LFT - Earnings call transcript Q3 2021 | Lument Finance Trust, Inc.

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Operator

Good morning and thank you for joining the Lument Finance Trust Third Quarter 2021 Earnings Call. All participants will be in listen-only mode. [Operator Instructions]. After today's presentation there will be an opportunity to ask questions. [Operator Instructions]. recorded company's be website. being webcast available is the on call and made will via Today's Lument I call Duddy at over now to Management. would like Charles with to Investor turn the Investment Relations Please go ahead.

Charles Duddy

call Torres, With and CEO; Gary, Michael James third Thank joining Finance morning XX-Q President; Thank the to Tuesday, financial Head the call CFO; James Precilla you, of On Lument a our and results. good Investment discuss XXXX Flynn, third on quarter you issued provided Larsen, we Estate everyone. and results. filed for which details with our our Real me quarter SEC are Trust Strategies. release, today Briggs, press on

earnings which on a be provided supplemental also We presentation, can found our website.

Form and the discussed XX-Q section in including filed on XX-K. are statements our identify actual Section Factors with reports Jim, reports risks that intended remind to within course forward-looking similar statements. like Such Before differ on forward-looking materially forward-looking during not the constitute XXE the Form to anticipates, results call I words certain this other are and company's of outlook, risks meaning made information this These handing everyone statements. call XXA conference uncertainties that intends, are and indicate, historical statements of in of X-K, based such Securities Securities contained Act of are over When in to XXXX. statements forward-looking the expressions will, various in believes, to cause may would the the of and Risk evaluate, SEC, its XX-K the subject to and of particular could and the used the Section expects, as of XXXX from those Act

GAAP amplified not undertakes call. not will place and to on the be these of financial such this as statements. predict not Additionally, information financial forward-looking cautioned be continue conference pandemic. in nor be company A to which the turn accordance the sec.gov. substitute as any to to are by non-GAAP these speak identify the and measures filings by obligation amplified financial in all to with certain Furthermore, will most isolation risks of James undue this or is can of Reconciliations prepared presentation possible over forward-looking uncertainties our the at on to discussed intended in measures with GAAP. amplified the no Please many update statements, risks. accessed Listeners to The or SEC call information Flynn. go future is comparable of considered only a will by presented to I currently hereof. non-GAAP that, with measures reliance through ahead. accordance be date in With COVID these maybe these the are of It

James Flynn

for you, busy Thank XXXX. call Trust important earnings an for Lument year the and very Good a year Trust. of morning, Charlie. everyone. quarter has Finance been Welcome XXXX Lument the third Finance to

related the unemployment, political variables significant capital we've and like all and particularly positive with observed we economic transactions investor generally At such and of environment year, social performance were by us and time, institutional in uncertain capital same the considerations, all several to unrest, rates, These grow our portfolio During accomplished an allowed our incremental exacerbated performance. executed strong base. impact COVID-XX. marked interest values, that the in made significant the COVID-XX to continued investments, asset also

and the Lument's to be continues to large opportunities. us market strength provide platform and continue competitive, lending the breadth multifamily, in While compelling in its of particular, with investment

floating showing substantial amounts capital. deploy rate million raised of over invested our ability $XXX in we recently quickly QX, new to loans, bridge During

on based have manager the flow of deployed and we expect current ahead year. the of Our of expansive end by be origination the schedule capabilities this the pipeline, driven fully to deal strong

other CRE also acknowledge investment of and that of continue such equity, to mezz bridge allowed instruments. management our we portion as we preferred expect in asset to credit lending high-yield well. important in invest focus other multifamily estate, perform platform It's grow, to loans, continue identify opportunities to investment our commercial strength real and in capital has portfolio to our and our the As to and a

XXX% no the not the subject to had the defaults, end a to COVID not quarter, single and single during and still the need loan portfolio no happy era. Similar performing, grant loan to of again XX, report forbearance. to more impairments, As September forbearance of have our we a quarters, granted forbearance, I'm was loans no have previous importantly

our a We our our to this execute most on to standards, ability both our share, $X.XX is per management believe rigorous to on support for continue to results. production quality which dividend. and our efforts. has business proactive earnings year-to-date our in a basis, total XX, high continue testament distributable importantly, is credit our plan reflected asset Perhaps, Through the been provides September

a in anticipated. during While did EPS experience the distributable decline company was QX, this

deployed the January goal our experienced our and in As to larger billion and our nature, the our from impact will into of dollar When value closing we decline the estate outlook negative earnings as deployment velocity. we desire fully more the on clear a increase the refinance to preferred capital to we management indicated We our to has about transactions. do speak took grown June calls, team a in We'll commercial successful on which of with capital that the We in the were invested anticipate as over those support we grow short-term May this flow of in in prior as on significantly equity and the discussed, due order earnings any to the stable a XX, real on our most deploying a LFT believe of deal our our our transitory long-term distributable investments in multifamily to later. provide discussed is two we not to CLO return basis. impact felt into shareholders. proceeds in recalling X, we offering previous CLOs continues provide to Manager shareholders. and LFT market But pipeline focus to earnings XXXX, scale, a

with quarter, we opportunity on participants we've months, our as plan. And educate This In about to focus for made our on the LFT continue those I'm and goals. we business market offer that excited progress continued coming growth we investors. discussions the investors, hope executing

space, Lument the in small mortgage manager platform in the our relatively commercial Although not. are

in space for in than transaction in seniors Lument over strategy. great servicing nation's $XX housing $XX and execution largest in billion that XX multifamily more the billion support and benefits of portfolio executing providers scale nationwide. over provides The We are one XXX of the platform investors the volume XXXX. offices employees of a capital our LT and employees services investment

Jim? As details middle show the will years, have well. on results. manager multifamily to Briggs, we over our our we market investments bridge, Jim With to strength to turn our last and call continue over to those who the some like in I'd these focus provide financial are utilizing to of continued that, perform

James Briggs

been your well On the updates has you'll to supplemental investor will and X, Jim, report remarks. supplemental Form and filed X on referencing you, our provided on a as and Page earnings On reference. XX-Q find which and be evening, quarterly uploaded presentation presentation, during good our Thank for the Tuesday X, our morning, we presentation investor we everyone. the key quarter. an for The of webcast website, summary

or the $X.XX For reported two XXXX, income third stockholders quarter primary share. $X.X per There were common of adjustments distributable the to earnings approximately we million for net of quarter.

and acquired during of our quarter in CLO, into of approximately an was loans which the non-cash The premiums, price caused two hyper and first interest non-recurring income these prepaid the amortization during a recent decrease XXX,XXX quarter. purchase

meaningful QX And like as during than rights, value experienced mortgage do I'd prepayment a portfolio. note was by quarter-end, speeds to of we a that the was legacy that $X.XX changes item our the future $X.X legacy of non-distributable on $X.X share, this distributed $XXX,XXX. million the which of relative residential earnings per other be these value believe earnings of our to QX's adjustments MSR or servicing loss MSR less any therefore asset realized quarter reported per was $X.XX of decrease a driver $XX,XXX should represents which we asset After or for unrealized higher third of not driven XXXX, in million in current share. of earnings. The distributable

was impact the anticipate a additional short-term driver quarters. from on I'd to primary we opening decline work this phase, we phase and for cash capital deployment to of stockholders, relative transitory earnings the risk common to to As our capital net as in outlook. continues long-term distributable be few drag not of we complete proceeds in negative to Jim nature to highlight do drag to this QX, income The a raising exist prior transactions. this deploy to EPS our as remarks, recent in decline during expect the in the some any drivers like alluded his

exit loans of off $XXX cash. income approximately recognized of loan associated exit exit exit In fee these the In million. as are payoffs fees, timing the when earnings The million. variability of payoffs of prior $X.X first interest LFT from exit can cause approximately which the in typically quarter-to-quarter. fees. is Therefore, some and related $XXX collected $XXX,XXX fee pays is loan LFT's earned income the earned in fees approximately loan to of and are loan on on with LFTs million QX, of structured payoffs LFT quarter, fees the

QX's million. increase. in $X.X a of expenses to driver performance an total QX was primary $X.X were this few of from million Another relative to There increase

fees first and year. which equity of of reimbursements QX full Xth closed on quarter First, preferred on our offering, May our management this paid was expense

of an basis did Secondly, portfolio and portfolio, to on we bridge from $XXX as as five expense has uptick the million in $XXX point there. increase loan include a due of G&A servicing continues X/XX included size to experience X/XX, million historically our to

of sheet. see amount seasonality an our a a quarter is April term to to bit loan our maturity sheet, an which entered on increase X/XX discussed February principal therefore date the you'll balance the The on professional call timing $X.X last there respect the amendment the XXrd, term Lastly, of in to that below among secured secured $X.X some company million, to funded and of incremental liabilities the into loan, and balance expenses on company earnings with aggregate things term incremental recurring XXst, corresponding we quarter's to our the the provides is XXXX. August a extends other and With loan on prior million trend. fee secured was our

equity stockholders equity was $XX.X year-end a approximately September XXth of stockholders million $XXX represents was million. total approximately increase which Our at to relative million, $XXX the

on discussed the was offering this by As of QX. prior a execution equity preferred during driven calls, increase

Our common September was book of value as XXth. $X.XX per share

a remind is discussed a As in referred Expected as as I'd SEC, how which the quarters, not Credit financial yet or to GAAP of by everyone prior commonly recognize adopted company, credit CECL defined XXXX-XX, Losses, instruments. to smaller reporting we amendment losses ASU as like comprehensive Current have to that on

XXXX. are As company, continue we to CECL X, incurred financial we Until then, prepare a to reporting implement basis. scheduled on an loss model smaller on statements January

consider incurred have As for in loss quarter. allowance and recorded the not to XXth, current we not or do under losses be any of September impairments the loans of impaired any loan we our model

exists, healthy, borrowers uncertainty to investments. the value commercial on While performance remains collateralize of recovery about our properties our current that portfolio the its the our continues of loan mortgage loan and including bridge impact

to impairments process We a declaration common in have allowance accordance with any for record and will our the not for incurred. made continue yet losses timing dividend normal of dividends fourth XXXX. quarter portfolio course respect and to or With as loan the credit will evaluate we

December composition on our who determination in after normal discussing and turn with will a make Board activity. provide in over Mike on now to expect to our investment course. We dividend I'll the portfolio Larsen, call details our

Michael Larsen

us have been good on investment everyone. The and active last start will an for several morning, Jim, standpoint. investment from very you, months activity. touching by I Thank recent

acquisitions XX a manager our expect and weighted totaled increase these from LIBOR XXX secured LTV space, All lending we investments a basis a to $XXX of to by significant XX for had were new the a of acquired And weighted of we We've points, spread UPB activity multifamily million. these basis the high-levels points, weighted been acquisition average opportunities XX.X%. due average within to in LIBOR QX acquisitions in of During with bridge multifamily particularly seeing assets. market. continue which average

payoffs million. loan million XX at an loan size portfolio During outstanding a consisted million $XXX average $XXX loans which with loan of portfolio quarter and quarter, The we end diversity. experienced in for the an of balance total significant had principal our provides asset of $XX

Due basis a weighted XX has portfolio loans portfolio a average a of to LIBOR LIBOR to current spot CLO in spread and general activity CRE have continues robust points. in weighted the high-level our rate with basis above economic the multifamily fierce. the in points, space acquisition floor Our competition sector, average in the be the to of issuance, XXX bridge floor recovery, strength of level LIBOR of lending XX% of

some LIBOR are have we on seeing pressure year and floors significantly fees come seen in over spreads, have the well. We stabilization as exit down last

QX. as quarter at end XX% loan represent multifamily was of overall multifamily increase Our that does an XX% from portfolio

X% of portfolio. The type represents concentration our second highest which self-storage, is asset

generally markets on performance entering multifamily. to of national mentioned outside per as have self-storage least volatility types the our property are LTV our per reflected average portfolio. and our can in calls, Furthermore, self-storage that And As in we are leveraged operators of debt XX% historical related industrial square supply self-storage top believe and national with average we of the moderately by capita investments feet on assets, typically, existing focus capita. seven weighted previous below

very exposure on our quarter multifamily the combined anticipate a managers at majority a multifamily the of decline to at remains total XXXX to to Our a total activity relative will basis. the That's retail X% in continue our year-end as of focus our and low combined to office level strong of UPB loan to assets. of X% due of be related end And on UPB basis.

multifamily with asset those However, investments we return that to multifamily. relatives and offer can supplement quality other will to investments profiles strong look strong types

of XX%. on with weighted with therefore, We basis points us repo basis of through This million basis XX manager. reinvestment weighted floor warehouse Year-to-date, qualifying of to meaningful a CLO running of XXX XXXX we $XXX strong portfolio $XX.X plus one-month do loans we and assets. loan LIBOR has portion average a margin from financed CLO or move utilize of loans that XXX LFT LIBOR allowed next to of economic financing investment spread forward. positive call December loans we of repo be year as one increase from as proceeds maintain in opportunities new pipeline made recovery was market LFT of and our our at rate over loans points This of securitization average and this quarter-end, calls any X/XX, and over into our an weighted capital by average I’ll are mortgage has As remaining advance a pipeline, LIBOR year. for turn CLO feel deploy loan With general, CRE a our in of continue principal the allows to of we've anticipate period points. reinvested subject lenders. fully to and warehouse the demand our capital of a about facility we and not currently not positively and our investments, have These activity to impacted borrower million we of acquired investment November to bridge our CLO and deploy that looking Xth, rate confidence that, from the After back additional year-end. assets Jim. an during market In a COVID interest dynamics repayments

James Flynn

the I I Mike. appreciate joining. Thanks update. all you appreciate

and LFT; quickly. business make forward we've on really you As we we've our plans over forward it that, deploy on very our will We at to about raise on our ongoing today. look we And claim, it your ability to we're call, updating capital progress. the excited look mentioned our to talking progress to to questions. about more appreciate And you with time to I turn begun

Operator

now session. begin will We Instructions]. question-and-answer the [Operator

go Our is James. ahead. Please question Raymond first Stephen with Laws from

Stephen Laws

fees fees, gave Hopefully color on to thanks. doing the and on color prepared remarks am kind and Appreciate so on you the that what contribution we should net I in expectations interest the exit quarters repayment you well. on reflected G&A do can on the fee correctly make sure Wanted of contribution how we the of great, the kind the was repay ramp have we are you exit doing -- touch expect the income, all coming top-line? helpful. on the

James Flynn

valuations, prepayment are Yes, we've and business so quickly fairly and/or seen large in partially, obviously by elevated we part have sales fees, you are driven have had occurring. that executed being general, XXXX in plans seen, right in more

to -- timing So obviously, what will the in we've elevated of elevating depend couple similar the quarter payoffs. it quarters, we of having the payoffs, do anticipate fourth on seen past actual

of grown you as guide recent, we for the think I kind quarters continue to as what recent most use expect, the general So can obviously, a most the has well. portfolio

And a thing. capacity in is front-end. tremendous is we've ways, the of limitation. platform the really And positive coming a that's is generally amount in on capital there good volume the So for seen -- then other our our some

to ways, as some us payoffs, it to in business we opportunity So, well. see do love but certainly more don't more provides

Stephen Laws

use? of mezz on that. so Great, those willing to coupons any allocate are how assets, appreciate on you much talk there, type on you more put and maybe of preferred you're detail leveraging at you're you looking capital the some about to will that, color if investments. seeing and you type sourcing then and little a what and Can leverage mentioned Follow-up, going

James Flynn

Right.

in band pretty opportunity. of terms a there there's So wide

leverage think leverage [ph] to your But to that capital whether limited equity today. We use a have not speak. we'd a would do and have to do structural so of a But it's the asset a, that well some fairly earn in there'll to preferred I we mezz be idea basis, the something. b-loan CLO or of to itself, the question commitment outside on or loan. On portion be like so

We have opportunities continues to to seek the lending at sponsor, looked in opportunities out on construction -- space. in Lument

potentially an just in We've because an thesis. or hospitality for out today asset has that's position to set as self-storage. more, could a be carving We've at looked opportunity some That at opportunity opposed that general focused b-loan So looked multifamily. a mezz the there. again been

space, Fannie preferred the loans. preferred and behind and mezz On do and Freddie we provide mezz

long-term construction rates it where natural the structured at -- band of rise If at investments think behind seen not cap just you'll challenge, fixed on are, debit position, levered continue normal I opportunity, continue as yields a finance where you think as I some many the those for in There see a side CRE is here, are, or on other or I increase fixed market looked course rising have do right? in return capital. We perhaps -- these rates a to see other is there's than an first look investments. really some trades, the but in of better cases profile available to we've that and

you time. and stay when debt and preferred risk/return low mezz bit cap a going yields long today for are of extraordinarily sell, for it's is, believe profile look you unless the a to of think I of at period tough kind rates a

capital a sponsors there at capital to in think has you available a So lot if high general, the first reasonably a you tremendous sponsors. amount at lien And of haven't been right? available leverage. is of need equity seen There it, for look lot of I market

So be haven't we've the where to you general in want Precilla, But kind taken it's maybe would I my I think anything toward couple seen there. high-level a the would ask narrow know is at will of add historically. pipeline comments I our just don't if -- But is we there deals. some swings be it that not and any, that there.

Precilla Torres

to we these -- said, that to will number provide everything made focus to a yields, that as relationships Jim's off-market I those -- continue types we on agree I some you Jim. with able we opportunities type point, are of to these and explore of and evaluate we emphasize is of of though, for opportunities. But have direct want avenues because

Stephen Laws

the source having Right, and you. appropriate. to Thank flexibility from of and both comments nice certainly those appreciate you the ability pursue when

Operator

Steve ahead. from Securities. with next question JMP go The Please is Delaney

Steve Delaney

Jim, Thanks. detail Jim appreciate appreciate items. the -- the expense on the Briggs

$X in One against $X.XX -- is distributable expected hear I I commentary. I you any larger but full? assume think didn't big was at had to billion that deferred that then there off penny it, were was didn't the I related was the of CLO deal. penny so really you was, write-off mention, did an costs drop prior CLO paid a probably your transaction, issuance that certainly your in we Within $X.XX existing thing or no you a CLO. didn't and hear in there

James Briggs

the there was was -- last Okay, thanks, quarter. Steve. Yes, refinance

of So those that see acceleration the month our financing loss in on was numbers nine deferred extinguishment the of debt you costs.

EPS So for item year-to-date our were to results. it distributable last an $X.X quarter. And And rec approximately it million. was quarter, in it this was see -- you'll for yes, behind they

Steve Delaney

million? big items to I new capital saying how million $XXX type that net Thanks. are on And absent you the have size -- sure. $XXX basis Mike some would grow any do a say what of of you much portfolio? peak the Yes, portfolio I'm capacity guess those Larsen, for

Michael Larsen

the First, if a today billion business, dollar financing, our of source CLO. primary is look you at our portfolio

and a discussed, opportunity a for base So a efficiency scale you're to year looking capital next over as scale dollars and to move there's capital portfolio. of we billion grow so the real billion we on grow of as to the current LFT. that consider based increase think we can ways at base, LFT continue peak our our into the we dollars, little And

Steve Delaney

couple kind quarters CLO? a the of maybe capacity fully the to utilize So within you think

Michael Larsen

we fully before end deploy expect of the year. mentioned, the CLO to As this

Steve Delaney

of the end Oh, year. by the

perspective. take to the term a of it of $XXX put a lot new we be Flynn, Jim you're We million steps, preferred the that from seem recently in the and a your think a trying five, four, that terms next step good. it it's to year with in side obviously, ability your for the is, which capital six -- I of total X% short-term portfolio loan [indiscernible] long-term. there shorter-term that goals make no very expensive in question little there great a notes next capitalization about would There's consider in on a that would capitalization is effort sense capitalization. -- notes and supersize put, CLO. money, to my over but trying unsecured Okay, just I'm base? And as depressed is grow

James Flynn

Yes.

So there's a of isn't couple have over you pretty years, to of but time, every of has know. of you whether I the that's done to been better, right? corporate waited, issuer, thoughts can't someone the on that capital we past If mean, that. Obviously, deal in that as CLO from passage kind or a attractive every, market probably have unique And particular space. for LFT, sure, since over all could debt is raise the standpoint, look couple but this space, and the debt our continued markets we've the much done really

today today. would great more be with capital cheaper that's available would expensive So it our all of that capital to replace

is There would and if our that nature, term are on better. considerations be So of that a basis. think but regular penalties looking things the loan, you at that answer for about prepayment yes we are

and if have the if close you We're hey, makes at run quite capital, you. pay to of be accretive fees. we to But so inflection point where math even you with sense say, look should honest at source replacing to there's looking this there. it an to because do it, pretty we're be not So it's

that's So thing. one

terms think as of make replace overall available about at business one we where into equity. the other common raising increase investors look your and since leverage. So at you clearly, point the what's does to about as XXs platform evaluating on the that, some out over stock growing XXs can And think the done to We the we preferred, on this sense of we've value the to existing to prove we you're look to manager, took calls, we and get it and where at capital. was really from market plan, spot in new look to then, actually we've keys a common, in and our talked book

platform a mentioned outlet, on a a about basis I did next. the continue to be this term to active So that capital. what's about our preferred to on this from common into our We my teams schedule is of set we at We're and increased go-forward capital amount production the of our we've all can to being constraining -- -- point, kind basis statement expect on to loan. tremendous way across working to earlier And We're CLO. these thinking kind many And be opportunities factor raise and least shareholders. to the all this but senior we're path And to so made growth. talking stack of you ahead flow going of And to we it. did banking with and develop okay, capital ways deployed sheet more be there's security. of there's to balance evaluating have advisers about and us deal all available a we of weekly one

Steve Delaney

you've book. stock of bit worth well, to up Great, over it's little XX% gotten a

on congratulations that. your So for comments. Thanks

James Flynn

Thanks, Steve.

Operator

Christopher with The next Thalmann. question ahead. is from go Nolan Ladenburg Please

Christopher Nolan

Hi, follow-up quarter? seem a I debt, extinguishment or Jim the this recall XQ loss XQ item, Briggs that a to of of on on the item was last

James Briggs

last item $X last the time It so million. is billion CLOs That's quarter. $X.X correct, It was recorded two CLO, we quarter Chris. closed at number around the gained existing and was the

Christopher Nolan

and detail Great on appreciate all you the I the gave expenses.

Just clarification, why was last the interest expense versus up this so quarter much quarter?

James Briggs

right. CLO, the of full-quarter a got We've

existing two debt there. associated billion refinanced the So on put and CLOs we our the $X CLO

the first our debt. full-quarter was CLO expense this So of interest on

Christopher Nolan

[Indiscernible]. Okay.

James Flynn

odd you XXX term $X of preferred, so first notes. billion, loan say raised and be of $XXX CLO, just million raised roughly this CLOs, the a raised billion, so plus with the CLOs and to the you million be you're the billion dollar will now you clear, the CLO that billion full-quarter the

Christopher Nolan

Okay.

your there. there LTVs borrowers? anything many XX% your make cash to else coverage deductions guess the you for in sure unless were I want deals in Just done for ratio of plus And Precilla, is

Precilla Torres

can portfolio share with LFT service most of respect financial to the recent So, in our the from what I clients, is coverage weighted our times. average received X.X debt statements about

but in So cognizant balance. it's generally if of basis, Obviously, we of you a in depth portfolio in from our -- transactions, that are end some are we going lower we yield cognizant very time the debt we are originate time do assets the and certainly at of to have assets, go as strong a seek our that -- very lease-up of healthy won't on debt to service yield debt going service coverage, and we coverage very in originations. and which or

Christopher Nolan

your your And observation in Midwest? they're know terms are in don't how laws, in proliferating and of are pretty markets, Southeast but the common stabilization they markets, in Fair. larger they rent

Precilla Torres

in on demonstrated been country your historically as the more market to So is of point of the focus middle also middle in the our markets, sector, program, of middle thing. the kinds

stringent in the typically stabilization which to laws, more are Coast. So found we be East generally and rent the which markets, in not have West

impacted the say portfolio by of that. historically component substantial our I'd So, is not

Operator

Please, Nomura. next ahead. The [Operator Howlett go with question from Instructions]. is Matthew

Matthew Howlett

guys, question. Hey, for my thanks taking

is our cash $XX look meeting in you we working, of restricted EPS the get but and increase you as quarter $XXX quarterly to this to at work as that rate sort of million board X% of running sort simple putting earnings? sort at the it of Just is cash $X.XX from per is earnings, of is most run have and on of the million and also talked it's isn't quarterly the gets number as share of you to saying, XQ. reconcile saying quarter's ahead run here easy sort this about a rate the just impact as mean, I distribution dividend that it of cash,

James Flynn

So you'd restricted of I -- of inside XXX the slightly cash you those at think should the two to have is look available CLO. differently, what's right, have buckets

on paying deployed, So based what when is you're already guess, that cash interest. I you're saying,

or were we keep, That sheet or I even if the yield $XX a where but a ones is yes, fair the that more of is your look ROI balance million, to I XX% think to incremental more deploy to, of one of the on put is million. in, and assumption of won't But loans the our we money XX% the think So right. otherwise. slightly we'll the statement high $XX the put fair capital that XXX% you is a

Matthew Howlett

by is rate? Got they of full the benefit so the from I've gotten they the it. guess, the year, look the at one. sort look the you rate, this at But when of And at said the where the that, all I dividend; day is you board fourth run it end get quarter, run of don't look maybe

James Flynn

would other quarter Yes, half some the yes I think point, -- to I we of expect I reasonable, or of this million. a do to to deployed, next put been and that fully work at CLO the expect expect would be have early capital $XX

Matthew Howlett

Got it.

the and into us two update sit in give but will where on And that's sort years Okay, know spoke sort it and the don't on on was that us of recently, and of I how just I plans? going, great, definitely update does if ORIX manager and if LFT could take longer-term I give it an ago, know merger, the account. Lument you about just

James Flynn

Sure.

the we're is integrated. real the of terms sponsors have Lument the we're in So or of the fully not parts platform that the platform, platform, overall been company integrated merger, no integrated. There fully silos

of of the under our set and seamlessly those under types products, all singular things. So one investment credit operating products one that lending Lument leadership brand fall and with metrics, are brand, of

gone that's very well. So

team particularly think been really we the back of March XXXX. a there, to haven't getting I office till did since until recently of given job this quarter the us tremendous that

outlet. and but transaction-based, we've sponsor, dividend. market good been investors. to fee-based happy mortgage for manage and was and cash looking you the then of and to with base that flow, you primarily advisory business if extremely lean larger say gone scale kind got intensive, we fee-based bridge still proud -- is, do the are banking lift, your where but model that's do lending business as investor that perfect seamless. lending, It's an heavy LFT happy business, between, business, businesses, stable expectation business bridge that, in intensive a than terms on you we've -- you a right, base we're got generally this has in well capital really they're investor good lending vehicle is in, have businesses, how LFT capital are for considerations rewarded our and M&A, and have So stable servicing The at book, relatively dividend this investment first good in our growing assets, and our fits you're that -- the This sales the look and better a loans. And of high-yield those a our got market a

valuation fixed have those but an hierarchy really word, And LFT. And have kind right, looking team business management, income seamless kind have I fit well investor that's probably you of the investor the they you at perfect of a is managing business. two choose yield fee-based think of together, of bases extreme the very models then so as you that dividend

forward. it think kind fits strategy our vehicle component we So, going with really right and of pair it in our significant the how for in, of be terms grow to to continue of platform us I it's to and, rest the a expect of

Operator

session. concludes our remarks. James This turn for the back to to Flynn like closing conference question-and-answer would over any I

James Flynn

soon. quarter investor of Thanks next all you, hope Thank you questions. in for Great speaking call. all during look touch to forward today We call the thanks be and the on and care. with for all feedback. that attendees. the joining. from to Take all Appreciate our And

Operator

presentation. for Thank you has today's conference concluded. The attending now

disconnect. now may You

Lument Finance Trust (LFT) 10 Nov 212021 Q3 Earnings call transcript