. At each reporting date, the effective yield is adjusted prospectively from the reporting period based on the new estimate of prepayments and the contractual terms of the security. For IIO securities, effective yield and income recognition calculations also take into account the index value applicable to the security. Changes in fair value of MBS during each reporting period are recorded in earnings and reported as un realized gains or losses on mortgage-backed securities in the accompanying consolidated statements of operations. The amount reported as unrealized gains or losses on mortgage backed securities thus captures the net effect of changes in the fair market val ue of securities caused by market developments and any premium or discount lost as a result of principal repayments during the period. |
Investment In Related Party [Policy Text Block] | Orchid Island Capital, Inc. Common Stock The Company has elected the fair value option for its investment in Orchid common shares. The change in the fair value of this investment and dividends received on this investment are reflected in the consolidated statements of operations. We estimate the fair value of our investment in Orchid on a market approach using “Level 1” inputs based on the quoted market price of Orchid’s common stock on a national stock exchange. Electing the fair value option requires the Company to record changes in fair value in the consolid ated statement s of operations, which, in management’s view, mo re appropriately reflects the results of our operations for a particular reporting period and is consistent with how the investment is managed. |
Retained Interests | Retained Interests in Securitizations Retained i nterests in the subordinated tranches of securities created in securitization transactions were initially recorded at their fair value when issued by Royal Palm. Subsequent adjustments to fair value are reflected in the consolidated statements of operation s. Quoted market prices for these assets are generally not available, so the Company estimates fair value based on the present value of expected future cash flows using management’s best estimates of key assumptions, which include expected credit losses, p repayment speeds, weighted-average life, and discount rates commensurate with the inherent risks of the asset. |
Derivative Financial Instruments | Derivative Financial Instruments The Company uses derivative instruments to manage interest rate risk, facilitate asset/liability strategies an d manage other exposures, and it may continue to do so in the future. The principal instruments that the Company has used to date are Treasury Note (“T-Note”) and Eurodollar futures contracts, and “to-be-announced” (“TBA”) securities transactions, but it m ay enter into other derivatives in the future. The Company purchases a portion of its MBS through forward settling transactions, including TBA securities transactions. At times when market conditions are conducive, the Company may choose to move the sett lement of these TBA securities transactions out to a later date by entering into an offsetting short position, which is then net settled for cash, and simultaneously entering into a substantially similar TBA securities trade for a later settlement date. S uch a set of transactions is referred to as a TBA “dollar roll” transaction. The TBA securities purchased at the later settlement date are typically priced at a discount to securities for settlement in the current month. This difference is referred to as the “price drop.” The price drop represents compensation to the Company for foregoing net interest margin and is referred to as TBA “dollar roll income.” The Company accounts for TBA securities as derivative instruments if either the TBA securities do n ot settle in the shortest period of time possible or if the Company cannot assert that it is probable at inception of the TBA transaction, or throughout its term, that it will take physical delivery of the MBS for a long position, or make delivery of the M BS for a short position, upon settlement of the trade. The Company accounts for TBA dollar roll transactions as a series of derivative transactions. Gains, losses and dollar roll income associated with TBA securities transactions and dollar roll transactio ns are reported in gain (loss) on derivative instruments in the accompanying consolidated statements of operations. The fair value of TBA securities is estimated based on similar methods used to value MBS securities. The Company has elected not to treat any of its derivative financial instruments as hedges in order to align the accounting treatment of its derivative instruments with the treatment of its portfolio assets under the fair value option. FASB ASC Topic 815, Derivatives and Hedging , requires th at all derivative instruments be carried at fair value. Changes in fair value are recorded in the consolidated operations for each period. Holding derivatives creates exposure to credit risk related to the potential for failure on the part of counterpart ies to honor their commitments. In addition, the Company may be required to post collateral based on any declines in the market value of the derivatives. In the event of default by a counterparty, the Company may have difficulty recovering its collateral and may not receive payments provided for under the terms of the agreement. To mitigate this risk, the Company uses only well-established commercial banks as counterparties. |
Financial Instruments | Financial Instruments ASC Topic 825 , Financial Instruments , requires disclos ure of the fair value of financial instruments for which it is practicable to estimate that value, either in the body of the financial statements or in the accompanying notes. MBS, Orchid common stock, Eurodollar futures contracts, interest rate swaptions and retained interests in securitization transactions are accounted for at fair value in the consolidated balance sheets. The methods and assumptions used to estimate fair value for these instruments are presented in Note 15 of the consolidated financial statements. The estimated fair value of cash and cash equivalents, restricted cash, accrued interest receivable, other assets, repurchase agreements, accrued interest payable and other liabilities generally approximates their carrying value as of March 31, 2018 and December 31, 2017 , due to the short-term nature of these financial instruments. It is impractical to estimate the fair value of the Company’s junior subordinated notes. Currently, there is a limited market for these types of instruments and the Company is unable to ascertain what interest rates would be available to the Company for similar financial instruments. Information regarding carrying amount and effective interest rate for these instruments is presented in Note 9 to the consolidat ed financial statements. |
Property and Equipment, net | Property and Equipment, net Property and equipment, net, consists of computer equipment with a depreciable life of 3 years, office furniture and equipment with depreciable lives of 8 to 20 years, land which has no depreciable lif e, and buildings and improvements with depreciable lives of 30 years. Property and equipment is recorded at acquisition cost and depreciated using the straight-line method over the estimated useful lives of the assets. |
Repurchase Agreements | Repurchase Agreements The Company finances the acquisition of the majority of its PT MBS through the use of repurchase agreements under master repurchase agreements. Pursuant to ASC Topic 860, Transfers and Servicing , the Company account s for repurchase transactions as collater alized financing transactions, which are carried at their contractual amounts, including accrued interest, as specified in the respective agreements . |
Share-Based Compensation | Share-Based Compensation The Company follows the provisions of ASC Topic 718, Compensation – Stock Compe nsation , to account for stock and stock-based awards. For stock and stock-based awards issued to employees, a compensation charge is recorded against earnings over the vesting period based on the fair value of the award. The Company applies a zero forfeiture rate for its equity based awards, as such awards have been granted to a limited number of employees and historical forfeitures have been minimal. A significant forfeiture, or an indication that significant forfeitures may occur, would result in a revised forfeiture rate which would be accounted for prospectively as a change in an estimate. For transactions with non-employees in which services are performed in exchange for the Company’s common stock or other equity instruments, the transactions a re recorded on the basis of the fair value of the service received or the fair value of the equity instruments issued, whichever is more readily measurable at the date of the issuance of the common stock. |
Earnings Per Share | Earnings Per Share The Company follows the provis ions of ASC Topic 260, Earnings Per Share , which requires companies with complex capital structures, common stock equivalents or two (or more) classes of securities that participate in dividend distributions to present both basic and diluted earnings per s hare (“EPS”) on the face of the consolidated statement of operations. Basic EPS is calculated as income available to common stockholders divided by the weighted average number of common shares outstanding during the period. Diluted EPS is calculated using the treasury stock or two-class method, as applicable for common stock equivalents. However, the common stock equivalents are not included in computing diluted EPS if the result is anti-dilutive. Outstanding shares of Class B Common Stock, participating a nd convertible into Class A Common Stock, are entitled to receive dividends in an amount equal to the dividends declared , if any, on each share of Class A Common Stock . Accordingly, shares of the Class B Common Stock are included in the computation of basic EPS using the two-class method and, consequently, are presented separately from Class A Common Stock. The shares of Class C Common Stock are not included in the basic EPS computation as these shares do not have participation rights. The outstanding shares of Class B and Class C Common Stock are not included in the computation of diluted EPS for the Class A Common Stock as the conditions for conversion into shares of Class A Common Stock were not met. |
Income Taxes | Income Taxes Income taxes are provided for using the asset and liability method. Deferred tax assets and liabilities represent the differences between the financial statement and income tax bases of assets and liabilities using enacted tax rates. The measurement of net deferred tax assets is adjust ed by a valuation allowance if, based on the Company’s evaluation, it is more likely than not that they will not be realized. The Company’s U.S. federal income tax returns for years ended on or after December 31, 2014 remain open for examination. Although management believes its calculations for tax returns are correct and the positions taken thereon are reasonable, the final outcome of tax audits could be materially different from the tax returns filed by the Company, and those differences could result in significant costs or benefits to the Company. For tax filing purposes, Bimini Capital and Bimini Advisors are consolidated as a single tax paying entity. Royal Palm files as a separate tax paying entity. The Company measures, recognizes and presents its uncertain tax positions in accordance with ASC Topic 740, Income Taxes . Under that guidance, the Company assesses the likelihood, based on their technical merit, that tax positions will be sustained upon examination based on the facts, circumstances and i nformation available at the end of each period. The measurement of uncertain tax positions is adjusted when new information is available, or when an event occurs that requires a change. The Company recognizes tax positions in the financial statements only when it is more likely than not that the position will be sustained upon examination by the relevant taxing authority based on the technical merits of the position. A position that meets this standard is measured at the largest amount of benefit that will more likely than not be realized upon settlement. The difference between the benefit recognized and the tax benefit claimed on a tax return is referred to as an unrecognized tax benefit and is recorded as a liability in the consolidated balance sheets. Th e Company records income tax-related interest and penalties, if applicable, within the income tax provision. On December 22, 2017, the U.S. Tax Cuts and Jobs Act (the “Tax Reform Act”) was signed into law by President Trump. The Tax Reform Act significant ly revised the U.S. corporate income tax code by, among other things, lowering the U.S. corporate tax rate from 35% to 21% effective January 1, 2018. On the same date, the Securities and Exchange Commission issued Staff Accounting Bulletin No. 118 which sp ecifies, among other things, that reasonable estimates of the income tax effects of the Tax Reform Act should be used, if determinable. The Company has accounted for the effects of the Tax Reform Act using reasonable estimates based on currently available information and its interpretations thereof. This accounting may change due to, among other things, changes in interpretations the Company has made and the issuance of new tax or accounting guidance. GAAP requires that the effects of a change in tax rate o n the value of deferred tax assets and deferred tax liabilities be recognized upon enactment . |
Reclassifications | Reclassifications Certain prior period amounts have been reclassified to conform to current period presentations. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In November 2016, the FASB issued Accounting Standards Update (“ASU”) 2016-18, Statement of Cash Flows – (Topic 230): Restricted Cash. ASU 2016-18 requires that restricted cash and restricted cash equivalents be included as components of total cash and cas h equivalents as presented on the statement of cash flows. ASU 2016-18 is effective for fiscal years, and for interim periods within those years, beginning after December 15, 2017. Early application is permitted. The Company early adopted the ASU beginni ng with the first quarter of 2017. In August 2016, the FASB issued ASU 2016-15, Statement of Cash Flows – (Topic 230): Classification of Certain Cash Receipts and Cash Payments. ASU 2016-15 addresses eight specific cash flow issues with the objective of reducing the existing diversity in practice. ASU 2016-15 is effective for fiscal years, and for interim periods within those years, beginning after December 15, 2017. Early application is permitted. The Company’s adoption of this ASU did not have a mater ial impact on its consolidated financial statements. In June 2016, the FASB issued ASU 2016-13, Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. ASU 2016-13 requires credit losses on most financial assets measured at amortized cost and certain other instruments to be measured using an expected credit loss model (referred to as the current expected credit loss (CECL) model). ASU 2016-13 is effective for fiscal years, and for interim periods within tho se years, beginning after December 15, 2019. Early application is permitted for fiscal periods beginning after December 15, 2018. The Company is currently evaluating the potential effect of this ASU on its consolidated financial statements. In January 2 016, the FASB issued ASU 2016-01, Financial Instruments-Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities. ASU 2016-01 provides guidance for the recognition, measurement, presentation and disclosure of fi nancial assets and financial liabilities. ASU 2016-01 is effective for fiscal years, and for interim periods within those years, beginning after December 15, 2017 and, for most provisions, is effective using the cumulative-effect transition approach. Ear ly application is permitted for certain provisions. The Company ’s adoption of this ASU did not have a material impact on its consolidated financial statements . In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers, which impl ements a common revenue standard and clarifies the principles used for recognizing revenue. The amendments in the ASU clarify that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflec ts the consideration to which the entity expects to be entitled in exchange for those goods or services. The amendments in ASU No. 2014-09 became effective for annual reporting periods beginning after December 15, 2017, including interim reporting periods within that reporting period. Interest income from MBS and dividend income for investment in Orchid are scoped out of the new revenue recognition standard. Management fee income is within the scope of the new revenue recognition standard. As a result of th e new revenue recognition standard there is no change to the recognition of management fees revenue as management fees are still recognized on a pro-rata basis during the period which the service is provided. Therefore the adoption of this ASU did not have a material impact on its consolidated financial statements. |
CASH AND CASH EQUIVALENTS (Tabl
CASH AND CASH EQUIVALENTS (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Accounting Policies [Abstract] | |
Schedule of reconciliation of cash, cash equivalents and restricted cash | The following table presents the Company’s cash, cash equivalents and restricted cash as of March 31, 2018 and December 31, 2017 . (in thousands) March 31, 2018 December 31, 2017 Cash and cash equivalents $ 4,976,440 $ 6,103,250 Restricted cash 908,530 2,649,610 Total cash, cash equivalents and restricted cash $ 5,884,970 $ 8,752,860 |
ADVISORY SERVICES (Tables)
ADVISORY SERVICES (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Advisory Services [Abstract] | |
Schedule of Advisory Fee Income [Table Text Block] | The following table summarizes the advisory services revenue from Orchid for the three months ended March 31, 2018 and 2017 . (in thousands) Three Months Ended March 31, 2018 2017 Management fee $ 1,712 $ 1,302 Allocated overhead 381 368 Total $ 2,093 $ 1,670 |
MORTGAGE-BACKED SECURITIES (Tab
MORTGAGE-BACKED SECURITIES (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Residential Mortgage Backed Securities [Member] | |
Mortgage Backed Securities [Line Items] | |
Schedule of Mortgage-Backed Securities Reconciliation | The following table presents the Company’s MBS portfolio as of March 31, 2018 and December 31, 2017 : (in thousands) March 31, 2018 December 31, 2017 Pass-Through MBS: Fixed-rate Mortgages $ 202,393 $ 207,179 Total Pass-Through MBS 202,393 207,179 Structured MBS: Interest-Only Securities 1,525 1,476 Inverse Interest-Only Securities 911 1,037 Total Structured MBS 2,436 2,513 Total $ 204,829 $ 209,692 |
RETAINED INTERESTS IN SECURIT28
RETAINED INTERESTS IN SECURITIZATIONS (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Retained Interests In Securitizations [Abstract] | |
Schedule of Retained Interests In Securitizations | The following table summarizes the estimated fair value of the Company’s re tained interests in asset backed securities as of March 31, 2018 and December 31, 2017 : (in thousands) Series Issue Date March 31, 2018 December 31, 2017 HMAC 2004-3 June 30, 2004 $ 3 $ 177 HMAC 2004-4 August 16, 2004 235 386 HMAC 2004-5 September 28, 2004 34 90 Total $ 272 $ 653 |
REPURCHASE AGREEMENTS (Tables)
REPURCHASE AGREEMENTS (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Disclosure of Repurchase Agreements [Abstract] | |
Schedule of repurchase agreements and remaining maturities | As of March 31, 2018 and December 31, 2017 , the Company’s repurchase agreements had remaining maturities as summarized below: ($ in thousands) OVERNIGHT BETWEEN 2 BETWEEN 31 GREATER (1 DAY OR AND AND THAN LESS) 30 DAYS 90 DAYS 90 DAYS TOTAL March 31, 2018 Fair value of securities pledged, including accrued interest receivable $ - $ 159,408 $ 46,055 $ - $ 205,463 Repurchase agreement liabilities associated with these securities $ - $ 150,261 $ 43,559 $ - $ 193,820 Net weighted average borrowing rate - 1.96% 1.88% - 1.94% December 31, 2017 Fair value of securities pledged, including accrued interest receivable $ - $ 94,649 $ 115,350 $ - $ 209,999 Repurchase agreement liabilities associated with these securities $ - $ 90,686 $ 109,497 $ - $ 200,183 Net weighted average borrowing rate - 1.47% 1.56% - 1.52% |
DERIVATIVE FINANCIAL INSTRUME30
DERIVATIVE FINANCIAL INSTRUMENTS (Tables) | 3 Months Ended | |
Mar. 31, 2018 | ||
Derivative Instruments and Hedging Activities Disclosure [Abstract] | ||
ScheduleOfDerivativeInstrumentsInStatementOfFinancialPositionFairValueTextBlock | Derivative Assets (Liabilities), at Fair Value The table below summarizes fair value information about our derivative assets and liabilities as of March 31, 2018 and December 31, 2017 . (in thousands) Derivative Instruments and Related Accounts Balance Sheet Location March 31, 2018 December 31, 2017 Liabilities TBA Securities Other liabilities $ 523 $ - Total derivative liabilities, at fair value $ 523 $ - Margin Balances Posted to (from) Counterparties Futures contracts Restricted cash $ 561 $ 442 TBA securities Restricted cash 281 - Total margin balances on derivative contracts $ 842 $ 442 | |
Schedule of Eurodollar Futures Positions | Eurodollar and T-Note futures are cash settled futures contracts on an interest rate, with gains and losses credited or charged to the Company’s cash accounts on a daily basis. A minimum balance, or “margin”, is required to be maintained in the account on a daily basis. The tables below present information related to the Company’s Eurodollar positions at March 31, 2018 and December 31, 2017 . ($ in thousands) As of March 31, 2018 Repurchase Agreement Funding Hedges Average Weighted Weighted Contract Average Average Notional Entry Effective Open Expiration Year Amount Rate Rate Equity (1) 2018 $ 73,333 2.03% 2.41% $ 206 2019 100,000 2.41% 2.69% 284 2020 100,000 2.64% 2.81% 166 2021 100,000 2.80% 2.84% 39 Total / Weighted Average $ 94,667 2.53% 2.72% $ 695 ($ in thousands) As of March 31, 2018 Junior Subordinated Debt Funding Hedges Average Weighted Weighted Contract Average Average Notional Entry Effective Open Expiration Year Amount Rate Rate Equity (1) 2018 $ 26,000 1.71% 2.39% $ 133 2019 26,000 1.63% 2.69% 276 2020 26,000 1.95% 2.81% 225 2021 26,000 2.22% 2.84% 162 Total / Weighted Average $ 26,000 1.89% 2.70% $ 796 ($ in thousands) As of December 31, 2017 Repurchase Agreement Funding Hedges Average Weighted Weighted Contract Average Average Notional Entry Effective Open Expiration Year Amount Rate Rate Equity (1) 2018 $ 60,000 1.90% 1.97% $ 41 2019 60,000 2.32% 2.27% (31) 2020 60,000 2.60% 2.36% (145) 2021 60,000 2.80% 2.42% (230) Total / Weighted Average $ 60,000 2.41% 2.25% $ (365) ($ in thousands) As of December 31, 2017 Junior Subordinated Debt Funding Hedges Average Weighted Weighted Contract Average Average Notional Entry Effective Open Expiration Year Amount Rate Rate Equity (1) 2018 $ 26,000 1.84% 1.97% $ 33 2019 26,000 1.63% 2.27% $ 166 2020 26,000 1.95% 2.36% $ 107 2021 26,000 2.22% 2.42% $ 51 Total / Weighted Average $ 26,000 1.91% 2.25% $ 357 | [1] |
Schedule of To Be Announced Securities Table Tex tBlock | The following table summarizes our contracts to purchase and sell TBA securities as of March 31, 2018 . ($ in thousands) Notional Net Amount Cost Market Carrying Long (Short) (1) Basis (2) Value (3) Value (4) March 31, 2018 30-Year TBA Securities: 3.0% $ (50,000) $ 48,180 $ 47,657 $ (523) | |
Schedule of the effect of the Company's deriviative financial instruments on the consolidated statement of operations | The table below presents the effect of the Company’s derivative financial instruments on the consolidated statements of operations for the three months ended March 31, 2018 and 2017 . (in thousands) Three Months Ended March 31, 2018 2017 Eurodollar futures contracts (short positions) Repurchase agreement funding hedges $ 1,090 $ 15 Junior subordinated debt funding hedges 415 7 T-Note futures contracts (short positions) Repurchase agreement funding hedges 759 - Net TBA securities (523) - Gains on derivative instruments $ 1,741 $ 22 | |
[1] | Open equity represents the cumulative gains (losses) recorded on open futures positions from inception. |
PLEDGED ASSETS (Tables)
PLEDGED ASSETS (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Financial Instruments Pledged as Collateral [Abstract] | |
Schedule of assets pledged as collateral under our repurchase agreements, prime brokerage clearing accounts, derivative agreements and insurance capital by type, including securities pledged related to securities sold but not yet settled | The table s below summarize our assets pledged as collateral under our repurchase agreements and derivative agreements pledged related to securities sold but not yet settled, as of March 31, 2018 and December 31, 2017 . ($ in thousands) As of March 31, 2018 Repurchase Derivative Assets Pledged to Counterparties Agreements Agreements Total PT MBS - at fair value $ 202,393 $ - $ 202,393 Structured MBS - at fair value 2,335 - 2,335 Accrued interest on pledged securities 735 - 735 Restricted cash 67 842 909 Total $ 205,530 $ 842 $ 206,372 ($ in thousands) As of December 31, 2017 Repurchase Derivative Assets Pledged to Counterparties Agreements Agreements Total PT MBS - at fair value $ 207,179 $ - $ 207,179 Structured MBS - at fair value 2,091 - 2,091 Accrued interest on pledged securities 730 - 730 Restricted cash 2,208 442 2,650 Total $ 212,208 $ 442 $ 212,650 |
Schedule of assets pledged to us from counterparties under our repurchase agreements. | The table below summarizes assets pledged to us from counterparties under our repurchase agreements as of March 31, 2018 and December 31, 2017 . Cash received as margin is recognized in cash and cash equivalents with a corresponding amount recognized as an increase in repurchase agreements in the consolidated balance sheets. ($ in thousands) Assets Pledged to Bimini March 31, 2018 December 31, 2017 PT MBS - at fair value $ 174 $ - Cash 26 - Total $ 200 $ - |
OFFSETTING ASSETS AND LIABILI32
OFFSETTING ASSETS AND LIABILITIES (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Offsetting [Abstract] | |
Offsetting of Liabilties [Table Text Block] | The Company’s derivatives and repurchase agreements are subject to underlying agreements with master netting or similar arrangements, which provide for the right of offset in the event of default or in the event of bankruptcy of either party to the transactions. The Company reports its assets and liabilities subject to these arrangements on a gross basis. The following table presents information regarding those assets and liabilities subject to such arrang ements as if the Company had presented them on a net basis as of March 31, 2018 and December 31, 2017 . (in thousands) Offsetting of Liabilities Gross Amount Not Offset in the Net Amount Consolidated Balance Sheet Gross Amount of Liabilities Financial Gross Amount Offset in the Presented in the Instruments Cash of Recognized Consolidated Consolidated Posted as Posted as Net Liabilities Balance Sheet Balance Sheet Collateral Collateral Amount March 31, 2018 Repurchase Agreements $ 193,820 $ - $ 193,820 $ (193,753) $ (67) $ - TBA securities 523 - 523 - 281 804 $ 194,343 $ - $ 194,343 $ (193,753) $ 214 $ 804 December 31, 2017 Repurchase Agreements $ 200,183 $ - $ 200,183 $ (197,975) $ (2,208) $ - |
CAPITAL STOCK (Tables)
CAPITAL STOCK (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Capital Stock [Abstract] | |
Issuances of Common Stock | The table below presents information related to Bimini Capital’s Class A Common Stock issued during the three months ended March 31, 2018 and 2017 . Three Months Ended March 31, Shares Issued Related To: 2018 2017 Shares sold directly to employees 83,332 - Total shares of Class A Common Stock issued 83,332 - |
STOCK INCENTIVE PLANS (Tables)
STOCK INCENTIVE PLANS (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Employee Benefits And Share Based Compensation [Abstract] | |
Schedule of Performance Units outstanding | The following table presents the activity related to Performance Units during the three months ended March 31, 2018 and 2017 : ($ in thousands, except per share data) Three Months Ended March 31, 2018 2017 Weighted Weighted Average Average Grant Date Grant Date Fair Value Fair Value Shares Per Share Shares Per Share Unvested, beginning of period 41,000 $ 0.84 70,000 $ 1.23 Granted - - - - Vested and issued - - - - Unvested, end of period 41,000 $ 0.84 70,000 $ 1.23 Compensation expense during the period $ 3 $ 7 Unrecognized compensation expense at period end $ 8 $ 32 Weighted-average remaining vesting term (in years) 0.7 1.3 Intrinsic value of unvested shares at period end $ 96 $ 186 |
EARNINGS PER SHARE (Tables)
EARNINGS PER SHARE (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Earnings Per Share [Abstract] | |
Schedule of reconciling the numerator and denominator of EPS | The table below reconciles the numerator and denominator of EPS for the three months ended March 31, 2018 and 2017 . (in thousands, except per-share information) 2018 2017 Basic and diluted EPS per Class A common share: Loss attributable to Class A common shares: Basic and diluted $ (3,266) $ (213) Weighted average common shares: Class A common shares outstanding at the balance sheet date 12,744 12,632 Effect of weighting (14) - Weighted average shares-basic and diluted 12,730 12,632 Loss per Class A common share: Basic and diluted $ (0.26) $ (0.02) (in thousands, except per-share information) 2018 2017 Basic and diluted EPS per Class B common share: Loss attributable to Class B common shares: Basic and diluted $ (8) $ (1) Weighted average common shares: Class B common shares outstanding at the balance sheet date 32 32 Effect of weighting - - Weighted average shares-basic and diluted 32 32 Loss per Class B common share: Basic and diluted $ (0.26) $ (0.02) |
FAIR VALUE (Tables)
FAIR VALUE (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Fair Value Disclosures [Abstract] | |
Schedule of financial assets (liabilities) measured at fair value on a recurring basis | The following table presents financial assets and liab ilities measured at fair value on a recurring basis as of March 31, 2018 and December 31, 2017 : (in thousands) Quoted Prices in Active Significant Markets for Other Significant Identical Observable Unobservable Fair Value Assets Inputs Inputs Measurements (Level 1) (Level 2) (Level 3) March 31, 2018 Mortgage-backed securities $ 204,829 $ - $ 204,829 $ - Orchid Island Capital, Inc. common stock 11,203 11,203 - - TBA securities (523) - (523) - Retained interests in securitizations 272 - - 272 December 31, 2017 Mortgage-backed securities $ 209,692 $ - $ 209,692 $ - Orchid Island Capital, Inc. common stock 14,106 14,106 - - Retained interests in securitizations 653 - - 653 |
Changes is Level 3 Assets Measured at Fair Value on a Recurring Basis | The following table illustrates a roll forward for all assets measured at fair value on a recurring basis using significant unobservable inputs (Level 3) for the three months ended March 31, 2018 and 2017 : (in thousands) Retained Interests in Securitizations Three Months Ended March 31, 2018 2017 Balances, January 1 $ 653 $ 1,114 Loss included in earnings (83) (194) Collections (298) (419) Balances, March 31 $ 272 $ 501 |
Quantitative Information About Level 3 Fair Value Measurements | The following table summarizes the significant quantitative information about our level 3 fair value measurements as of March 31, 2018 . Retained interests in securitzations, at fair value (in thousands) $ 272 CPR Range Prepayment Assumption (Weighted Average) Constant Prepayment Rate 10% (10%) Severity Default Assumptions Probability of Default (Weighted Average) Range Of Loss Timing Real Estate Owned 100% 30.3% Next 10 Months Loans in Foreclosure 100% 30.3% Month 4 - 13 Loans 90 Day Delinquent 100% 45% Month 11-28 Loans 60 Day Delinquent 85% 45% Month 11-28 Loans 30 Day Delinquent 75% 45% Month 11-28 Current Loans 3.9% 45% Month 29 and Beyond Remaining Life Range Discount Rate Range Cash Flow Recognition Valuation Technique (Weighted Average) (Weighted Average) Nominal Cash Flows Discounted Cash Flow 11.9 - 16.5 (12.3) 27.50% (27.50%) Discounted Cash Flows Discounted Cash Flow 0.8 - 16.2 (2.6) 27.50% (27.50%) |
SEGMENT INFORMATION (Tables)
SEGMENT INFORMATION (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Segment Reporting [Abstract] | |
Schedule Of Segment Reporting Information By Segment [Text Block] | Segment information for the three months ended March 31, 2018 and 2017 is as follows: (in thousands) Asset Investment Management Portfolio Corporate Eliminations Total 2018 Advisory services, external customers $ 2,093 $ - $ - $ - $ 2,093 Advisory services, other operating segments (1) 58 - - (58) - Interest and dividend income - 2,551 - - 2,551 Interest expense - (809) (337) (2) - (1,146) Net revenues 2,151 1,742 (337) (58) 3,498 Other income - (6,457) 333 (3) - (6,124) Operating expenses (4) (761) (978) - - (1,739) Intercompany expenses (1) - (58) - 58 - Income (loss) before income taxes $ 1,390 $ (5,751) $ (4) $ - $ (4,365) Asset Investment Management Portfolio Corporate Eliminations Total 2017 Advisory services, external customers $ 1,670 $ - $ - $ - $ 1,670 Advisory services, other operating segments (1) 50 - - (50) - Interest and dividend income - 1,896 - - 1,896 Interest expense - (283) (292) (2) - (575) Net revenues 1,720 1,613 (292) (50) 2,991 Other income - (1,550) (187) (3) - (1,737) Operating expenses (4) (747) (852) - - (1,599) Intercompany expenses (1) - (50) - 50 - Income (loss) before income taxes $ 973 $ (839) $ (479) $ - $ (345) |
Reconciliation of Assets from Segment to Consolidated [Table Text Block] | Assets in each reportable segment were as follows: (in thousands) Asset Investment Management Portfolio Corporate Total March 31, 2018 $ 1,761 $ 258,286 $ 14,922 $ 274,969 December 31, 2017 1,632 267,429 15,528 284,589 March 31, 2017 2,249 195,915 19,859 218,023 |
SIGNIFICANT ACCOUNTING POLICIES
SIGNIFICANT ACCOUNTING POLICIES - Organization (Details) | 3 Months Ended |
Mar. 31, 2018 | |
Accounting Policies [Abstract] | |
Entity Incorporation, Date of Incorporation | Sep. 24, 2003 |
Entity Incorporation, State Country Name | Maryland |
SIGNIFICANT ACCOUNTING POLICI39
SIGNIFICANT ACCOUNTING POLICIES - Cash (Details) | Mar. 31, 2018USD ($) |
Accounting Policies [Abstract] | |
Uninsured Cash Balances | $ 4,300,000 |
SIGNIFICANT ACCOUNTING POLICI40
SIGNIFICANT ACCOUNTING POLICIES - Cash, Cash Equivalents and Restricted Cash (Details) - USD ($) | Mar. 31, 2018 | Dec. 31, 2017 | Mar. 31, 2017 | Dec. 31, 2016 |
Accounting Policies [Abstract] | ||||
Cash and cash equivalents | $ 4,976,440 | $ 6,103,250 | ||
Restricted cash | 908,530 | 2,649,610 | ||
Cash Cash Equivalents And Restricted Cash | $ 5,884,970 | $ 8,752,860 | $ 5,322,080 | $ 5,651,437 |
ADVISORY SERVICES (Details)
ADVISORY SERVICES (Details) - USD ($) | 3 Months Ended | ||
Mar. 31, 2018 | Mar. 31, 2017 | Dec. 31, 2017 | |
Advisory Services [Line Items] | |||
Management Fee Revenue | $ 2,093,465 | $ 1,670,001 | |
Orchid Island Capital [Member] | |||
Advisory Services [Line Items] | |||
Management Fee Revenue | 2,093,000 | 1,670,000 | |
Due From Affiliate | 800,000 | $ 800,000 | |
Orchid Island Capital [Member] | Management Fees [Member] | |||
Advisory Services [Line Items] | |||
Management Fee Revenue | 1,712,000 | 1,302,000 | |
Orchid Island Capital [Member] | Overhead Allocation [Member] | |||
Advisory Services [Line Items] | |||
Management Fee Revenue | $ 381,000 | $ 368,000 |
MORTGAGE-BACKED SECURITIES - M
MORTGAGE-BACKED SECURITIES - MBS Portfolio (Details) - USD ($) | Mar. 31, 2018 | Dec. 31, 2017 |
Schedule of Trading Securities and Other Trading Assets [Line Items] | ||
Fair Value | $ 204,828,946 | $ 209,692,132 |
Residential Mortgage Backed Securities [Member] | ||
Schedule of Trading Securities and Other Trading Assets [Line Items] | ||
Fair Value | 204,828,946 | 209,692,132 |
Residential Mortgage Backed Securities [Member] | Total Pass Through Certificates [Member] | ||
Schedule of Trading Securities and Other Trading Assets [Line Items] | ||
Fair Value | 202,393,000 | 207,179,000 |
Residential Mortgage Backed Securities [Member] | Total Pass Through Certificates [Member] | Fixed Rate Mortgages [Member] | ||
Schedule of Trading Securities and Other Trading Assets [Line Items] | ||
Fair Value | 202,393,000 | 207,179,000 |
Residential Mortgage Backed Securities [Member] | Total Strucutured MBS Certificates [Member] | ||
Schedule of Trading Securities and Other Trading Assets [Line Items] | ||
Fair Value | 2,436,000 | 2,513,000 |
Residential Mortgage Backed Securities [Member] | Total Strucutured MBS Certificates [Member] | Interest Only Securities [Member] | ||
Schedule of Trading Securities and Other Trading Assets [Line Items] | ||
Fair Value | 1,525,000 | 1,476,000 |
Residential Mortgage Backed Securities [Member] | Total Strucutured MBS Certificates [Member] | Inverse Interest Only [Member] | ||
Schedule of Trading Securities and Other Trading Assets [Line Items] | ||
Fair Value | $ 911,000 | $ 1,037,000 |
MORTGAGE-BACKED SECURITIES -43
MORTGAGE-BACKED SECURITIES - MBS Portfolio By Contractual Maturities (Details) - USD ($) | Mar. 31, 2018 | Dec. 31, 2017 |
Mortgage Backed Securities [Abstract] | ||
Total mortgage-backed securities | $ 204,828,946 | $ 209,692,132 |
RETAINED INTERESTS IN SECURIT44
RETAINED INTERESTS IN SECURITIZATIONS (Details) - USD ($) | Mar. 31, 2018 | Dec. 31, 2017 |
Retained Interestes Securitzations [Line Items] | ||
Transferor's Interests in Transferred Financial Assets, Fair Value | $ 271,738 | $ 653,380 |
HMAC 2004-3 [Member] | ||
Retained Interestes Securitzations [Line Items] | ||
Transferor's Interests in Transferred Financial Assets, Fair Value | 3,000 | 177,000 |
HMAC 2004-4 [Member] | ||
Retained Interestes Securitzations [Line Items] | ||
Transferor's Interests in Transferred Financial Assets, Fair Value | 235,000 | 386,000 |
HMAC 2004-5 [Member] | ||
Retained Interestes Securitzations [Line Items] | ||
Transferor's Interests in Transferred Financial Assets, Fair Value | $ 34,000 | $ 90,000 |
REPURCHASE AGREEMENTS - Narrati
REPURCHASE AGREEMENTS - Narrative (Details) - USD ($) | Mar. 31, 2018 | Dec. 31, 2017 |
Assets Sold under Agreements to Repurchase [Line Items] | ||
Outstanding repurchase obligations | $ 193,819,649 | $ 200,182,751 |
Fair Value of securities pledged, including accrued interest receivable | $ 205,463,000 | $ 209,999,000 |
Net weighted average borrowing rate | 1.94% | 1.52% |
Aggregate amount at risk will all counterparties | $ 11,800,000 | $ 11,700,000 |
REPURCHASE AGREEMENTS - Maturit
REPURCHASE AGREEMENTS - Maturities (Details) - USD ($) | Mar. 31, 2018 | Dec. 31, 2017 |
Assets Sold under Agreements to Repurchase [Line Items] | ||
Fair Value of securities pledged, including accrued interest receivable | $ 205,463,000 | $ 209,999,000 |
Outstanding repurchase obligations | $ 193,819,649 | $ 200,182,751 |
Net weighted average borrowing rate | 1.94% | 1.52% |
Overnight (1 Day or Less) [Member] | ||
Assets Sold under Agreements to Repurchase [Line Items] | ||
Fair Value of securities pledged, including accrued interest receivable | $ 0 | $ 0 |
Outstanding repurchase obligations | $ 0 | $ 0 |
Net weighted average borrowing rate | 0.00% | 0.00% |
Between 2 and 30 Days [Member] | ||
Assets Sold under Agreements to Repurchase [Line Items] | ||
Fair Value of securities pledged, including accrued interest receivable | $ 159,408,000 | $ 94,649,000 |
Outstanding repurchase obligations | $ 150,261,000 | $ 90,686,000 |
Net weighted average borrowing rate | 1.96% | 1.47% |
Between 31 and 90 Days [Member] | ||
Assets Sold under Agreements to Repurchase [Line Items] | ||
Fair Value of securities pledged, including accrued interest receivable | $ 46,055,000 | $ 115,350,000 |
Outstanding repurchase obligations | $ 43,559,000 | $ 109,497,000 |
Net weighted average borrowing rate | 1.88% | 1.56% |
Greater Than 90 days [Member] | ||
Assets Sold under Agreements to Repurchase [Line Items] | ||
Fair Value of securities pledged, including accrued interest receivable | $ 0 | $ 0 |
Outstanding repurchase obligations | $ 0 | $ 0 |
Net weighted average borrowing rate | 0.00% | 0.00% |
DERIVATIVE FINANCIAL INSTRUME47
DERIVATIVE FINANCIAL INSTRUMENTS - Schedule of Derivative Assets and Liabilties (Details) - USD ($) | Mar. 31, 2018 | Dec. 31, 2017 |
Derivitive Financial Instruments [Line Items] | ||
Restricted Cash And Cash Equivalents At Carrying Value | $ 908,530 | $ 2,649,610 |
NotDesignatedAsHedgingInstrumentEconomicHedgeMember | ||
Derivitive Financial Instruments [Line Items] | ||
Derivative Asset Fair Value Gross Liability | 523,000 | 0 |
Restricted Cash And Cash Equivalents At Carrying Value | 842,000 | 442,000 |
TBA Contracts [Member] | NotDesignatedAsHedgingInstrumentEconomicHedgeMember | ||
Derivitive Financial Instruments [Line Items] | ||
Derivative Asset Fair Value Gross Liability | 523,000 | 0 |
Restricted Cash And Cash Equivalents At Carrying Value | 281,000 | 0 |
Eurodollar Future Margin [Member] | NotDesignatedAsHedgingInstrumentEconomicHedgeMember | ||
Derivitive Financial Instruments [Line Items] | ||
Restricted Cash And Cash Equivalents At Carrying Value | $ 561,000 | $ 442,000 |
DERIVATIVE FINANCIAL INSTRUME48
DERIVATIVE FINANCIAL INSTRUMENTS - Eurodollar Futures Positions (Details) - Short [Member] - Eurodollar Future [Member] - USD ($) | Mar. 31, 2018 | Dec. 31, 2017 |
Junior Subordinated Debt Funding Hedges [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Notional Amount | $ 26,000,000 | $ 26,000,000 |
Entry Rate | 1.89% | 1.91% |
Weighted Average Effective Rate | 2.70% | 2.25% |
Open Equity | $ 796,000 | $ 357,000 |
Junior Subordinated Debt Funding Hedges [Member] | Year 2018 Expiration [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Notional Amount | $ 26,000,000 | $ 26,000,000 |
Entry Rate | 1.71% | 1.84% |
Weighted Average Effective Rate | 2.39% | 1.97% |
Open Equity | $ 133,000 | $ 33,000 |
Junior Subordinated Debt Funding Hedges [Member] | Year 2019 Expiration [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Notional Amount | $ 26,000,000 | $ 26,000,000 |
Entry Rate | 1.63% | 1.63% |
Weighted Average Effective Rate | 2.69% | 2.27% |
Open Equity | $ 276,000 | $ 166,000 |
Junior Subordinated Debt Funding Hedges [Member] | Year 2020 Expiration [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Notional Amount | $ 26,000,000 | $ 26,000,000 |
Entry Rate | 1.95% | 1.95% |
Weighted Average Effective Rate | 2.81% | 2.36% |
Open Equity | $ 225,000 | $ 107,000 |
Junior Subordinated Debt Funding Hedges [Member] | Year 2021 Expiration [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Notional Amount | $ 26,000,000 | $ 26,000,000 |
Entry Rate | 2.22% | 2.22% |
Weighted Average Effective Rate | 2.84% | 2.42% |
Open Equity | $ 162,000 | $ 51,000 |
Repurchase Agreement Funding Hedges [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Notional Amount | $ 94,667,000 | $ 60,000,000 |
Entry Rate | 2.53% | 2.41% |
Weighted Average Effective Rate | 2.72% | 2.25% |
Open Equity | $ 695,000 | $ (365,000) |
Repurchase Agreement Funding Hedges [Member] | Year 2018 Expiration [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Notional Amount | $ 73,333,000 | $ 60,000,000 |
Entry Rate | 2.03% | 1.90% |
Weighted Average Effective Rate | 2.41% | 1.97% |
Open Equity | $ 206,000 | $ 41,000 |
Repurchase Agreement Funding Hedges [Member] | Year 2019 Expiration [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Notional Amount | $ 100,000,000 | $ 60,000,000 |
Entry Rate | 2.41% | 2.32% |
Weighted Average Effective Rate | 2.69% | 2.27% |
Open Equity | $ 284,000 | $ (31,000) |
Repurchase Agreement Funding Hedges [Member] | Year 2020 Expiration [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Notional Amount | $ 100,000,000 | $ 60,000,000 |
Entry Rate | 2.64% | 2.60% |
Weighted Average Effective Rate | 2.81% | 2.36% |
Open Equity | $ 166,000 | $ (145,000) |
Repurchase Agreement Funding Hedges [Member] | Year 2021 Expiration [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Notional Amount | $ 100,000,000 | $ 60,000,000 |
Entry Rate | 2.80% | 2.80% |
Weighted Average Effective Rate | 2.84% | 2.42% |
Open Equity | $ 39,000 | $ (230,000) |
DERIVATIVE FINANCIAL INSTRUME49
DERIVATIVE FINANCIAL INSTRUMENTS - TBA positions (Details) - 30 Year [Member] - 3% [Member] - Short [Member] | Mar. 31, 2018USD ($) |
Derivatives, Fair Value [Line Items] | |
Notional Amount | $ (50,000,000) |
Cost Basis | 48,180,000 |
Market Value Of TBA Contract | 47,657,000 |
Derivative Asset Fair Value Gross Liability | $ (523,000) |
DERIVATIVE FINANCIAL INSTRUME50
DERIVATIVE FINANCIAL INSTRUMENTS - Effect on the consolidated statements of operations(Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Derivative Instruments, Gain (Loss) [Line Items] | ||
(Losses) gains on derivative instruments | $ 1,740,712 | $ 21,500 |
Eurodollar Future [Member] | Junior Subordinated Debt Funding Hedges [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
(Losses) gains on derivative instruments | 415,000 | 7,000 |
Eurodollar Future [Member] | Repurchase Agreement Funding Hedges [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
(Losses) gains on derivative instruments | 1,090,000 | 15,000 |
Treasury Note Future [Member] | Repurchase Agreement Funding Hedges [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
(Losses) gains on derivative instruments | 759,000 | 0 |
TBA Contracts [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
(Losses) gains on derivative instruments | $ (523,000) | $ 0 |
PLEDGED ASSETS - Assets Pledged
PLEDGED ASSETS - Assets Pledged to Counterparties (Details) - USD ($) | Mar. 31, 2018 | Dec. 31, 2017 |
Financial Instruments Owned and Pledged as Collateral [Line Items] | ||
Financial Instruments, Owned and Pledged as Collateral, at Fair Value | $ 204,728,276 | $ 209,269,791 |
Accrued interest receivable | 739,221 | 746,121 |
Restricted cash | 908,530 | 2,649,610 |
Repurchase Agreements [Member] | ||
Financial Instruments Owned and Pledged as Collateral [Line Items] | ||
Accrued interest receivable | 735,000 | 730,000 |
Restricted cash | 67,000 | 2,208,000 |
Pledged Assets Total | 205,530,000 | 212,208,000 |
Derivative [Member] | ||
Financial Instruments Owned and Pledged as Collateral [Line Items] | ||
Accrued interest receivable | 0 | 0 |
Restricted cash | 842,000 | 442,000 |
Pledged Assets Total | 842,000 | 442,000 |
Total Pledged Financial Instruments [Member] | ||
Financial Instruments Owned and Pledged as Collateral [Line Items] | ||
Accrued interest receivable | 735,000 | 730,000 |
Restricted cash | 909,000 | 2,650,000 |
Pledged Assets Total | 206,372,000 | 212,650,000 |
Residential Mortgage Backed Securities [Member] | ||
Financial Instruments Owned and Pledged as Collateral [Line Items] | ||
Financial Instruments, Owned and Pledged as Collateral, at Fair Value | 204,728,276 | 209,269,791 |
Residential Mortgage Backed Securities [Member] | Repurchase Agreements [Member] | Mortgage Backed Securities Pass Through Certificates [Member] | ||
Financial Instruments Owned and Pledged as Collateral [Line Items] | ||
Financial Instruments, Owned and Pledged as Collateral, at Fair Value | 202,393,000 | 207,179,000 |
Residential Mortgage Backed Securities [Member] | Repurchase Agreements [Member] | Mortgage Backed Securities Structured Certificates [Member] | ||
Financial Instruments Owned and Pledged as Collateral [Line Items] | ||
Financial Instruments, Owned and Pledged as Collateral, at Fair Value | 2,335,000 | 2,091,000 |
Residential Mortgage Backed Securities [Member] | Derivative [Member] | Mortgage Backed Securities Pass Through Certificates [Member] | ||
Financial Instruments Owned and Pledged as Collateral [Line Items] | ||
Financial Instruments, Owned and Pledged as Collateral, at Fair Value | 0 | 0 |
Residential Mortgage Backed Securities [Member] | Derivative [Member] | Mortgage Backed Securities Structured Certificates [Member] | ||
Financial Instruments Owned and Pledged as Collateral [Line Items] | ||
Financial Instruments, Owned and Pledged as Collateral, at Fair Value | 0 | 0 |
Residential Mortgage Backed Securities [Member] | Total Pledged Financial Instruments [Member] | Mortgage Backed Securities Pass Through Certificates [Member] | ||
Financial Instruments Owned and Pledged as Collateral [Line Items] | ||
Financial Instruments, Owned and Pledged as Collateral, at Fair Value | 202,393,000 | 207,179,000 |
Residential Mortgage Backed Securities [Member] | Total Pledged Financial Instruments [Member] | Mortgage Backed Securities Structured Certificates [Member] | ||
Financial Instruments Owned and Pledged as Collateral [Line Items] | ||
Financial Instruments, Owned and Pledged as Collateral, at Fair Value | $ 2,335,000 | $ 2,091,000 |
PLEDGED ASSETS - Assets Pledg52
PLEDGED ASSETS - Assets Pledged from Counterparties (Details) - Repurchase Agreements [Member] - USD ($) | Mar. 31, 2018 | Dec. 31, 2017 |
Financial Instruments Owned and Pledged as Collateral [Line Items] | ||
Cash Pledged By Counterparties | $ 26,000 | $ 0 |
Residential Mortgage Backed Securities [Member] | Mortgage Backed Securities Pass Through Certificates [Member] | ||
Financial Instruments Owned and Pledged as Collateral [Line Items] | ||
Financial Instruments Pledged By Counterparties | $ 174,000 | $ 0 |
OFFSTTING ASSETS AND LIABILITIE
OFFSTTING ASSETS AND LIABILITIES - Offsetting of Liabilties (Details) - USD ($) | Mar. 31, 2018 | Dec. 31, 2017 |
Offsetting Liabilities [Line Items] | ||
Gross Amount Of Recognized Liabilties | $ 194,343,000 | |
Gross Amount Of Liabilties Offset In The Balance Sheet | 0 | |
Net Amount Of Liabilities Presented In The Balance Sheet | 194,343,000 | |
Gross Amount Of Financial Instruments Posted Not Offset in Balance Sheet | (193,753,000) | |
Gross Amounts Of Cash Posted Not Offset In Balance Sheet | 214,000 | |
Net Amount Of Liabilities | 804,000 | |
Repurchase Agreements [Member] | ||
Offsetting Liabilities [Line Items] | ||
Gross Amount Of Recognized Liabilties | 193,820,000 | $ 200,183,000 |
Gross Amount Of Liabilties Offset In The Balance Sheet | 0 | 0 |
Net Amount Of Liabilities Presented In The Balance Sheet | 193,820,000 | 200,183,000 |
Gross Amount Of Financial Instruments Posted Not Offset in Balance Sheet | (193,753,000) | (197,975,000) |
Gross Amounts Of Cash Posted Not Offset In Balance Sheet | (67,000) | (2,208,000) |
Net Amount Of Liabilities | 0 | $ 0 |
TBA Contracts [Member] | ||
Offsetting Liabilities [Line Items] | ||
Gross Amount Of Recognized Liabilties | 523,000 | |
Gross Amount Of Liabilties Offset In The Balance Sheet | 0 | |
Net Amount Of Liabilities Presented In The Balance Sheet | 523,000 | |
Gross Amount Of Financial Instruments Posted Not Offset in Balance Sheet | 0 | |
Gross Amounts Of Cash Posted Not Offset In Balance Sheet | 281,000 | |
Net Amount Of Liabilities | $ 804,000 |
TRUST PREFERRED SECURITIES - Na
TRUST PREFERRED SECURITIES - Narrative (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2018 | Dec. 31, 2017 | |
Debt Instrument [Line Items] | ||
Outstanding Principal Balance | $ 26,804,440 | $ 26,804,440 |
Junior Subordinated Debt [Member] | Bimini Capital Trust II Junior Subordinated Note [Member] | Three Month Libor [Member] | ||
Debt Instrument [Line Items] | ||
Outstanding Principal Balance | $ 26,800,000 | $ 26,800,000 |
Basis Spread on Variable Rate | 3.50% | |
Interest Rate at Period End | 5.62% |
CAPITAL STOCK - Issuances of Co
CAPITAL STOCK - Issuances of Common Stock (Details) - shares | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Class A Common Stock [Member] | ||
Class of Stock [Line Items] | ||
Shares Sold to Employees | 83,332 | 0 |
Total Shares Issued During Period | 83,332 | 0 |
Class B Common Stock [Member] | ||
Class of Stock [Line Items] | ||
Total Shares Issued During Period | 0 | 0 |
Class C Common Stock [Member] | ||
Class of Stock [Line Items] | ||
Total Shares Issued During Period | 0 | 0 |
CAPITAL STOCK - Stock Repurchas
CAPITAL STOCK - Stock Repurchase Plan (Details) - Class A Common Stock [Member] - March 2018 Stock Repurchase Plan [Member] | 3 Months Ended |
Mar. 31, 2018USD ($)$ / sharesshares | |
Share Repurchase Program [Line Items] | |
Authorized Shares | 500,000 |
Stock Repurchase Program Expiration Date | Nov. 15, 2018 |
Aggregate Repurchase Cost | $ | $ 0 |
Shares Acquired | 0 |
Average Cost Per Share | $ / shares | $ 0 |
Subsequent Event Member | |
Share Repurchase Program [Line Items] | |
Aggregate Repurchase Cost | $ | $ 26,000 |
Shares Acquired | 11,900 |
Average Cost Per Share | $ / shares | $ 2.2 |
STOCK INCENTIVE PLAN - Descript
STOCK INCENTIVE PLAN - Descriptions of Plan (Details) | Mar. 31, 2018shares |
Employee Benefits And Share Based Compensation [Abstract] | |
Maximum Number of Shares to Be Issued the Plan | 4,000,000 |
STOCK INCENTIVE PLAN - Incentiv
STOCK INCENTIVE PLAN - Incentive Share Awards (Details) - Performance Units Member [Member] - USD ($) | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Stock Incentive Plan Compensation Expense | $ 3,000 | $ 7,000 |
Unrecognized Compensation Cost | $ 8,000 | $ 32,000 |
Remaining Weighted Average Vesting Period | 8 months 10 days | 1 year 3 months 12 days |
Sharebased Compensation Arrangement By Sharebased Payment Award Equity Instruments Other Than Options, Aggregate Intrinsic Value Nonvested | $ 96,000 | $ 186,000 |
STOCK INCENTIVE PLAN - Incent59
STOCK INCENTIVE PLAN - Incentive Share Activity (Details) - Performance Units Member [Member] - $ / shares | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Incentive Share Activity, Shares | ||
Nonvested - Beginning Balance | 41,000 | 70,000 |
Granted | 0 | 0 |
Forfeited | 0 | 0 |
Vested | 0 | 0 |
Nonvested - Ending Balance | 41,000 | 70,000 |
Incentive Share Activity Weighted Average Grant Date Fair Value | ||
Nonvested - Beginning Balance | $ 0.84 | $ 1.23 |
Granted | 0 | 0 |
Forfeited | 0 | 0 |
Vested | 0 | 0 |
Nonvested - Ending Balance | $ 0.84 | $ 1.23 |
INCOME TAXES - Narrative (Detai
INCOME TAXES - Narrative (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Income Tax Disclosure [Abstract] | ||
Income Loss From Continuing Operations Before Income Taxes Minority Interest And Income Loss From Equity Method Investments | $ (4,365,056) | $ (345,933) |
Income Tax Expense Benefit | $ (1,091,290) | $ (131,716) |
EARNINGS PER SHARE (Details)
EARNINGS PER SHARE (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Class A Common Stock [Member] | ||
Net Income (Loss) Available to Common Stockholders, Diluted [Abstract] | ||
Net Income (Loss) Available to Common Stockholders, Basic | $ (3,266,000) | $ (213,000) |
Net Income (Loss) Available to Common Stockholders, Diluted | $ (3,266,000) | $ (213,000) |
Weighted Average Number of Shares Outstanding, Diluted [Abstract] | ||
Common Shares Outstanding | 12,744,000 | 12,632,000 |
Unvested Dividend Eligible Shares Outstanding at the Balance Sheet Date | 0 | 0 |
Effect of Weighting | (14,000) | 0 |
Weighted Average Shares - Basic and Diluted | 12,730,070 | 12,631,627 |
Income (Loss) Per Share - Basic | $ (0.26) | $ (0.02) |
Income (Loss) Pe Share - Diluted | $ (0.26) | $ (0.02) |
Class B Common Stock [Member] | ||
Net Income (Loss) Available to Common Stockholders, Diluted [Abstract] | ||
Net Income (Loss) Available to Common Stockholders, Basic | $ (8,000) | $ (1,000) |
Net Income (Loss) Available to Common Stockholders, Diluted | $ (8,000) | $ (1,000) |
Weighted Average Number of Shares Outstanding, Diluted [Abstract] | ||
Common Shares Outstanding | 32,000 | 32,000 |
Weighted Average Shares - Basic and Diluted | 31,938 | 31,938 |
Income (Loss) Per Share - Basic | $ (0.26) | $ (0.02) |
Income (Loss) Pe Share - Diluted | $ (0.26) | $ (0.02) |
FAIR VALUE - Assets and Liabili
FAIR VALUE - Assets and Liabilities Recorded at Fair Value on Recurring Basis (Details) - USD ($) | Mar. 31, 2018 | Dec. 31, 2017 | Mar. 31, 2017 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Mortgage-backed securities | $ 204,828,946 | $ 209,692,132 | |
Orchid Island Capital, Inc. common stock, at fair value | 11,202,665 | 14,105,934 | |
Fair Value Assets Transfers Amount | 0 | $ 0 | |
Estimate of Fair Value, Fair Value Disclosure [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Mortgage-backed securities | 204,829,000 | 209,692,000 | |
Retained Interests | 11,203,000 | 14,106,000 | |
Orchid Island Capital, Inc. common stock, at fair value | 272,000 | 653,000 | |
TBA Contracts | (523,000) | ||
Fair Value, Inputs, Level 1 [Member] | Estimate of Fair Value, Fair Value Disclosure [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Mortgage-backed securities | 0 | 0 | |
Retained Interests | 11,203,000 | 14,106,000 | |
Orchid Island Capital, Inc. common stock, at fair value | 0 | 0 | |
TBA Contracts | 0 | ||
Fair Value, Inputs, Level 2 [Member] | Estimate of Fair Value, Fair Value Disclosure [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Mortgage-backed securities | 204,829,000 | 209,692,000 | |
Retained Interests | 0 | 0 | |
Orchid Island Capital, Inc. common stock, at fair value | 0 | 0 | |
TBA Contracts | (523,000) | ||
Fair Value, Inputs, Level 3 [Member] | Estimate of Fair Value, Fair Value Disclosure [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Mortgage-backed securities | 0 | 0 | |
Retained Interests | 0 | 0 | |
Orchid Island Capital, Inc. common stock, at fair value | 272,000 | $ 653,000 | |
TBA Contracts | $ 0 |
FAIR VALUE - Changes in Level 3
FAIR VALUE - Changes in Level 3 Assets Measured at Fair Value on a Recurring Basis (Details) - Retained Interest [Member] - USD ($) | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||
Beginning Balance | $ 653,000 | $ 1,114,000 |
Gain (loss) Included in Earnings | (83,000) | (194,000) |
Collections | 298,000 | 419,000 |
Ending Balance | $ 272,000 | $ 501,000 |
FAIR VALUE - Quantitative Infor
FAIR VALUE - Quantitative Information About Level 3 Fair Value Measurements - Prepayment Assumptions (Details) - Retained Interest [Member] | 3 Months Ended |
Mar. 31, 2018 | |
Maximum [Member] | |
Fair Value Inputs, Assets, Quantitative Information [Line Items] | |
Prepayment Range | 10.00% |
Minimum [Member] | |
Fair Value Inputs, Assets, Quantitative Information [Line Items] | |
Prepayment Range | 10.00% |
Weighted Average [Member] | |
Fair Value Inputs, Assets, Quantitative Information [Line Items] | |
Prepayment Range | 10.00% |
FAIR VALUE - Quantitative Inf65
FAIR VALUE - Quantitative Information About Level 3 Fair Value Measurements - Default Assumptions (Details) - Retained Interest [Member] | 3 Months Ended |
Mar. 31, 2018 | |
Real Estate Owned [Member] | |
Fair Value Inputs, Assets, Quantitative Information [Line Items] | |
Probability of Default | 100.00% |
Range Of Loss Timining | Next 10 Months |
Real Estate Owned [Member] | Weighted Average [Member] | |
Fair Value Inputs, Assets, Quantitative Information [Line Items] | |
Loss Severity Range | 30.30% |
Loans In Foreclosure [Member] | |
Fair Value Inputs, Assets, Quantitative Information [Line Items] | |
Probability of Default | 100.00% |
Range Of Loss Timining | Month 4 - 13 |
Loans In Foreclosure [Member] | Weighted Average [Member] | |
Fair Value Inputs, Assets, Quantitative Information [Line Items] | |
Loss Severity Range | 30.30% |
Loans 90 Days Delinquent [Member] | |
Fair Value Inputs, Assets, Quantitative Information [Line Items] | |
Probability of Default | 100.00% |
Range Of Loss Timining | Month 11-28 |
Loans 90 Days Delinquent [Member] | Weighted Average [Member] | |
Fair Value Inputs, Assets, Quantitative Information [Line Items] | |
Loss Severity Range | 45.00% |
Loans 60 Days Delinquent [Member] | |
Fair Value Inputs, Assets, Quantitative Information [Line Items] | |
Probability of Default | 85.00% |
Range Of Loss Timining | Month 11-28 |
Loans 60 Days Delinquent [Member] | Weighted Average [Member] | |
Fair Value Inputs, Assets, Quantitative Information [Line Items] | |
Loss Severity Range | 45.00% |
Loans 30 Days Delinquent [Member] | |
Fair Value Inputs, Assets, Quantitative Information [Line Items] | |
Probability of Default | 75.00% |
Range Of Loss Timining | Month 11-28 |
Loans 30 Days Delinquent [Member] | Weighted Average [Member] | |
Fair Value Inputs, Assets, Quantitative Information [Line Items] | |
Loss Severity Range | 45.00% |
Current Loans [Member] | |
Fair Value Inputs, Assets, Quantitative Information [Line Items] | |
Probability of Default | 3.90% |
Range Of Loss Timining | Month 29 and Beyond |
Current Loans [Member] | Weighted Average [Member] | |
Fair Value Inputs, Assets, Quantitative Information [Line Items] | |
Loss Severity Range | 45.00% |
FAIR VALUE - Quantitative Inf66
FAIR VALUE - Quantitative Information About Level 3 Fair Value Measurements - Cash Flow Recognition (Details) | 3 Months Ended |
Mar. 31, 2018 | |
Nominal Cashflows [Member] | |
Fair Value Inputs, Assets, Quantitative Information [Line Items] | |
Fair Value Measurements Valuation Techniques | Discounted Cash Flow |
Discounted Cashflows [Member] | |
Fair Value Inputs, Assets, Quantitative Information [Line Items] | |
Fair Value Measurements Valuation Techniques | Discounted Cash Flow |
Maximum [Member] | Nominal Cashflows [Member] | |
Fair Value Inputs, Assets, Quantitative Information [Line Items] | |
Remaining Life Range | 16.5 |
Fair Value Inputs Discount Rate | 27.50% |
Maximum [Member] | Discounted Cashflows [Member] | |
Fair Value Inputs, Assets, Quantitative Information [Line Items] | |
Remaining Life Range | 16.2 |
Fair Value Inputs Discount Rate | 27.50% |
Minimum [Member] | Nominal Cashflows [Member] | |
Fair Value Inputs, Assets, Quantitative Information [Line Items] | |
Remaining Life Range | 11.9 |
Fair Value Inputs Discount Rate | 27.50% |
Minimum [Member] | Discounted Cashflows [Member] | |
Fair Value Inputs, Assets, Quantitative Information [Line Items] | |
Remaining Life Range | 0.8 |
Fair Value Inputs Discount Rate | 27.50% |
Weighted Average [Member] | Nominal Cashflows [Member] | |
Fair Value Inputs, Assets, Quantitative Information [Line Items] | |
Remaining Life Range | 12.3 |
Fair Value Inputs Discount Rate | 27.50% |
Weighted Average [Member] | Discounted Cashflows [Member] | |
Fair Value Inputs, Assets, Quantitative Information [Line Items] | |
Remaining Life Range | 2.6 |
Fair Value Inputs Discount Rate | 27.50% |
SEGMENT INFORMATION - Reconcili
SEGMENT INFORMATION - Reconciliation of Segment Revenues (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Segment Reporting, Revenue Reconciling Item [Line Items] | ||
Advisory services, external customers | $ 2,093,465 | $ 1,670,001 |
Advisory Services Other Segments | 0 | 0 |
Interest and dividend income | 2,551,000 | 1,896,000 |
Interest expense | 1,146,000 | 575,000 |
Net revenues | 3,498,000 | 2,991,000 |
Other Income | (6,124,000) | (1,737,000) |
Operating Expenses | 1,739,000 | 1,599,000 |
Intercompany Expenses | 0 | 0 |
Net (loss) income before income tax provision (benefit) | (4,365,056) | (345,933) |
Operating Segments [Member] | Asset Management Segment [Member] | ||
Segment Reporting, Revenue Reconciling Item [Line Items] | ||
Advisory services, external customers | 2,093,000 | 1,670,000 |
Advisory Services Other Segments | 58,000 | 50,000 |
Interest and dividend income | 0 | 0 |
Interest expense | 0 | 0 |
Net revenues | 2,151,000 | 1,720,000 |
Other Income | 0 | 0 |
Operating Expenses | 761,000 | 747,000 |
Intercompany Expenses | 0 | 0 |
Net (loss) income before income tax provision (benefit) | 1,390,000 | 973,000 |
Operating Segments [Member] | Investment Portfolio Segment [Member] | ||
Segment Reporting, Revenue Reconciling Item [Line Items] | ||
Advisory services, external customers | 0 | 0 |
Advisory Services Other Segments | 0 | 0 |
Interest and dividend income | 2,551,000 | 1,896,000 |
Interest expense | 809,000 | 283,000 |
Net revenues | 1,742,000 | 1,613,000 |
Other Income | (6,457,000) | (1,550,000) |
Operating Expenses | 978,000 | 852,000 |
Intercompany Expenses | 58,000 | 50,000 |
Net (loss) income before income tax provision (benefit) | (5,751,000) | (839,000) |
Corporate, Non-Segment [Member] | ||
Segment Reporting, Revenue Reconciling Item [Line Items] | ||
Advisory services, external customers | 0 | 0 |
Advisory Services Other Segments | 0 | 0 |
Interest and dividend income | 0 | 0 |
Interest expense | 337,000 | 292,000 |
Net revenues | (337,000) | (292,000) |
Other Income | 333,000 | (187,000) |
Operating Expenses | 0 | 0 |
Intercompany Expenses | 0 | 0 |
Net (loss) income before income tax provision (benefit) | (4,000) | (479,000) |
Intersegment Eliminations [Member] | ||
Segment Reporting, Revenue Reconciling Item [Line Items] | ||
Advisory services, external customers | 0 | 0 |
Advisory Services Other Segments | (58,000) | (50,000) |
Interest and dividend income | 0 | 0 |
Interest expense | 0 | 0 |
Net revenues | (58,000) | (50,000) |
Other Income | 0 | 0 |
Operating Expenses | 0 | 0 |
Intercompany Expenses | (58,000) | (50,000) |
Net (loss) income before income tax provision (benefit) | $ 0 | $ 0 |
SEGMENT INFORMATION - Reconci68
SEGMENT INFORMATION - Reconciliation of Segment Assets (Details) - USD ($) | Mar. 31, 2018 | Dec. 31, 2017 | Mar. 31, 2017 |
Segment Reporting, Asset Reconciling Item [Line Items] | |||
Assets | $ 274,969,055 | $ 284,588,797 | $ 218,023,000 |
Operating Segments [Member] | Asset Management Segment [Member] | |||
Segment Reporting, Asset Reconciling Item [Line Items] | |||
Assets | 1,761,000 | 1,632,000 | 2,249,000 |
Operating Segments [Member] | Investment Portfolio Segment [Member] | |||
Segment Reporting, Asset Reconciling Item [Line Items] | |||
Assets | 258,286,000 | 267,429,000 | 195,915,000 |
Corporate, Non-Segment [Member] | |||
Segment Reporting, Asset Reconciling Item [Line Items] | |||
Assets | $ 14,922,000 | $ 15,528,000 | $ 19,859,000 |
SEGMENT INFORMATION - Revenue F
SEGMENT INFORMATION - Revenue From Major Customer (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Entity Wide Revenue Major Customer [LineItems] | ||
Revenues | $ 4,644,942 | $ 3,566,092 |
Total Revenue [Member] | Orchid Island Capital [Member] | ||
Entity Wide Revenue Major Customer [LineItems] | ||
Revenues | $ 2,093,000 | $ 1,670,000 |
Percentgage of Total Sales | 45.00% | 47.00% |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details) - USD ($) | 3 Months Ended | ||
Mar. 31, 2018 | Mar. 31, 2017 | Dec. 31, 2017 | |
Related Party Transaction [Line Items] | |||
Investment Income, Dividend | $ 471,211 | $ 603,415 | |
Orchid Island Capital [Member] | |||
Related Party Transaction [Line Items] | |||
Investment Owned Balance Shares | 1,520,036 | 1,520,036 | |
Equity Method Investment Ownership Percentage | 2.90% | 2.90% |