DOCUMENT AND ENTITY INFORMATION
DOCUMENT AND ENTITY INFORMATION - shares | 9 Months Ended | |
Sep. 30, 2020 | Nov. 06, 2020 | |
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Sep. 30, 2020 | |
Document Fiscal Year Focus | 2020 | |
Document Fiscal Period Focus | Q3 | |
Entity Registrant Name | Bimini Capital Management, Inc. | |
Entity Central Index Key | 0001275477 | |
Entity Current Reporting Status | Yes | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
EntityInteractiveDataCurrent | Yes | |
Class A Common Stock [Member] | ||
Entity Common Stock Shares Outstanding | 11,608,555 | |
Class B Common Stock [Member] | ||
Entity Common Stock Shares Outstanding | 31,938 | |
Class C Common Stock [Member] | ||
Entity Common Stock Shares Outstanding | 31,938 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) | Sep. 30, 2020 | Dec. 31, 2019 |
Mortgage Backed Securities At Fair Value [Abstract] | ||
Pledged to counterparties | $ 73,115,844 | $ 217,793,209 |
Unpledged | 28,685 | 47,744 |
Total mortgage-backed securities | 73,144,529 | 217,840,953 |
Cash and cash equivalents | 5,837,067 | 8,070,067 |
Restricted cash | 1,253,075 | 4,315,050 |
Orchid Island Capital, Inc. common stock, at fair value | 13,002,739 | 8,892,211 |
Accrued interest receivable | 234,431 | 750,875 |
Property and equipment, net | 2,110,752 | 2,162,975 |
Real Estate Held-for-sale | 450,000 | 450,000 |
Deferred tax assets, net | 24,003,192 | 33,288,536 |
Other assets | 2,127,592 | 3,718,281 |
Total Assets | 122,163,377 | 279,488,948 |
Liabilities | ||
Outstanding repurchase obligations | 70,685,172 | 209,954,000 |
Long-term Debt, Gross | 27,618,048 | 27,481,121 |
Accrued interest payable | 83,384 | 645,302 |
Other Liabilities | 1,346,817 | 1,431,534 |
Total Liabilities | 99,733,421 | 239,511,957 |
Stockholders' Equity | ||
Preferred stock | 0 | 0 |
Common stock | 11,673 | 11,673 |
Additional paid in capital | 332,642,758 | 332,642,758 |
Accumulated deficit | (310,224,475) | (292,677,440) |
Stockholders Equity | 22,429,956 | 39,976,991 |
Total Liabilities and Stockholders' Equity | 122,163,377 | 279,488,948 |
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 | 73,115,844 | 217,793,209 |
Unpledged | 28,685 | 47,744 |
Total mortgage-backed securities | $ 73,144,529 | $ 217,840,953 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parentheticals) - USD ($) | Sep. 30, 2020 | Dec. 31, 2019 |
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 Shares Outstanding | 11,672,431 | |
Common Stock Value Outstanding | $ 11,673 | $ 11,673 |
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 | 11,608,555 | 11,608,555 |
Common Stock Shares Outstanding | 11,608,555 | 11,608,555 |
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 |
Series A Preferred Stock [Member] | ||
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 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Revenues | ||||
Advisory services | $ 1,629,463 | $ 1,791,135 | $ 4,969,143 | $ 5,052,251 |
Interest income | 604,158 | 1,646,389 | 3,167,439 | 5,970,482 |
Orchid Island Capital, Inc. dividends | 493,118 | 364,809 | 1,246,636 | 1,094,426 |
Total revenues | 2,726,739 | 3,802,333 | 9,383,218 | 12,117,159 |
Interest expense on repurchase agreements | 42,955 | 1,001,781 | 1,030,372 | 3,654,675 |
Interest Expense, Long-term Debt | 261,341 | 389,543 | 893,299 | 1,195,690 |
Net revenues | 2,422,443 | 2,411,009 | 7,459,547 | 7,266,794 |
Other income: | ||||
Unrealized (losses) gains on mortgage-backed securities | 275,796 | 950,334 | 303,651 | 6,226,586 |
Realized gains on mortgage-backed securities | 0 | 23,078 | (5,804,656) | 23,078 |
Unrealized losses on Orchid Island Capital, Inc. common stock | 793,727 | (927,222) | 38,935 | (972,823) |
(Losses) gains on derivative instruments | 75 | (483,446) | (5,292,346) | (6,105,202) |
Gains on retained interests in securitizations | 58,735 | 39,869 | 58,735 | 314,984 |
Impairment of property and equipment | 0 | 673,438 | 0 | 673,438 |
Other expense, net | (8,890) | 32,029 | (8,248) | 32,523 |
Total other income | 1,119,443 | (1,038,796) | (10,703,929) | (1,154,292) |
Expenses | ||||
Compensation and related benefits | 1,010,407 | 987,024 | 3,157,074 | 3,074,650 |
Directors fees and liability insurance | 166,093 | 169,468 | 511,786 | 490,775 |
Audit, legal and other professional fees | 120,374 | 96,996 | 467,015 | 381,024 |
Administrative and other expenses | 318,874 | 352,896 | 870,919 | 878,924 |
Total expenses | 1,615,748 | 1,606,384 | 5,006,794 | 4,825,373 |
Net (loss) income before income tax provision (benefit) | 1,926,138 | (234,171) | (8,251,176) | 1,287,129 |
Income tax provision (benefit) | 608,351 | 537,945 | 9,295,859 | 942,364 |
Net (loss) income | $ 1,317,787 | $ (772,116) | $ (17,547,035) | $ 344,765 |
Class B Common Stock [Member] | ||||
Basic and Diluted Net (Loss) Income Per Share of: | ||||
Basic | $ 0.11 | $ (0.07) | $ (1.51) | $ 0.03 |
Diluted | $ 0.11 | $ (0.07) | $ (1.51) | $ 0.03 |
Weighted Average Shares Outstanding | ||||
Weighted Average Shares - Basic and Diluted | 31,938 | 31,938 | 31,938 | 31,938 |
CONSOLIDATED STATEMENT OF STOCK
CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY - USD ($) | Total | Common Stock [Member] | Common Stock [Member] | Additional Paid In Capital [Member] | Retained Earnings [Member] |
Beginning Balances at Dec. 31, 2018 | $ 28,954,621 | $ 12,773 | $ 334,919,265 | $ (305,977,417) | |
Increase (Decrease) in Stockholders' Equity | |||||
Net income | 1,618,603 | 0 | 0 | 1,618,603 | |
Stock Repurchased And Retired During Period Value | (1,542) | 0 | (1,542) | 0 | |
Ending Balances at Mar. 31, 2019 | 30,571,682 | 12,773 | 334,917,723 | (304,358,814) | |
Common Stock Shares Outstanding, Beginning Balance at Dec. 31, 2018 | 12,773,145 | ||||
Increase (Decrease) in Stockholders' Equity | |||||
Stock Repurchased and Retired During Period, Shares | 714 | ||||
Common Stock Shares Outstanding, Ending Balance at Mar. 31, 2019 | 12,772,431 | ||||
Beginning Balances at Dec. 31, 2018 | 28,954,621 | 12,773 | 334,919,265 | (305,977,417) | |
Increase (Decrease) in Stockholders' Equity | |||||
Net income | 344,765 | ||||
Ending Balances at Sep. 30, 2019 | 27,021,779 | 11,673 | 332,642,758 | (305,632,652) | |
Common Stock Shares Outstanding, Beginning Balance at Dec. 31, 2018 | 12,773,145 | ||||
Common Stock Shares Outstanding, Ending Balance at Sep. 30, 2019 | 11,672,431 | ||||
Beginning Balances at Mar. 31, 2019 | 30,571,682 | 12,773 | 334,917,723 | (304,358,814) | |
Increase (Decrease) in Stockholders' Equity | |||||
Net income | (501,722) | 0 | 0 | (501,722) | |
Ending Balances at Jun. 30, 2019 | 30,069,960 | 12,773 | 334,917,723 | (304,860,536) | |
Common Stock Shares Outstanding, Beginning Balance at Mar. 31, 2019 | 12,772,431 | ||||
Common Stock Shares Outstanding, Ending Balance at Jun. 30, 2019 | 12,772,431 | ||||
Increase (Decrease) in Stockholders' Equity | |||||
Net income | (772,116) | 0 | 0 | (772,116) | |
Stock Repurchased And Retired During Period Value | (2,276,065) | (1,100) | (2,274,965) | 0 | |
Ending Balances at Sep. 30, 2019 | 27,021,779 | 11,673 | 332,642,758 | (305,632,652) | |
Increase (Decrease) in Stockholders' Equity | |||||
Stock Repurchased and Retired During Period, Shares | 1,100,000 | ||||
Common Stock Shares Outstanding, Ending Balance at Sep. 30, 2019 | 11,672,431 | ||||
Beginning Balances at Dec. 31, 2019 | 39,976,991 | 11,673 | 332,642,758 | (292,677,440) | |
Increase (Decrease) in Stockholders' Equity | |||||
Net income | (22,332,947) | 0 | 0 | (22,332,947) | |
Ending Balances at Mar. 31, 2020 | 17,644,044 | 11,673 | 332,642,758 | (315,010,387) | |
Common Stock Shares Outstanding, Beginning Balance at Dec. 31, 2019 | 11,672,431 | ||||
Common Stock Shares Outstanding, Ending Balance at Mar. 31, 2020 | 11,672,431 | ||||
Beginning Balances at Dec. 31, 2019 | 39,976,991 | 11,673 | 332,642,758 | (292,677,440) | |
Increase (Decrease) in Stockholders' Equity | |||||
Net income | $ (17,547,035) | ||||
Ending Balances at Sep. 30, 2020 | 11,673 | 332,642,758 | (310,224,475) | ||
Common Stock Shares Outstanding, Beginning Balance at Dec. 31, 2019 | 11,672,431 | ||||
Common Stock Shares Outstanding, Ending Balance at Sep. 30, 2020 | 11,672,431 | 11,672,431 | |||
Beginning Balances at Mar. 31, 2020 | $ 17,644,044 | 11,673 | 332,642,758 | (315,010,387) | |
Increase (Decrease) in Stockholders' Equity | |||||
Net income | 3,468,125 | 0 | 0 | 3,468,125 | |
Ending Balances at Jun. 30, 2020 | 21,112,169 | 11,673 | 332,642,758 | (311,542,262) | |
Common Stock Shares Outstanding, Beginning Balance at Mar. 31, 2020 | 11,672,431 | ||||
Increase (Decrease) in Stockholders' Equity | |||||
Net income | $ 1,317,787 | 0 | 0 | 1,317,787 | |
Ending Balances at Sep. 30, 2020 | $ 11,673 | $ 332,642,758 | $ (310,224,475) | ||
Common Stock Shares Outstanding, Ending Balance at Sep. 30, 2020 | 11,672,431 | 11,672,431 |
CONSOLIDATED STATEMENT OF CASH
CONSOLIDATED STATEMENT OF CASH FLOWS - USD ($) | 9 Months Ended | |
Sep. 30, 2020 | Sep. 30, 2019 | |
CASH FLOWS FROM OPERATING ACTIVITIES | ||
Net (loss) income | $ (17,547,035) | $ 344,765 |
Adjustments to reconcile net (loss) income to net cash provided by (used in) operating activities: | ||
Depreciation | 52,223 | 54,886 |
Deferred income tax provision (benefit) | 9,285,344 | 1,136,975 |
Losses (gains) on mortgage-backed securities | 5,501,005 | (6,249,664) |
Gains on retained interests in securitizations | (58,735) | (314,984) |
Unrealized losses on Orchid Island Capital, Inc. common stock | 38,935 | (972,823) |
Realized and unrealized losses on TBA securities | (1,441,406) | (2,005,175) |
Impairment of Real Estate | 0 | 673,438 |
Changes in operating assets and liabilities | ||
Accrued interest receivable | 516,444 | 194,552 |
Other assets | 1,590,689 | (158,981) |
Accrued interest payable | (561,918) | (365,887) |
Other liabilities | (26,123) | (315,920) |
NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES | 154,365 | (2,022,822) |
From mortgage-backed securities investments | ||
Purchases | (43,129,835) | (3,285,372) |
Sales | 171,155,249 | 43,975,274 |
Principal repayments | 11,170,005 | 14,756,931 |
Proceeds From Termination of Retained Interests | 58,735 | 314,984 |
Net setlement of forward settling TBA contracts | 1,500,000 | 2,889,941 |
Purchases of Orchid Island Capital, Inc. common stock | 4,071,593 | 0 |
NET CASH PROVIDED BY (USED IN) INVESTING ACTIVITIES | 133,682,561 | 52,871,876 |
CASH FLOWS FROM FINANCING ACTIVITIES | ||
Proceeds from repurchase agreements | 501,460,570 | 860,182,000 |
Principal payments on repurchase agreements | (640,729,398) | (906,103,000) |
Proceeds from Issuance of Long-term Debt | 136,927 | 0 |
Payments For Repurchase Of Common Stock | 0 | 2,277,607 |
NET CASH (USED IN) PROVIDED BY FINANCING ACTIVITIES | (139,131,901) | (48,198,607) |
NET INCREASE IN CASH, CASH EQUIVALENTS AND RESTRICTED CASH | (5,294,975) | 2,650,447 |
CASH, CASH EQUIVALENTS AND RESTRICTED CASH, beginning of period | 12,385,117 | 6,240,488 |
CASH, CASH EQUIVALENTS AND RESTRICTED CASH, end of period | 7,090,142 | 8,890,935 |
Cash paid during the period for: | ||
Interest | 2,485,589 | 5,216,252 |
Income Taxes | (1,581,828) | (46,700) |
TBA Contracts [Member] | ||
Adjustments to reconcile net (loss) income to net cash provided by (used in) operating activities: | ||
Realized and unrealized losses on TBA securities | 1,441,406 | 2,005,175 |
From mortgage-backed securities investments | ||
Net setlement of forward settling TBA contracts | $ 1,500,000 | $ 2,889,941 |
ORGANIZATION AND SIGNIFICANT AC
ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES | 9 Months Ended |
Sep. 30, 2020 | |
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 operates in two business segments through its principal wholly-owned operating subsidiar y, Royal Palm Capital LLC, which includes its wholly-owned subsidiary, Bimini Advisors Holdings , LLC . Bimini Advisors Holdings, LLC and its wholly-owned subsidiary, Bimini Advisors, LLC (a n investment advisor registered with the Securities and Exchange Commission ), 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 for providing these services. Bimini Advisors also manages the MBS portfolio of Royal Palm Capital, LLC. Ro yal 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. Variable Interest Ent ities (“VIEs”) A variable interest entity ("VIE") is consolidated by an enterprise if it is deemed the primary beneficiary of the VIE. Bimini Capital has a common share investment in a trust used in connection with the issuance of Bimini Capital's junior subordinated notes. See Note 8 for a description of the accounting used for this VIE. The Company obtains interests in VIEs through its investments in mortgage-backed securities. The interests in these VIEs are passive in nature and are not expected to result in the Company obtaining a controlling financial interest in these VIEs in the future. As a result, the Company does not consolidate these VIEs and accounts for the interest in these VIEs as mortgage-backed securities. See Note 3 for additi onal information regarding the Company’s investments in mortgage-backed securities. The maximum exposure to loss for these VIEs is the carrying value of the mortgage-backed securities. Basis of Presentation The accompanying unaudited 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 may 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 ne cessary for a fair presentation have been included. Operating results fo r the nine and three month periods ended September 30, 2020 are not necessarily indicative of the results that may be expected for the year end ing December 31, 2020 . The consolidated balan ce sheet at December 31, 2019 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 statements and footnotes thereto included in the Company’s A nnual R eport on Form 10-K for the year ended December 31, 2019 . COVID-19 Impact Beginning in mid-March 2020, the global pandemic associated with the novel coronavirus COVID-19 (“COVID-19”) and related economic conditions began to impact our financial position and results of operations. As a result of the economic, health and market turmoil brought about by COVID-19, the Agency MBS market experienced severe d islocations. This resulted in falling prices of our assets and increased margin calls from our repurchase agreement lenders. Further, as interest rates declined, we faced additional margin calls related to our various hedge positions. In order to maintain our leverage ratio at prudent levels, maintain sufficient cash and liquidity, reduce risk and satisfy margin calls, we sold assets at levels significantly below their carrying values and closed several hedge positions . The Agency MBS market largely stabili zed after the Federal Reserve announced on March 23, 2020 that it would purchase Agency MBS and U.S. Treasuries in the amounts needed to support smooth market functioning. As of September 30, 2020 , we had timely satisfied all margin calls. The following summarize s the impact COVID-19 has had on our financial position and results of operations through September 30, 2020 . We sold approximately $ 171.2 million of MBS during the three months ended March 31 , 2020, realizing losses of approximately $ 5.8 million. Substantially all of the realized losses were a direct result of the adverse MBS market conditions associated with COVID-19 . We had no additional sales of MBS during the six months ended September 30, 2020 . Our MBS portfolio had a fair market value of approximately $73.1 million as of September 30, 2020, compared to $52.8 m illion as of June 30, 2020, $54.4 million at March 31, 2020, and $ 217.8 m illion as of December 31, 2019. Our outstanding balances under our repurchase agreement borrowings as of Septe mber 30, 2020 were approximately $70.7 million, compared to $ 51.6 m illion as of June 30, 2020 , $52.4 million as of March 31, 2020 and $ 210.0 m illion as of December 31, 2019. We recorded an additional valuation allowance against our deferred tax assets of a pproximately $11.2 million during the three months ended March 31, 2020. We have not adjusted the valuation allowance since March 31, 2020. Our stockholders’ equity was $22.4 million as of September 30, 2020, compared to $ 21.1 m illion as of June 30 , 2020, $17.6 million as of March 31, 2020 and $ 40.0 million as of December 31, 2019. In response to the Shelter in Place order issued in Florida in March 2020 , management has invoked the Company’s Disaster Recovery Plan and its employees are working remotely. Prior planning resulted in the successful implementation of this plan and key operational team members maintain daily communication. In addition, President Trump signed into law the Coronavirus Aid, Relief, and Economic Security (CARES) Act, which has provide d billions of dollars of relief to individuals, businesses, state and local governments, and the health care system suffering the impact of the pandemic, including mortgage loan forbearance and modification programs to qualifying borrowers who may have difficulty making their loan payments. On April 13, 2020, t he Company received $152,000 through the Pay check Protection Program of the CARES Act in the form of a low interest rate loan. The application for these funds requires the Company to, in good faith, certify that the current economic uncertainty made the loan request necessary to support the ongoing operations of the Company. T his certification further requires the Company to take into account our current business activity and our ability to access other sources of liquidity sufficient to support ongoing operations in a manner that is not significantly detrimental to the busines s. The receipt of these funds, and the forgiveness of the loan attendant to these funds, is dependent on the Company having initially qualified for the loan and qualifying for the forgiveness of such loan based on our future adherence to the forgiveness cr iteria. The CARES Act also makes technical corrections to, or modifies on a temporary basis, certain provisions of the U.S. Income Tax Code. Significant income tax impacts of the CARES Act include the ability to carry back a net operating loss for 5 years and an i ncrease in the interest expense disallowance limitations from 30% to 50% of adjusted taxable income. Those changes did not significantly impact the consolidated financial statements or the Company’s 2019 income tax return . The Company has evaluated the o ther provisions of the CARES Act and does not believe it will have a material effect on the Company’s business, results of operations and financial condition . The Federal Housing Financing Agency (the “FHFA”) has instructed the GSEs on how they will handle servicer advances for loans that back Agency RMBS that enter into forbearance, which should limit prepayments during the forbearance period that could have resulted otherwise. During the forbearance period the Company will continue to receive scheduled principal and interest each month on its Agency RMBS securities. There can be no assurance as to how, in the long term, these and other actions by the U.S. government will affect the efficiency, liquidity and stability of the financial and mortgage markets. To the extent the financial or mortgage markets do not respond favorably to any of these actions, or such actions do not function as intended, our business, results of operations and financial condition may continue to be materially adversely affected. 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 da te of the financial statements and the 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 dete rmining the fair values of MBS, investment in Orchid common shares and derivatives, determining the amounts of asset valuation allowances, the impairment for the real property held for sale, and the computation of the income tax provision or benefit and th e deferred tax asset allowances recorded for each accounting period . Management believes the estimates and assumptions underlying the financial statements are reasonable based on the information available as of September 30, 2020 , however uncertainty over the ult imate impact that COVID-19 will have on the global economy generally, and on our business in particular, makes any estimates and assumptions as of September 30 , 2020 inherently less certain than they would be absent the current and potential impacts of COV ID-19. 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 with the exception that inter-segment revenues and expenses are included in the presentation of segment results. F or further information see Note 14 . 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 agreements and derivative instruments. The following table presents the Company’s cash, cash equivalents and restricted cash as of September 30, 2020 and December 31, 2019 . (in thousands) September 30, 2020 December 31, 2019 Cash and cash equivalents $ 5,837,067 $ 8,070,067 Restricted cash 1,253,075 4,315,050 Total cash, cash equivalents and restricted cash $ 7,090,142 $ 12,385,117 The Company maintains cash balances at several banks and excess margin with an exchange clearing member. At times, 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. Restricted c ash balances are uninsured, but are held in separate accounts that are segregated from the general funds of the counterparty. The Company limits uninsured balances to only large, well-known bank s and exchange clearing members and believes that it is not e xposed 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 . Revenues from management fees are recognized over the period of time in which the service is performed . Mortgage-Backed Securities The Company invests primarily in mortgage pass-through (“PT”) mortgage backed certificates issued by Freddie Mac, Fannie Mae or Ginnie Mae (“MBS”), collateralized mortgage obligations (“CMOs”), interest-only (“IO”) securities and inverse interest-only (“IIO”) securities representing inter est in or obligations backed by pools of mortgage-backed loans. We refer to MBS and CMOs as PT MBS. We refer to IO and IIO securities as structured MBS. 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 statement 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 removed from the MBS balance with an offsetting receivable recorded. Fair value is defined as the price that would be received 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 the principal market for the asset o r 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 quotes, 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 reflected in unrealize d gains and losses 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 inves tment and serves to reduce the asset’s carrying value. At each reporting date, the effective yield is adjusted prospectively for future reporting periods based on the new estimate of prepayments and the contractual terms of the security. For IIO securitie s, 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 unrealized gains or losses on mort gage-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 value of securities caused by marke t 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 th e 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 consolidated 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 Securitizat ions The Company holds retained interests in the subordinated tranches of securities created in securitization transactions. These retained interests currently have a recorded fair value of zero, as the prospect of future cash flows being received is uncertain. Any cash received from the retained interests is reflected as a gain in the consolidated statements of operations. Derivative Financial Instruments The Company uses derivative instruments to manage interest rate risk, facilitate asset/liability strategies and 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”) secu rities transactions, but it may enter into other derivative instruments in the future. The Company accounts for TBA securities as derivative instruments. Gains and losses associated with TBA securities transactions are reported in gain (loss) on derivativ e instruments in the accompanying consolidated statements of operations. Derivative instruments are carried at fair value, and changes in fair value are recorded in the consolidated operations for each period. The Company’s derivative financial instruments are not designated as hedge accounting relationships, but rather are used as economic hedges of its portfolio assets and liabilities. Holding derivatives creates exposure to credit risk related to the potential for failure by counterparties 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 The fair value of financial instruments for w hich it is practicable to estimate that value is disclosed, either in the body of the financial statements or in the accompanying notes. MBS, Orchid common stock and derivative assets and liabilities are accounted for at fair value in the consolidated bala nce sheets. The methods and assumptions used to estimate fair value for these instruments are presented in Note 13 of the consolidated financial statements. The estimated fair value of cash and cash equivalents, restricted cash, accrued interest receiva ble, other assets, repurchase agreements, accrued interest payable and other liabilities generally approximates their carrying value as of September 30, 2020 and December 31, 2019 , due to the short-term nature of these financial instruments. It is impractica l 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. Further information regarding these instruments is presented in Note 8 to the consolidated 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 life, and buildings and improvements with depreciable live s 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. Repurchase agreements are accounted for as collateralized financing transactions, which are carried at their contractual amounts, including accrued interest, as specified in the respective agreements . Share-Based Compensation 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. Earnings Per Share Basic EPS is calculated as income available to common stockholders divided by the weighted average number of common shares outstanding d uring 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 and 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 C lass 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 sh ares 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 adjusted 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, 2016 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 return s filed by the Company, and those differences could result in significant costs or benefits to the Company. For tax filing purposes, Bimini Capital and its includable subsidiaries, and Royal Palm, and its includable subsidiaries, file as separate tax payin g entities. The Company assesses the likelihood, based on their technical merit, that uncertain tax positions will be sustained upon examination based on the facts, circumstances and information available at the end of each period. The measurement of unc ertain 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 up on 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 betwe en 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. The Company records income tax-related interest and penalties, if applica ble, within the income tax provision. Recent Accounting Pronouncements On January 1, 2020, we adopted Accounting Standards Update (“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 model). The Company ’s adop tion of this ASU did not have a material impact on its consolidated financial statements as its financial assets were already measured at fair value through earnings. In March 2020, the FASB issued ASU 2020-04 “Reference Rate Reform (Topic 848): Facilitat ion of the Effects of Reference Rate Reform on Financial Reporting .” ASU 2020-04 provides optional expedients and exceptions to GAAP requirements for modifications on debt instruments, leases, derivatives, and other contracts, related to the expected mark et transition from the London Interbank Offered Rate (“LIBOR,”) , and certain other floating rate benchmark indices, or collectively, IBORs, to alternative reference rates. ASU 2020-04 generally considers contract modifications related to reference rate ref orm to be an event that does not require contract remeasurement at the modification date nor a reassessment of a previous accounting determination. The guidance in ASU 2020-04 is optional and may be elected over time, through December 31, 2022, as referenc e rate reform activities occur. The Company does not believe the adoption of this ASU will have a material impact on its consolidated financial statements . |
ADVISORY SERVICES
ADVISORY SERVICES | 9 Months Ended |
Sep. 30, 2020 | |
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 oversight 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 Orchid’s month-end equity, as defined in the management agreement, One-twelfth of 1.25% of Orchid’s month-end equity that is greater than $250 million and less than or equal to $500 million, and One-twelfth of 1.00% of Orchid’s month-end equity that is greater than $500 million. Orchi d 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 February 20, 2021 and provides for automatic one-year extension options thereafter. Should Orchid terminate the management agreement without cause, it will be obligated to pay Bimini Advisors a termination fee equal to three tim es the average annual management fee, as defined in the management agreement, before or on the last day of the automatic renewal term. The following table summarizes the advisory services revenue from Orchid for the nine and three months ended September 30, 2020 a nd 2019 . (in thousands) Nine Months Ended September 30, Three Months Ended September 30, 2020 2019 2020 2019 Management fee $ 3,897 $ 4,051 $ 1,252 $ 1,440 Allocated overhead 1,072 1,001 377 351 Total $ 4,969 $ 5,052 $ 1,629 $ 1,791 At September 30, 2020 and December 31, 2019 , the net amount due from Orchid was approximately $0.6 million and $0. 6 million, respectively . These amounts are included in “other assets” in the consolidated balance sheets . |
MORTGAGE-BACKED SECURITIES
MORTGAGE-BACKED SECURITIES | 9 Months Ended |
Sep. 30, 2020 | |
Mortgage Backed Securities [Abstract] | |
Mortgage-Backed Securities | NOTE 3 . MORTGAGE-BACKED SECURITIES The following table presents the Company’s MBS portfolio as of September 30, 2020 and December 31, 2019 : (in thousands) September 30, 2020 December 31, 2019 Fixed-rate MBS $ 72,782 $ 216,231 Interest-Only MBS 334 1,024 Inverse Interest-Only MBS 29 586 Total $ 73,145 $ 217,841 |
REPURCHASE AGREEMENTS
REPURCHASE AGREEMENTS | 9 Months Ended |
Sep. 30, 2020 | |
Disclosure of Repurchase Agreements [Abstract] | |
Repurchase Agreements | NOTE 4 . REPURCHASE AGREEMENTS The Company pledges certain of its MBS as collateral under repurchase agreements with financial institutions. Interest rates are generally fixed based on prevailing rates corresponding to the terms of the borrowings, and interest is generally paid at the termination of a borrowing. If the fair value of the pledged securities declines, lenders will typically require the Company to post additional collateral or pay down borrowings to re-establish agreed upon collateral requirements, referred to as "margin ca lls." Similarly, if the fair value of the pledged securities increases, lenders may release collateral back to the Company. As of September 30, 2020 , the Company had met all margin call requirement s. As of September 30, 2020 and December 31, 2019 , the Company’s repu rchase 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 September 30, 2020 Fair value of securities pledged, including accrued interest receivable $ - $ 34,229 $ 5,182 $ 33,938 $ 73,349 Repurchase agreement liabilities associated with these securities $ - $ 32,960 $ 4,913 $ 32,812 $ 70,685 Net weighted average borrowing rate - 0.26% 0.22% 0.27% 0.26% December 31, 2019 Fair value of securities pledged, including accrued interest receivable $ - $ 137,992 $ 80,550 $ - $ 218,542 Repurchase agreement liabilities associated with these securities $ - $ 132,573 $ 77,381 $ - $ 209,954 Net weighted average borrowing rate - 2.02% 1.92% - 1.98% I n addition, cash pledged to counterparties for repurchase agreements was approximately $1.3 million and $3.8 million as of September 30, 2020 and December 31, 2019 , respectively. 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 agains t 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 receivable , and cash posted by the Company as collate ral, if any. At September 30, 2020 and December 31, 2019 , 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 securities and cash pledged (if any), including a ccrued interest on such securities) with all counterparties of approximately $3.9 million and $11.8 million, respectively. The Company did not have an amount at risk with any individual counterparty greater than 10% of the Company’s equit y at December 31, 2019 . As of September 30, 2020 , the Company had amounts at risk greater than 10% of the Company’s equity as follows: . ($ in thousands) % of Weighted Stockholders' Average Amount Equity Maturity Repurchase Agreement Counterparties at Risk at Risk (in Days) September 30, 2020 Mirae Asset Securities (USA) Inc. $ 2,562 11.4% 64 |
DERIVATIVE FINANCIAL INSTRUMENT
DERIVATIVE FINANCIAL INSTRUMENTS | 9 Months Ended |
Sep. 30, 2020 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivative Financial Instruments | NOTE 5 . DERIVATIVE FINANCIAL INSTRUMENTS Derivative Liabilities, at Fair Value The table below summarizes fair value information about our derivative liabilities as of September 30, 2020 and December 31, 2019 . (in thousands) Derivative Instruments and Related Accounts Balance Sheet Location September 30, 2020 December 31, 2019 Liabilities TBA Securities Other liabilities $ - $ 59 Total derivative liabilities, at fair value $ - $ 59 Margin Balances Posted To (From) Counterparties Futures contracts Restricted cash $ 1 $ 537 Total margin balances on derivative contracts $ 1 $ 537 Eurodollar and T-Note futures are cash settled futures contracts on an interest rate, with gains and losses credited or charged to the Co mpany’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 and T-note futures positions at September 30, 2020 and December 31, 2019 . ($ in thousands) As of September 30, 2020 Junior Subordinated Debt Funding Hedges Average Weighted Weighted Contract Average Average Notional Entry Effective Open Expiration Year Amount Rate Rate Equity (1) 2021 $ 1,000 1.02% 0.20% $ (8) Total / Weighted Average $ 1,000 1.02% 0.20% $ (8) ($ in thousands) As of December 31, 2019 Repurchase Agreement Funding Hedges Average Weighted Weighted Contract Average Average Notional Entry Effective Open Expiration Year Amount Rate Rate Equity (1) 2020 $ 120,000 2.90% 1.67% $ (1,480) 2021 80,000 2.80% 1.57% (984) Total / Weighted Average $ 100,000 2.86% 1.63% $ (2,464) Treasury Note Futures Contracts March 2020- 5-year T-Note futures (2) (Mar 2020 - Mar 2025 Hedge Period) $ 20,000 1.96% 2.06% $ 88 ($ in thousands) As of December 31, 2019 Junior Subordinated Debt Funding Hedges Average Weighted Weighted Contract Average Average Notional Entry Effective Open Expiration Year Amount Rate Rate Equity (1) 2020 $ 19,500 1.92% 1.68% $ (46) Total / Weighted Average $ 19,500 1.92% 1.68% $ (46) (1) Open equity represents the cumulative gains (losses) recorded on open futures positions from inception. (2) T-Note futures contracts were valued at a price of $ 118.61 at December 31, 2019 . The notional contract values of the short positions were $ 23.7 million. The following table summarizes our contracts to purchase and sell TBA securities as of December 31, 2019 . There were no outstanding T BA securities at September 30, 2020 . ($ in thousands) Notional Net Amount Cost Market Carrying Long (Short) (1) Basis (2) Value (3) Value (4) December 31, 2019 30-Year TBA Securities: 3.5% $ (50,000) $ (51,414) $ (51,438) $ (24) 4.5% (50,000) (52,621) (52,656) (35) $ (100,000) $ (104,035) $ (104,094) $ (59) (1) Notional amount represents the par value (or principal balance) of the underlying Agency MBS . (2) Cost basis represents the forward price to be paid (received) for the underlying Agency MBS. (3) Market value represents the current market value of the TBA securities (or of the underlying Agency MBS) as of period-end . (4) 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 value in our consolidated balance sheets . (Losses) 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 nine and three months ended September 30, 2020 and 2019 (in thousands) Nine Months Ended September 30, Three Months Ended September 30, 2020 2019 2020 2019 Eurodollar futures contracts (short positions) Repurchase agreement funding hedges $ (2,328) $ (2,995) $ - $ (164) Junior subordinated debt funding hedges (517) (409) - - T-Note futures contracts (short positions) Repurchase agreement funding hedges (1,006) (696) - (115) Net TBA securities (1,441) (2,005) - (204) (Losses) gains on derivative instruments $ (5,292) $ (6,105) $ - $ (483) 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 t his 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 monitoring positions with individual counterpa rties. 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 contract. In the event of a default by a counte rparty, 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 equivalents pledged as collateral for the Com pany’s derivative instruments are included in restricted cash on the consolidated balance sheets . It is the Company's policy not to offset assets and liabilities associated with open derivative contracts. However, the Chicago Mercantile Exchange (“CME”) ru les characterize variation margin transfers as settlement payments, as opposed to adjustments to collateral. As a result, derivative assets and liabilities associated with centrally cleared derivatives for which the CME serves as the central clearing party are presented as if these derivatives had been settled as of the reporting date . |
PLEDGED ASSETS
PLEDGED ASSETS | 9 Months Ended |
Sep. 30, 2020 | |
Financial Instruments Pledged as Collateral [Abstract] | |
Pledged Assets [Text Block] | NOTE 6 . PLEDGED ASSETS Assets Pledged to Counterparties The table below summarize s Bimini’s assets pledged as collateral under its repurchase agreements and derivative agreements as of September 30, 2020 and December 31, 2019 . ($ in thousands) September 30, 2020 December 31, 2019 Repurchase Derivative Repurchase Derivative Assets Pledged to Counterparties Agreements Agreements Total Agreements Agreements Total PT MBS - at fair value $ 72,782 $ - $ 72,782 $ 216,231 $ - $ 216,231 Structured MBS - at fair value 333 - 333 1,562 - 1,562 Accrued interest on pledged securities 234 - 234 749 - 749 Restricted cash 1,252 1 1,253 3,778 537 4,315 Total $ 74,601 $ 1 $ 74,602 $ 222,320 $ 537 $ 222,857 Assets Pledged from Counterparties The table below summarizes cash pledged to Bimini from counterparties under repurchase agreements and derivative agreements as of September 30, 2020 and December 31, 2019 . Cash received as margin is recognized in cash and cash equivalents with a corresponding amount recognized as an increase in repurchase agreements or other liabilities in the consolidated balance sheets. ($ in thousands) Assets Pledged to Bimini September 30, 2020 December 31, 2019 Repurchase agreements $ 80 $ - Total $ 80 $ - |
OFFSETTING ASSETS AND LIABILITI
OFFSETTING ASSETS AND LIABILITIES | 9 Months Ended |
Sep. 30, 2020 | |
Offsetting [Abstract] | |
Offsetting Assets And Liabilities [Text Block] | NOTE 7 . 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 tables present information regarding those assets and liabilities subject to such arrang ements as if the Company had presented them on a net basis as of September 30, 2020 and December 31, 2019 . (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 September 30, 2020 Repurchase Agreements $ 70,685 $ - $ 70,685 $ (69,433) $ (1,252) $ - $ 70,685 $ - $ 70,685 $ (69,433) $ (1,252) $ - December 31, 2019 Repurchase Agreements $ 209,954 $ - $ 209,954 $ (206,176) $ (3,778) $ - TBA securities 59 - 59 - - 59 $ 210,013 $ - $ 210,013 $ (206,176) $ (3,778) $ 59 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 . The fair value of the actual collateral received by or posted to the same counterparty typically exceeds the amounts presented. See Note 6 for a discussion of collateral posted for, or received against, repurchase obligations and derivative instruments. |
LONG-TERM DEBT
LONG-TERM DEBT | 9 Months Ended |
Sep. 30, 2020 | |
Trust Preferred Securities [Abstract] | |
Trust Preferred Securities | NOTE 8 . LONG-TERM DEBT Long-term debt at September 30, 2020 and December 31, 2019 is summarized as follows: (in thousands) September 30, 2020 December 31, 2019 Junior subordinated debt $ 26,804 $ 26,804 Note payable 662 677 Paycheck Protection Plan ("PPP") loan 152 - Total $ 27,618 $ 27,481 Junior Subordinated Debt 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 September 30, 2020 and December 31, 2019 , 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 September 30, 2020 , the interest rate was 3.75% . The BCTII trust preferred securities and Bimini Capital's BCTII Junior Su bordinated 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 present and future senior indebtedness. BCTII is a VIE because the holders of the equity investment at risk do not have substantive decision-making ability over BCTII’s activities. Since Bimini Capital's investment in BCTII’s common equity securities was financed 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 a t risk. Since Bimini Capital's common share investment in BCTII is not a variable interest, Bimini Capital is not the primary beneficiary of BCTII. Therefore, Bimini Capital has not consolidated the financial statements of BCTII into its consolidated finan cial statements, and this investment is accounted for on the equity method. The accompanying consolidated financial statements present Bimini Capital's BCTII Junior Subordinated Notes issued to BCTII as a liability and Bimini Capital's investment in the c ommon 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. Note Payable On October 30, 2019 , the Company borrowed $680,000 from a bank. The note is payable in equal monthly principal and interest installments of approximately $4,500 through October 30, 2039. Interest accrues at 4.89% through October 30, 2024. Thereafter, interest accrues based o n the weekly average yield to the United States Treasury securities adjusted to a constant maturity of 5 years, plus 3.25%. The note is secured by a mortgage on the Company’s office building. Paycheck Protection Plan Loan On April 13, 2020, the Company r eceived approximately $152,000 through the Paycheck Protection Program (“PPP”) of the CARES Act in the form of a low interest loan. As discussed in Note 1, PPP loans may be forgiven, in whole or in part, if the proceeds are used for payroll and other perm itted purposes in accordance with the requirements of the PPP and if certain other requirements are met. These loans carry a fixed rate of 1.00% and a term of two years, if not forgiven, in whole or in part. Payments are deferred for the first ten months after the completion of the loan forgiveness covered period . The Company believes that all of the proceeds were used for eligible purposes and the outstanding principal and accrued interest will ultimately be forgiven. The table below presents the future scheduled principal payments on the Company’s long-term debt. (in thousands) Last three months of 2020 $ 5 2021 22 2022 175 2023 24 2024 25 After 2024 27,367 Total $ 27,618 |
CAPITAL STOCK
CAPITAL STOCK | 9 Months Ended |
Sep. 30, 2020 | |
Capital Stock [Abstract] | |
Capital Stock | NOTE 9 . COMMON STOCK There were no issuances of Bimini Capital 's Class A Common Stock, Class B Common Stock or Class C Common Stock during the nine months ended September 30, 2020 and 2019 . 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 10b-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 obl igate the Company to purchase any shares . The Repurchase Plan was originally set to expire on November 15, 2018, but it has been extended twice by the Board of Directors, first until November 15, 2019, and then until November 15, 2020 . This authorization is not expected to be renewed . From the inception of the Repurchase Plan through September 30, 2020 , the Company repurchased a total of 70,404 shares at an aggregate cost of approximately $166,945 , including commissions and fees, for a weighted average price of $2.37 per share. There were no shares repurchased during the nine months ended September 30, 2020 . Tender Offer In July 2019 , the Company completed a “modified Dutch auction” tender offer and paid an aggregate of $ 2.2 million , excluding fees and related expenses, to repurchase 1.1 million shares of Bimini Capital’s Class A common stock at a price of $ 2.00 per share. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 9 Months Ended |
Sep. 30, 2020 | |
Commitments And Contingencies Disclosure [Abstract] | |
Commitments And Contingencies | NOTE 10 . 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. On April 22, 2020, the Company received a demand for payment from Citigroup, Inc. in the amount of $33 .1 million related to the indemnification provisions of various mortgage loan purchase agreements (“MLPA’s”) entered into between Citigroup Global Markets Realty Corp and Royal Palm Capital, LLC (f/k/a Opteum Financial Services, LLC ) prior to the date Royal Palm’s mortgage ori gination operations ceased in 2007. The demand is based on Royal Palm’s alleged breaches of certain representations and warranties in the related MLPA’s. The Company believes the demands are without merit and intends to defend against the demand vigorous ly. No provision or accrual has been recorded as of September 30, 2020 related to the Citigroup demand. Management is not aware of any other significant reported or unreported contingencies at September 30, 2020 . |
INCOME TAXES
INCOME TAXES | 9 Months Ended |
Sep. 30, 2020 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | NOTE 11 . INCOME TAXES The total income tax provision recorded for the nine and three months ended September 30, 2020 was $ 9.3 million and $0.6 million, respectively, on consolidated pre-tax book (loss) income of $ (8.3 ) million and $ 1.9 million in the nine and three months ended September 30, 2020 , respectively. The total income tax provision (benefit) recorded for the nine and three months ended September 30, 2019 was $ 0.9 million and $ 0.5 million, respectively, on consolidated pre-tax book income (loss) of $ 1.3 million and $ (0.2 ) million in the nine and three months ended September 30, 2019 , respectively. The Company’s tax provision is based on a projected effective rate based on annualized amounts applied to actual income to date and includes the expected realiz ation of a portion of the tax benefits of federal and state net operating 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 capital loss and NOL carryforwards is dependent upon the generation of future capital gains and taxable income in periods prior to their expiration. The C ompany 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 valuat ion allowance at each reporting date . As a result of adverse economic impacts of COVID-19 on its business, the Company performed an assessment of the need for additional valuation allowances against existing deferred tax assets as of March 31, 2020 . Follo wing the more-likely-than-not standard that benefits will not be realized in the future, the Company determined an additional valuation allowance of approximately $11.2 million was necessary for the net operating loss carryforwards and capital loss carryfo rwards during the three months ended March 31, 2020. With the rapidly evolving and changing landscape caused by the pandemic, the Company will continue to closely monitor the impacts of COVID-19 on the Company’s ability to realize its deferred tax assets , and it may increase valuation allowances in the future as new information becomes available . |
EARNINGS PER SHARE
EARNINGS PER SHARE | 9 Months Ended |
Sep. 30, 2020 | |
Earnings Per Share [Abstract] | |
Earnings Per Share (EPS) | NOTE 12 . 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. T he Class B common stock is in cluded 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 conversio n to Class A common stock were not met at September 30, 2020 and 2019 . 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 September 30, 2020 and 2019 . The table below reconciles the numerator and denominator of EPS for the nine and three months ended September 30, 2020 and 2019 . (in thousands, except per-share information) Nine Months Ended September 30, Three Months Ended September 30, 2020 2019 2020 2019 Basic and diluted EPS per Class A common share: (Loss) income attributable to Class A common shares: Basic and diluted $ (17,499) $ 344 $ 1,314 $ (770) Weighted average common shares: Class A common shares outstanding at the balance sheet date 11,609 11,609 11,609 11,609 Effect of weighting - 761 - 95 Weighted average shares-basic and diluted 11,609 12,370 11,609 11,704 (Loss) income per Class A common share: Basic and diluted $ (1.51) $ 0.03 $ 0.11 $ (0.07) (in thousands, except per-share information) Nine Months Ended September 30, Three Months Ended September 30, 2020 2019 2020 2019 Basic and diluted EPS per Class B common share: (Loss) income attributable to Class B common shares: Basic and diluted $ (48) $ 1 $ 4 $ (2) Weighted average common shares: Class B common shares outstanding at the balance sheet date 32 32 32 32 Weighted average shares-basic and diluted 32 32 32 32 (Loss) income per Class B common share: Basic and diluted $ (1.51) $ 0.03 $ 0.11 $ (0.07) |
FAIR VALUE
FAIR VALUE | 9 Months Ended |
Sep. 30, 2020 | |
Fair Value Disclosures [Abstract] | |
Fair Value | NOTE 13 . FAIR VALUE Fair value is the price that would be received to sell an asset or paid to transfer a liability (an exit price). A fair value measure should reflect the assumptions that market participants would use in pricing the asset or liability, including the assumptions about th e 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 are not active and model-based v aluation 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 the 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 cas h 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. MBS, Orchid common stock, retained interests and TBA securities were all recor ded at fair value on a recurring basis during the nine and three months ended September 30, 2020 and 2019 . When determining fair value measurements, the Company considers the principal or most advantageous market in which it would transact and considers assumpti ons 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, and this model resulted in a value of zero at both September 30, 2020 and December 31, 2019 . T he Company's MBS and TBA securities are valued using Level 2 valuations, and such valuations currently 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 appropriate price to use to calculate the fair values. The Company and the independent pricing sources use various valuation techniques to determine the price of the Company’s securities. These techniques include observing the most recent market for like or identical assets, spread pricing techniques (option adjusted spread, zero volatility spread, spread to the U.S. T reasury curve or spread to a benchmark such as a TBA security ), and model driven approaches (the discounted cash flow method, Black Scholes and SABR models which rely upon observable market rates such as the term structure of interest rates and volatility). The appropriate spread pricing method used is based on market conventio n. The pricing source determines the spread of recently observed trade activity or observable markets for assets similar to those being priced. The spread is then adjusted based on variances in certain characteristics between the market observation and the asset being priced. Those characteristics include: type of asset, the expected life of the asset, the stability and predictability of the expected future cash flows of the asset, whether the coupon of the asset is fixed or adjustable, the guarantor of the security if applicable, the coupon, the maturity, the issuer, size of the underlying loans, year in which the underlying loans were originated, loan to value ratio, state in which the underlying loans reside, credit score of the underlying borrowers and o ther variables if appropriate. The fair value of the security is determined by using the adjusted spread. The following table presents financial assets and liabilities measured at fair value on a recurring basis as of September 30, 2020 and December 31, 2019 : (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) September 30, 2020 Mortgage-backed securities $ 73,145 $ - $ 73,145 $ - Orchid Island Capital, Inc. common stock 13,003 13,003 - - December 31, 2019 Mortgage-backed securities $ 217,841 $ - $ 217,841 $ - Orchid Island Capital, Inc. common stock 8,892 8,892 - - TBA securities (59) - (59) - 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 nine months ended September 30, 2020 and 2019 : (in thousands) Retained Interests in Securitizations Nine Months Ended September 30, 2020 2019 Balances, January 1 $ - $ - Gain included in earnings 59 315 Collections (59) (315) Balances, September 30 $ - $ - During the nine months ended September 30, 2020 and 2019 , there were no transfers of financial assets or liabilities between levels 1, 2 or 3 . |
SEGMENT INFORMATION
SEGMENT INFORMATION | 9 Months Ended |
Sep. 30, 2020 | |
Segment Reporting [Abstract] | |
Segment Reporting Disclosure [Text Block] | NOTE 14 . 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 r evenues received under this management agreement for the nine months ended September 30, 2020 and 2019 , were approximately $5.0 million and $5.1 million, respectively, accounting for approximately 53 % and 42 % of consolidated revenues, respectively. The investment portfolio segment includes the investment activities conducted by Royal Palm. The investment portfolio segment receives revenue in the form of interest and dividend income on its investments. Segment information for the nine months end ed September 30, 2020 and 2019 is as follows: (in thousands) Asset Investment Management Portfolio Corporate Eliminations Total 2020 Advisory services, external customers $ 4,969 $ - $ - $ - $ 4,969 Advisory services, other operating segments (1) 116 - - (116) - Interest and dividend income - 4,414 - - 4,414 Interest expense - (1,030) (893) (2) - (1,923) Net revenues 5,085 3,384 (893) (116) 7,460 Other - (10,238) (466) (3) - (10,704) Operating expenses (4) (2,632) (2,375) - - (5,007) Intercompany expenses (1) - (116) - 116 - Income (loss) before income taxes $ 2,453 $ (9,345) $ (1,359) $ - $ (8,251) Asset Investment Management Portfolio Corporate Eliminations Total 2019 Advisory services, external customers $ 5,052 $ - $ - $ - $ 5,052 Advisory services, other operating segments (1) 200 - - (200) - Interest and dividend income - 7,064 1 - 7,065 Interest expense - (3,655) (1,195) (2) - (4,850) Net revenues 5,252 3,409 (1,194) (200) 7,267 Other - (419) (736) (3) - (1,155) Operating expenses (4) (2,019) (2,806) - - (4,825) Intercompany expenses (1) - (200) - 200 - Income (loss) before income taxes $ 3,233 $ (16) $ (1,930) $ - $ 1,287 Segment information for the three months ended September 30, 2020 and 2019 is as follows: (in thousands) Asset Investment Management Portfolio Corporate Eliminations Total 2020 Advisory services, external customers $ 1,629 $ - $ - $ - $ 1,629 Advisory services, other operating segments (1) 32 - - (32) - Interest and dividend income - 1,097 - - 1,097 Interest expense - (43) (261) (2) - (304) Net revenues 1,661 1,054 (261) (32) 2,422 Other - 1,070 49 (3) - 1,119 Operating expenses (4) (956) (659) - - (1,615) Intercompany expenses (1) - (32) - 32 - Income (loss) before income taxes $ 705 $ 1,433 $ (212) $ - $ 1,926 Asset Investment Management Portfolio Corporate Eliminations Total 2019 Advisory services, external customers $ 1,791 $ - $ - $ - $ 1,791 Advisory services, other operating segments (1) 63 - - (63) - Interest and dividend income - 2,011 - - 2,011 Interest expense - (1,002) (389) (2) - (1,391) Net revenues 1,854 1,009 (389) (63) 2,411 Other - (438) (601) (3) - (1,039) Operating expenses (4) (754) (852) - - (1,606) Intercompany expenses (1) - (63) - 63 - Income (loss) before income taxes $ 1,100 $ (344) $ (990) $ - $ (234) Assets in each reportable segment as of September 30, 2020 and December 31, 2019 were as follows: (in thousands) Asset Investment Management Portfolio Corporate Total September 30, 2020 $ 1,474 $ 107,414 13,275 $ 122,163 December 31, 2019 1,457 263,223 14,809 279,489 |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 9 Months Ended |
Sep. 30, 2020 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | NOTE 15 . RELATED PARTY TRANSACTIONS Relationships with Orchid At September 30, 2020 and December 31, 2019, the Company owned 2,595,357 and 1, 520,036 shares of Orchid common stock , respectively, representing approximately 3.8 % and 2.4% of Orchid’s outstanding common stock on such dates . T he Company received dividends on this common stock investment of approximately $1.2 million and $0.5 million during the nine and three months ended September 30, 2020 , respectively , and $1.1 million and $ 0.4 million d uring the nine and three months ended September 30, 2019 , respectively. Robert Cauley, the Chief Executive Officer and Chairman of the Board of Directors of the Company, also serves as Chief Executive Officer and Chairman of the Board of Directors of Orchid, receives co mpensation 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 directors, each own shares of common stock of Orchid. |
SUBSEQUENT EVENT
SUBSEQUENT EVENT | 9 Months Ended |
Sep. 30, 2020 | |
Subsequent Events [Abstract] | |
Subsequent Events [Text Block] | NOTE 16 . SUBSEQUENT EVENT Real Property Held For Sale On October 15, 2020 , t he C ompany completed the sale of real property that was not used in the Company’s business. The C ompany received proceeds of approximately $4 62 ,000. The transaction resulted in a gain of approximately $ 12,000 , which will be included in the consolidated statement of operations during the fourth quarter of 20 20 . |
BASIS OF PRESENTATION (Policies
BASIS OF PRESENTATION (Policies) | 9 Months Ended |
Sep. 30, 2020 | |
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. |
Variable Interest Entity [Policy Text Block] | Variable Interest Ent ities (“VIEs”) A variable interest entity ("VIE") is consolidated by an enterprise if it is deemed the primary beneficiary of the VIE. Bimini Capital has a common share investment in a trust used in connection with the issuance of Bimini Capital's junior subordinated notes. See Note 8 for a description of the accounting used for this VIE. The Company obtains interests in VIEs through its investments in mortgage-backed securities. The interests in these VIEs are passive in nature and are not expected to result in the Company obtaining a controlling financial interest in these VIEs in the future. As a result, the Company does not consolidate these VIEs and accounts for the interest in these VIEs as mortgage-backed securities. See Note 3 for additi onal information regarding the Company’s investments in mortgage-backed securities. The maximum exposure to loss for these VIEs is the carrying value of the mortgage-backed securities. |
Basis of Presentation | Basis of Presentation The accompanying unaudited 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 may 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 ne cessary for a fair presentation have been included. Operating results fo r the nine and three month periods ended September 30, 2020 are not necessarily indicative of the results that may be expected for the year end ing December 31, 2020 . The consolidated balan ce sheet at December 31, 2019 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 statements and footnotes thereto included in the Company’s A nnual R eport on Form 10-K for the year ended December 31, 2019 . |
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 da te of the financial statements and the 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 dete rmining the fair values of MBS, investment in Orchid common shares and derivatives, determining the amounts of asset valuation allowances, the impairment for the real property held for sale, and the computation of the income tax provision or benefit and th e deferred tax asset allowances recorded for each accounting period . Management believes the estimates and assumptions underlying the financial statements are reasonable based on the information available as of September 30, 2020 , however uncertainty over the ult imate impact that COVID-19 will have on the global economy generally, and on our business in particular, makes any estimates and assumptions as of September 30 , 2020 inherently less certain than they would be absent the current and potential impacts of COV ID-19. |
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 with the exception that inter-segment revenues and expenses are included in the presentation of segment results. F or further information see Note 14 . |
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 agreements and derivative instruments. The following table presents the Company’s cash, cash equivalents and restricted cash as of September 30, 2020 and December 31, 2019 . (in thousands) September 30, 2020 December 31, 2019 Cash and cash equivalents $ 5,837,067 $ 8,070,067 Restricted cash 1,253,075 4,315,050 Total cash, cash equivalents and restricted cash $ 7,090,142 $ 12,385,117 The Company maintains cash balances at several banks and excess margin with an exchange clearing member. At times, 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. Restricted c ash balances are uninsured, but are held in separate accounts that are segregated from the general funds of the counterparty. The Company limits uninsured balances to only large, well-known bank s and exchange clearing members and believes that it is not e xposed 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 . Revenues from management fees are recognized over the period of time in which the service is performed . |
Mortgage-Backed Securities | Mortgage-Backed Securities The Company invests primarily in mortgage pass-through (“PT”) mortgage backed certificates issued by Freddie Mac, Fannie Mae or Ginnie Mae (“MBS”), collateralized mortgage obligations (“CMOs”), interest-only (“IO”) securities and inverse interest-only (“IIO”) securities representing inter est in or obligations backed by pools of mortgage-backed loans. We refer to MBS and CMOs as PT MBS. We refer to IO and IIO securities as structured MBS. 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 statement 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 removed from the MBS balance with an offsetting receivable recorded. Fair value is defined as the price that would be received 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 the principal market for the asset o r 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 quotes, 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 reflected in unrealize d gains and losses 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 inves tment and serves to reduce the asset’s carrying value. At each reporting date, the effective yield is adjusted prospectively for future reporting periods based on the new estimate of prepayments and the contractual terms of the security. For IIO securitie s, 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 unrealized gains or losses on mort gage-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 value of securities caused by marke t 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 th e 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 consolidated 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 Securitizat ions The Company holds retained interests in the subordinated tranches of securities created in securitization transactions. These retained interests currently have a recorded fair value of zero, as the prospect of future cash flows being received is uncertain. Any cash received from the retained interests is reflected as a gain in the consolidated statements of operations. |
Derivative Financial Instruments | Derivative Financial Instruments The Company uses derivative instruments to manage interest rate risk, facilitate asset/liability strategies and 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”) secu rities transactions, but it may enter into other derivative instruments in the future. The Company accounts for TBA securities as derivative instruments. Gains and losses associated with TBA securities transactions are reported in gain (loss) on derivativ e instruments in the accompanying consolidated statements of operations. Derivative instruments are carried at fair value, and changes in fair value are recorded in the consolidated operations for each period. The Company’s derivative financial instruments are not designated as hedge accounting relationships, but rather are used as economic hedges of its portfolio assets and liabilities. Holding derivatives creates exposure to credit risk related to the potential for failure by counterparties 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 The fair value of financial instruments for w hich it is practicable to estimate that value is disclosed, either in the body of the financial statements or in the accompanying notes. MBS, Orchid common stock and derivative assets and liabilities are accounted for at fair value in the consolidated bala nce sheets. The methods and assumptions used to estimate fair value for these instruments are presented in Note 13 of the consolidated financial statements. The estimated fair value of cash and cash equivalents, restricted cash, accrued interest receiva ble, other assets, repurchase agreements, accrued interest payable and other liabilities generally approximates their carrying value as of September 30, 2020 and December 31, 2019 , due to the short-term nature of these financial instruments. It is impractica l 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. Further information regarding these instruments is presented in Note 8 to the consolidated 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 life, and buildings and improvements with depreciable live s 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. Repurchase agreements are accounted for as collateralized financing transactions, which are carried at their contractual amounts, including accrued interest, as specified in the respective agreements . |
Share-Based Compensation | Share-Based Compensation 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. |
Earnings Per Share | Earnings Per Share Basic EPS is calculated as income available to common stockholders divided by the weighted average number of common shares outstanding d uring 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 and 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 C lass 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 sh ares 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 adjusted 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, 2016 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 return s filed by the Company, and those differences could result in significant costs or benefits to the Company. For tax filing purposes, Bimini Capital and its includable subsidiaries, and Royal Palm, and its includable subsidiaries, file as separate tax payin g entities. The Company assesses the likelihood, based on their technical merit, that uncertain tax positions will be sustained upon examination based on the facts, circumstances and information available at the end of each period. The measurement of unc ertain 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 up on 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 betwe en 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. The Company records income tax-related interest and penalties, if applica ble, within the income tax provision. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements On January 1, 2020, we adopted Accounting Standards Update (“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 model). The Company ’s adop tion of this ASU did not have a material impact on its consolidated financial statements as its financial assets were already measured at fair value through earnings. In March 2020, the FASB issued ASU 2020-04 “Reference Rate Reform (Topic 848): Facilitat ion of the Effects of Reference Rate Reform on Financial Reporting .” ASU 2020-04 provides optional expedients and exceptions to GAAP requirements for modifications on debt instruments, leases, derivatives, and other contracts, related to the expected mark et transition from the London Interbank Offered Rate (“LIBOR,”) , and certain other floating rate benchmark indices, or collectively, IBORs, to alternative reference rates. ASU 2020-04 generally considers contract modifications related to reference rate ref orm to be an event that does not require contract remeasurement at the modification date nor a reassessment of a previous accounting determination. The guidance in ASU 2020-04 is optional and may be elected over time, through December 31, 2022, as referenc e rate reform activities occur. The Company does not believe the adoption of this ASU will have a material impact on its consolidated financial statements . |
CASH AND CASH EQUIVALENTS (Tabl
CASH AND CASH EQUIVALENTS (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
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 September 30, 2020 and December 31, 2019 . (in thousands) September 30, 2020 December 31, 2019 Cash and cash equivalents $ 5,837,067 $ 8,070,067 Restricted cash 1,253,075 4,315,050 Total cash, cash equivalents and restricted cash $ 7,090,142 $ 12,385,117 |
ADVISORY SERVICES (Tables)
ADVISORY SERVICES (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Advisory Services [Abstract] | |
Schedule of Advisory Fee Income [Table Text Block] | The following table summarizes the advisory services revenue from Orchid for the nine and three months ended September 30, 2020 a nd 2019 . (in thousands) Nine Months Ended September 30, Three Months Ended September 30, 2020 2019 2020 2019 Management fee $ 3,897 $ 4,051 $ 1,252 $ 1,440 Allocated overhead 1,072 1,001 377 351 Total $ 4,969 $ 5,052 $ 1,629 $ 1,791 |
MORTGAGE-BACKED SECURITIES (Tab
MORTGAGE-BACKED SECURITIES (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Mortgage Backed Securities [Line Items] | |
Schedule of Mortgage-Backed Securities Reconciliation | The following table presents the Company’s MBS portfolio as of September 30, 2020 and December 31, 2019 : (in thousands) September 30, 2020 December 31, 2019 Fixed-rate MBS $ 72,782 $ 216,231 Interest-Only MBS 334 1,024 Inverse Interest-Only MBS 29 586 Total $ 73,145 $ 217,841 |
REPURCHASE AGREEMENTS (Tables)
REPURCHASE AGREEMENTS (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Disclosure of Repurchase Agreements [Abstract] | |
Schedule of repurchase agreements and remaining maturities | As of September 30, 2020 and December 31, 2019 , the Company’s repu rchase 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 September 30, 2020 Fair value of securities pledged, including accrued interest receivable $ - $ 34,229 $ 5,182 $ 33,938 $ 73,349 Repurchase agreement liabilities associated with these securities $ - $ 32,960 $ 4,913 $ 32,812 $ 70,685 Net weighted average borrowing rate - 0.26% 0.22% 0.27% 0.26% December 31, 2019 Fair value of securities pledged, including accrued interest receivable $ - $ 137,992 $ 80,550 $ - $ 218,542 Repurchase agreement liabilities associated with these securities $ - $ 132,573 $ 77,381 $ - $ 209,954 Net weighted average borrowing rate - 2.02% 1.92% - 1.98% |
ScheduleOfRepurchaseAgreementCounterpartiesWithWhomRepurchaseAgreementsExceed10PercentOfStockholdersEquityTextBlock | ($ in thousands) % of Weighted Stockholders' Average Amount Equity Maturity Repurchase Agreement Counterparties at Risk at Risk (in Days) September 30, 2020 Mirae Asset Securities (USA) Inc. $ 2,562 11.4% 64 |
DERIVATIVE FINANCIAL INSTRUME_2
DERIVATIVE FINANCIAL INSTRUMENTS (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
ScheduleOfDerivativeInstrumentsInStatementOfFinancialPositionFairValueTextBlock | Derivative Liabilities, at Fair Value The table below summarizes fair value information about our derivative liabilities as of September 30, 2020 and December 31, 2019 . (in thousands) Derivative Instruments and Related Accounts Balance Sheet Location September 30, 2020 December 31, 2019 Liabilities TBA Securities Other liabilities $ - $ 59 Total derivative liabilities, at fair value $ - $ 59 Margin Balances Posted To (From) Counterparties Futures contracts Restricted cash $ 1 $ 537 Total margin balances on derivative contracts $ 1 $ 537 |
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 Co mpany’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 and T-note futures positions at September 30, 2020 and December 31, 2019 . ($ in thousands) As of September 30, 2020 Junior Subordinated Debt Funding Hedges Average Weighted Weighted Contract Average Average Notional Entry Effective Open Expiration Year Amount Rate Rate Equity (1) 2021 $ 1,000 1.02% 0.20% $ (8) Total / Weighted Average $ 1,000 1.02% 0.20% $ (8) ($ in thousands) As of December 31, 2019 Repurchase Agreement Funding Hedges Average Weighted Weighted Contract Average Average Notional Entry Effective Open Expiration Year Amount Rate Rate Equity (1) 2020 $ 120,000 2.90% 1.67% $ (1,480) 2021 80,000 2.80% 1.57% (984) Total / Weighted Average $ 100,000 2.86% 1.63% $ (2,464) Treasury Note Futures Contracts March 2020- 5-year T-Note futures (2) (Mar 2020 - Mar 2025 Hedge Period) $ 20,000 1.96% 2.06% $ 88 ($ in thousands) As of December 31, 2019 Junior Subordinated Debt Funding Hedges Average Weighted Weighted Contract Average Average Notional Entry Effective Open Expiration Year Amount Rate Rate Equity (1) 2020 $ 19,500 1.92% 1.68% $ (46) Total / Weighted Average $ 19,500 1.92% 1.68% $ (46) |
Schedule of To Be Announced Securities Table Tex tBlock | The following table summarizes our contracts to purchase and sell TBA securities as of December 31, 2019 . There were no outstanding T BA securities at September 30, 2020 . ($ in thousands) Notional Net Amount Cost Market Carrying Long (Short) (1) Basis (2) Value (3) Value (4) December 31, 2019 30-Year TBA Securities: 3.5% $ (50,000) $ (51,414) $ (51,438) $ (24) 4.5% (50,000) (52,621) (52,656) (35) $ (100,000) $ (104,035) $ (104,094) $ (59) |
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 nine and three months ended September 30, 2020 and 2019 . (in thousands) Nine Months Ended September 30, Three Months Ended September 30, 2020 2019 2020 2019 Eurodollar futures contracts (short positions) Repurchase agreement funding hedges $ (2,328) $ (2,995) $ - $ (164) Junior subordinated debt funding hedges (517) (409) - - T-Note futures contracts (short positions) Repurchase agreement funding hedges (1,006) (696) - (115) Net TBA securities (1,441) (2,005) - (204) (Losses) gains on derivative instruments $ (5,292) $ (6,105) $ - $ (483) |
PLEDGED ASSETS (Tables)
PLEDGED ASSETS (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
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 below summarize s Bimini’s assets pledged as collateral under its repurchase agreements and derivative agreements as of September 30, 2020 and December 31, 2019 . ($ in thousands) September 30, 2020 December 31, 2019 Repurchase Derivative Repurchase Derivative Assets Pledged to Counterparties Agreements Agreements Total Agreements Agreements Total PT MBS - at fair value $ 72,782 $ - $ 72,782 $ 216,231 $ - $ 216,231 Structured MBS - at fair value 333 - 333 1,562 - 1,562 Accrued interest on pledged securities 234 - 234 749 - 749 Restricted cash 1,252 1 1,253 3,778 537 4,315 Total $ 74,601 $ 1 $ 74,602 $ 222,320 $ 537 $ 222,857 |
Schedule of assets pledged to us from counterparties under our repurchase agreements. | The table below summarizes cash pledged to Bimini from counterparties under repurchase agreements and derivative agreements as of September 30, 2020 and December 31, 2019 . Cash received as margin is recognized in cash and cash equivalents with a corresponding amount recognized as an increase in repurchase agreements or other liabilities in the consolidated balance sheets. ($ in thousands) Assets Pledged to Bimini September 30, 2020 December 31, 2019 Repurchase agreements $ 80 $ - Total $ 80 $ - |
OFFSETTING ASSETS AND LIABILI_2
OFFSETTING ASSETS AND LIABILITIES (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
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 tables present information regarding those assets and liabilities subject to such arrang ements as if the Company had presented them on a net basis as of September 30, 2020 and December 31, 2019 . (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 September 30, 2020 Repurchase Agreements $ 70,685 $ - $ 70,685 $ (69,433) $ (1,252) $ - $ 70,685 $ - $ 70,685 $ (69,433) $ (1,252) $ - December 31, 2019 Repurchase Agreements $ 209,954 $ - $ 209,954 $ (206,176) $ (3,778) $ - TBA securities 59 - 59 - - 59 $ 210,013 $ - $ 210,013 $ (206,176) $ (3,778) $ 59 |
LONG-TERM DEBT (Tables)
LONG-TERM DEBT (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Debt Instruments [Abstract] | |
Schedule of Long-term Debt Instruments [Table Text Block] | Long-term debt at September 30, 2020 and December 31, 2019 is summarized as follows: (in thousands) September 30, 2020 December 31, 2019 Junior subordinated debt $ 26,804 $ 26,804 Note payable 662 677 Paycheck Protection Plan ("PPP") loan 152 - Total $ 27,618 $ 27,481 |
Debt Instrument Redemption [Table Text Block] | The table below presents the future scheduled principal payments on the Company’s long-term debt. (in thousands) Last three months of 2020 $ 5 2021 22 2022 175 2023 24 2024 25 After 2024 27,367 Total $ 27,618 |
EARNINGS PER SHARE (Tables)
EARNINGS PER SHARE (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
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 nine and three months ended September 30, 2020 and 2019 . (in thousands, except per-share information) Nine Months Ended September 30, Three Months Ended September 30, 2020 2019 2020 2019 Basic and diluted EPS per Class A common share: (Loss) income attributable to Class A common shares: Basic and diluted $ (17,499) $ 344 $ 1,314 $ (770) Weighted average common shares: Class A common shares outstanding at the balance sheet date 11,609 11,609 11,609 11,609 Effect of weighting - 761 - 95 Weighted average shares-basic and diluted 11,609 12,370 11,609 11,704 (Loss) income per Class A common share: Basic and diluted $ (1.51) $ 0.03 $ 0.11 $ (0.07) (in thousands, except per-share information) Nine Months Ended September 30, Three Months Ended September 30, 2020 2019 2020 2019 Basic and diluted EPS per Class B common share: (Loss) income attributable to Class B common shares: Basic and diluted $ (48) $ 1 $ 4 $ (2) Weighted average common shares: Class B common shares outstanding at the balance sheet date 32 32 32 32 Weighted average shares-basic and diluted 32 32 32 32 (Loss) income per Class B common share: Basic and diluted $ (1.51) $ 0.03 $ 0.11 $ (0.07) |
FAIR VALUE (Tables)
FAIR VALUE (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Fair Value Disclosures [Abstract] | |
Schedule of financial assets (liabilities) measured at fair value on a recurring basis | The following table presents financial assets and liabilities measured at fair value on a recurring basis as of September 30, 2020 and December 31, 2019 : (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) September 30, 2020 Mortgage-backed securities $ 73,145 $ - $ 73,145 $ - Orchid Island Capital, Inc. common stock 13,003 13,003 - - December 31, 2019 Mortgage-backed securities $ 217,841 $ - $ 217,841 $ - Orchid Island Capital, Inc. common stock 8,892 8,892 - - TBA securities (59) - (59) - |
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 nine months ended September 30, 2020 and 2019 : (in thousands) Retained Interests in Securitizations Nine Months Ended September 30, 2020 2019 Balances, January 1 $ - $ - Gain included in earnings 59 315 Collections (59) (315) Balances, September 30 $ - $ - |
SEGMENT INFORMATION (Tables)
SEGMENT INFORMATION (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Segment Reporting [Abstract] | |
Schedule Of Segment Reporting Information By Segment [Text Block] | Segment information for the nine months end ed September 30, 2020 and 2019 is as follows: (in thousands) Asset Investment Management Portfolio Corporate Eliminations Total 2020 Advisory services, external customers $ 4,969 $ - $ - $ - $ 4,969 Advisory services, other operating segments (1) 116 - - (116) - Interest and dividend income - 4,414 - - 4,414 Interest expense - (1,030) (893) (2) - (1,923) Net revenues 5,085 3,384 (893) (116) 7,460 Other - (10,238) (466) (3) - (10,704) Operating expenses (4) (2,632) (2,375) - - (5,007) Intercompany expenses (1) - (116) - 116 - Income (loss) before income taxes $ 2,453 $ (9,345) $ (1,359) $ - $ (8,251) Asset Investment Management Portfolio Corporate Eliminations Total 2019 Advisory services, external customers $ 5,052 $ - $ - $ - $ 5,052 Advisory services, other operating segments (1) 200 - - (200) - Interest and dividend income - 7,064 1 - 7,065 Interest expense - (3,655) (1,195) (2) - (4,850) Net revenues 5,252 3,409 (1,194) (200) 7,267 Other - (419) (736) (3) - (1,155) Operating expenses (4) (2,019) (2,806) - - (4,825) Intercompany expenses (1) - (200) - 200 - Income (loss) before income taxes $ 3,233 $ (16) $ (1,930) $ - $ 1,287 Segment information for the three months ended September 30, 2020 and 2019 is as follows: (in thousands) Asset Investment Management Portfolio Corporate Eliminations Total 2020 Advisory services, external customers $ 1,629 $ - $ - $ - $ 1,629 Advisory services, other operating segments (1) 32 - - (32) - Interest and dividend income - 1,097 - - 1,097 Interest expense - (43) (261) (2) - (304) Net revenues 1,661 1,054 (261) (32) 2,422 Other - 1,070 49 (3) - 1,119 Operating expenses (4) (956) (659) - - (1,615) Intercompany expenses (1) - (32) - 32 - Income (loss) before income taxes $ 705 $ 1,433 $ (212) $ - $ 1,926 Asset Investment Management Portfolio Corporate Eliminations Total 2019 Advisory services, external customers $ 1,791 $ - $ - $ - $ 1,791 Advisory services, other operating segments (1) 63 - - (63) - Interest and dividend income - 2,011 - - 2,011 Interest expense - (1,002) (389) (2) - (1,391) Net revenues 1,854 1,009 (389) (63) 2,411 Other - (438) (601) (3) - (1,039) Operating expenses (4) (754) (852) - - (1,606) Intercompany expenses (1) - (63) - 63 - Income (loss) before income taxes $ 1,100 $ (344) $ (990) $ - $ (234) Assets in each reportable segment as of September 30, 2020 and December 31, 2019 were as follows: (in thousands) Asset Investment Management Portfolio Corporate Total September 30, 2020 $ 1,474 $ 107,414 13,275 $ 122,163 December 31, 2019 1,457 263,223 14,809 279,489 |
SIGNIFICANT ACCOUNTING POLICIES
SIGNIFICANT ACCOUNTING POLICIES - Organization (Details) | 9 Months Ended |
Sep. 30, 2020 | |
Accounting Policies [Abstract] | |
Entity Incorporation, Date of Incorporation | Sep. 24, 2003 |
SIGNIFICANT ACCOUNTING POLICI_2
SIGNIFICANT ACCOUNTING POLICIES - COVID-19 Impact (narrative) (Details) - USD ($) | 3 Months Ended | 9 Months Ended | |||||
Sep. 30, 2020 | Mar. 31, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | Jun. 30, 2020 | Dec. 31, 2019 | |
Accounting Policies [Abstract] | |||||||
Proceeds From Sale Of Mortgage Backed Securities MBS Categorized As Trading | $ 0 | $ 171,200,000 | $ 171,155,249 | $ 43,975,274 | |||
Realized Gains On Investments | 0 | (5,800,000) | $ 23,078 | (5,804,656) | $ 23,078 | ||
Mortgage-backed Securities Available-for-sale, Fair Value Disclosure | 73,144,529 | 54,400,000 | 73,144,529 | $ 52,800,000 | $ 217,840,953 | ||
Securities Sold Under Agreements To Repurchase | 70,685,172 | 52,400,000 | 70,685,172 | 51,600,000 | 209,954,000 | ||
Reduction of deferred tax valuation allowance | 11,200,000 | ||||||
Stockholders Equity | $ 22,429,956 | $ 17,600,000 | $ 22,429,956 | $ 21,100,000 | $ 39,976,991 |
SIGNIFICANT ACCOUNTING POLICI_3
SIGNIFICANT ACCOUNTING POLICIES - Cash, Cash Equivalents and Restricted Cash (Details) - USD ($) | Sep. 30, 2020 | Dec. 31, 2019 | Sep. 30, 2019 | Dec. 31, 2018 |
Accounting Policies [Abstract] | ||||
Cash and cash equivalents | $ 5,837,067 | $ 8,070,067 | ||
Restricted cash | 1,253,075 | 4,315,050 | ||
Cash Cash Equivalents And Restricted Cash | $ 7,090,142 | $ 12,385,117 | $ 8,890,935 | $ 6,240,488 |
ADVISORY SERVICES (Details)
ADVISORY SERVICES (Details) - USD ($) | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | Dec. 31, 2019 | |
Advisory Services [Line Items] | |||||
Advisory services | $ 1,629,463 | $ 1,791,135 | $ 4,969,143 | $ 5,052,251 | |
Orchid Island Capital [Member] | |||||
Advisory Services [Line Items] | |||||
Advisory services | 1,629,000 | 1,791,000 | 4,969,000 | 5,052,000 | |
Due From Affiliate | 600,000 | 600,000 | $ 600,000 | ||
Orchid Island Capital [Member] | Management Fees [Member] | |||||
Advisory Services [Line Items] | |||||
Advisory services | 1,252,000 | 1,440,000 | 3,897,000 | 4,051,000 | |
Orchid Island Capital [Member] | Overhead Allocation [Member] | |||||
Advisory Services [Line Items] | |||||
Advisory services | $ 377,000 | $ 351,000 | $ 1,072,000 | $ 1,001,000 |
MORTGAGE-BACKED SECURITIES - M
MORTGAGE-BACKED SECURITIES - MBS Portfolio (Details) - USD ($) | Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Dec. 31, 2019 |
Schedule of Trading Securities and Other Trading Assets [Line Items] | ||||
Fair Value | $ 73,144,529 | $ 52,800,000 | $ 54,400,000 | $ 217,840,953 |
Fixed Rate Mortgages [Member] | ||||
Schedule of Trading Securities and Other Trading Assets [Line Items] | ||||
Fair Value | 72,782,000 | 216,231,000 | ||
Interest Only Securities [Member] | ||||
Schedule of Trading Securities and Other Trading Assets [Line Items] | ||||
Fair Value | 334,000 | 1,024,000 | ||
Inverse Interest Only [Member] | ||||
Schedule of Trading Securities and Other Trading Assets [Line Items] | ||||
Fair Value | $ 29,000 | $ 586,000 |
REPURCHASE AGREEMENTS - Narrati
REPURCHASE AGREEMENTS - Narrative (Details) - USD ($) | Sep. 30, 2020 | Dec. 31, 2019 |
Assets Sold under Agreements to Repurchase [Line Items] | ||
Restricted Cash And Cash Equivalents At Carrying Value | $ 1,253,075 | $ 4,315,050 |
Repurchase Agreements [Member] | ||
Assets Sold under Agreements to Repurchase [Line Items] | ||
Restricted Cash And Cash Equivalents At Carrying Value | 1,252,000 | 3,778,000 |
Aggregate amount at risk will all counterparties | $ 3,900,000 | $ 11,800,000 |
REPURCHASE AGREEMENTS - Maturit
REPURCHASE AGREEMENTS - Maturities (Details) - USD ($) | Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Dec. 31, 2019 |
Assets Sold under Agreements to Repurchase [Line Items] | ||||
Fair Value of securities pledged, including accrued interest receivable | $ 73,349,000 | $ 218,542,000 | ||
Outstanding repurchase obligations | $ 70,685,172 | $ 51,600,000 | $ 52,400,000 | $ 209,954,000 |
Net weighted average borrowing rate | 0.26% | 1.98% | ||
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 | $ 34,229,000 | $ 137,992,000 | ||
Outstanding repurchase obligations | $ 32,960,000 | $ 132,573,000 | ||
Net weighted average borrowing rate | 0.26% | 2.02% | ||
Between 31 and 90 Days [Member] | ||||
Assets Sold under Agreements to Repurchase [Line Items] | ||||
Fair Value of securities pledged, including accrued interest receivable | $ 5,182,000 | $ 80,550,000 | ||
Outstanding repurchase obligations | $ 4,913,000 | $ 77,381,000 | ||
Net weighted average borrowing rate | 0.22% | 1.92% | ||
Greater Than 90 days [Member] | ||||
Assets Sold under Agreements to Repurchase [Line Items] | ||||
Fair Value of securities pledged, including accrued interest receivable | $ 33,938,000 | $ 0 | ||
Outstanding repurchase obligations | $ 32,812,000 | $ 0 | ||
Net weighted average borrowing rate | 0.27% | 0.00% |
REPURCHASE AGREEMENTS - Amount
REPURCHASE AGREEMENTS - Amount at Risk in Exceess of Ten Percent of Equity (Details) - Mirae Asset Securities (USA) Inc. [Member] | 9 Months Ended |
Sep. 30, 2020USD ($) | |
Repurchase Agreement Counterparty [Line Items] | |
Repurchase Agreement Counterparty, Amount at Risk | $ 2,562,000 |
Percent Of Equity At Risk | 0.114 |
Repurchase Agreement Counterparty, Weighted Average Maturity | 64 days |
DERIVATIVE FINANCIAL INSTRUME_3
DERIVATIVE FINANCIAL INSTRUMENTS - Schedule of Derivative Assets and Liabilties (Details) - USD ($) | Sep. 30, 2020 | Dec. 31, 2019 |
Derivitive Financial Instruments [Line Items] | ||
Restricted Cash And Cash Equivalents At Carrying Value | $ 1,253,075 | $ 4,315,050 |
NotDesignatedAsHedgingInstrumentEconomicHedgeMember | ||
Derivitive Financial Instruments [Line Items] | ||
Derivative Asset Fair Value Gross Liability | 0 | 59,000 |
Restricted Cash And Cash Equivalents At Carrying Value | 1,000 | 537,000 |
TBA Contracts [Member] | NotDesignatedAsHedgingInstrumentEconomicHedgeMember | ||
Derivitive Financial Instruments [Line Items] | ||
Derivative Asset Fair Value Gross Liability | 0 | 59,000 |
Eurodollar Future Margin [Member] | NotDesignatedAsHedgingInstrumentEconomicHedgeMember | ||
Derivitive Financial Instruments [Line Items] | ||
Restricted Cash And Cash Equivalents At Carrying Value | $ 1,000 | $ 537,000 |
DERIVATIVE FINANCIAL INSTRUME_4
DERIVATIVE FINANCIAL INSTRUMENTS - Interest Rate Futures Positions (Details) - Short [Member] - USD ($) | Sep. 30, 2020 | Dec. 31, 2019 |
Repurchase Agreement Funding Hedges [Member] | Eurodollar Future [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Notional Amount | $ 100,000,000 | |
Entry Rate | 2.86% | |
Weighted Average Effective Rate | 1.63% | |
Open Equity | $ (2,464,000) | |
Repurchase Agreement Funding Hedges [Member] | Year 2020 Expiration [Member] | Eurodollar Future [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Notional Amount | $ 120,000,000 | |
Entry Rate | 2.90% | |
Weighted Average Effective Rate | 1.67% | |
Open Equity | $ (1,480,000) | |
Repurchase Agreement Funding Hedges [Member] | Year 2020 Expiration [Member] | Treasury Note Future [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Notional Amount | $ 20,000,000 | |
Entry Rate | 1.96% | |
Weighted Average Effective Rate | 2.06% | |
Open Equity | $ 88,000 | |
Repurchase Agreement Funding Hedges [Member] | Year 2021 Expiration [Member] | Eurodollar Future [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Notional Amount | $ 80,000,000 | |
Entry Rate | 2.80% | |
Weighted Average Effective Rate | 1.57% | |
Open Equity | $ (984,000) | |
Junior Subordinated Debt Funding Hedges [Member] | Eurodollar Future [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Notional Amount | $ 1,000,000 | $ 19,500,000 |
Entry Rate | 1.02% | 1.92% |
Weighted Average Effective Rate | 0.20% | 1.68% |
Open Equity | $ (8,000) | $ (46,000) |
Junior Subordinated Debt Funding Hedges [Member] | Year 2020 Expiration [Member] | Eurodollar Future [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Notional Amount | $ 19,500,000 | |
Entry Rate | 1.92% | |
Weighted Average Effective Rate | 1.68% | |
Open Equity | $ (46,000) | |
Junior Subordinated Debt Funding Hedges [Member] | Year 2021 Expiration [Member] | Eurodollar Future [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Notional Amount | $ 1,000,000 | |
Entry Rate | 1.02% | |
Weighted Average Effective Rate | 0.20% | |
Open Equity | $ (8,000) |
DERIVATIVE FINANCIAL INSTRUME_5
DERIVATIVE FINANCIAL INSTRUMENTS - TBA positions (Details) - 30 Year [Member] - Short [Member] | Dec. 31, 2019USD ($) |
Derivatives, Fair Value [Line Items] | |
Notional Amount | $ 100,000,000 |
Cost Basis | (104,035,000) |
Market Value Of TBA Contract | (104,094,000) |
Derivative Asset Fair Value Gross Liability | (59,000) |
3.5% Member | |
Derivatives, Fair Value [Line Items] | |
Notional Amount | 50,000,000 |
Cost Basis | (51,414,000) |
Market Value Of TBA Contract | (51,438,000) |
Derivative Asset Fair Value Gross Liability | (24,000) |
4.5% Member | |
Derivatives, Fair Value [Line Items] | |
Notional Amount | 50,000,000 |
Cost Basis | (52,621,000) |
Market Value Of TBA Contract | (52,656,000) |
Derivative Asset Fair Value Gross Liability | $ (35,000) |
DERIVATIVE FINANCIAL INSTRUME_6
DERIVATIVE FINANCIAL INSTRUMENTS - Effect on the consolidated statements of operations (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Derivative Instruments, Gain (Loss) [Line Items] | ||||
(Losses) gains on derivative instruments | $ 75 | $ (483,446) | $ (5,292,346) | $ (6,105,202) |
Eurodollar Future [Member] | Repurchase Agreement Funding Hedges [Member] | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
(Losses) gains on derivative instruments | 0 | (164,000) | (2,328,000) | (2,995,000) |
Eurodollar Future [Member] | Junior Subordinated Debt Funding Hedges [Member] | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
(Losses) gains on derivative instruments | 0 | 0 | (517,000) | (409,000) |
Treasury Note Future [Member] | Repurchase Agreement Funding Hedges [Member] | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
(Losses) gains on derivative instruments | 0 | (115,000) | (1,006,000) | (696,000) |
TBA Contracts [Member] | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
(Losses) gains on derivative instruments | $ 0 | $ (204,000) | $ (1,441,000) | $ (2,005,000) |
PLEDGED ASSETS - Assets Pledged
PLEDGED ASSETS - Assets Pledged to Counterparties (Details) - USD ($) | Sep. 30, 2020 | Dec. 31, 2019 |
Financial Instrument Secured2 [Domain] | ||
Financial Instruments Owned and Pledged as Collateral [Line Items] | ||
Interest Receivable | $ 234,000 | |
Restricted Cash And Cash Equivalents At Carrying Value | 1,253,000 | $ 4,315,000 |
Repurchase Agreements [Member] | ||
Financial Instruments Owned and Pledged as Collateral [Line Items] | ||
Interest Receivable | 234,000 | 749,000 |
Restricted Cash And Cash Equivalents At Carrying Value | 1,252,000 | 3,778,000 |
Derivative [Member] | ||
Financial Instruments Owned and Pledged as Collateral [Line Items] | ||
Interest Receivable | 0 | 0 |
Restricted Cash And Cash Equivalents At Carrying Value | 1,000 | 537,000 |
Residential Mortgage Backed Securities [Member] | Financial Instrument Secured2 [Domain] | ||
Financial Instruments Owned and Pledged as Collateral [Line Items] | ||
Interest Receivable | 234,000 | 749,000 |
Residential Mortgage Backed Securities [Member] | Financial Instrument Secured2 [Domain] | 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 | 72,782,000 | 216,231,000 |
Residential Mortgage Backed Securities [Member] | Financial Instrument Secured2 [Domain] | 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 | 333,000 | 1,562,000 |
Residential Mortgage Backed Securities [Member] | Repurchase Agreements [Member] | ||
Financial Instruments Owned and Pledged as Collateral [Line Items] | ||
Interest Receivable | 234,000 | 749,000 |
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 | 72,782,000 | 216,231,000 |
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 | 333,000 | 1,562,000 |
Residential Mortgage Backed Securities [Member] | Derivative [Member] | ||
Financial Instruments Owned and Pledged as Collateral [Line Items] | ||
Interest Receivable | 0 | 0 |
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 |
PLEDGED ASSETS - Assets Pledg_2
PLEDGED ASSETS - Assets Pledged from Counterparties (Details) - Repurchase Agreements [Member] - USD ($) | Sep. 30, 2020 | Dec. 31, 2019 |
Financial Instruments Owned and Pledged as Collateral [Line Items] | ||
Cash Pledged By Counterparties | $ 80,000 | $ 0 |
Total Assets Pledged By Counterparties | $ 80,000 | $ 0 |
OFFSETTING ASSETS AND LIABILI_3
OFFSETTING ASSETS AND LIABILITIES - Offsetting of Liabilties (Details) - USD ($) | Sep. 30, 2020 | Dec. 31, 2019 |
Offsetting Liabilities [Line Items] | ||
Gross Amount Of Recognized Liabilties | $ 70,685,000 | $ 210,013,000 |
Gross Amount Of Liabilties Offset In The Balance Sheet | 0 | 0 |
Net Amount Of Liabilities Presented In The Balance Sheet | 70,685,000 | 210,013,000 |
Gross Amount Of Financial Instruments Posted Not Offset in Balance Sheet | (69,433,000) | (206,176,000) |
Gross Amounts Of Cash Posted Not Offset In Balance Sheet | (1,252,000) | (3,778,000) |
Net Amount Of Liabilities | 0 | 59,000 |
Repurchase Agreements [Member] | ||
Offsetting Liabilities [Line Items] | ||
Gross Amount Of Recognized Liabilties | 70,685,000 | 209,954,000 |
Gross Amount Of Liabilties Offset In The Balance Sheet | 0 | 0 |
Net Amount Of Liabilities Presented In The Balance Sheet | 70,685,000 | 209,954,000 |
Gross Amount Of Financial Instruments Posted Not Offset in Balance Sheet | (69,433,000) | (206,176,000) |
Gross Amounts Of Cash Posted Not Offset In Balance Sheet | (1,252,000) | (3,778,000) |
Net Amount Of Liabilities | 0 | 0 |
TBA Contracts [Member] | ||
Offsetting Liabilities [Line Items] | ||
Gross Amount Of Recognized Liabilties | 0 | 59,000 |
Gross Amount Of Liabilties Offset In The Balance Sheet | 0 | 0 |
Net Amount Of Liabilities Presented In The Balance Sheet | 0 | 59,000 |
Gross Amount Of Financial Instruments Posted Not Offset in Balance Sheet | 0 | 0 |
Gross Amounts Of Cash Posted Not Offset In Balance Sheet | 0 | 0 |
Net Amount Of Liabilities | $ 0 | $ 59,000 |
LONG-TERM DEBT- Narrative (Deta
LONG-TERM DEBT- Narrative (Details) - USD ($) | 9 Months Ended | |
Sep. 30, 2020 | Dec. 31, 2019 | |
Debt Instrument [Line Items] | ||
Outstanding Principal Balance | $ 27,618,048 | $ 27,481,121 |
Junior Subordinated Debt [Member] | Bimini Capital Trust II Junior Subordinated Note [Member] | London Interbank Offered Rate (LIBOR) [Member] | ||
Debt Instrument [Line Items] | ||
Outstanding Principal Balance | $ 26,804,000 | 26,804,000 |
Basis Spread on Variable Rate | 3.50% | |
Interest Rate at Period End | 3.75% | |
Note Payable | US Treasury (UST) Interest Rate [Member] | ||
Debt Instrument [Line Items] | ||
Outstanding Principal Balance | $ 662,000 | $ 677,000 |
Basis Spread on Variable Rate | 3.25% | |
Interest Rate at Period End | 4.89% | |
Original Loan Amount | $ 680,000 | |
Installment Amount | $ 4,500 | |
Paycheck Protection Plan [Member] | ||
Debt Instrument [Line Items] | ||
Interest Rate at Period End | 1.00% | |
Original Loan Amount | $ 152,000 |
LONG-TERM DEBT - Outstanding Ba
LONG-TERM DEBT - Outstanding Balances (Details) - USD ($) | Sep. 30, 2020 | Dec. 31, 2019 |
Debt Instrument [Line Items] | ||
Long-term Debt, Gross | $ 27,618,048 | $ 27,481,121 |
Junior Subordinated Debt [Member] | ||
Debt Instrument [Line Items] | ||
Long-term Debt, Gross | 26,804,000 | 26,804,000 |
Note Payable | ||
Debt Instrument [Line Items] | ||
Long-term Debt, Gross | 662,000 | 677,000 |
Paycheck Protection Plan [Member] | ||
Debt Instrument [Line Items] | ||
Long-term Debt, Gross | $ 152,000 | $ 0 |
LONG-TERM DEBT - Scheduled Prin
LONG-TERM DEBT - Scheduled Principal Balances (Details) $ in Thousands | 9 Months Ended |
Sep. 30, 2020USD ($) | |
Debt Instrument [Line Items] | |
Scheduled Principal Payments | $ 27,618 |
Debt Instrument, Redemption, Period One [Member] | |
Debt Instrument [Line Items] | |
Scheduled Principal Payments | 5 |
Debt Instrument, Redemption, Period Two [Member] | |
Debt Instrument [Line Items] | |
Scheduled Principal Payments | 22 |
Debt Instrument, Redemption, Period Three [Member] | |
Debt Instrument [Line Items] | |
Scheduled Principal Payments | 175 |
Debt Instrument, Redemption, Period Four [Member] | |
Debt Instrument [Line Items] | |
Scheduled Principal Payments | 24 |
Debt Instrument, Redemption, Period Five [Member] | |
Debt Instrument [Line Items] | |
Scheduled Principal Payments | 25 |
Debt Instrument, Redemption, Thereafter [Member] | |
Debt Instrument [Line Items] | |
Scheduled Principal Payments | $ 27,367 |
COMMITMENTS AND CONTINGENCIES -
COMMITMENTS AND CONTINGENCIES - Narrative (Details) - Citigroup Demand For Payment [Member] - Threatened Litigation [Member] - Breach Of Representations and Warranties [Member] | 9 Months Ended |
Sep. 30, 2020USD ($) | |
Loss Contingencies [Line Items] | |
Loss Contingency, Period of Occurrence | December 31, 2007 |
Demand For Payment Date | April 22, 2020 |
Loss Contingency, Damages Sought, Value | $ 33,100,000 |
Loss Contingency, Estimate of Possible Loss | $ 0 |
INCOME TAXES - Narrative (Detai
INCOME TAXES - Narrative (Details) - USD ($) | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2020 | Mar. 31, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Income Tax Disclosure [Abstract] | |||||
Pre-tax book income | $ 1,926,138 | $ (234,171) | $ (8,251,176) | $ 1,287,129 | |
Income tax provision (benefit) | $ 608,351 | $ 537,945 | $ 9,295,859 | $ 942,364 | |
Reduction of deferred tax valuation allowance | $ 11,200,000 |
EARNINGS PER SHARE (Details)
EARNINGS PER SHARE (Details) - Class B Common Stock [Member] - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Net Income (Loss) Available to Common Stockholders, Diluted [Abstract] | ||||
Net Income (Loss) Available to Common Stockholders, Basic | $ 4,000 | $ (2,000) | $ (48,000) | $ 1,000 |
Net Income (Loss) Available to Common Stockholders, Diluted | $ 4,000 | $ (2,000) | $ (48,000) | $ 1,000 |
Weighted Average Number of Shares Outstanding, Diluted [Abstract] | ||||
Common Shares Outstanding | 32,000 | 32,000 | 32,000 | 32,000 |
Weighted Average Shares - Basic and Diluted | 31,938 | 31,938 | 31,938 | 31,938 |
Income (Loss) Per Share - Basic | $ 0.11 | $ (0.07) | $ (1.51) | $ 0.03 |
Income (Loss) Pe Share - Diluted | $ 0.11 | $ (0.07) | $ (1.51) | $ 0.03 |
FAIR VALUE - Assets and Liabili
FAIR VALUE - Assets and Liabilities Recorded at Fair Value on Recurring Basis (Details) - USD ($) | Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Dec. 31, 2019 | Sep. 30, 2019 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||
Mortgage-backed securities | $ 73,144,529 | $ 52,800,000 | $ 54,400,000 | $ 217,840,953 | |
Orchid Island Capital, Inc. common stock, at fair value | 13,002,739 | 8,892,211 | |||
Fair Value Assets Transfers Amount | 0 | $ 0 | |||
Fair Value, Inputs, Level 1 [Member] | |||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||
Mortgage-backed securities | 0 | 0 | |||
Orchid Island Capital, Inc. common stock, at fair value | 13,003,000 | 8,892,000 | |||
TBA Contracts | 0 | ||||
Fair Value, Inputs, Level 2 [Member] | |||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||
Mortgage-backed securities | 73,145,000 | 217,841,000 | |||
Orchid Island Capital, Inc. common stock, at fair value | 0 | 0 | |||
TBA Contracts | (59,000) | ||||
Fair Value, Inputs, Level 3 [Member] | |||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||
Mortgage-backed securities | 0 | 0 | |||
Orchid Island Capital, Inc. common stock, at fair value | $ 0 | 0 | |||
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 ($) | 9 Months Ended | |
Sep. 30, 2020 | Sep. 30, 2019 | |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||
Beginning Balance | $ 0 | $ 0 |
Gain (loss) Included in Earnings | 59,000 | 315,000 |
Collections | (59,000) | (315,000) |
Ending Balance | $ 0 | $ 0 |
SEGMENT INFORMATION - Reconcili
SEGMENT INFORMATION - Reconciliation of Segment Revenues (Details) - USD ($) | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | Dec. 31, 2019 | |
Segment Reporting, Revenue Reconciling Item [Line Items] | |||||
Advisory services, external customers | $ 1,629,463 | $ 1,791,135 | $ 4,969,143 | $ 5,052,251 | |
Advisory Services Other Segments | 0 | 0 | 0 | 0 | |
Interest and dividend income | 1,097,000 | 2,011,000 | 4,414,000 | 7,065,000 | |
Interest expense | 304,000 | 1,391,000 | 1,923,000 | 4,850,000 | |
Net Segment Revenue | 2,422,000 | 2,411,000 | 7,460,000 | 7,267,000 | |
Other Income | 1,119,000 | (1,039,000) | (10,704,000) | (1,155,000) | |
Operating Expenses | 1,615,000 | 1,606,000 | 5,007,000 | 4,825,000 | |
Intercompany Expenses | 0 | 0 | 0 | 0 | |
Pre-tax book income | 1,926,138 | (234,171) | (8,251,176) | 1,287,129 | |
Assets | 122,163,377 | 122,163,377 | $ 279,488,948 | ||
Operating Segments [Member] | Asset Management Segment [Member] | |||||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||||
Advisory services, external customers | 1,629,000 | 1,791,000 | 4,969,000 | 5,052,000 | |
Advisory Services Other Segments | 32,000 | 63,000 | 116,000 | 200,000 | |
Interest and dividend income | 0 | 0 | 0 | 0 | |
Interest expense | 0 | 0 | 0 | 0 | |
Net Segment Revenue | 1,661,000 | 1,854,000 | 5,085,000 | 5,252,000 | |
Other Income | 0 | 0 | 0 | 0 | |
Operating Expenses | 956,000 | 754,000 | 2,632,000 | 2,019,000 | |
Intercompany Expenses | 0 | 0 | 0 | 0 | |
Pre-tax book income | 705,000 | 1,100,000 | 2,453,000 | 3,233,000 | |
Assets | 1,474,000 | 1,474,000 | 1,457,000 | ||
Operating Segments [Member] | Investment Portfolio Segment [Member] | |||||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||||
Advisory services, external customers | 0 | 0 | 0 | 0 | |
Advisory Services Other Segments | 0 | 0 | 0 | 0 | |
Interest and dividend income | 1,097,000 | 2,011,000 | 4,414,000 | 7,064,000 | |
Interest expense | 43,000 | 1,002,000 | 1,030,000 | 3,655,000 | |
Net Segment Revenue | 1,054,000 | 1,009,000 | 3,384,000 | 3,409,000 | |
Other Income | 1,070,000 | (438,000) | (10,238,000) | (419,000) | |
Operating Expenses | 659,000 | 852,000 | 2,375,000 | 2,806,000 | |
Intercompany Expenses | 32,000 | 63,000 | 116,000 | 200,000 | |
Pre-tax book income | 1,433,000 | (344,000) | (9,345,000) | (16,000) | |
Assets | 107,414,000 | 107,414,000 | 263,223,000 | ||
Corporate, Non-Segment [Member] | |||||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||||
Advisory services, external customers | 0 | 0 | 0 | 0 | |
Advisory Services Other Segments | 0 | 0 | 0 | 0 | |
Interest and dividend income | 0 | 0 | 0 | 1,000 | |
Interest expense | 261,000 | 389,000 | 893,000 | 1,195,000 | |
Net Segment Revenue | (261,000) | (389,000) | (893,000) | (1,194,000) | |
Other Income | 49,000 | (601,000) | (466,000) | (736,000) | |
Operating Expenses | 0 | 0 | 0 | 0 | |
Intercompany Expenses | 0 | 0 | 0 | 0 | |
Pre-tax book income | (212,000) | (990,000) | (1,359,000) | (1,930,000) | |
Assets | 13,275,000 | 13,275,000 | $ 14,809,000 | ||
Intersegment Eliminations [Member] | |||||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||||
Advisory services, external customers | 0 | 0 | 0 | 0 | |
Advisory Services Other Segments | (32,000) | (63,000) | (116,000) | (200,000) | |
Interest and dividend income | 0 | 0 | 0 | 0 | |
Interest expense | 0 | 0 | 0 | 0 | |
Net Segment Revenue | (32,000) | (63,000) | (116,000) | (200,000) | |
Other Income | 0 | 0 | 0 | 0 | |
Operating Expenses | 0 | 0 | 0 | 0 | |
Intercompany Expenses | (32,000) | (63,000) | (116,000) | (200,000) | |
Pre-tax book income | $ 0 | $ 0 | $ 0 | $ 0 |
SEGMENT INFORMATION - Revenue F
SEGMENT INFORMATION - Revenue From Major Customer (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Entity Wide Revenue Major Customer [Line Items] | ||||
Revenues | $ 2,726,739 | $ 3,802,333 | $ 9,383,218 | $ 12,117,159 |
Total Revenue [Member] | Orchid Island Capital [Member] | ||||
Entity Wide Revenue Major Customer [Line Items] | ||||
Revenues | $ 4,969,000 | $ 5,052,000 | ||
Percentgage of Total Sales | 53.00% | 42.00% |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details) - USD ($) | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | Dec. 31, 2019 | |
Related Party Transaction [Line Items] | |||||
Investment Owned Balance Shares | 2,595,357 | 2,595,357 | 1,520,036 | ||
Equity Method Investment Ownership Percentage | 3.80% | 3.80% | 2.40% | ||
Investment Income, Dividend | $ 493,118 | $ 364,809 | $ 1,246,636 | $ 1,094,426 | |
Orchid Island Capital [Member] | |||||
Related Party Transaction [Line Items] | |||||
Investment Owned Balance Shares | 2,595,357 | 2,595,357 | 1,520,036 | ||
Equity Method Investment Ownership Percentage | 3.80% | 3.80% | 2.40% |
SUBSEQUENT EVENT (Details)
SUBSEQUENT EVENT (Details) - Subsequent Event [Member] | 1 Months Ended |
Nov. 06, 2020USD ($) | |
SubsequentEventLineItems | |
DisposalGroupNotDiscontinuedOperationGainLossOnDisposal | $ 12,000 |
ProceedsFromSaleOfOtherAssetsInvestingActivities | $ 462,000 |