Ready Capital Corp
For the period ended Jun 30, 2026. Filed Aug 7, 2026.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Jun 30, 2026 · Filed Aug 7, 2026
RC$0.85-20.4%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2026-03-31; filed 2026-05-08.
0001628280-26-032982
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2026-06-30; filed 2026-08-07.
0001628280-26-054850
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
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566 unchanged; 62 reworded; 92 added; 40 removed; 3 previous and 6 current paragraphs rearranged.
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A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (92)
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described below, distributable earningsand distributable return on equity are measures which are not prepared in
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loan activity andoperations. We use distributable return on equity because we believe it is the most relevant metric for
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determining ongoing profitability period over period. Refer to “—Non-GAAP Financial Measures” below for a
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Three months ended June 30, 2026. Earnings from continuing operations was a loss of $0.63 per common share,
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compared to $1.25 per common share in the prior quarter, principally due to a decrease in the provision for loan losses
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and non-performing assets pursuant to the balance sheet repositioning strategy which included strategic loan sales, and
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transfers of loans to held-for-sale classifications. Book value per common share was $6.83, a decline of $0.60 quarter
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over quarter compared to a decline of $1.36 in the prior quarter. The quarter over quarter decrease in the rate at which
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part of our balance sheet repositioning strategy.
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FL11, RCMF 2023-FL12 and RCMT 2016-3 and paydowns on securitized loans, partially offset by the closing of RCLT
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held for sale, and the closing of RCLT 2026-4, partially offset by the collapse of RCMF 2021-FL7, RCMF 2023-FL11,
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RCMF 2023-FL12 and RCMT 2016-3.
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consolidated VIEs, net, partially offset by an increase in Guaranteed loan financing. Secured borrowings decreased $0.9
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billion due to the closing of RCLT 2026-4 and payoffs, partially offset by the collapse of RCMF 2021-FL7, RCMF
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2023-FL11, RCMF 2023-FL12 and RCMT 2016-3. Securitized debt obligations of consolidated VIEs, netdecreased
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$0.5 billion due to the collapse of RCMF 2021-FL7, RCMF 2023-FL11, RCMF 2023-FL12 and RCMT 2016-3, partially
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offsetby the closing of RCLT 2026-4. Guaranteed loan financing increased $0.4 billion due to the closing of RCLT
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Q2 2026 versus Q2 2025. Interest income of$53.9 million representeda decrease of$68.3 million, due to a decrease in
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loan balances and an increase innon-accrual loans. Decreased loan balances were primarily driven by reduced
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origination activity, portfolio runoff, loan maturities, strategic loan sales, and transfers of loans to held-for-sale
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classifications in connection with a broader balance sheet repositioning and liquidity strategy in response to upcoming
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2026 debt maturities. Increase in non-accrual loans wasprincipally driven by adverse macroeconomic conditions
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including elevated interest rates, inflationary pressures, supply absorption challenges, and cap rate movements. Interest
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expense of$65.2 million representeda decrease of$50.8 million, driven by decreased loan balances as described above.
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Provision for loan losses of$13.7 million representedan increase of$8.5 million, primarily due to an increase in asset
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specific reserves. Non-interest loss of$19.3 million representeda decrease of$17.3 million, primarily due to an increase
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inthe valuation recovery and income from the Portland mixed-use asset, partially offset by an increase in realized losses
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Portland mixed-use asset.
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YTD 2026 versus YTD 2025. Interest income of$112.8 million representeda decrease of$134.4 million, due to a
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decrease in loan balances and an increase in non-accrual loans. Decreased loan balances were primarily driven by
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reduced origination activity, portfolio runoff, loan maturities, strategic loan sales, and transfers of loans to held-for-sale
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classifications in connection with a broader balance sheet repositioning and liquidity strategy in response to upcoming
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2026 debt maturities. Increase in non-accrual loans was principally driven by adverse macroeconomic conditions
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including elevated interest rates, inflationary pressures, supply absorption challenges, and cap rate movements. Interest
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above. Provision for loan losses of$80.2 million representedan increase of$193.0 million, primarily due to changes in
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$63.7 million, primarily due to a decrease inthe valuation allowance and income from the Portland mixed-use asset,
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partially offset by an increase in realized losses on financial instruments related to loan sales. Non-interest expense of
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$73.7 million representedan increase of$18.4 million, due to an increase in other operating expenses primarily driven
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by operating costs and depreciation related to the Portland mixed-use asset.
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Q2 2026 versus Q2 2025. Interest income of$23.5 million representeda decrease of$7.0 million, primarily due to a
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flows.
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described below, distributable earnings is a measure that is not prepared in accordance with GAAP. We use distributable
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FL11 and RCMF 2023-FL12 and paydowns on securitized loans. Loans, held for sale decreased $0.2 billion, primarily
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to loan sales and loans transferred from Loans, net to Loans, held for sale, partially offset by the collapse of RCMF
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2021-FL7, RCMF 2023-FL11 and RCMF 2023-FL12.
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Secured borrowings. Securitized debt obligations of consolidated VIEs, netdecreased $0.6 billion due to the collapse of
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RCMF 2021-FL7, RCMF 2023-FL11 and RCMF 2023-FL12. Secured borrowings decreased $0.5 billion due to payoffs,
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partially offset by the collapse of RCMF 2021-FL7, RCMF 2023-FL11 and RCMF 2023-FL12.
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Q1 2026 versus Q1 2025. Interest income of$58.9 million representeda decrease of$66.1 million, primarily due to
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decreased loan balances primarily driven by loan sales and an increased balance of loans on non-accrual status driven by
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a higher probability that principal and interest will not be collected under the original contractual terms. Interest expense
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for loan losses of$66.5 million representedan increase of$184.5 million, due to changes in the forecasted
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million, primarily due to a decrease in the transfer of Loans, net to Loans, held for sale and the recovery of the valuation
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Q1 2026 versus Q1 2025. Interest income of$22.8 million representeda decrease of$7.2 million, primarily due to
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decreased loan balances and interest rates. Interest expense of$16.2 million representeda decrease of$4.0 million,
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$4.0 million, due to changes in the forecasted macroeconomic inputs for reserve modeling, partially offset by an increase
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in specific loan reserves. Non-interest income of$19.1 million representeda decrease of$17.4 million, primarily due to
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unchanged from the prior year period.
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representeda decrease of$2.2 million, primarily due to decreased transaction related expenses.
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representedan increase of$282.1 million from thethree months ended March 31, 2025, primarily due to provision for
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reserves, partially offset by a decrease in the provision for loan losses related to loans transferred from Loans, net to
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Loans, held for sale, a gain on bargain purchase recognized from the UDF IV Merger in the prior year period, primarily
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change in our stock price between the date of the agreement and the closing date of the UDF IV Merger and net realized
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losses on financial instruments and real estate owned driven by loan sales, partially offset bydecrease in the valuation
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allowance related to the transfer of Loans, net to Loans, held for sale driven by loan sales. Consolidated distributable
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losses before realized losses of$49.2 million for thethree months ended March 31, 2026 representedan increase of
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Merger in the prior year period and realized losses on sale of investments, partially offset by a decrease in thevaluation
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allowance related to the transfer of Loans, net to Loans, held for sale. Consolidated distributable lossesof$159.8 million
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for thethree months ended March 31, 2026 representedan increase of$148.5 million from thethree months ended
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$200.0 million of unrestricted cash and approximately$700.0 million of unencumbered assets as of March 31, 2026. We
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expect approximately $450 million in net liquidity from portfolio maturities and pending asset resolutions over the next
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12 months, and may also sell additional assets. We expect the combination of these items to de-lever the balance sheet,
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which may impact book value depending on the size, timing and pricing of such actions. We expect to utilize these
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paydowns of warehouse loans, partially offset by the collapse of RCMF 2021-FL7, RCMF 2023-FL11 and RCMF 2023-
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FL12.
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million outstanding under this credit facility.
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(8)Interest on the corporate debt is payable quarterly on March 15, June 15, September 15, and December 15 of each year.
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Broadmark merged with and into RCC Merger Sub, with RCC Merger Sub remaining as a wholly owned subsidiary of
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the operating partnership (the “Broadmark Merger”), RCC Merger Sub assumed Broadmark’s obligations on certain
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customary affirmative and negative covenants.
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•our potential entry into certain hedging arrangements related to the delivery of shares of common stock upon
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•our entry into certain hedging arrangements related to the delivery of shares of common stock upon vesting of
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vesting of certain performance-based equity awards and restricted stock awards and the risk that such
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certain performance-based equity awards and restricted stock awards and the risk that such arrangements may
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arrangements may not have the desired impact and may expose us to additional risks, including the failure of
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not have the desired impact and may expose us to additional risks, including the failure of the counterparty to
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the counterparty to perform under the contracts;
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perform under the contracts;
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rate loans. As of March 31, 2026, all fixed rate loans are match funded in securitization. Floating rate loans generally
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rate loans. As of June 30, 2026, all fixed rate loans are match funded in securitization. Floating rate loans generally have
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have an adjustable interest rate equal to the sum of a fixed spread plus an index rate, such as the Secured Overnight
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an adjustable interest rate equal to the sum of a fixed spread plus an index rate, such as the Secured Overnight Financing
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Financing Rate (“SOFR”), which typically resets monthly. As of March 31, 2026, approximately 80% of the loans in our
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Rate (“SOFR”), which typically resets monthly. As of June 30, 2026, approximately 81% of the loans in our portfolio
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portfolio were floating rate loans, and 20% were fixed rate loans, based on carrying value.
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were floating rate loans, and 19% were fixed rate loans, based on carrying value.
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Current market conditions. During thefirst quarter, macroeconomic concerns persisted including global market
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Current market conditions. During thesecond quarter, macroeconomic concerns persisted including global market
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Federal Reserve did not decrease interest rates in the quarter and there is uncertainty regarding if and when decreases
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Federal Reserve held interest rates steady during the quarter and there is uncertainty regarding if and when decreases will
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will occur. Although the full impact of these changes remains uncertain and difficult to predict, concerns and
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occur. Although the full impact of these changes remains uncertain and difficult to predict, concerns and uncertainties
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uncertainties about the economic outlook may adversely impact our financial condition, results of operations and cash
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about the economic outlook may adversely impact our financial condition, results of operations and cash flows.
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earnings to evaluate our performance and determine dividends, excluding the effects of certain transactions and GAAP
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accordance with GAAP. We use distributable earnings to evaluate our performance and determine dividends, excluding
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adjustments that we believe are not necessarily indicative of our current loan activity and operations. Refer to “—Non-
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the effects of certain transactions and GAAP adjustments that we believe are not necessarily indicative of our current
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GAAP Financial Measures” below for a reconciliation of net income to distributable earnings.
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reconciliation of net income to distributable earnings and for the calculation of distributable return on equity.
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allowance from loans sold, partially offset by net realized losses on financial instruments and real estate owned driven by
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and net realized losses on financial instruments and real estate owned, which were primarily driven by the sale of sub-
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was primarily driven by a discount in UDF IV’s market valuation due to factors such as the illiquid nature of UDF IV’s
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book value per common share decreased was primarily driven by the wind down of the large portfolio sales that were
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Assets of consolidated VIEs decreased $1.0 billion, primarily due to thecollapseof RCMF 2021-FL7, RCMF 2023-
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Assets of consolidated VIEs decreased $0.9 billion, primarily due to thecollapseof RCMF 2021-FL7, RCMF 2023-
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due to loans sold, partially offset by loans transferred from Loans, net. Loans, netdecreased $0.1 billion, primarily due
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Loans, net. Loans, netdecreased $0.1 billion, primarily due to loan sales, loans transferred from Loans, net to Loans,
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As of March 31, 2026, total liabilities in our consolidated balance sheet were$4.9 billion, a decrease of$1.3 billion from
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As of June 30, 2026, total liabilities in our consolidated balance sheet were$4.9 billion, a decrease of$1.2 billion from
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December 31, 2025, primarily reflectinga decrease in Securitized debt obligations of consolidated VIEs, net and
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December 31, 2025, primarily reflectinga decrease in Secured borrowings and Securitized debt obligations of
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As of March 31, 2026, total stockholders’ equity was$1.4 billion, a decrease of$0.2 billion from December 31, 2025,
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As of June 30, 2026, total stockholders’ equity was$1.3 billion, a decrease of$0.3 billion from December 31, 2025,
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loan sales. Non-interest expense of$40.9 million representedan increase of$13.2 million, due to an increasein other
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on financial instruments related to loan sales. Non-interest expense of$32.7 million representedan increase of$5.2
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operating expenses primarily driven by hotel expenses.
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million, due to an increase in other operating expenses primarily driven by operating costs and depreciation related to the
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of$80.7 million representeda decrease of$39.7 million, driven by decreased loan balances and interest rates. Provision
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expense of$145.9 million representeda decrease of$90.5 million, driven by decreased loan balances as described
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macroeconomic inputs for reserve modeling and an increase in asset specific reserves, partially offset by loans
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the forecasted macroeconomic inputs for reserve modeling and an increase in asset specific reserves, partially offset by
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transferred from Loans, net to Loans, held for sale. Non-interest loss of$68.0 million representeda decrease of$46.5
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loans transferred from Loans, net to Loans, held for sale. Non-interest loss of$87.3 million representeda decrease of
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driven by decreased loan balances and interest rates. Provision for loan losses of$4.4 million representeda decrease of
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decrease of$2.1 million, driven by a decrease in average loan balances and a decrease in interest rates. Provision for loan
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a decrease in net realized gains on financial instruments. Non-interest expense of$29.2 million was essentially
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decrease of$31.4 million, primarily due to a decrease in net realized gains on financial instruments. Non-interest
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Q1 2026 versus Q1 2025. Non-interest income of$0.9 million representeda decrease of $102.8 million due to a gain on
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Q2 2026 versus Q2 2025. Non-interest income of$0.8 million representedan increase of$15.0 million, primarily due to
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IV’s market valuation due to factors such as the illiquid nature of UDF IV’s shares, and a change in our stock price
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UDF IV’s shares, and a change in our stock price between the date of the agreement and the closing date of the UDF IV
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bargain purchase recognized from the UDF IV Merger in the prior year period, primarily driven by a discount in UDF
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discount in UDF IV’s market valuation due to factors such as the illiquid nature of UDF IV’s shares, and a change in our
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between the date of the agreement and the closing date of the UDF IV Merger. Non-interest expense of$12.6 million
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stock price between the date of the agreement and the closing date of the UDF IV Merger. Non-interest expense of$29.2
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Q1 2026 versus Q1 2025. Consolidated netloss of$200.1 million for thethree months ended March 31, 2026
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YTD 2026 versus YTD 2025. Consolidated netloss of$299.8 million for thesix months ended June 30, 2026
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$53.3 million from thethree months ended March 31, 2025. Theincrease in the distributable earnings reconciling items
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representedan increase of$75.8 million from thesix months ended June 30, 2025. Theincrease in the distributable
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is primarily due to an increase in the provision for loan losses, a gain on bargain purchase recognized from the UDF IV
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earnings reconciling items is primarily due to an increase in the provision for loan losses, realized losses on sale of
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We believe that our sources of liquidity will provide sufficient liquidity to fund ongoing obligations and address
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liquidity to fund ongoing obligations and address upcoming debt maturities, including the approximately$450.0 million
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upcoming debt maturities, including the approximately$450.0 million of debt maturing in 2026. We had approximately
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of debt maturing in 2026. We had approximately$124.0 million of unrestricted cash and approximately$690.0 million
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resources, together with our access to the capital markets, to meet our liquidity needs.
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upcoming debt maturities. We expect to utilize these resources, together with our access to the capital markets, to meet
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Three Months Ended March 31, 2026. Cash and cash equivalents as of March 31, 2026, decreased by$8.3 million to
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Six Months Ended June 30, 2026. Cash, cash equivalents and restricted cash as of June 30, 2026, decreased by$71.8
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2026-4. Loans, held for sale decreased $0.3 billion, primarily due to loans sold, partially offset by loans transferred from
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on sales of real estate owned assets and LMM loans.
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UDF IV Merger in the prior year period, primarily driven by a discount in UDF IV’s market valuation due to factors
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such as the illiquid nature of UDF IV’s shares, and a change in our stock price between the date of the agreement and the
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illiquid nature of UDF IV’s shares and a change in our stock price between the date of the agreement and the closing
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(7)Interest on the corporate debt is payable quarterly on March 15, June 15, September 15, and December 15 of each year.
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loan losses due to changes in the forecasted macroeconomic inputs for reserve modeling and an increase in asset specific
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shares and a change in our stock price between the date of the agreement and the closing date of the merger. The net cash
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(6)Interest on the corporate debt is payable semiannually on January 31 and July 31 of each year.