MMA Capital (Trading Symbol(s) MMAC MMAC) 18 Mar 202019 Q4 Earnings call transcript

Good morning, ladies and gentlemen, and welcome to the MMA Capital Holdings, Inc. 2019 Annual Financial Results and Business Update Conference Call. My name is Andrew, and I will be your coordinator for today. At this time, all participants are in a listen-only mode.

We will facilitate a question-and-answer session at the end of this conference call. Instructions]. [Operator event this being is note recorded. Please

these to are today and Commission could projections comments which include based These those results will uncertainties, the cause risks MMA the include events future are Securities comments forward-looking from expectations. those current filings regarding identified statements on to statements. of which that materially expressed differ Holdings significant and forward-looking in Capital Some subject company's financial with in of performance Exchange and actual

Listeners the undue forward-looking statements, the the are obligation reliance on which speak of not to in cautioned place The statements. no these only date undertakes any contained forward-looking as company update of to information hereof.

Falcone, MMA ahead. CEO Please go I Holdings. of call now would to Michael turn Capital like the Mr. over to

morning, Vice and Thank Financial our Bjarnason, and Chief Operating Megan you, are me Officer; our and welcome. Chief today call on President President Good and everyone, Treasurer. Senior operator. the Dave Officer; Mentesana, Gary With Sophocles,

today, after questions. which For our all remarks, our take will to Dave, deliver will call available be we prepared I and Gary

of of because on handful note issues I together. of might we cell technical coronavirus a for current call we’re remotely, should I so are doing apologize as develop bridged phones that that, any crisis, but result this the different a

results of our provide to and an financial Capital MMA overall annual purpose The update. XXXX call today review is Holdings business to

and this our Friday, SEC Our Web the an investor annual presentation report filed was available site. past updated is on with

company the shareholders' of represents book year $XXX.X XXXX increase which quarter. for $XX.X which review that are the $XX.X Dave million to in December the will fourth detail an million respect with the we With pleased common value, the for and equity financial later, report year-ended million of or results, to ended

The quarter. the or $XX.XX per compared the XX.X% per for XX.X along in the and the asset finished an book the up recognition year of of renewable fourth at or increase driven strong the year. beginning to quarter $XX.XX, year Book fourth energy for primarily share increase with from XX.X% tax by value share of deferred $XX.XX the million returns value was in investments

further Dave of the the impacted our in annual greatly period tax the and deferred asset will quarterly As recognition discuss, results.

repayment this point debt in the capital manage particular of aided to in third where profitability of was by redeploying the the from recognition company note to XXXX result receivable the and from expenses around of moving operations and Hunt by reposition to from access of the from the foresees work company the capital The liabilities asset years markets yielding the quarters our portfolio and of gaining our fourth recurring investments. the ongoing higher forward, year-end

cause entails are could the important business will financial structure tax realized judgment. significant that volatility. in and assessing of absurd, regard, earnings reporting therefore It's the deferred carrying be requires the deferred estimates potentially though particularly assumptions net and assets results, the value In concerning inherently and to likelihood note change this that of tax making subsequent assets company's periods future and

risks the reflect expanded have of to We our disclosures income. projection filing XX-K book company's pre-tax various of in the

tax business performance assets. which eliminates value non-GAAP deferred impact investor we per presentation of you useful and book and the of include are value release book which underlying of the our measures share, potential see think financial recognition a also adjusted trends, in press assessing the our financial will non-cash filing, because created impact taxes the and tax including the and that Additionally, disclosures company's significant excludes of statements, to in certain expanded of volatility it because adjusted assets the value in deferred we deferred

or for year $XX.XX, X.X% the XXXX. per $X.XX $X.XX an increase end book book X.X% basis, quarter. the was said, million, On at adjusted adjusted increase share or per at a year-end value value That for and XX.X the the was versus or year an XXX.X of year X.X% the company's million share of company's for

As obtaining reasonably involved deploy renewable investments. order to discussed our for quarters, part on to capital returns of the investments, capital prior as plan in energy in improved priced generate year well capital as additional into such

of XXX the committed this During the call, quarter facility. the of now amount successfully and fourth facility XX as million. three-year been debt of a to we raised quarter, that revolving A million third in in form credit million credit of it’s XXX capital increased

grow portfolio capital a on effort return in equity. our increase Assessing significant our this of and source to new

Another year strategy the lower capital for the it returns. redeployed energy leverage bond with investments. yielding and investments note in of out the investments higher is recycling capital was Hunt continue into renewable to This

For such we finance to our liquidated portion of the all significant related conditions. bond investments year, including a debt used remaining

in million note disclosed to million we available January. addition additional overall been full filing, for Hunt. of prepayment energy part of portfolio. million thus investments return renewable created receivable in most on note of approximately capital year-end our are into In balances This XX of deployed the improving bond equity as in significant received our liquidation, XX XX And additional a at paid has we investment, for early Hunt overall which on we of the the from as approximately a

see our quarter strong fourth investments energy returns renewable the to We during continue year-over-year. and from

to As financing for market also remained and positive in due to which social though developers and America Gary to solar underserved. and renewable The will energy impacts invest further returns environmental well the projects remained segmented generate growing, renewable our we in external North manager's loan origination generate capital platform. are largely sector we positioned continue strong, demand further this and can result is alternatives discuss, energy finance risk-adjusted attractive believe to

minutes few the company the the quarter year the on of the will the In fourth operations and of call, ended. we focus during next for just

address outbreak current conditions marking to I the the coronavirus investors, response. will before related opening call from However, market for due questions and

investments our Gary. of review to turn the further funding, me over let call a in Gary? for Now

Thanks, good Mike, morning, and everyone.

Before longer financial assets in organize portfolios. no the that fourth note change and company's simplification approach company's quarter conventions. sheet and of funding, investments two reflecting with we on consistent touching management our liabilities I that This and into the is an result effective the the should reporting is balance with

said, that partnerships energy related development capital alongside That Solar energy institutional and company loan to and the invests and the year-end, of renewable construction finance company's which receivables, investments of the in an North America. projects the represented partner Ventures mainly XX% in company's renewable investments, bonds at

at to carrying on the the equity and renewable our start carrying income the the increased revolving the company's primarily the the year, XX. recognized of quarter, credit energy by investments XXX.X energy for investments increase $XXX.X was to December of of of This or value net fourth total million Since the draws renewable increased approximately deployment due million facility, value $XX In million recycled XXX%. period.

or As an million you renewable will $XX The in increase XXX% for million these represents filing, investments of an of million unleveraged net during in which the company year-over-year. XXXX. investment income see income on the our of related return Table X.X% the represented to versus year of $XX energy $XX.X investments recognized in X of recognized year XX.X%

aggregate or XX million At $XXX,XXX million million, increase of compared XX. and income unpaid of XX, coupon the balance a a XX.X% maturity Further, months average quarter-over-quarter weighted a loans the $XXX.X September December UPB quarter to in representing principal X%. was had remaining weighted of average by Solar $XXX.X funded $X.X XX.X% and or months an nine Ventures at

growth maturity weighted was the XXXX, Solar million UPB XX, respectively. average UPB in originated X.X%, and Ventures. months a XXX% commitments XXX.X December year-over-year by and represents with of of seven At coupon the This

on coupons prior on from on to origination generate X% funded that capital XX%. and discussed ranging calls, loans from loan target balances As X% committed to we typically X% fees ranging

million project-based the energy. Since their in over total XXXX, to projects. contribute deployment in commitments completed, of generation X.X But more renewable that the renewable of XXX for of than have over and gigawatts Ventures project when construction the debt of invested XXX energy will loans inception $X.X Solar

with continues Through opportunities principal on loss commitments also XXXX, IRR loan were December while X.X of average a and invested our of generating repaid asset no was investment pipeline level risk-adjusted which that XX.X% meet goals. than energy of attractive higher an returns project-based originally class robust across renewable weighted XXX social with average and billion XX, debt underwritten. of environmental The represent to remains loans

believe As $XXX of will Mike in revolving earlier, we we mentioned our million increase which credit equity capital amount a our have a returns now future. fully the facility which invested committed enable to remain should with

including continue optimize explore to the additional debt where We ways company's to appropriate. capitalization, capital

we continue $XX.X Turning our quarter the was bond-related exit our repayment to liabilities, note, down X% $XX.X of respect bond slightly in of as the being With previously and January UPB fair disclosed Hunt and portion prepayment of assets at note XX December positions. investments in of and the million, respectively, as other with X million to we energy to the renewable a full into investments. significant redeployed value proceeds

company's assets opportunities quarters, of other at we As to pursue from to sheet levels. stated the contribute and in the attractive income not to will and part liabilities do balance expect consistently prior we capital this quarterly to continue recycle

discuss With that, Dave I'll greater over turn our detail. call results annual who will the to in Dave?

and everyone. good Gary, morning, Thanks,

of As various our refer will X Item results, I I XX-K. an to of overview in provide tables Form our

regard, this $XX.X value increased and increase million Mike share the book a $XX.XX in share quarter fourth increased XXXX As per to in per per $XX.XX value year share on which full million. In basis. mentioned, to $XXX.X per share represented book $XX.XX

value resulted a allowance tax fourth the earlier, quarter, this significant As the tax factors. the partial a high the of XX at in basis recognition is in asset asset. partial noted net two But by primarily of was company's the discussed The million of driven book which Note increase level, reported financial $XX.X a of in statements. the XXXX in driver in release valuation release for was a further deferred deferred release

pre-tax analysis its portion of exclusive book benefits of expiration. prior an non-recurring evidence last of to an the as the earnings ability utilize well provided income positive their as evaluation core to tax to First, company's three items, company's of for years, a

Secondly, investments, of to enabled after of achieved and connection an of the enhanced yielding note leverage third quarter used through amount energy redeploy the increase company's in the use company improved leverage. the full higher into income Hunt the returns projection in investments renewable and energy renewable consequently book the collectively which the capital with pre-tax repayment of given

considered overall that our factors of other deferred weight at net federal was it types not assets the would these we reflected XXXX of supported pre-tax portion time company's than valuation losses. likely a utilization and XX, forecast of company's the released of $XXX.X more related December tax The a that be million of evidence of income realized. Consequently, our allowance over portion book the projected we operating of consideration in that the of assessment

determining tax As disclosures that be in deferred earnings Mike company's this could reporting pre-tax and In assets periods assets mentioned, the and are the deferred significant value requires uncertain, realized entails therefore net tax inherently of to various filing assumptions change volatility. expanded likelihood the projection risks in judgment. will of the cause the and carrying we reported book regard, identify potentially Therefore, estimates income. the subsequent to making

of We also certain and in in in and the trends, of that the the business are assets financial underlying deferred and value think of press added because volatility measures investor performance impacts they potential release useful assets. non-GAAP disclosures the eliminate that performance deferred tax we exclude company's assessing tax our presentation the filing,

continually how will relevant the best disclosed information measures to to usefulness, relevance determine performance to We public. provide and non-GAAP the limitations evaluate

the approximately million quarter $XX.X fourth in of XXXX by in driven increases by recognized to at primarily XX,XXX shares income, book $X.X common value which of said, that $XX.X comprehensive of including were driven other large million price by part $XX.XX. was reductions book offset value partially average the of in This an in were million repurchase

which exceeded $XX.X reported in included income and $XX.X amounts we quarter, year-over-year key million in fourth loss. reported XXXX, exceeded other million $XX.X in in drivers million reported the recognized increase. net income million by Comprehensive three in Net of income $XX which $XXX reported we at what XXXX, million playing into comprehensive with that included XXXX in XXXX, this

deferred to fourth can X of you the being filing, company's income tax partial with release company in Table as benefit of allowance modest the change XXXX the the the $XX.X tax due expense valuation recognized tax the compared income in XXXX First, to million quarter XXXX. primarily in asset of see in

as increased net Secondly, Ventures $XX.X in share Ventures loans you significant a of in as the XXXX, result X XXXX originated thereof year-over-year Ventures company’s equity see from Solar filing, the the income volume million of by can and which to Table of higher. drove company's primarily increase in compared the and the recognized income the of Solar a Solar

in attributable partner’s preferred also XXXX. the by in interest former was increase earned of such the quarter to investment net part Ventures a to was that the prior This partner second in buyout Solar the elimination previously of one of the of return company's

Table Thirdly, a by company recognized and assets. year-over-year to in decreased company's the is fees X as million the see by related XXXX non-recurring various of incurred you operating the in of on professional can in a basis, primarily due businesses to sale reduction expenses $X.X that were which filing,

drivers the largest noting. three several these net there were other drove worth in While items changes income,

all part large bond agreements. of interest due the First, a total $X.X and return investments decreased basis of and various to disposition in on termination net by income outstanding swap the redemption million year-over-year

million Secondly, connection a currency, in derivatives, decrease items, interest or increase offset primarily to bond value the foreign XXXX investments. net by that exchange impact sale holding in to were due to realized redemption in this of net gains gains among an rate, other $X.X was gains fair compared partially by, related though decreased with foreign

year-over-year consolidated in other such statements associated loss interest XXXX, increased income income the of of basis in credit interest reporting XXXX. expense in of other a disaggregate while said, million XXXX expense recognized in loss Lastly, drawn The $XX.X of recognized facility. revolving XXXX of recognition and due the with on from increased to comprehensive recognized increased amount comprehensive by million million. XXXX $X.X company's net components other $XX the This amounts of primarily also period the during the comprehensive UPB

year-over-year see gains out investments the of connection comprehensive a of the can in holding-related you comprehensive as in cumulative that gains also A were translation decrease adjustments recognized recognized disposition into result with $XX.X bond-related XXXX that a it, of in bond-related the driven reclassified a decrease other by net income was amount realized reviewing in of increase $X.X the factor. loss earnings In of primarily that in and in million amount increase of was the accumulated and were investments. other million amount recognized

respect cash million X.X company's with and was Lastly, at December to $XX.X capital XX, XXXX; cash, and resources, the of company equivalents million the restricted of liquidity unrestricted. which had cash

total company's activities restricted driven of cash X amount the and cash, net million cash Table $XX.X cash of with in reported As XXXX investing equivalents in our filing, was in decreased the renewable energy of which associated investments. million primarily by used $XXX.X

draws impact offset by the against part activities that by was Such attributable XXXX, of during to was in partially closed that in was financing by large credit provided million cash made company revolving was which September. facility the $XX.X

flows cash by provided of activities in million net However, $X.X were XXXX. operating

the turn will I Mike. that, over With call back to

since that was – or inception. is X.X if get was problem. I broader lending total don’t just he One case just when about started. broke number I comment that At The in know before line my billion Dave. in that a up my Thanks, line, talked Gary if least for

update Before priced ahead, a a the market I’ll remains we investments going of a assessing out get include of the Q&A, reasonably further increase non-core reviewing the opportunities. strategic for provide wake renewable combination accessing the on remaining and our to of a recycling current credit perspective, capital visibility scale year priority. to to From sources the in of company's coronavirus markets other energy continue assets, approach operations the business capital, news That’s our reaction. of and brief

opportunities positive retain or identify interested social and to dislocations, market in some impacts risk-adjusted attractive seek Further, company, programs for accordingly. realize return we share flexibility invest returns will the will capital buyback. we’ll investment generate the think are new that we we to apart environmental and produce Even any in to particular the including additional endeavor from shareholders current

appropriateness when of many capital factors any share considers or the program. buyback return The Board determining other the

volatile at monitor the The available events window, events plan making new will decision Board proceed market determination before capital of XX. before there current the clarity time. around any no including trading render are that a this assurances for a throughout decided be the uncertainty, slowly will the activity Board balance to markets, on Given market has during the Board March but sufficient the to current more

personnel not the Finally, I a touch coronavirus have to with remain don't perspective operations, material aspect that remotely, Obviously, impact we of company's sure or impact seen operations. we working wanted on that foresee on the an situation. But the day-to-day when resources make human its can of impact IT from has operations. productivity. on is the from and our Hunt fluid very people to and productive this worked a of hard

renewable and On defaults the investments any source haven't the of side, even the form seen new in to on our investment direct impact we slowdown investment. energy or ability

Of early our current our the course, generate knows, everyone have on borrowers, to impact to investment. too coronavirus longer-term or for as any ability will assets new portfolio predict our it’s whether

While in capital revolving that long-term should this as and we or credit capacity liquidity XX potential our have markets, the remain we access under our portfolio. million access of with to we agreement, yet don't renewable impact liquidity need call the our to on covenants approximately in all manage energy of of to our financial investments compliance know

about in continued In for moment even we our the remain committed closing, future you and thank uncertain shareholders, your excited to time in this we support.

questions. call the now I’ll So Operator? to open

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

Stanley. of ahead. go from The Stan Morgan comes Please first question Trilling

that assets that period of liquidation, million. thank again two could think be are time you I one, you do $XX a said think liquidation Number Over questions. done? have residual basically the Gentlemen, value you for magnificent once I of what you job. the doing contemplating

actively two speak ended related because assets land Gary Dave Mike. I’ll development the where projects up This development land land last on. But to relate remaining make really we would largest projects to the we projects world should overall right. speak bond that sure bonds the can would within investments, know particularly changes it’s don’t to the in and quickly, long recent or two to with the exact were I but how to let more those, financial the taking to in I hard is partials both just move taxes where non-renewables The we know. take marketing But that I get move want assets we crisis. say, We but expect number generally. would that are and we back largest the

Fair enough.

It’s not it and could hope years. is weeks. We be would it months

Okay, I understand.

level too, premiums you asset create question but shareholders? capital liquidity what would company and more and the offering consider its a of only not secondary to Second create is value net to doing to

that question amount. for I our XX me close realized go question. is realize to Thanks rotated I haven’t that total total your closer XX to which XX didn’t as I to of million one – we in assets is XX% out. amount the back the of opposed as terms answer step. let It’s total The assets. to net

book we In of accretive. a growth heart that question out if where MMAC. would of terms around the be question could our believe of we that have of a We value, are long-term it sort actually and is gets an great that equity adjusted sell is offering, investment there opportunities today that to

be opportunities have will accretively? opportunities book that’s do and is investment it Does for the function happen would a number see probably equity. the – more I time reinvestment to for a we bogey And that It So be so we get or probably the decision discount. would have somewhere adjusted book GAAP alternative Do are that wouldn’t could of the all time. probably make value a deploy not, of at to looking significant capital very we it capital value much would probably the to all what the decision, function I is say that number the raise the value at think for looking we than but be way at at. adjusted the where it opportunity we par but it we premium? around if a the

understand valuation are always Okay. at that you the said, I But doing matter being time, appreciate your of reasonable that much. in offering. you it. based very at a a It’s what of I’m being Thank situation a I time that. judgment pleased potential on

you. Thank

next McLafferty ahead. The from go Colin Lapides. Instructions]. comes of [Operator Please question

Hi. Thanks loan taking Good had couple of questions portfolio. a solar morning. for related I questions. the my to

So in who better that understanding my your to would providing are get are to so dry budget upon refinance borrowers lenders? the syndicators? parties tax eventually that capital, have order permanent the this relying construction parties ups on So they powder capital are sense you’re want to model. be, access a those exit loans more need And equity credit development business their really to and follow a so completion are of that who the are markets it’s that the first If is that providing And capital? get what’s who to on I couple as then well. refinance? to I

why that? take you Dave, don’t

of kind be delays. Yes. But of spending takeouts. plan large well and kind And the tax there’s I lot or don’t kind of short-term respect of timing understand takeout environment. constantly construction still liquidity takeouts on date the they’re assessing, sheltering a but each deal for equity as Thanks, how provided reacting of to banks. in or loans. to financial that see often But at but with place, yet we’re timing, the least there with we And of think an issues been have to for in by issue The in We have of loans kind seen time typically in trying of the to early the development Colin. perm counterparties if basic late-stage we’re as more very obviously we we could are are credit loans this. this have institutions, any delays, not those but

specific “syndicators”. your to just Colin, takeouts to equity actual the users. to not Okay. tend tend be add question, They be tax And I would our

few a did the all that and it’s due the utilities, banks. by remember next on insurance a tend programs. financing loan permanent loan companies, some of So loans capital be equity those. utilities, are of review that source in Hopefully of seeing And it’s banks to We various helps. months don’t over the repay “syndicator” as a any the sources week I over again to using

putting It does, And about just follow a capital to folks are have if JV. or up, developers capital yes. you refinancing for they and levers of or capital projects, got who who the pull to so are So work unfunded do if in these XXX.X you have the kind the trouble commitment to What building you’ve of the meet do EPCs your this goal? nervous here, raising such they’re little what to can situation? in million solar

profile. their the a three to than ventures And have more fair returns, than who joint legally risk the like who share has banks. opportunity of have they was, we’re remember is, a do day bring I is, or two other recently to have can’t has obligations line is Monday, look the is, and of by significantly Friday of couple because is by our credit which welcomed of We obligated sheet that in balance that cash we who larger which return on we partner we fund but to, continuing we million increasing continuing large it options. balance sheet; increased particularly in One as line a a so to not credit $XX have at solar

So those levers. are three the

last Okay, the helpful. couple just And the portfolio. then on on

is you that or such there to to in speak noticed portfolio, size the I solar that large – XXXX seems percentage that in of the So type appetite Can JV or And to of in the the the risk of million about made is loan? for of like for kind and making X controls loan $XXX are that? XX-K guess your JV, of a X is place loans it normal that relative portfolio. I large kind very the

that you too. one I’ll Gary, give

Yes.

than larger is normal. it So

So we million. that to $XX typically are $XX target loans million

were counterparty We of loans with. done a have lot more of loan $XXX we to keep It’s as and it’s business that a kind small comfortable kind kind at making done a of than partner is a loan of $X getting otherwise large but asset we we’ll would. joint the have million kind venture $XX just a as it lot making as we of comfortable and a done well certainly attention we’ve that of might, million managing is loan It million. as as kind was that

get off Okay. sense few it’s been be up would those question a folks as to, of bit attractive? would speak those rolling this the credits all people give a you that? have most and your little you big you next the years is, become credits putting think to you’re dries I off tax What the seen kind guess Just a lot in over about of the demand investments curious, market for the capacity, look have on market? lending beneficiary kind us to thoughts in of that this roll incentivizing that that whether helpful to if at federal level I state are I’m are the soon. solar code just and and what

Sure. Last at year XX% year to the loan have to end was late we year equipment end fall to year getting again saw year then tax do been in We’ve construction. year. of right, into tried would were to tax folks this from the activity maybe next saw accelerated benefit was different just it’s finance and that the credit moving and folks some then get XX% year done as higher materials XX% as early slightly around federal XX% That credit. the a in then last to And falls thereafter. this down the where some deals form, it necessary really maybe it

the kind demand the see credit to future of in the tax step The over folks probably that large of commitments renewable kind even energy a continue cost. than amount energy cost that at fuels that of already down five predict renewable the that because for. the compared to of have in projects double next in they projects, markets some fossil renewable think and with – capital of comparative the the will for in industry years We federal demand, more part lot is we and is the still parity believe energy

a lot stepping seems federal necessarily of to to down demand type stepping fact see but extended, will that that the to And product. get because extend we there of and that down that credit if of tax a who foresee away knows notwithstanding big there the don’t bill a is for don’t XX%. credit, this we demand So issue just or be ever with

matters I a also policy how utilities as matter, being being state are as policy much that regulated are how and policy, as federal just set. add public would rates

state So the and at you a see presentation, many of a And when state policy it’s That’s done favorable. policy investor ways of in federal can where look you issue. where map we’ve a business. both is most a function

want I’m there to the queue there Okay, are so great. folks if waiting. other hog line, other get questions. are I can But if sure don’t I not back into

just you going? don’t keep Why

guys Okay. have other me Please you cut questions. off whenever

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Okay, Thank all right. you.

you what guys risk is that Can to around said related equity credit through to What the in have one by is JV basically the explain it’s you the the you save next assets just of kind portfolio. the in looking the So So JV. covenant? agreement? us time is the revolver’s your still debt the or that that of limited

There various picture the Sure. but the and rates they’re financial go the in But to based have and by equity facility kind up we and into of it’s is JV. set invested loan. I as can a approach, details place of basically necessary. Mike covenants advance big have in are collateralized type the underlying that give can a upon

but So as basically lower advance facility, development, loans rates drawn set than getting that’s rates as basically against have we and can serves base investment and pay a rates constantly that loans. advance as predetermined existing the added loans construction that which facility have for more higher it’s box then existing collateral higher loans there a Currently, collateral kind amount, but up new so permanent borrowing we for as get and it’s off up, draw draw of is even facility in. advance a loans late-stage we criteria managed for amount. under And

of you that how I on to construction, -- the with guess leverage had that XX%. loans permanent? of kind your put kind Is the XX% about current I portfolio on of You think said for So your want before is limit, ballpark will, between generally of the appetite of that development, you if those you facility? mix in speaking your much Is

The shares, level only advance in the doesn’t at financial basically billion ahead of but the It covenants higher the kind like from company of the really put debt common prudent of feel Currently, we XX%, are place. it’s which don’t too have subordinated debt senior rates is than any to we portfolio. prohibits us to much much but of really have $X.X them. putting on

the worth really is committed we are facility. is debt additional deploy of $XXX asset in today the backed indicated this So have million. we commitments is the But subordinated we aside we million facility level the of maximum amount revolver capital $XXX think The we increase. to for could and that a kind looking from debt, as

not is will in portfolio. to million, to range We maybe up that X $XXX kind maybe to million of think leverage that somewhere We in to X, relative XX of X. this going $XXX get total this be

loss getting offline of on one you’re lending one against. projects you’re that’s I’m a and development can loans, I spoken fairly you the hoping Okay, on bears those great. types projects lending when we’ve the by But risk the amount I’m and of one JV, of maybe high loans, a of that just think that you’re I solar you’re guess with loans, about uncertainty that five knock kind of commensurate this coupon been to at these the the the you’ve for underwriting the kind experience us this portfolio thoughts the or losses? on give making last construction I generally any sense so assuming lot think and of then the the I have us for for loans know expectations loans. these a curious haven’t that years I’m you your you’re default for lending space. Can had full through losses wood, given taking for level into an some or potential probability on like of high your what losses cycle? in are you across of But in walk entire loss a account cycle just yet, those

lens You’re really this large the date, at that through cycle. been X% don’t to look correct default asset this of long-term theory underlying asset the doing We in principal credit It’s kind an that only think over and XXXX. we numbers have that by of not a realized invested any we’ve really of losses since but will of analysis.

estimating lent that full the and we good underlying to realize kind and analysis in we of much have that lending think pretty fortunate been in length counterparties we over losses of been But we I not we’re of may of the kind have gone how have of against. through collateral kind that a accurate cycle have we time. an

in or all to adjacent rate rate, construction even that for Have loss you for assuming not base at portfolio the be get for for will, loans? guess a could through your projects you I you’re if lending what the general industries looked feel just

be what how we relevant focused kind compare So were renewable industries experience would certainly or the construction this. have experience to doing different doing how affordable to certainly But lending other zero. in not I’m we on side. not than when I’m on we’re It’s that housing. to had prudent it of on higher industries primarily sure was sure

Okay, that’s keep the helpful. there in questions I going queue? are Can other or

about then to in queue. if guys questions can other jump we those and some circle How are back. we There the

for Sure. so my Awesome. you Thank much answering questions.

Sure.

Greenfield Jesse comes question Investment. go Greenfield Please ahead. next from of The

late, the got Hi, buyback just if a what’s you recap on the Mike. with could story I little so program.

closing Sure. question is Board whether What we revisit and to revisit exceedingly the taking not marketplace the is we uncertainty in March we wait the or XX see today. prior of may part is not we in and on which attitude we operate may said – a given question, window act the the now, environment or the will fluid in question right based the

our to the price shareholders would relative the the On it accretive clear share and to is value, that significantly to book hand, buy shares. one it’s off

every lesson On sort nickel the the liquidity of from other the last hand, was of crisis financial matters.

capital capital to and us stimulus make – waiting of over you to constant how go see environment. kind like meetings settle discussion tell watching to the stable shareholders, know return a down, might will may bit and if decision have has whether I be position to where to looks we March that that might slowly X I shareholders to been we what we at can we’re more XX. a more by otherwise we and have, given the So sort markets than a in of recent return I just months events last Board XX think caused of probably don’t

Okay.

the Now, month. the does end close is window the closed? How window stay of at the long

to about Probably XX. May

Okay.

stay In the the course until of XX. events, normal window closed would May

Okay, happened fine. following quarter. attracting is last that in meaning now right much And what the we’re quarter pretty now pretty decently,

to that know we’ve I weeks. yet things guidance. give are script don’t We of the over the couple in say don’t next haven’t we would said the where of we disruptions, was seen but going go forward things really one

I Okay, it. I Thank appreciate Mike. you, understand.

Sure.

next Group. go from ahead. Please Financial question comes Valley [ph] The Ted Lou of

the morning, on wondered remaining Good I Michael. just is the NOL? amount what

The unwritten up part, if you will?

Yes, sir.

guys --? that million. Is the right One that XXX Dave, to I around you want give that me is number. number think of

the at which to for Yes, just in statements, Note it looking if it’s XX I’m is starts FXX. or Ted, located on look our footnotes Yes, financial Page you it.

that Okay. I didn’t get just far.

Yes. No, it’s -- on

Come on, Ted.

far pretty back Yes, it’s there.

just $XX.X this Scanning it. recognized a me million one Give disclosure. we looking I’m for So second. asset. through

a line? speaking you on are Brooks,

I am.

this are impaired So there remains about XXX million point. at of NOLs that

so and creative. being on congratulations you Thank Okay. so much

favorite my still You’re stock.

you. Thank

from a Colin go up we And Lapides. Please McLafferty ahead. of have follow

Thanks taking Hi. follow the up. for

Just two should really easy. be that fairly quick ones

walk statement last through first the example, of you would you those management XX three the how in OpEx recurring forward? For year categories shake additional reimbursement aside fee to what other million external mentioned. the contract, going out is, I from year management then fee, and So operating and us expense gave this expect be expenses guys the thereafter? than income do incentive for you Can

in forward guidance Well, we don’t that regard. really give

those do Dave to conclude of give sort could think just steady I be which sense want year’s to expenses Colin talk Gary about are one-time things comment? sort you can of useful or and which last of operating the are Gary, it – a elements of of are items. to he

Yes, kind statement. up the I income was just of pulling

amount you as the related certainly the benefits income the change for of There of the I that XXXX differently? XXXX change part, that a in a result most expenses think because to reimbursements – be statement largely But to compared see recurring any I are a in and in Dave, other nature. will expense on cap. the in significant can’t think of changes. salary do

No, same I the comment. was going echo to

cap So this consequential to year in sort think expect amounts would we point the any of that I change don’t XXXX. the reported on besides

categories into you book these slowly adjusted solar very your XX% look in cash as those for non-core walk net up it kind through before about that walk and about seems some your can Okay, And assets curious last the value, at and the are is you us asset your be some just if on of five recycling Can you’re when me XX% portfolio. the call, price you categories, I is the I’m those non-core just helpful. tied you of one us think stock value to there. just asset through – five discount flowing, lending other between them mentioned of not. there’s are of of

XX you’ll a the I’m how give basis expectation income you on that of much And from a recurring assets? us can sense for So of million categories bucket your get for and in estate referring investment category. in partnerships, the to bonds, real real the U.S. fund workforce bonds, then estate South multifamily the are infrastructure tax-exempt the housing the investment owned Africa

Sure.

neighborhood bond, will which you Fort the estate assets real depending world. those; maybe estate, point real Spanish as opposed same Megan, future South infrastructure the and Africa, have to out maybe essentially like Megan, those bond, U.S. with a the the pays enough, of of three exact close happens bond in pays on paid to though multifamily are quarterly pays Was because The And annual not producing it’s what some non-income an might us that return neighborhood. in X%. multifamily a gain, the is Dave? you The there. Gary, capital cash in bond. the at bond took owned the number of flow last net normal they paid in and If

I so. Yes, think

numbers, which numbers are CEO Colin, big in Those are I round head. keep what can the my call I

answer. very Thank questions a appreciate so from more helpful you that. That’s I me. much. No

– quick to your one expenses. just on other related follow-up Colin, point is question this

no they our announced MMA of aware as be auditor companies look in. December change are I small as KPMG longer at required on well SEC, And to mentioned we think likely of a public reporting company, September The on is think given XXXX compliance controls internal like be required come – SEC opinion external the companies reporting to qualify I what may audit for external controls. now companies. just of costs, result announcement expenses you at recently an XX, as to as given of both because think the terms that opine of I’m as this required. a rules of numbers recent – change to you the how in auditors particularly think we sorry, in a will related going But to that basically recent with opine recent small the you opinion costs potentially a I our when as if on, the look development SEC will

sort in of number for reasons just to, just but cost we mentioned. I I what type by to the I So that expect to least clarify that of really at wanted come can’t speak directionally particular

great. Okay,

MMAC the not manager? that’s the income audit, to covered financial cost your statement by – reimbursement external paid on not all the that’s So then of expense the and the reporting, back

MMA. a It’s of correct. direct that’s cost Yes,

much, Thank so I Okay, guys. really appreciate you great. it.

other any there are Operator, questions?

The to – next [ph], from investor. Greg – verify Benet question ahead. comes Please go just a private

Good morning.

you credit For right any things using for in buyback program, stock prevent there from facilities buyback the your are now? stock that cash

just which don’t the in line think on a there that buyback not shares. is as be I it could of is directly our on of by neighborhood $XX share limit the result, But We draw cash otherwise million-ish. a effective would hand credit an

if your to utilize now roughly to and Board million wanted you XX, that? would if XX free have approve between March decided So you

If of we to don’t wanted we think would our do cash, utilize I but that. all yes,

than I XX think would would be be likely it whatever – smaller do million. we would

now not supposed Spanish million South Fort, sometime I Fort fund African – that? back – still Spanish in think $X you roughly it’s is I guess expect Do pay to April. you

I summer. expect that between April the and

for you cash And that that up a stock free could you buyback use would if wanted to?

cash free whatever we up yes. determine, would use It for

Okay.

asset payment deferred long process that tax the a you on for [ph], the would have So think can I that. go accountants through determining you utilize

year, any you with for the there might from what determining as something but income give – expect XXXX? at the of would seems ongoing you there guidance, financial for be You sharing would have this have that least must been business what say don’t solar your what of I projection taxable far as taxable something it you us been have guess a I for So income to like lending way business? for is call

objectively GAAP but losses projection standard is to them, The which literature of the have operating have net you determine in your to rules that deferred certainly to the they elements have verifiable. a your apply a assets for forward in tax called meet

we sort matter uses. sort what has statement those not verifiable of a and our numbers present Board the of of addition to made numbers point. a Board the forward-looking But then objectively of to now that is on so decision internal income of based to any this And make forward-looking kind to as of that at sort Board aspirations the a projections get public to

forward-looking we to speak going so not And are to information.

yet. to value loan not Okay. we or And since bad final had question have a solar experience about for loans

each is behind of these one property loans, or security behind is are other construction or itself that there loan, the what it the security in On guarantees that the loans? the

construction package Megan? want a add and loans. know to some of general on sort there’s they generally don’t bond of Gary, payment the performance anything description sort you Obviously, level but I usually is variability, to if high – is of or mortgage that a

Yes.

kind a value. first underlying all lien there’s of So of on the

So the a deposits the always value don’t all collateral. made, We of that on really of position the kind the serves of mortgage are project guarantee kind claim have of underlying all focused equipment, borrower. We have to as on first collateral. to most addition first underlying value that to that the and lien, a in basically are we underlying of of the look really all

contract Do loan? project off you the contract a asset in you taking already borrower will lend the a have the power for construction for before require hand the or on selling to

Yes.

a there’s spec So there’s terminology – homebuilding building? in like – guess not building, spec not I no you’re the not financing you’re

Correct.

the little for loans, it of So development of binary all but risks has kind as the of think a it’s been out can late-stage equation. you of different bit taken

So to in there are kind permits of the kind sight of be. place basically and will project underlying you of have as line what

sheets can project will because the may how the but for you close, look of have lend time in at you how underlying have we You of with to like, to contract takeout fully the an it. counterparties we’ll worked what understand against term various previously the not you kind understanding and a kind get place of kind of and binding may market

Okay.

thanks whatever performance. it’s and for you So thank the good worth,

the ill-liquid for I hitting the in years. the possible, think probably the biggest might having in with I the be stocks times, of good these market would it’s a program idea shareholder think a people, certainly I discount’s – several particularly the if anyway, value. buyback think in just number big it and in been And volatility stock

if are then That’s next Thank So if won’t there be not, anyway until the were think buying you. in would be XX confident idea. to whether the good May my the going opinion. you forward, or window approve because stock a would Board it buyback program great I you’re

Thanks, Greg.

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

we environment to business did weeks plan, which did when a Thanks, Great. on sort business the we But our a business plan. the the execute we this pretty Obviously, at our existed looks operate month operator. ago ago continue dramatically feel we plan. our two or of different few when to good environment that from ability about point

longer but we the in certainly There there’s about impact so, over great disruption of are excited a the some be of obviously uncertainty and by the deal could virus. on the our month or next future. term virus But economic brought the

businesses can regard, And frankly in companies very happening it the would we we’re days. tell are cloudy to with sure doing these who as best that but thing what’s most keep same to trying gives up us you I’m a run the picture or people

So your thanks support. for

to success all much you for support of morning. to shareholders thank be dedicated continue this the and as time your this and very company took continued We you we the

you. everybody, So Thank be well.

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

You disconnect. may now