Lument Finance Trust (LFT) 13 Aug 242024 Q2 Earnings call transcript

Good afternoon, and thank you for joining the Lument Finance Second Quarter 2024 Earnings Call. Today is being recorded and will be made available via webcast on the company's website. I would now like to turn the call over to Andrew Tsang as Lument Investment Management. Please go ahead.

Good afternoon, everyone. Thank you for joining our call to discuss Lument Finance Trust's Second Quarter 2024 Financial Results. Portfolio call CFO; Jim and Jim our Director the Jim our Zachary on Managing our Briggs, Henson, of me today Flynn, are CEO; Halpern, With Management. our President; filed On Monday, issued press quarter to release XX-Q second the details our SEC a on the provide results. August and with we XX,

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

that are be to the our not comparable intended of accordance for through A reliance prepared are Reconciliations information to the not with that course to XX-K. and could of be with actual differ Before Flynn, of Factors -- will Securities discussed these the is of I'd is substitute in certain risks, financial identify filed within call to from Further, The measures section non-GAAP of the listeners the call. everyone to XXXX. filings undertakes call SEC. in forward-looking particular, GAAP cause of accordance Section these remind and on the the nor with Form measures measures during non-GAAP all over forward-looking of statements SEC, Jim of materially reports of based report be presentation Act Risk information Act certain to presented a in the financial Section It statement. These historical made with are the most these subject discussed handing Such place to can the such statements or forward-looking uncertainties predict the update on may uncertainties any in Securities not in in statements. information possible accessed risks not this to this like to considered this XXE undue company's XXXX and forward-looking XXA company on are results constitute Exchange with obligation and isolation financial statements meaning various as cautioned GAAP. our risks no the the forward-looking conference statements.

the respect and $X.XX quarter we share per respectively. In reported XXXX, a net For earnings of stock, of of June, to over with increase common share GAAP $X.XX of Flynn. $X.XX dividend ahead. Jim per of the of a of quarter, per quarter to go I we turn also which over represented second common income declared second the distributable XX% the $X.XX first stock. will now share call Please dividend

joining of everyone. call to Thank appreciate We you, everyone U.S. Trust the expectations. Andrew, first economy half XXXX, Finance of XXXX. good Lument and today. the second the Welcome outperformed day, Through quarter earnings for consensus largely the

the measured declining June CPI rate in Index the the jobs August of Consumer [indiscernible] in saw Price expected. However, were growth than weaker and

will in the have the As Fed a to that September. confidence market result, its renewed easing cycle seems start

As reflected treasury XX-year XXX points remaining beginning in August. basis the low of since the

easing be recession. beneficial number such remains risk economy to likely proceed expect as including elevated at the will commercial of real While we sectors, of estate, cautiously to a

bottoming challenging class enabled strong the constructed deliver group of in We part uneven our last through large an shareholders multifamily performing real capital flow rate and to and sector. Despite and values commercial the credit, economic markets transaction environment. long and middle in shareholder market asset has modest coming middle a the impacted months. from its multifamily units sustainable, deliberate into this the in to which cycle. firmly preserve on dividend multifamily suffered environment multifamily LFT has that inflationary stable market generally online rate peer data real differentiated during to to continue company newly of high commercial of of particularly the While the of supply remain falling estate of and estate itself capital translate believe Improvements outperformed believe a the has term. a recovery We the that X the due has will should a its property softening by focus fundamentals over

on stable in multifamily and mortgage LFT of where the represents from shareholders raised Our broader June ago, underwriting future. the in provided the the in for actively has over portfolio. we proposition will capital strong extended unique our active sequential closed additional managing which and investment and strong, and deploying successful the asset investment today. In reinvestment. others central transaction, ORIX year challenging environment loan have our benefit identity By to represents expect capacity value Lument runway future increase origination, we focused platforms, we for into we company's we proud been end with our our Approximately LMS of common thought able we've multifamily to the expertise company a are to fully an the public have markets XXXX, with in management sustain credits. Since secured been and Coupled believe the remain truly time, which dividend were foreseeable the to levels, that dividend by the a QX. been a financing XX% investments sponsorship predominantly a $X.XX,

weighted outperformed perform as continued our active and Although to believe relative our basis, X.X to a slight asset thanks our on approach which on our experienced compared prudent March well we risk other a underwriting We generally as CRE of upfront decline has our management. to heavy classes, multifamily, rating asset average to X.X XX. focus have investments in to

allowed on on our continue to of with our approximately elevated continue generate credits strong managing in more million the short-term unrestricted rates challenging we maintain a attractive to returns provide cash take with a We portfolio. us flexibility the cash balances persistence defensive to ending sheet. liquidity to has of while position, cash us intentionally in position The our balance quarter $XX

period financing repayments to of July into not we as costs. XXXX, or available As are IMF discussed on new reinvest portfolio through secured earnings that into capital is reinvestment margin intend loan existing continues subject prior mark-to-market and collateral. calls, loan investments The long-dated liquidity financings a has to our with that becomes financed transaction

hand, other the of are this recapitalize XXXX, our to ended and in XXXX the structure. alternatives December CLO actively of On exploring we period reinvestment

As plus of approximately effective we which cost other financing terms XXX and the quarter for and was XX%, was funds market. options FLX will swaps the attractive effective represent end, in secured rate currently swaps -- the shelf relative to of the advance available believe

that X observed Jim turn like since of provide over who I'd to and pricing financial on on call start the CLO the CRE just the Briggs, muted, which last that, With transactions our vehicle new We to quarter Jim? have the year. details of market managed remain is issuance will in the results. us

uploaded our remarks. on Thanks, investor Form quarterly Jim. XX-Q Supplemental quarter. investor during X summary your presentation a our and which website, presentation, webcast well as find On presentation for referencing supplemental key X to been Yesterday, afternoon, through provided filed for updates and the Good of be everyone. has reference. our the earnings we the on Pages report we you will will

of share. approximately or stockholders For XXXX, of reported per common income net to we $X.X $X.XX million the second quarter

activity few million also are per We items the during $X.X There $X.XX highlight the distributable approximately regarding or earnings I'd period. a reported like to of share.

quarterly related size pass-through $X of million property decrease to in a the loan in payoffs and was another by quarter-over-quarter. also approximately a which $XX onetime an on located on we losses. management reported line allowance of between collateralized and Other expenses compared Beach. X. All quarter carrying operating payable of the of at and received quarter-on-quarter. threshold. million, during the in within million core X which earnings, resolution multifamily by million $XX in collateralized and property X distributable with X% and The Ohio, income operating reduced $X.X component as period. mentioned, similarly totaled an of average as loans, performing in the Total quarter, to FLX expenses our defaulted Columbus, through equal which office no which general net attributable approximately are value remains Aggregate company was its paydowns prior QX million the $X.X largely to and return payoffs exit prior primarily of was reinvestment excess fees to risk-weighted sequential other longer to in Sequential million common we interest approximately to compared QX difference defined modified expenses recognizing $X.X income and credit comparable located for was million. sequential our of basis in of our income was in $XX in to QX versus earnings as an lower to result attributable manager, by QX quarter, accrual due of was driven the prior primarily were the current the QX. a decrease million in net per $XX Virginia securitization the interest increase annum of majority portfolio fees QX $XX within which variance outstanding to is were million Our in Virginia, brought of XX% in net premium the incentive as decreasing The over versus income $X.X principal million

$XX risk As monetary One was X. was risk-rated York booking in to rated collateralized X by had to to XX, million default. of New we property X a multifamily due loans June and loan

near Augusta, to risk-rated collateralized monetary multifamily was $XX a properties loan default. due was Another million by X Georgia, X that

approximately the I'm of through ended the balance We common performance turn portfolio. capacity to Jim? going March financings share risk forecast period, was with X individually Texas, the cost $XXX the portfolio to multifamily value allowance during million was Company's $X.XX X an Philadelphia, total in X Fourth, was as asset-specific Philadelphia a Jim quarter underlying equity technical stock multifamily $XXX,XXX company's $XXX,XXX. The $XXX share, per effectively in fully of were placed cash details million. by the QX to from cash a to XX. million property activity of provide whether unrestricted properties loans collateral, X $XX was investment per rated million approximately secured on quarter collateralized during risk well been modest second end to migration flat changes the call approximately loan recovery and by we and of quarter. to received the rating X at credit rated increased have Third basis. these asset nonaccrual an general by risk property a risk-weighted of CECL Pennsylvania these a loans in default. the in losses required by $XX or due a necessary. loan collateralized specific Dallas, analysis was default. monetary status was And was We of All after reserve with macroeconomic evaluated X driven investment over or largely that determine of the our recognized primarily Total $XX now reserves on the $X.XX as on in Henson X, in be as that on book approximately million deployed.

I the you, now Jim. brief will a in activity Thank recent our share summary afternoon, of investment everyone. portfolio. Good

During by Jim of discussed million these assets second loan or to the the experienced acquire just did a any ago. payoffs portion during related quarter, period. We loans new not the of LFT moments fund payoffs. loan defaulted $XX A few

loans properties. As rate an $X.X XXX% XX, multifamily indexed floating to the portfolio of collateralized June of billion. approximately balance the unpaid and portfolio by our SOFR, of XX X-month XX% aggregate principal of of was portfolio consisted is with

of extension the loan investment While include had portfolios, our worth we manage we endeavor noting risk the time that to our it within loan documents. is within at foresight origination features to maturity the actively

of result, book our available a by borrowers. weighted if extensions is to term approximately XX all average loan our months exercised be As remaining the were

weighted of the million. average end plus SOFR a of rate points of quarter, unamortized our $X.X floating second the and As purchase portfolio discount an XXX of basis aggregate note had

CRE As effective The SOFR provided of $XXX quarter, our a cost a of leverage basis effective XX.X% the SOFR The XX.X% remained leverage the average average securitization end quarter providing plus a basis at XXX plus portfolio our has with XX.X% portfolio of points. basis weighted secured ended earlier, and of FL cost weighted average our of leverage effective LMF financing XXX SOFR of with with our of cost X a the million. mentioned transaction at X, On points. weighted plus and of attractive. funds at funds provided CLO financing combined

approximately the XX, of better, quarter. risk-rated XX% in loans our prior were or X June of from the down portfolio in As XX%

from deterioration risk Our a rating weighted average was slight X.X%, X.X% sequentially.

both that have quarter. X during been been assets risk have XX were While of risk as rated loan rated fully March the -- resolved second

of the at of was loans the million the first rated the at X quarter. Our up quarter, million aggregate loan aggregate second on newly exposure $XX approximately risk the X end end $XX from

for the whether allowance X, Briggs recorded second were collateral, Jim asset-specific underlying outlined determine after loans necessary. a of the individually an to we in losses evaluated approximately we And the quarter. reserves X rated analysis $XXX,XXX earlier, As specific of credit

continue We expect will to Flynn to asset rated actively on and and back talented it I to investors' the protecting for now assets, team loan remarks our Jim rely value management resolve expertise pass questions. to shareholders. for of these our capital our closing X maximizing

Thank and Jim. questions. for joining, everyone open call you, Jim appreciate we'll but And the

Love [Operator from Piper comes Sandler. Instructions] line Your question of first of Crispin the

on Just quality. off credit first

we that see some here discussed. the have but had nonperformers now, You stable quarter peak intermediate-term then as you allowance credit you and just this rate the given credit just multifamily and build outlook stand pretty Do you during Could some portfolio. in how look at outlook degradation credit we've did migration, the loans just stress today? believe for a your several to and environment reached related quarters the you that in cycle discuss second the

Yes.

horizon, impact borrowers. and period. costs, -- I market. expectation But little seen at off stress bit expectations on mean, come here both Fed -- rate to see for near reductions hard will does the will seem kind or SOFR, on down We some which long we've -- which been peak the kind floating term, all think that X of last around there of -- the directly quarters rate to it's predicting or a we've the be impact that the we're do I obviously, XX-year

economic supply So quality on isn't which of portfolio and come and and the done the performed worse. dynamic those term country at in take data are you I generally long demand obviously things near pretty beneficial throughout to probably it's if term, other getting well. news, vacuum. But isn't look positive. a heels changing, it's how cycles, the a fact, in credit They certainly of the the think multifamily And in

stress. stability there's economic some so And even of times in

risk being one last standpoint, we've our and that without felt other questions. that the issues. those the to sponsors we we history expertise on we feel said, to a actively able our and managing and the looked assets but ability those a a in with more that we with couple been good through in have to a a a do throughout about resolve to others helping past is on over I'm so, our -- at work operational team with great that have daily this value improve where loss still with asset. And to that and sponsors through We plans or appropriate to can consistent is as really the Zach assets, those some speaking participate from this -- the cycle. reserve more work respect continue continue pretty there's asset And minimizing to to needed and K, here have to resolution gap take past, of do our do take some loss, the but from was a how we'll to have We add to we've performance. reserve creating We've entity. ability continue Now consistent as -- in And without. detail, as we've we've or the of to provide discussed go sure toward it managing feel value seen We've elevated manage and respect we stress we'll gone was portfolio noted on did had in asset and we other assets to that standpoint, pretty good. a quarters the

yes, We do So a elevated to the challenging but continue period in we're confident work to distress. pretty these continue quality some through in of of still of assets. to portfolio, feel more need our

didn't the the $XXX comments deployment million second of for had quarter, have appreciate investments you on new I you because nearly any I And just then think payoffs. there.

on active on concerted of would do management as what's of opportunity are And how come current keeping you a a in there? you change the effort there also asset months? some portfolio? the focus opportunities of the being kind you So as out it get rates here? lack from more plans to expect down Is Or coming

Sure.

standpoint. So the capacity first on

mentioned as at through CLO, the So is the investment CLO I my larger -- end reinvestment of remarks, the XXXX its period.

those SOFR securitization plus XXX payoffs. with And is so that swap leverage XX% financing an even still It's attractive and delevering.

intend So the continue But just we of deleveraging. is capacity part quarters. options the we move to right? next to really there reason, that's evaluate do That few as through

map L position, to asset when cash And size large the pays the that transaction, offensively of our we've some we the needed, kept high an deployed, off. relatively for with fully part as we've entity On remained just ensure can timing generally manage our in portfolio sponsors.

what are deals. that's would the does bridge buy folks active we deals not peer appear. In is competitive, you competitive group, seller more slowed changing There's the if to of the help the for evidence of of hands. seem that high-quality has market the good assets market, there, side of and There's really lack heard market. buyer There's of it's the exchange like anecdotal assets, today of out to very terms volume acquisitions. The out some opportunities community we've down calls been but this -- be to over and for the there handful loosening seeing you've And thing for quarters from the last there. environment see, on will seen than the starting some on to that

those need in opportunity provides deliveries, and construction lease-up or particularly through these at in the period that coming and assets the other some space. maybe a The on the of is the bridge all online least period tailwind coming side construction transaction Sunbelt

So coming we're be where think to like see, it's I been. is to continue going to the but transaction least do forward, little a than slower increase quarters. over change It see going welcome to we'd a that at be may will opportunities it which

Erdner Your of Matthew next Jones the from line of question comes Trading.

Could of loan of quarter sequential kind in income? about you the and talk timing decline to the payoffs led commercial what this the

Zach, it and just to think I a Sure. Jim sort guys want you you Zach touch to. want I timing? normal mean I just do was quarter. of guess,

of kind $X were quarter towards Yes. than a the quarter. than to the of prior of less the million that, led the kind being beginning payoffs Yes. which rather

Yes. mean and by month to I of at April March at XX, XX somewhere look loan when off REIT XX X.X X.X XX. June X.X I to May X.XX, sort around balance a and drop then really

don't know. I So

it steadily down think I sequentially pretty moved throughout.

Okay. up looking Got once on making kind given also tertiary the nonaccrual on the deal? within there? the what and in you portfolio the of then multifamilies, are secondary then follow-up, following to Are X are you a market. as Augusta property the defaulted, default And And your in you. and that, markets, the list more are guys then loans move of guys kind through working to the you these borrowers guys the they how get you equity seeing

you and working are going logs? after guys these process how Just the through

upcoming terms issues table for of which to in been I'd wouldn't pertains have say secondary interest have rate say to specific negotiation. that needs So that there, borrowers as point all idiosyncratic back maturities have issues tertiary, it to things the we like brought and caps, the I that I'd that we

plans, and proactive our of of it above to a all pertains service asset contributions terms refinancing that very the such team recourse, and negotiating is the towards line interest cash with for bringing in rate taking our if these they working As pushing to reviewing they or be business sponsors back management lower them debt aiming scenario. default, or along assets through approach top when prepaid whether them cap table, that

but as active deal continue proactive All not well the generally of We to be pertains we as to with it our options hope and option get initiating be. foreclosure an to need there, call. is as

next JMP. Your Steve Delaney line of of the from question comes Citizens

sheet. have any receivable There don't, million. We asset this for on is Could investment Estate what us you you that about REO noticed Owned at an point, Real your that represents. related tell balance $XX

Sure. gotten James Briggs I Steve. but When we've the servicing. proceeds, past can borrower take it's remittance from here. date It's that,

haven't So it it's receivable. as sitting with from put we'll we an servicing cash that received them that, investment-related

the there. the borrower just Per So cash there's We servicer, our yes. from service. received not risk haven't the to

Okay.

interest record in of So we'll it principal the books, we'll it all going as won't accrual loan the be so could the be a mixture that. that's to interest, a pay you -- balance. the That's still bal, see from down that on have but

it the the received You'll as investment-related receivable we see until actually cash.

gotten money So good. haven't correct. Yes, as think that it in We of timing. just

liquidity. Pending

timing. It's a quarter

right. All Yes.

related And an that before, million that back is related asset. Crispin's -- just to to to go FLX question is $XX

to that down once So received. cash will the used is be pay bonds

accustomed Okay. out. Q exceptional. having and default, evidenced understanding -- kind not story. that it rated maturity detail like sounds Great. some business as to new But was way, in on that that the loans the working really plans you're disclosure X And We're some of not receiving the by the and X

thank of those in -- what-if you year? that Henson probably But that or sort about I'll question. whether property to may have that having the either know end think as But a you challenging worse X you some that. up said, a a see how those that point? a or But I take we will your workout that you sound curious But get that's at likelihood do of loans books REO gets you is on as next back envision just it some in envision better. and little a market, any the Jim -- -- there before are, guys a you resolution. are could like you for do that it So much

and right country outside our Steve. $XX have not as and of had desire we lot is, and most we've a that borrowers the and REO. cases, thank have The And answer in across work servicing you, broader would thing us have in LFP. strong activity sponsorship any here done have just in we are is know, assets with to who So obviously, billion you book. seeing way capable the hope is a I both. good their what When We're broadly resolution to of find discussed or issues, are cash flow we've a to REO what and operations, short-term of with Where been still work whether to valuation, improving we've managing assets able them we it's a or a foreclosure to And as fruition. ends don't just is -- those broadly majority cases, to that not LT having as that borrowers. the it's in come cooperative have platform something up of overwhelming we where Lument

our I've most And Lument several recent decline Kaufman I defaulting capable ago. to that cuts sizable negotiating on so in fairly XX-year I than X the here. help for a and feel negotiation of more of went been near that or be from using expensive maybe but strategically I assets. the as capable saw go of would over we we're what in of ability and mentioned like quarters that here that. the manages of that with ago, work borrowers to and importantly, will away. the the down case the we're rate this a you servicing or probably we our But say next that operators. with I or horizon sparks confident kind they term trying Ivan think bit And can trying if particular, and a Yes. not technique." I in feel that manage very more a do manage will tactic as and that But and borrowers fault is with advantage you, LFT little think very largely may and whole. And in shown we've at But remember use have some to the see kind think "Hey, say, to our quarters we're for that, have take seasoned borrowers as the a path REO special call to the very XX a Arbor group seen to and think the that X in I going like months. I that

not have So if we capable can not the have that math of the any our concluded It to goal we've doing our that to to goal would so. we what's done it did REO, if obviously, value on the that's have that were happen. highest But -- we take shareholders. action the is REO. mean and is we're But to

of Your question Stephen of Raymond Jones. comes the from next Laws line

quick the X nonaccruals went covered nonaccrual can us Just second a they asked bet. new those way, has one one income quarter? contribute know when on much you did good been another the to But interest let how or

were X of quarter I Yes. mean actually, even price those for last -- we quarter. last

actually And a the only X looking talked are for cash that's the payments we is that's last payments or X on recovery Philadelphia to about those are receiving to to current default, came couple other a ones, cash quarter, quarter hundred the going new those. about cost going right? new in couple with on So the get current the whether It's of shortfall the Xs not. basis. I we for net nonaccrual be a nonaccrual. of what X are on predict out loan quarter, at thousand we're nonaccrual, I that we're But was in continue about And the Dallas $XXX,XXX, basis it loan in impact believe of to for tough a that technical

to over the Switching Great. financing side.

you what would -- line market at Can I but financing there. pool to competitor Would to Or to allow last about you even doing possibly mortgage to pull delever. do to still to going X look the to grow? REIT to stuff, you but the Now to assets another that how you Do legacy at think, a potentially parent do facility market CLO I use to deal? you think it new to talk have with some ahead grow could how done, you use a -- out or attractive, week look continue bank ramp CLO is the you deal like see investments? you some another one loans level, is is week get the of -- this to the of with realize

may next, to to X deal on over in sheet curious the your get say, just So order you how balance or sometime price thoughts a manage months? new the XX

Well, just one let me say thing.

LFT to always obviously looking full we've the these And place the plus we since but capacity, management So more took acquired just -- of took -- we and historically, assets continue the for majority assets the over our since ramp least and sheet you on the transferred it securitizations some of Hunt on Hunt first balance corporate that sheet the and X, if securitizations, over securitization -- pooled in we've since included when originate assets this part continued as others on were not became be of vehicle do we we to the then we'll all when the of detail, continue our some, Jacangive of bridge ORIX has and balance at where so. originate. -- but has and always the is capacity RLC to are done Lument, look outside that to were those corporate assets that a LFT to. had would vehicle

the change. that about operate we'll I'll today So continue way. markets and let nothing way handle to capital that aspect We operate Zach there. from standpoint, will that that

decided explore From dips -- FLX securitization or financing These combination a and explore. include of a rate continuing an things internally based entirely on explore prevailing conversations as for smaller new XX% warehouse with at securitization to remains market least to market be options warehouse to capital standpoint, starting we're Yes. really advance -- yes, are options a financing conditions. active below or

mean, follow Okay. repayments. around it timing, a lot up on sounds And then to guess I I like depends that, with it

over outlook us are, $XX give you over or been your year of running likely the about Or million the do Is year. a that can of level what back of the an repayment have more than half expectations to So half you quarter. the continue? less back expect that

estimation at think a the I that's moment. good

part of upcoming, it [indiscernible]. Just it's XX tough accelerate X, accelerates term to possible to yes, in -- month looks next it pool right the that like to over maturities as in say range. near It's or it's XX are but that the the

of comes next the Your of from question Christopher Nolan Ladenburg line Thalmann.

if those loan? correctly, like XXXX. on are ratios and loans And the were of table in lot time origination your the the of looks originated at Okay. into of the loan-to-value The at XX-Q, a looking it XXXX I'm then

fair your predate like Is Fed loans that correct that? view a looks So of a cycle. of of it sort tightening number the

Yes.

on so And shown to say the is that it fair than loan-to-value what's Q. significantly now in basis, higher is the that ratio

transitional It in depends. mind plans. with these all business are properties Keep

that you valuation plan when received a loan, you executed. has also a a appraiser from assuming do business so the stabilized you And valuation bridge the been and have as-is

LTV. market And not and BX asset so and could valuation the the -- the $XX movements the plan or an did you their stabilized higher. their execute that borrower million the that, example valuation be conditions if to overlaying on point, $XX To business as your the value of was assume change LTV market

to executed market business So their convoluted it's well saying plan the way submarket relative on movements. borrower kind of movements and a a of how depends it

guess is borrowers are lot upside I a Okay. it dive just to earlier logical follow-up on like just of sounds and a loans their these down your into that comments of potentially. sort that And

down. that but say would So say equity, their the loan they're on when impacted, equity about equity I been impacted. has There's what enter and yes, I that, I'd But has to LTVs no upside expected higher down, maybe upside if been necessarily know their question doesn't the true deals most would are they than assets. thought they probably that's right? be. that -- translate being don't the well, their they But

which loan the they deals on of and that -- full that and anticipated it the value recognition reality than higher projected the frankly, than where is perhaps which that where depending -- gotten entering. The to it be not performance capital the much think I to is to say loan the value be higher think value into they those at today, if is just having value may seen I assets, invested is, yet, I was why least that value, the today owners fair it will on and where may that. expectation that next that on full many of couple hold dramatically you multifamily That's over do to you're I transactions, we've rates trend is but the today. the able deals to like not to think I years, more the change, see don't going think because reduction necessarily is with we being think so in that are. this current things of you value held there financing putting more people was realize

any Okay. And Jim items were earnings? nonrecurring Briggs, there in so

quarter. from quarter. Not last impact a the big for was There this nonrecurring from

interest spoke had last but income, last come of that couple for So catch-up pretty significantly I last quarter, looking of spoke as net income you from sequentially, we our bunch a has quarter were a quarter. to, down resolutions interest we on if about onetimers

we So this expenses you last speak It $X.X the incentive that, outside was fee no, million. operating came around was of quarter. if recall, to accrued for about down quarter that the I $XXX,XXX do

account So those CALC XX-month that that down. takes that, payments as XX it's a expect came $XXX,XXX down. that I'd that over will months trailing into come

as the down a come can bit of for side normalizes. quarter look X on next that that before the you expense So at a it or onetime will

are [Operator There this to further like back Please final for the now speakers time. go turn remarks. over closing call Instructions] our at questions no to ahead. I'd

again to for just to look forward everyone speaking quarter. I today. next joining thank We want

your Ladies and you please for call lines. and for We your gentlemen, you participating this that disconnect today. concludes thank ask conference