FRANKLIN BSP REALTY TRUST, INC. Administration’s Dialogue and Evaluation of Monetary Situation and Outcomes of Operations (kind 10-Ok)

The next dialogue and evaluation needs to be learn at the side of the
accompanying monetary statements of Franklin BSP Realty Belief, Inc. the notes
thereto and different monetary info included elsewhere on this Annual Report
on Kind 10-Ok. This dialogue accommodates forward-looking statements reflecting the
Firm's present expectations, estimates and assumptions regarding occasions and
monetary traits that will have an effect on our future working outcomes or monetary
place. Precise outcomes and timing of occasions might differ materially from these
contained in these forward-looking statements as a consequence of numerous elements,
together with these mentioned within the sections of this Annual Report entitled "Danger
Elements" and "Ahead-Wanting Statements."

Overview

The Firm is a Maryland company and has made tax elections to be handled
as a REIT for U.S. federal earnings tax functions since 2013. The Firm, via
a number of subsidiaries that are every handled as a TRS, is not directly topic
to U.S. federal, state and native earnings taxes. We commenced enterprise in Might
2013. We primarily originate, purchase and handle a diversified portfolio of
industrial actual property debt investments secured by properties situated inside and
outdoors of america. Business actual property debt investments might
embody first mortgage loans, subordinated mortgage loans, mezzanine loans and
participations in such loans. Considerably all of our enterprise is performed
via the OP, a Delaware restricted partnership. We're the only real normal companion
and instantly or not directly maintain the entire items of restricted companion pursuits in
the OP.

The Firm has no staff. We're managed by our Advisor pursuant to an
Advisory Settlement, as amended on August 18, 2021 (the "Advisory Settlement").
Our Advisor manages our affairs on a day-to-day foundation. The Advisor receives
compensation and charges for providers associated to the funding and administration of
our property and our operations.

The Advisor, an SEC-registered funding adviser, is a credit-focused
various asset administration agency. The Advisor manages funds for establishments
and high-net-worth traders throughout numerous credit score funds and complementary
methods together with excessive yield, levered loans, non-public / opportunistic debt,
liquid credit score, structured credit score and industrial actual property debt. These
methods complement one another as all of them leverage the sourcing, analytical,
compliance, and operational capabilities that embody the Advisor's strong
platform. On February 1, 2019, Franklin Assets, Inc. and Templeton
Worldwide, Inc. (collectively, "Franklin Templeton") acquired the Advisor,
which occasion didn't affect the phrases of the Advisory Settlement or end in any
modifications to the manager officers of the Firm.

The Firm invests in industrial actual property debt investments, which can
embody first mortgage loans, subordinated mortgage loans, mezzanine loans and
participations in such loans. The Firm additionally originates conduit loans which
the Firm intends to promote via its TRS into CMBS securitization
transactions at a revenue. The Firm additionally owns actual property which it acquires
via foreclosures and deed in lieu of foreclosures, and which it purchases for
funding, usually topic to triple web leases.

The Firm additionally invests in industrial actual property securities. Actual property
securities might embody CMBS, senior unsecured debt of publicly traded REITs,
debt or fairness securities of different publicly traded actual property firms, RMBS
and CDOs. The Firm additionally owns actual property acquired by the Firm via
foreclosures and deed in lieu of foreclosures, and bought for funding,
usually topic to triple web leases.

Affect of the Capstead Acquisition

As additional described in Word 18 - Merger with Capstead, on October 19, 2021, the
Firm accomplished a merger with Capstead Mortgage Company ("Capstead")
pursuant to which Capstead merged right into a wholly-owned subsidiary of the Firm,
and the Firm's frequent inventory commenced buying and selling on the NYSE below the ticker
"FBRT". The Capstead property acquired within the merger consist primarily of money and
residential adjustable-rate mortgage pass-through securities issued and
assured by government-sponsored enterprises or by an company of the federal
authorities ("ARM Company Securities"). The Firm intends to reinvest the money
and proceeds from dividends, curiosity, repayments and gross sales of the property
acquired within the merger into its personal funding methods.

The Capstead acquisition resulted within the following materials impacts on our
monetary outcomes for the yr and quarter ended December 31, 2021:

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•Impairment of acquired property: Pursuant to Accounting Requirements Codification
Matter 805, "Enterprise Combos," the Firm accounted for the transaction as
an asset acquisition since considerably the entire truthful worth of the gross
property acquired was concentrated in a bunch of comparable identifiable property, a
portfolio of company mortgage-backed securities. The Firm measured the price of
the online identifiable property acquired on the premise of the truthful worth of the
consideration given, inclusive of transaction prices, which was decided to be
extra reliably measurable. As the price of the acquisition exceeded the truthful worth
of the online identifiable property acquired, the Firm allotted the distinction on
the premise of relative truthful values to sure property which weren't carried at
truthful worth. The quantity of extra consideration, together with the Firm's
transaction prices, was capitalized on the steadiness sheet as a long-lived asset at
the time of acquisition. Within the fourth quarter of 2021, the Firm concluded
the long-lived asset had no potential worth to the technology of future money
flows and absolutely impaired the asset, recognizing an expense totaling
$88.3 million within the consolidated statements of operations .

•Buying and selling losses: For the reason that Firm doesn't intend to carry the ARM Company
Securities acquired within the Capstead merger for long-term funding, the property
are handled as "labeled as buying and selling" for accounting functions. Consequently,
these property are recorded at truthful worth on the steadiness sheet with buying and selling beneficial properties
and losses on the paydowns and gross sales of those securities recorded within the
Firm's consolidated statements of operations. For the quarter ended
December 31, 2021, the Firm acknowledged a buying and selling lack of $34.8 million
associated to those property.

So long as the Firm holds a major quantity of the ARM Company Securities
acquired within the Capstead merger, the Firm's future outcomes of operations will
proceed to be impacted by buying and selling beneficial properties and losses associated to this portfolio,
and such impacts might be opposed and materials. As of December 31, 2021, the
worth of the Firm's ARM Company Securities portfolio was $4.6 billion. As of
February 18, 2022, the worth of the Firm's ARM Company Securities portfolio
was $2.4 billion. The discount within the worth of the ARM Company Securities
portfolio from January 1, 2022 to February 18, 2022 is due partially to (i) $265
million of principal funds and (ii) $1.8 billion of gross sales. From January 1,
2022 to February 18, 2022, the Firm skilled losses of $38 million associated
to the ARM Company Securities portfolio because of web buying and selling losses
totaling $59.5 million associated to principal paydowns, modifications in market value
and losses on gross sales of securities, web of portfolio-related by-product beneficial properties of
$21.5 million.

E book Worth Per Share

The next desk calculates our guide worth per share as of December 31, 2021
($ in 1000’s, besides per share information):

                                                               December 31, 2021           December 31, 2020
Stockholders' fairness relevant to frequent inventory              $          736,464          $          798,444
Shares
  Widespread inventory                                                       43,951,382                  44,494,496
  Restricted inventory                                                       14,546                      15,555
Complete excellent                                                    43,965,928                  44,510,051
E book worth per share                                         $            16.75          $            17.94

The next desk calculates our fully-converted guide worth per share as of
December 31, 2021 ($ in 1000’s, besides per share information):

                                                               December 31, 2021           December 31, 2020
Stockholders' fairness relevant to convertible frequent
inventory                                                        $        1,543,550          $        1,007,698
Shares
  Widespread inventory                                                       43,951,382                  44,494,496
  Restricted inventory                                                       14,546                      15,555
  Collection A convertible most popular inventory                                        -                  12,122,088
  Collection C convertible most popular inventory                                  418,880                     418,880
  Collection D convertible most popular inventory                                5,370,640                           -
  Collection F convertible most popular inventory                               39,733,299                           -
Complete excellent                                                    89,488,747                  57,051,019
Absolutely-converted guide worth per share                         $            17.25          $            17.66


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Crucial Accounting Estimates

Our monetary statements are ready in conformity with accounting rules
usually accepted in america of America ("GAAP"), which requires us
to make estimates and assumptions that have an effect on the reported quantities of property and
liabilities on the date of the monetary statements and the reported quantities of
revenues and bills through the reporting intervals. Crucial accounting
estimates are those who require the appliance of administration's most tough,
subjective or advanced judgments on issues which can be inherently unsure and
that will change in subsequent intervals. In getting ready the monetary statements,
administration has made estimates and assumptions that have an effect on the reported quantities
of property and liabilities on the date of the monetary statements and the
reported quantities of revenues and bills through the reporting intervals. In
getting ready the monetary statements, administration has utilized accessible
info, together with our previous historical past, trade requirements and the present
financial setting, amongst different elements, in forming its estimates and
judgments, giving due consideration to materiality. Precise outcomes might differ
from these estimates. As well as, different firms might make the most of totally different
estimates, which can affect the comparability of our outcomes of operations to
these of firms in comparable companies.

Set forth under is a abstract of the essential accounting estimates and demanding
accounting insurance policies that administration believes are necessary to the preparation of
our monetary statements. The Firm's important accounting insurance policies,
together with not too long ago issued accounting pronouncements, are extra absolutely described in
Word 2 - Abstract of Crucial Accounting Insurance policies to the accompanying
consolidated monetary statements included on this Annual Report on Kind 10-Ok.

Credit score Losses – Estimating Credit score Losses

The allowance for credit score losses for the Firm's monetary devices carried
at amortized value and off-balance sheet credit score exposures, reminiscent of loans held for
funding and unfunded mortgage commitments represents a lifetime estimate of
anticipated credit score losses. Elements thought-about by the Firm when figuring out the
allowance for credit score losses reserve embody loan-specific traits such
as loan-to-value ("LTV") ratio, classic yr, mortgage time period, property sort,
occupancy and geographic location, monetary efficiency of the borrower,
anticipated funds of principal and curiosity, in addition to inside or exterior
info referring to previous occasions, present circumstances and cheap and
supportable forecasts.

The allowance for credit score losses is measured on a collective (pool) foundation when
comparable danger traits exist for a number of monetary devices. If
comparable danger traits don't exist, the Firm measures the allowance
for credit score losses on a person instrument foundation. The willpower of
whether or not a specific monetary instrument needs to be included in a pool can
change over time. If a monetary asset's danger traits change, the
Firm evaluates whether or not it's acceptable to proceed to maintain the monetary
instrument in its current pool or consider it individually.

In measuring the allowance for credit score losses for monetary devices together with
our unfunded mortgage commitments that share comparable danger traits, the
Firm primarily applies a chance of default ("PD")/loss given default
("LGD") mannequin for devices which can be collectively assessed, whereby the
allowance for credit score losses is calculated because the product of PD, LGD and publicity
at default ("EAD"). The Firm's mannequin principally makes use of historic loss
charges derived from a industrial mortgage backed securities database with
historic losses from 1998 to 2020 supplied by a good third celebration,
forecasting the loss parameters utilizing a scenario-based statistical method over
an affordable and supportable forecast interval of twelve months, adopted by an
rapid reversion to common historic losses. For monetary devices
assessed on a person foundation, together with when it's possible that the Firm
shall be unable to gather the total cost of principal and curiosity on the
instrument, the Firm applies a reduced money circulation ("DCF") methodology.

For monetary devices the place the borrower is experiencing monetary
problem primarily based on the Firm's evaluation on the reporting date and the
compensation is predicted to be supplied considerably via the operation or sale
of the collateral, the Firm might elect to make use of as a sensible expedient the
truthful worth of the collateral on the reporting date when figuring out the
allowance for credit score losses.

In growing the allowance for credit score losses for its loans held for funding,
the Firm performs a complete evaluation of its mortgage portfolio and assigns
danger scores to loans that incorporate administration's present judgments about
their credit score high quality primarily based on all identified and related inside and exterior
elements that will have an effect on collectability, utilizing comparable elements as these in
growing the allowance for credit score losses. This technique ends in loans
being segmented by danger classification into danger score classes which can be
related to estimated possibilities of default and principal loss. Danger
score classes vary from "1" to "5" with "1" representing the bottom danger of
loss and "5" representing the very best danger of loss with the scores up to date
quarterly.

Loans are positioned on nonaccrual standing and regarded non-performing when full
cost of principal and curiosity is unpaid for 90 days or extra or the place
cheap doubt exists as to well timed assortment, until the mortgage is each nicely
secured and within the strategy of assortment. Curiosity acquired on nonaccrual standing
loans are accounted for below the cost-recovery methodology, till qualifying for
return to accrual. The associated fee restoration methodology will not apply if assortment
of all principal and curiosity in all fairness assured. A mortgage could also be positioned again
on accrual standing if we decide it's possible that we are going to gather all
funds that are contractually due.
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Actual Property Owned – Estimating Honest Worth and Holding Interval

Actual property owned property are carried at their estimated truthful worth at
acquisition and introduced web of amassed depreciation and impairment
prices. The Firm allocates the acquisition value of acquired actual property property
primarily based on the truthful worth of the acquired land, constructing, furnishings, fixtures and
tools.

Actual property owned property are depreciated utilizing the straight-line methodology over
estimated helpful lives of as much as 40 years for buildings and enhancements and up
to fifteen years for furnishings, fixtures and tools. Renovations and/or
replacements that enhance or lengthen the lifetime of the true property owned property are
capitalized and depreciated over their estimated helpful lives. Actual property owned
income is acknowledged when the Firm satisfies a efficiency obligation by
transferring a promised good or service to a buyer. The Firm is taken into account
to have glad all efficiency obligation at a time limit.

Actual property owned property which can be possible to be bought inside one yr are
reported as held on the market. Actual property owned property labeled as held on the market
are measured on the decrease of its carrying quantity or truthful worth much less value to
promote. Actual property owned property usually are not depreciated or amortized whereas labeled
as held on the market. Curiosity and different bills attributable to the liabilities of
a disposal group labeled as held on the market proceed to be accrued. Upon the
disposition of an actual property owned asset, the Firm calculates realized beneficial properties
and losses as web proceeds acquired much less the carrying worth of the true property
owned asset. Web proceeds acquired are web of direct promoting prices related
with the disposition of the true property owned asset.

Actual Property Securities – Estimating Honest Worth

On the acquisition date, all of our industrial actual property securities shall be
labeled as accessible on the market and shall be carried at truthful worth, with any
unrealized beneficial properties or losses reported as a part of amassed different
complete earnings or loss. Nonetheless, we might elect to switch these property to
buying and selling securities, and consequently, any unrealized beneficial properties or losses on such actual
property securities shall be recorded as unrealized beneficial properties or losses on investments
in our consolidated statements of operations. Associated reductions, premiums, and
acquisition bills on investments are amortized over the lifetime of the
funding utilizing the efficient curiosity methodology. Amortization is mirrored as an
adjustment to curiosity earnings within the consolidated statements of operations.

Credit score Impairment Evaluation of Actual Property Securities

Business actual property securities for which the truthful worth choice has not been
elected shall be periodically evaluated for credit score impairment. AFS actual property
securities which have skilled a decline within the truthful worth under their
amortized value foundation (i.e., impairment) are evaluated every reporting interval to
decide whether or not the decline in truthful worth is because of credit-related elements.
Any impairment that isn't credit-related is acknowledged in different complete
earnings, whereas credit-related impairment is acknowledged as an allowance on the
consolidated steadiness sheets with a corresponding adjustment on the consolidated
statements of operations. If the Firm intends to promote an impaired actual property
safety or extra seemingly than not shall be required to promote such a safety earlier than
recovering its amortized value foundation, all the impairment quantity is acknowledged
within the consolidated statements of operations with a corresponding adjustment to
the safety's amortized value foundation.

The Firm analyzes the AFS safety portfolio on a periodic foundation for credit score
losses on the particular person safety stage utilizing the identical standards described above
for these amortized value monetary property topic to an allowance for credit score
losses together with however not restricted to; efficiency of the underlying property within the
safety, borrower monetary sources and funding in collateral, collateral
sort, credit score scores, mission economics and geographic location in addition to
nationwide and regional financial elements.
The non-credit loss part of the unrealized loss inside the Firm's AFS
portfolio is acknowledged as an adjustment to the person safety's asset
steadiness with an offsetting entry to different complete earnings within the
consolidated steadiness sheets.

Business actual property securities for which the truthful worth choice has been
elected usually are not evaluated for other-than-temporary impairment as modifications in truthful
worth are recorded in our consolidated assertion of operations.

Actual Property Securities – Categorized As Buying and selling – Estimating Honest Worth

Within the merger with Capstead, we acquired a portfolio of ARM Company Securities
labeled as buying and selling and recorded at truthful worth on the steadiness sheet with
buying and selling beneficial properties and losses on the paydowns and gross sales of those securities recorded
within the Firm's consolidated statements of operations. Honest values fluctuate
with present and projected modifications in rates of interest, prepayment expectations
and different elements reminiscent of market liquidity circumstances and the perceived credit score
high quality of company securities. Judgment is required to interpret market information and
develop estimated truthful values, notably in circumstances of deteriorating
credit score high quality and market liquidity.
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Outcomes of Operations

Comparability of the 12 months Ended December 31, 2021 to the 12 months Ended December 31,
2020

The Firm conducts its enterprise via the next segments:

•The actual property debt enterprise focuses on originating, buying and asset
managing industrial actual property debt investments, together with first mortgages,
subordinate mortgages, mezzanine loans and participations in such loans.

•The actual property securities enterprise focuses on investing in and asset managing
actual property securities. Traditionally this enterprise has centered totally on
CMBS, unsecured REIT debt, CDO notes and different securities. On account of the
October 2021 acquisition of Capstead, the Firm acquired and continues to carry
a major portfolio of Residential Mortgage Backed Securities ("RMBS") in
the type of the ARM Company Securities. The Firm intends to reinvest the money
and proceeds from dividends, curiosity, repayments and gross sales of those property into
its different segments and doesn't intend to proceed to spend money on ARM Company
Securities or RMBS normally. As of December 31, 2021, the entire actual property
securities on this section had been ARM Company Securities acquired within the Capstead
acquisition.

•The conduit enterprise operated via the Firm's TRS, which is targeted on
producing superior risk-adjusted returns by originating and subsequently
promoting fixed-rate industrial actual property loans into the CMBS securitization
market at a revenue.

•The actual property owned enterprise represents actual property acquired by the Firm
via foreclosures, deed in lieu of foreclosures, or buy.

As well as, as described above in "Affect of the Capstead Acquisition", the
Firm's outcomes of operations had been materially impacted by the asset impairment
associated to the Capstead merger and buying and selling losses and reduces within the values of
the property acquired within the transaction from acquisition date to December 31,
2021.

Web Curiosity Revenue

Web curiosity earnings is generated on our interest-earning property much less associated
interest-bearing liabilities and is recorded as a part of our actual property debt,
actual property securities and TRS segments.

The next desk presents the typical steadiness of interest-earning property much less
associated interest-bearing liabilities, related curiosity earnings and expense and
corresponding yield earned and incurred for the years ended December 31, 2021
and 2020 ({dollars} in 1000's):
                                                                                                 12 months Ended December 31,
                                                                        2021                                                                 2020
                                                                                           WA Yield /                                                           WA Yield /
                                           Common Carrying       Curiosity Revenue        Financing Price         Common Carrying       Curiosity Revenue        Financing Price
                                              Worth (1)            / Expense (2)               (3)                 Worth (1)            / Expense (2)               (3)
Curiosity-earning property:
Actual property debt                           $      3,156,492       $    189,090                     6.0  %       $      2,606,081       $    165,907                     6.4  %
Actual property conduit                                  75,633              3,060                     4.0  %                 83,618              3,111                     3.7  %
Actual property securities                              899,033             24,740                     2.8  %                351,859             10,854                     3.1  %
  Complete                                    $   4,131,158          $    216,890                     5.3  %       $   3,041,558          $    179,872                     5.9  %

Curiosity-bearing Liabilities:
Repurchase agreements – industrial $ 477,138 $ 17,299

                     3.6  %       $        249,289       $     10,908                     4.4  %
mortgage loans
Different financing and mortgage
participation- industrial mortgage                   36,045              1,874                     5.2  %                 16,704                916                     5.5  %

loans

Repurchase agreements - actual property                 871,466              3,639                     0.4  %                313,227             13,637                     4.4  %

securities

Collateralized mortgage obligations                   1,821,993             35,920                     2.0  %              1,706,207             41,095                     2.4  %

Unsecured debt                                    35,268                 2,103                     6.0  %                   -                     -                       -  %
  Complete                                    $      3,241,910       $     60,835                     1.9  %       $      2,285,427       $     66,556                     2.9  %
Web curiosity earnings/unfold                                        $    156,055                     3.4  %                              $    113,316                     3.0  %
Common leverage % (4)                              78.5  %                                                              75.1  %
Weighted common levered yield (5)                                                                17.5  %                                                              15.0  %


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(1) Primarily based on amortized value for actual property debt and actual property securities and
principal quantity for interest-bearing liabilities. Quantities are calculated primarily based
on day by day averages for the years ended December 31, 2021 and 2020, respectively.
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(2) Contains the impact of amortization of premium or accretion of low cost and
deferred charges. The RMBS securities acquired within the Capstead merger are
labeled as buying and selling and use the straightforward curiosity methodology to calculate curiosity
earnings due to this fact no premium amortization is acknowledged on these securities.

(3) Calculated as curiosity earnings or expense divided by common carrying worth.

(4) Calculated by dividing complete common interest-bearing liabilities by complete
common interest-earning property.

(5) Calculated by dividing web curiosity earnings/unfold by the typical
interest-earning property much less common interest-bearing liabilities.

Curiosity earnings

Curiosity earnings for the years ended December 31, 2021 and 2020 totaled $216.9
million and $179.9 million, respectively. As of December 31, 2021, our portfolio
consisted of 165 industrial mortgage loans, one industrial mortgage mortgage, held
on the market, measured at truthful worth, RMBS securities acquired within the merger with
Capstead and no investments in CMBS. The primary driver within the improve in curiosity
earnings was because of the larger common carrying worth of interest-earning property
through the yr ended December 31, 2021.

Curiosity expense

Curiosity expense for the yr ended December 31, 2021 decreased to $60.8 million
in comparison with curiosity expense for the yr ended December 31, 2020 of $66.6
million. The lower in curiosity expense was as a consequence of a lower within the one-month
LIBOR, the benchmark index for our financing traces.

Realized Achieve/Loss on Business Mortgage Loans Held for Sale

Realized acquire on industrial mortgage loans held on the market, measured at truthful worth
on the TRS for the yr ended December 31, 2021 was $24.2 million in comparison with
$15.9 million for the yr ended December 31, 2020. The $8.3 million improve in
realized acquire was as a consequence of larger gross sales volumes in our conduit enterprise section
with complete proceeds of $478.3 million from the sale of fixed-rate industrial
actual property loans into the CMBS securitization market through the yr ended
December 31, 2021 in comparison with transactions with complete proceeds of $328.1 million
for the yr ended December 31, 2020.

Realized Achieve/Loss on Actual Property Securities Out there for Sale

For the yr ended December 31, 2021 gross sales of our actual property securities,
accessible on the market, measured at truthful worth resulted in a web realized lack of
$1.4 million included inside the consolidated statements of operations. The loss
is attributable to 9 CMBS securities bought through the yr ended December 31,
2021. For the yr ended December 31, 2020 gross sales of our actual property securities,
accessible on the market, measured at truthful worth resulted in a web realized lack of
$10.1 million included inside the consolidated statements of operations. The
loss was attributable to twenty CMBS securities bought through the yr ended
December 31, 2020 in response to the dislocations within the capital markets as a consequence of
COVID-19.

Unrealized Achieve/Loss on Actual Property Securities Out there for Sale

For the yr ended December 31, 2021 our actual property securities, accessible for
sale, measured at truthful worth had an unrealized acquire of $8.3 million included
inside the consolidated statements of complete earnings. The rise in truthful
worth of actual property securities will be attributed to the reversal of the
unrealized losses on the 9 CMBS gross sales through the yr ended December 31,
2021.
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Buying and selling Achieve/Loss

For the yr ended December 31, 2021 we had a realized buying and selling lack of $34.8
million included inside the consolidated statements of operations. The loss is
attributable to $20.9 million of losses as a consequence of change in market values of the
ARM Company Securities and $14.0 million of losses as a consequence of mortgage prepayments,
web of $0.1 million in realized beneficial properties on gross sales of securities.

Bills from operations

Bills from operations for the years ended December 31, 2021 and 2020 had been
made up of the next ({dollars} in 1000’s):

                                                               12 months Ended 

December 31,

                                                                 2021       

2020

Asset administration and subordinated efficiency charge $ 28,110

       $ 15,178
Acquisition bills                                             1,203                 696
Administrative providers bills                                 7,658              13,120
Impairment of acquired property                                   88,282                   -
Skilled charges                                               11,650              10,964
Actual property owned working bills                                 -      

3,653

Depreciation and amortization                                    2,107      

2,233

Different bills                                                   3,946      

3,312

Complete bills from operations                           $     142,956      

$ 49,156


The rise in our bills from operations was primarily associated to impairment
of acquired property and better asset administration and subordinated efficiency
charges. The rise in impairment of acquired property and asset administration and
subordinated efficiency charges had been all because of the merger with Capstead throughout
the yr ended December 31, 2021. Seek advice from "Affect of the Capstead Acquisition"
above for a dialogue of the impairment of acquired property. The lower in
administrative providers bills was primarily pushed by a higher quantity of
originations through the yr and due to this fact larger acquisition charges paid to our
Advisor, which decreased the executive providers bills for the yr ended
December 31, 2021, in comparison with the yr ended December 31, 2020. The lower of
$3.7 million in actual property owned working bills was because of the sale of an
owned workplace property through the yr ended December 31, 2020 and the actual fact our
remaining owned property, an industrial property, is leased on a triple-net
foundation.

Comparability of the Three Months Ended December 31, 2021 to the Three Months Ended
September 30, 2021

Web Curiosity Revenue

Web curiosity earnings is generated on our interest-earning property much less associated
interest-bearing liabilities and is recorded as a part of our actual property debt,
actual property securities and TRS segments.
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The next desk presents the typical steadiness of interest-earning property much less
associated interest-bearing liabilities, related curiosity earnings and expense and
corresponding yield earned and incurred for the three months ended December 31,
2021 and September 30, 2021 ({dollars} in 1000's):
                                                                                                  Three Months Ended
                                                                 December 31, 2021                                                  September 30, 2021
                                                                     Curiosity             WA Yield /                                     Curiosity             WA Yield /
                                           Common Carrying          Revenue /           Financing Price         Common Carrying          Revenue /           Financing Price
                                              Worth (1)            Expense (2)              (3)(4)                Worth (1)            Expense (2)              (3)(4)
Curiosity-earning property:
Actual property debt                           $      3,631,346       $    53,145                     5.9  %       $      3,118,201       $    47,166                     6.1  %
Actual property conduit                                  36,447               497                     5.5  %                 61,157               581                     3.8  %
Actual property securities                            3,482,245            24,279                     2.8  %                      -                 -                        N/A
Complete                                      $   7,150,038          $    77,921                     4.4  %       $   3,179,358          $    47,747                     6.0  %

Curiosity-bearing Liabilities:
Repurchase agreements – industrial $ 959,729 $ 9,069

                     3.8  %       $        331,871       $     3,095                     3.7  %
mortgage loans
Different financing and mortgage
participation- industrial mortgage                   37,770               386                     4.1  %                 49,145               350                     2.8  %

loans

Repurchase agreements - actual property               3,233,599             1,361                     0.2  %                 46,527               148                     1.3  %

securities

Collateralized mortgage obligations                   1,714,736            11,922                     2.8  %              1,906,402             8,395                     1.8  %

Unsecured debt                                      101,064             2,103                     8.3  %                      -                 -                       -  %
Complete                                      $      6,046,898       $       24,841                  1.6  %       $      2,333,945       $       11,988                  2.1  %
Web curiosity earnings/unfold                                        $    53,080                     2.8  %                              $    35,759                     3.9  %
Common leverage % (5)                              84.6  %                                                             73.4  %
Weighted common levered yield (6)                                                               19.2  %                                                             16.9  %


________________________

(1) Primarily based on amortized value for actual property debt and actual property securities and
principal quantity for interest-bearing liabilities. Quantities are calculated primarily based
on day by day averages for the three months ended December 31, 2021 and September 30,
2021, respectively.

(2) Contains the impact of amortization of premium or accretion of low cost and
deferred charges. The RMBS securities acquired within the Capstead merger are
labeled as buying and selling and use the straightforward curiosity methodology to calculate curiosity
earnings due to this fact no premium amortization is acknowledged on these securities.

(3) Calculated as curiosity earnings or expense divided by common carrying worth.

(4) Annualized.

(5) Calculated by dividing complete common interest-bearing liabilities by complete
common interest-earning property.

(6) Calculated by dividing web curiosity earnings/unfold by the typical
interest-earning property much less common interest-bearing liabilities.

Curiosity earnings

Curiosity earnings for the three months ended December 31, 2021 and September 30,
2021 totaled $77.9 million and $47.7 million, respectively. As of December 31,
2021, our portfolio consisted of 165 industrial mortgage loans, one industrial
mortgage mortgage, held on the market, measured at truthful worth, RMBS securities acquired
within the merger with Capstead and no investments in CMBS. The primary driver within the
improve in curiosity earnings was because of the larger common carrying worth of
interest-earning property through the three months ended December 31, 2021,
instantly associated to the merger with Capstead.

Curiosity expense

Curiosity expense for the three months ended December 31, 2021 elevated to $24.8
million in comparison with curiosity expense for the three months ended September 30,
2021 of $12.0 million. The rise in curiosity expense was because of the improve
of $627.9 million in repurchase agreements on industrial mortgage loans and an
improve of $3,187.1 million in repurchase agreements on actual property securities
through the three months ended December 31, 2021, in comparison with the three months
ended September 30, 2021.
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Realized Achieve/Loss on Business Mortgage Loans Held for Sale

Realized acquire on industrial mortgage loans held on the market, measured at truthful worth
on the TRS for the three months ended December 31, 2021 was $2.0 million
in comparison with $9.1 million for the three months ended September 30, 2021. The $7.1
million lower in realized acquire was as a consequence of the truth that there had been one
sale of fixed-rate industrial actual property loans into the CMBS securitization
market through the three months ended December 31, 2021 in comparison with two gross sales
through the three months ended September 30, 2021. Proceeds from sale had been $67.1
million for the three months ended December 31, 2021 in comparison with $154.0 million
for the three months ended September 30, 2021.

Buying and selling Achieve/Loss

For the three months ended December 31, 2021 we had a realized buying and selling lack of
$34.8 million included inside the consolidated statements of operations. The
loss is attributable to $20.9 million of losses as a consequence of change in market values
of the ARM Company Securities and $14.0 million of losses as a consequence of mortgage
prepayments, web of $0.1 million in realized beneficial properties on gross sales of securities.

Bills from operations

Bills from operations for the three months ended December 31, 2021 and
September 30, 2021 had been made up of the next ({dollars} in 1000’s):

Three Months Ended

                                                                 December 31, 2021           September 31, 2021
Asset administration and subordinated efficiency charge              $            8,428          $             8,265
Acquisition bills                                                          191                          690
Administrative providers bills                                           (1,874)                       2,980
Impairment of acquired property                                              88,282                            -
Skilled charges                                                           4,388                        2,488

Depreciation and amortization                                               1,295                            -
Different bills                                                              1,831                          709
Complete bills from operations                                 $          102,541          $            15,132


The rise in our bills from operations was primarily associated to impairment
of acquired property and better asset administration and subordinated efficiency
charges. The rise in impairment of acquired property and asset administration and
subordinated efficiency charges had been all because of the merger with Capstead throughout
the three months ended December 31, 2021. Seek advice from "Affect of the Capstead
Acquisition" above for a dialogue of the impairment of acquired property. The
lower in administrative providers bills was primarily pushed by the
year-end adjustment to such bills through the three months ended December 31,
2021, in comparison with the three months ended September 30, 2021. The rise in
depreciation and amortization expense was as a consequence of $1.3 million of bills
incurred on one actual property owned property through the three months ended
December 31, 2021, in comparison with no such bills incurred through the three months
ended September 30, 2021.
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Comparability of the 12 months Ended December 31, 2020 to the 12 months Ended December 31,
2019

See Half II, Merchandise 7. "Administration's Dialogue and Evaluation of Monetary
Situation and Outcomes of Operations" in our Annual Report on Kind 10-Ok for the
yr ended December 31, 2020, filed with the Securities and Change Fee
on March 11, 2021, for a dialogue of the comparability of the yr ended
December 31, 2020 to the yr ended December 31, 2019.

Portfolio

As of December 31, 2021 and 2020, our portfolio consisted of 165 and 130
industrial mortgage loans, respectively, excluding industrial mortgage loans
accounted for below the truthful worth choice. The industrial mortgage loans held
for funding as of December 31, 2021 and December 31, 2020 had a complete
carrying worth, web of allowance for credit score losses, of $4,211.1 million and
$2,693.8 million, respectively. As of December 31, 2021 and 2020 the Firm's
complete industrial mortgage loans, held on the market, measured at truthful worth comprised
of 1 mortgage with complete truthful worth of $34.7 million and three loans with complete
truthful worth of $67.6 million, respectively. As of December 31, 2021, we had no
actual property securities, accessible on the market, in comparison with actual property securities,
accessible on the market, at truthful worth comprised of 9 CMBS investments with complete
truthful worth of $171.1 million, as of December 31, 2020. As of December 31, 2021
and December 31, 2020, our different actual property investments, measured at truthful
worth, had been comprised one funding with a complete truthful worth of $2.1 million and
$2.5 million, respectively. As of December 31, 2021 and December 31, 2020, our
actual property owned portfolio comprised one industrial property and one workplace
property, respectively with carrying values of $90.0 million and $26.5 million,
respectively.

As of December 31, 2021, we had two loans with unpaid contractual principal
steadiness for a complete carrying worth of $114.0 million, one with curiosity late
for higher than 90 days and the opposite which is present. We didn't take any
asset particular reserves for these loans. As of December 31, 2020, we had one
mortgage with unpaid contractual principal steadiness and carrying worth of $57.1
million that had curiosity late for higher than 90 days.

As of December 31, 2021 and 2020, our industrial mortgage loans, excluding
industrial mortgage loans accounted for below the truthful worth choice, had a
weighted common coupon of 4.3% and 5.5%, and a weighted common remaining life
of two.1 years and 1.7 years, respectively. As of December 31, 2020, our CMBS
investments had a weighted common coupon of two.2%, and a weighted common
remaining lifetime of 12.8 years.

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The next charts summarize our industrial mortgage loans, held for
funding, by coupon charge sort, collateral sort and geographical area as of
December 31, 2021 and 2020:

[[Image Removed: bsprt-20211231_g2.jpg]]
[[Image Removed: bsprt-20211231_g3.jpg]]
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[[Image Removed: bsprt-20211231_g4.jpg]]
[[Image Removed: bsprt-20211231_g5.jpg]]


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[[Image Removed: bsprt-20211231_g6.jpg]]
[[Image Removed: bsprt-20211231_g7.jpg]]


An investments area classification is outlined based on the under map primarily based
on the situation of investments secured property.

[[Image Removed: bsprt-20211231_g8.jpg]]

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The next charts present the par worth by contractual maturity yr for the
investments in our portfolio as of December 31, 2021 and 2020:

[[Image Removed: bsprt-20211231_g9.jpg]]

[[Image Removed: bsprt-20211231_g10.jpg]]

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The next desk exhibits chosen information from our industrial mortgage loans, held
for funding in our portfolio as of December 31, 2021 ({dollars} in 1000's):

      Mortgage Sort                Property Sort            Par Worth            Curiosity Fee (1)            Efficient Yield (5)         Mortgage to Worth (2)
Senior Debt 1                   Hospitality               $4,858           1 month LIBOR + 4.00%                 5.00%                      77.0%
Senior Debt 2                   Hospitality               57,075           1 month LIBOR + 5.19%                 6.19%                      51.8%
Senior Debt 3                   Multifamily               26,568           1 month LIBOR + 4.50%                 5.50%                      22.4%
Senior Debt 4                   Hospitality               22,150           1 month LIBOR + 6.00%                 6.50%                      48.1%
Senior Debt 5                     Workplace                  6,901            1 month LIBOR + 5.15%                 6.60%                      56.4%
Senior Debt 6                   Multifamily               36,822           1 month LIBOR + 3.00%                 3.80%                      63.7%
Senior Debt 7                   Multifamily               37,025           1 month LIBOR + 3.00%                 4.50%                      83.6%
Senior Debt 8                   Hospitality               22,355           1 month LIBOR + 3.50%                 4.80%                      68.8%
Senior Debt 9                     Workplace                  20,685           1 month LIBOR + 3.75%                 5.80%                      70.0%
Senior Debt 10                    Workplace                  15,722           1 month LIBOR + 3.40%                 5.30%                      67.5%
Senior Debt 11                    Retail                  29,500                   6.50%                         6.50%                      68.5%
Senior Debt 12                  Multifamily               27,488           1 month LIBOR + 3.35%                 5.25%                      73.0%
Senior Debt 13                  Hospitality               8,285            1 month LIBOR + 4.85%                 6.75%                      62.5%
Senior Debt 14                    Workplace                  7,125            1 month LIBOR + 3.90%                 5.95%                      67.6%
Senior Debt 15                  Hospitality               13,972           1 month LIBOR + 4.47%                 6.72%                      44.8%
Senior Debt 16                    Retail                  11,924           1 month LIBOR + 3.95%                 6.45%                      61.2%
Senior Debt 17                    Workplace                  42,631           1 month LIBOR + 3.50%                 5.75%                      71.0%
Senior Debt 18                    Retail                  8,203            1 month LIBOR + 8.00%                 8.10%                      51.6%
Senior Debt 19                  Hospitality               10,580           1 month LIBOR + 4.50%                 6.75%                      68.7%
Senior Debt 20                  Hospitality               19,900           1 month LIBOR + 4.15%                 6.50%                      61.8%
Senior Debt 21                    Workplace                  39,650           1 month LIBOR + 4.01%                 6.26%                      68.2%
Senior Debt 22                  Hospitality               20,930           1 month LIBOR + 3.75%                 6.10%                      62.6%
Senior Debt 23                  Hospitality               13,000           1 month LIBOR + 2.94%                 5.44%                      56.4%
Senior Debt 24                  Hospitality               4,987            1 month LIBOR + 4.25%                 6.50%                      47.7%
Senior Debt 25                  Hospitality               12,750           1 month LIBOR + 4.45%                 6.85%                      62.9%
Senior Debt 26                  Hospitality               10,845           1 month LIBOR + 4.50%                 6.85%                      64.0%
Senior Debt 27                    Retail                  9,400            1 month LIBOR + 4.20%                 6.30%                      77.1%
Senior Debt 28                  Hospitality               34,053           1 month LIBOR + 3.99%                 5.74%                      31.0%
Senior Debt 29                  Industrial                56,933           1 month LIBOR + 3.75%                 5.50%                      59.7%
Senior Debt 30                    Workplace                  21,825           1 month LIBOR + 3.50%                 5.40%                      70.9%
Senior Debt 31                  Hospitality               7,100            1 month LIBOR + 4.00%                 5.75%                      70.3%
Senior Debt 32                  Multifamily               15,342           1 month LIBOR + 2.75%                 4.25%                      71.7%
Senior Debt 33                  Multifamily               27,650           1 month LIBOR + 3.15%                 4.95%                      71.6%
Senior Debt 34                  Multifamily               27,094           1 month LIBOR + 2.70%                 2.80%                      76.0%
Senior Debt 35                  Multifamily               9,016            1 month LIBOR + 3.95%                 5.00%                      75.3%
Senior Debt 36                  Multifamily               25,000           1 month LIBOR + 3.30%                 4.75%                      75.5%
Senior Debt 37                    Workplace                  25,802           1 month LIBOR + 4.35%                 6.05%                      64.9%
Senior Debt 38                  Multifamily               15,150           1 month LIBOR + 3.10%                 4.50%                      63.7%
Senior Debt 39                    Workplace                  58,714           1 month LIBOR + 3.70%                 5.00%                      65.7%
Senior Debt 40                  Multifamily               11,739           1 month LIBOR + 3.15%                 4.75%                      72.4%
Senior Debt 41                    Workplace                  28,083           1 month LIBOR + 2.70%                 2.80%                      71.4%
Senior Debt 42             Manufactured Housing           1,359                    5.50%                         5.50%                      62.8%
Senior Debt 43                  Multifamily               7,060            1 month LIBOR + 4.75%                 5.75%                      62.6%
Senior Debt 44                  Industrial                17,038           1 month LIBOR + 6.25%                 7.00%                      61.0%
Senior Debt 45                  Multifamily               4,300            1 month LIBOR + 5.50%                 6.50%                      87.4%
Senior Debt 46             Manufactured Housing           7,680            1 month LIBOR + 4.50%                 5.00%                      66.7%


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        Mortgage Sort                 Property Sort            Par Worth            Curiosity Fee (1)            Efficient Yield (5)         Mortgage to Worth (2)
Senior Debt 47                      Blended Use                30,465           1 month LIBOR + 5.15%                 6.15%                      67.0%
Senior Debt 48                     Hospitality               27,000           1 month LIBOR + 6.50%                 6.85%                      62.7%
Senior Debt 49                     Multifamily               50,000           1 month LIBOR + 6.69%                 7.44%                      80.0%
Senior Debt 50                    Self Storage               29,895           1 month LIBOR + 5.00%                 5.25%                      58.8%
Senior Debt 51                     Multifamily               14,183           1 month LIBOR + 4.75%                 5.25%                      70.0%
Senior Debt 52                Manufactured Housing           3,400            1 month LIBOR + 5.00%                 5.25%                      58.6%
Senior Debt 53                     Multifamily               27,550           1 month LIBOR + 5.75%                 6.00%                      69.8%
Senior Debt 54                Manufactured Housing           5,020            1 month LIBOR + 5.25%                 5.35%                      65.9%
Senior Debt 55                       Workplace                  18,603           1 month LIBOR + 4.50%                 5.25%                      47.9%
Senior Debt 56                       Workplace                  67,651                   5.15%                         5.15%                      52.5%
Senior Debt 57                       Workplace                  30,900           1 month LIBOR + 5.20%                 5.45%                      66.0%
Senior Debt 58                    Self Storage               11,600           1 month LIBOR + 4.76%                 5.01%                      66.6%
Senior Debt 59                Manufactured Housing           5,000            1 month LIBOR + 5.90%                 6.50%                      58.8%
Senior Debt 60                       Workplace                  12,750           1 month LIBOR + 5.00%                 5.25%                      67.8%
Senior Debt 61                     Multifamily               43,320           1 month LIBOR + 4.35%                 4.60%                      73.2%
Senior Debt 62                     Multifamily               37,674           1 month LIBOR + 4.45%                 4.70%                      66.5%
Senior Debt 63                     Multifamily               8,763            1 month LIBOR + 5.50%                 5.75%                      73.7%
Senior Debt 64                       Retail                  11,963           1 month LIBOR + 4.87%                 5.12%                      75.0%
Senior Debt 65                     Multifamily               5,730            1 month LIBOR + 5.00%                 5.25%                      73.5%
Senior Debt 66                     Multifamily               18,800           1 month LIBOR + 4.00%                 4.10%                      79.7%
Senior Debt 67                     Industrial                14,985           1 month LIBOR + 4.50%                 4.75%                      66.3%
Senior Debt 68                       Workplace                  11,981           1 month LIBOR + 5.50%                 5.75%                      68.8%
Senior Debt 69                     Multifamily               11,820           1 month LIBOR + 4.55%                 4.75%                      73.0%
Senior Debt 70                     Multifamily               21,000           1 month LIBOR + 4.60%                 4.75%                      66.7%
Senior Debt 71                       Workplace                  26,000           1 month LIBOR + 5.00%                 5.25%                      63.9%
Senior Debt 72                     Multifamily               54,500           1 month LIBOR + 3.80%                 4.05%                      77.0%
Senior Debt 73                     Multifamily               11,672           1 month LIBOR + 3.50%                 3.65%                      60.1%
Senior Debt 74                     Multifamily               21,000           1 month LIBOR + 4.95%                 5.05%                      84.2%
Senior Debt 75                       Workplace                  43,751           1 month LIBOR + 3.94%                 4.14%                      53.9%
Senior Debt 76 (3)                 Multifamily                 -              1 month LIBOR + 7.25%                 7.50%                       -%
Senior Debt 77                     Multifamily               5,400            1 month LIBOR + 5.25%                 5.50%                      83.1%
Senior Debt 78                     Hospitality               23,000           1 month LIBOR + 5.79%                 5.99%                      57.2%
Senior Debt 79                     Multifamily               32,856           1 month LIBOR + 6.75%                 7.00%                      78.2%
Senior Debt 80                     Multifamily               12,325           1 month LIBOR + 4.50%                 4.65%                      83.3%
Senior Debt 81                     Multifamily               6,300            1 month LIBOR + 5.35%                 5.60%                      84.0%
Senior Debt 82                     Multifamily               31,023           1 month LIBOR + 3.00%                 3.10%                      74.3%
Senior Debt 83                     Multifamily               11,936           1 month LIBOR + 4.25%                 4.55%                      76.4%
Senior Debt 84                     Multifamily               5,575            1 month LIBOR + 4.50%                 4.75%                      83.6%
Senior Debt 85                     Multifamily               53,178           1 month LIBOR + 3.00%                 3.25%                      71.6%
Senior Debt 86                     Multifamily               14,045           1 month LIBOR + 3.39%                 3.54%                      70.6%
Senior Debt 87                     Multifamily               8,301            1 month LIBOR + 3.80%                 3.95%                      69.9%
Senior Debt 88                     Multifamily               13,582           1 month LIBOR + 4.50%                 4.75%                      76.7%
Senior Debt 89                     Multifamily               18,277           1 month LIBOR + 5.25%                 5.50%                      67.0%
Senior Debt 90                     Multifamily               17,985           1 month LIBOR + 3.60%                 3.75%                      70.8%
Senior Debt 91                     Multifamily               41,823           1 month LIBOR + 2.95%                 3.10%                      71.6%
Senior Debt 92                     Hospitality               25,785           1 month LIBOR + 5.60%                 5.85%                      61.0%
Senior Debt 93                      Blended Use                32,500           1 month LIBOR + 3.70%                 4.20%                      69.7%
Senior Debt 94                     Multifamily               12,688           1 month LIBOR + 3.75%                 3.90%                      63.2%


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        Mortgage Sort                 Property Sort            Par Worth            Curiosity Fee (1)            Efficient Yield (5)         Mortgage to Worth (2)
Senior Debt 95                     Multifamily               70,620           1 month LIBOR + 2.95%                 3.10%                      72.6%
Senior Debt 96                     Multifamily               20,321           1 month LIBOR + 3.35%                 3.50%                      67.7%
Senior Debt 97                     Multifamily               28,318           1 month LIBOR + 2.95%                 3.10%                      70.4%
Senior Debt 98                     Multifamily               34,998           1 month LIBOR + 2.95%                 3.10%                      71.7%
Senior Debt 99                     Multifamily               32,557           1 month LIBOR + 2.95%                 3.10%                      72.2%
Senior Debt 100                    Hospitality               25,771           1 month LIBOR + 9.00%                 9.25%                      74.2%
Senior Debt 101                   Self Storage               15,000           1 month LIBOR + 4.26%                 4.51%                      74.6%
Senior Debt 102                    Multifamily               24,248           1 month LIBOR + 3.25%                 3.35%                      70.8%
Senior Debt 103                      Workplace                  6,800            1 month LIBOR + 5.25%                 5.50%                      67.3%
Senior Debt 104                    Multifamily               12,792           1 month LIBOR + 6.50%                 7.00%                       -%
Senior Debt 105                    Multifamily               10,391           1 month LIBOR + 3.15%                 3.25%                      75.6%
Senior Debt 106                    Hospitality               17,449           1 month LIBOR + 5.35%                 5.75%                      56.8%
Senior Debt 107                    Hospitality               28,000           1 month LIBOR + 6.25%                 6.50%                      59.2%
Senior Debt 108                    Multifamily               31,900           1 month LIBOR + 3.15%                 3.25%                      73.0%
Senior Debt 109                    Multifamily               37,260           1 month LIBOR + 3.40%                 3.55%                      75.6%
Senior Debt 110 (4)                Multifamily                 -              1 month LIBOR + 8.00%                 8.25%                       -%
Senior Debt 111                    Multifamily               29,500           1 month LIBOR + 2.88%                 2.98%                      68.0%
Senior Debt 112                    Multifamily               10,050           1 month LIBOR + 4.50%                 4.65%                      77.3%
Senior Debt 113                    Multifamily               13,259           1 month LIBOR + 3.75%                 3.85%                      76.9%
Senior Debt 114                    Multifamily               29,250           1 month LIBOR + 3.00%                 3.10%                      73.5%
Senior Debt 115                    Multifamily               34,077           1 month LIBOR + 3.15%                 3.25%                      71.0%
Senior Debt 116                    Multifamily               42,850           1 month LIBOR + 3.40%                 3.50%                      79.9%
Senior Debt 117                    Multifamily               35,020           1 month LIBOR + 3.64%                 3.74%                      66.0%
Senior Debt 118                    Multifamily               8,500            1 month LIBOR + 3.75%                 4.00%                      79.4%
Senior Debt 119                    Multifamily               14,200           1 month LIBOR + 3.15%                 3.25%                      79.8%
Senior Debt 120                    Multifamily               13,350           1 month LIBOR + 3.75%                 3.85%                      64.2%
Senior Debt 121                    Multifamily               66,650           1 month LIBOR + 3.25%                 3.35%                      77.1%
Senior Debt 122                    Multifamily               18,750           1 month LIBOR + 2.95%                 3.05%                      72.1%
Senior Debt 123                    Multifamily               9,099            1 month LIBOR + 3.75%                 3.95%                      70.0%
Senior Debt 124                    Multifamily               26,160           1 month LIBOR + 3.20%                 3.30%                      77.3%
Senior Debt 125                    Hospitality               17,370           1 month LIBOR + 5.25%                 5.35%                      61.0%
Senior Debt 126                    Hospitality               16,500           1 month LIBOR + 7.10%                 7.20%                      73.0%
Senior Debt 127                    Multifamily               13,168           1 month LIBOR + 3.40%                 3.50%                      78.2%
Senior Debt 128                    Multifamily               88,500           1 month LIBOR + 2.75%                 2.85%                      50.3%
Senior Debt 129                    Multifamily               56,150           1 month LIBOR + 3.10%                 3.20%                      78.9%
Senior Debt 130                    Multifamily               36,750           1 month LIBOR + 2.90%                 3.00%                      72.2%
Senior Debt 131                    Multifamily               52,192           1 month LIBOR + 3.10%                 3.20%                      67.2%
Senior Debt 132                    Multifamily               37,100           1 month LIBOR + 2.90%                 3.00%                      72.0%
Senior Debt 133                    Multifamily               60,267           1 month LIBOR + 2.85%                 2.95%                      70.6%
Senior Debt 134                    Multifamily               30,600           1 month LIBOR + 2.65%                 2.75%                      59.1%
Senior Debt 135                    Multifamily               30,650           1 month LIBOR + 3.25%                 3.35%                      80.0%
Senior Debt 136                    Multifamily               62,850           1 month LIBOR + 3.35%                 3.45%                      78.0%
Senior Debt 137                    Multifamily               42,474           1 month LIBOR + 3.00%                 3.10%                      74.8%
Senior Debt 138                    Multifamily               46,080           1 month LIBOR + 2.75%                 2.85%                      68.1%
Senior Debt 139                    Multifamily               28,880           1 month LIBOR + 2.90%                 3.00%                      74.2%
Senior Debt 140               Manufactured Housing           6,700            1 month LIBOR + 4.50%                 4.60%                      77.9%
Senior Debt 141                    Multifamily               58,680           1 month LIBOR + 3.45%                 3.55%                      74.8%
Senior Debt 142                    Multifamily               26,600           1 month LIBOR + 2.90%                 3.00%                      72.1%


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       Mortgage Sort               Property Sort           Par Worth            Curiosity Fee (1)             Efficient Yield (5)         Mortgage to Worth (2)
Senior Debt 143                 Multifamily             12,478            1 month LIBOR + 3.20%                  3.30%                      62.4%
Senior Debt 144                 Multifamily             35,996            1 month LIBOR + 3.00%                  3.10%                      73.3%
Senior Debt 145                 Multifamily             32,250            1 month LIBOR + 3.20%                  3.30%                      74.5%
Senior Debt 146                 Multifamily             38,631            1 month LIBOR + 2.90%                  3.00%                      71.7%
Senior Debt 147                 Multifamily             64,281            1 month LIBOR + 2.88%                  2.98%                      74.8%
Senior Debt 148                 Multifamily             62,003            1 month LIBOR + 2.88%                  2.98%                      75.5%
Senior Debt 149                 Multifamily             16,570             1 month SOFR + 3.50%                  3.55%                      71.7%
Senior Debt 150                 Multifamily             56,930            1 month LIBOR + 2.75%                  2.85%                      73.9%
Senior Debt 151                 Multifamily             65,000             1 month SOFR + 5.14%                  5.19%                      74.7%
Senior Debt 152                 Multifamily             22,240             1 month SOFR + 2.96%                  3.01%                      79.4%
Senior Debt 153                 Multifamily             25,573             1 month SOFR + 2.96%                  3.01%                      72.9%
Senior Debt 154                 Multifamily             31,678             1 month SOFR + 3.20%                  3.25%                      74.2%
Senior Debt 155                 Multifamily             78,050             1 month SOFR + 3.45%                  3.50%                      78.8%
Senior Debt 156                 Multifamily             77,870            1 month LIBOR + 3.21%                  3.31%                      76.1%
Senior Debt 157                 Multifamily             24,000             1 month SOFR + 3.11%                  3.16%                      72.7%
Senior Debt 158                   Retail                31,000             1 month SOFR + 3.29%                  3.34%                      42.5%
Senior Debt 159                 Multifamily             47,444             1 month SOFR + 2.86%                  2.91%                      68.2%
Senior Debt 160                 Multifamily             36,824             1 month SOFR + 2.86%                  2.91%                      69.7%
Senior Debt 161                 Hospitality             17,169                    5.99%                          5.99%                      52.9%
Mezzanine Mortgage 1                Multifamily              6,500            1 month LIBOR + 10.25%                11.00%                      90.4%
Mezzanine Mortgage 2                Multifamily              3,000            1 month LIBOR + 9.20%                 10.00%                      62.2%
Mezzanine Mortgage 3                Multifamily             10,000            1 month SOFR + 15.29%                 15.34%                      86.2%
Mezzanine Mortgage 4                  Retail                 3,000            1 month SOFR + 12.00%                 12.05%                      46.6%
                                                      $4,242,962                                                 4.33%


_______________________

(1) Our floating charge mortgage agreements comprise the contractual obligation for the
borrower to keep up an rate of interest cap to guard towards rising curiosity
charges. In a easy rate of interest cap, the borrower pays a premium for a notional
principal quantity primarily based on a capped rate of interest (the "cap charge"). When the
floating charge exceeds the cap charge, the borrower receives a cost from the cap
counterparty equal to the distinction between the floating charge and the cap charge
on the identical notional principal quantity for a specified time frame. When
rates of interest rise, the worth of an rate of interest cap will improve, thereby
lowering the borrower's publicity to rising rates of interest.

(2) Mortgage to worth proportion is from metrics at origination.

(3) The overall dedication of this mortgage is $31.5 million, nevertheless none was funded
as of December 31, 2021.

(4) The overall dedication of this mortgage is $38.0 million, nevertheless none was funded
as of December 31, 2021.

(5) Efficient yield is calculated because the unfold of the mortgage plus the upper of
any relevant index or index flooring.

The next desk exhibits chosen information from our industrial mortgage loans, held
on the market, measured at truthful worth as of December 31, 2021 ({dollars} in 1000's):
         Mortgage Sort               Property Sort         Par Worth            Curiosity Fee            Efficient Yield         Mortgage to Worth (1)
TRS Senior Debt 1                    Workplace             $34,250                 3.60%                     3.60%                    63.2%
                                                        $34,250                                           3.60%


________________________

(1) Mortgage to worth proportion is from metrics at origination.

We had no actual property securities, accessible on the market, measured at truthful worth as
of December 31, 2021.

The next desk exhibits chosen information from our different actual property investments,
measured at truthful worth as of December 31, 2021 ({dollars} in 1000’s):

        Sort           Property Sort    Par Worth    Most popular Return
Most popular Fairness 1   Retail              $2,074           12.5%
                                         $2,074


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The next desk exhibits chosen information from our actual property owned property in our
portfolio as of December 31, 2021 ({dollars} in 1000’s):

         Sort            Property Sort    Carrying Worth
Actual Property Owned 1    Industrial             $90,048
                                              $90,048


The next is a abstract of the Firm's RMBS, all of which had been ARM Company
Securities, labeled by collateral sort and rate of interest traits as
of December 31, 2021 ({dollars} in 1000's):
                                   Carrying         Common
Sort                                Quantity         Yield (1)

Company Securities:

  Fannie Mae/Freddie Mac ARMs    $ 4,246,803            0.02%
  Ginnie Mae ARMs                    320,068            0.03%
                                 $ 4,566,871            0.02%


________________________

(1) Common yield is introduced for the yr then ended, and relies on the money
part of curiosity earnings expressed as a proportion on common value foundation
(the "money yield").

Throughout 2021, the Firm bought buying and selling securities utilizing the particular
identification methodology for proceeds totaling $1.9 billion recognizing $0.1
million in web realized beneficial properties. Subsequent to yr finish, till February 18, 2022,
the Firm bought buying and selling securities utilizing the identical methodology for proceeds totaling
$1.8 billion recognizing $12 million in web realized losses. The Firm didn't
personal any buying and selling securities throughout 2020. As of February 18, 2022, the present
market worth of the Firm's RMBS portfolio was $2.4 billion.

Liquidity and Capital Assets

Overview

Our anticipated materials money necessities for the twelve months ended December 31,
2022 and thereafter are comprised of (i) contractually obligated expenditures,
together with funds of principal and curiosity and contractually-obligated
fundings on our loans; (ii) different important expenditures, together with working
and administrative bills and dividends paid in accordance with REIT
distribution necessities; and (iii) opportunistic expenditures, together with new
loans.

Our contractually obligated expenditures primarily include cost
obligations below the debt financing preparations that are set forth within the
desk under below "Contractual Obligations and Commitments" and that are every
described in additional element under below "Repurchase Agreements, Business Mortgage
Loans", "Different financing and mortgage participation - Business Mortgage Loans",
"Mortgage Word Payable", "Unsecured Debt", "Repurchase Agreements - Actual Property
Securities", and "Repurchase Agreements - Actual Property Securities Categorized As
Buying and selling."

We count on to make use of working money circulation, new or refinanced debt (together with
collateral mortgage and debt obligation securitizations) and fairness financing as a
supply of capital. Since we intend to proceed to qualify as a REIT for federal
earnings tax functions, we shall be required to yearly distribute to our
stockholders not less than 90% of our REIT taxable earnings and we intend to distribute
100% of REIT taxable earnings. This may scale back the quantity of working money circulation
accessible to fund our operations and development initiatives after the cost of
these distributions.

The board of administrators presently intends to function at a leverage stage of
between one to 3 occasions guide worth of fairness. We've used and should within the
future use numerous types of incurring indebtedness, together with via repurchase
agreements, credit score services, securitizations, private and non-private, secured and
unsecured debt issuances by us or our subsidiaries. We've usually relied on
repurchase agreements to offer short-term debt financing for our industrial
mortgage loans and utilized collateral mortgage and debt obligation securitizations
for long-term match-funded financing.

With respect to fairness, we might sooner or later challenge frequent inventory and/or most popular
inventory, together with via an at-the-market providing program. We can also promote
sure property in our portfolio and reinvest the proceeds in property with extra
engaging risk-adjusted returns. For instance, we intend to reinvest the money
and proceeds from dividends, curiosity, repayments and gross sales of the property
acquired within the Capstead merger into our major funding methods.

As mentioned intimately in Word 9 - Inventory Transactions to the accompanying
consolidated monetary statements included on this Annual Report on Kind 10-Ok,
in October 2021 we closed our merger with Capstead. We intend to transition the
fairness invested within the property we acquired from Capstead into our conventional
funding methods, together with the origination of economic actual property
mortgages. Particularly, we intend to reinvest any dividend, curiosity and
principal paid on such property, and proceeds from the sale of such property, into
our present funding methods. Till we absolutely transition this fairness into
our enterprise, we count on that proceeds acquired from the sale of Capstead property
shall be a major supply of capital.
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We imagine that our anticipated accessible working money flows, proceeds from
gross sales of property and debt and fairness financing sources shall be sufficient to fund
our quick and long-term anticipated makes use of of capital.

Collateralized Mortgage Obligations

Throughout 2021, the Firm raised $1.3 billion of capital via the issuance of
BSPRT 2021-FL6 Issuer, Ltd. and BSPRT 2021-FL7 Issuer, Ltd. Moreover, as of
December 31, 2021, the Firm had $46 million reinvestment capital accessible
throughout all excellent collateralized mortgage obligations.

Repurchase Agreements, Business Mortgage Loans

As of December 31, 2021, the Firm has repurchase services with JPMorgan
Chase Financial institution, Nationwide Affiliation (the "JPM Repo Facility"), Barclays Financial institution PLC
(the "Barclays Revolver Facility" and the "Barclays Repo Facility"), Wells Fargo
Financial institution, Nationwide Affiliation (the "WF Repo Facility"), and Credit score Suisse AG (the
"CS Repo Facility" and along with JPM Repo Facility, USB Repo Facility, WF
Repo Facility, Barclays Revolver Facility, and Barclays Repo Facility, the "Repo
Services").

The Repo Services are financing sources via which the Firm might pledge
a number of mortgage loans to the financing entity in trade for funds
usually at an advance charge of between 65% to 80% of the principal quantity of
the mortgage mortgage being pledged.

The Firm expects to make use of the advances from these Repo Services to finance
the acquisition or origination of eligible loans, together with first mortgage
loans, subordinated mortgage loans, mezzanine loans and participation pursuits
therein.

The Repo Services usually present that within the occasion of a lower within the
worth of our collateral, the lenders can demand further collateral. Ought to
the worth of our collateral lower because of deteriorating credit score
high quality, ensuing margin calls might trigger an opposed change in our liquidity
place.

The main points of our Repo Services at December 31, 2021 and December 31, 2020
are as follows ({dollars} in 1000's):
As of December 31, 2021
                                                                                                   Ending Weighted
                                   Dedicated              Quantity               Curiosity           Common Curiosity
Repurchase Facility                Financing            Excellent           Expense(1)                Fee                 Time period Maturity
JPM Repo Facility               $    400,000          $    136,470          $      5,178                    2.13  %                  10/6/2022

CS Repo Facility (2)                 300,000               137,364                 3,446                    2.43  %                  9/30/2022
WF Repo Facility (3)                 450,000               186,734                 2,090                    1.64  %                 11/21/2023
Barclays Revolver Facility (4)       250,000               166,700                 1,976                    6.12  %                  9/20/2023
Barclays Repo Facility (5)           500,000               392,332                 4,057                    1.76  %                  3/14/2025
Complete                           $  1,900,000          $  1,019,600          $     16,747


__________________________

(1) For the yr ended December 31, 2021. Contains amortization of deferred
financing prices.

(2) On August 12, 2021, the Firm exercised the extension choice upon the
satisfaction of sure circumstances, and prolonged the time period maturity to September
30, 2022. Moreover, on November 3, 2021 the dedicated financing quantity was
amended from $200 million to $300 million with the choice to extend to
$400 million on the Firm's discretion.

(3) On October 15, 2021 the dedicated financing quantity was elevated from
$175 million to $275 million. There are three extra one-year extension choices
accessible on the Firm’s discretion.

(4) On September 8, 2021, the Firm amended the maturity date to September 20,
2023
. On December 1, 2021 the dedicated financing quantity was elevated from
$100 million to $250 million. The Firm might improve the overall dedication
quantity by an quantity between $100 million and $150 million for 3 month
intervals, on a limiteless foundation previous to maturity.

(5) On December 3, 2021 the Firm amended the maturity date to March 14, 2025
and the dedicated financing quantity was elevated from $300 million to
$500 million. There are two one-year extension choices accessible on the
Firm’s discretion.

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As of December 31, 2020

                                                                                                   Ending Weighted
                                   Dedicated              Quantity               Curiosity            Common Curiosity
Repurchase Facility                Financing            Excellent           Expense(1)                 Fee                 Time period Maturity
JPM Repo Facility (2)           $    300,000          $    113,884          $      5,020                     2.54  %                  10/6/2022
USB Repo Facility (3)                100,000                 5,775                   599                     2.40                     6/15/2021
CS Repo Facility (4)                 200,000               106,971                 3,539                     2.84  %                  8/19/2021
WF Repo Facility (5)                 175,000                27,150                 1,041                     2.50  %                 11/21/2021
Barclays Revolver
Facility (6)                         100,000                     -                   387                         N/A                  9/20/2021
Barclays Facility (7)                300,000                22,560                 1,046                     2.51  %                  3/15/2022
Complete                           $  1,175,000          $    276,340          $     11,632


_______________________

(1) For the yr ended December 31, 2020. Contains amortization of deferred
financing prices.

(2) On October 6, 2020 the maturity date was amended to October 6, 2022.

(3) On June 9, 2020, the Firm exercised the extension choice upon the
satisfaction of sure circumstances, and prolonged the time period maturity to June 15,
2021
.

(4) On August 28, 2020, the Firm exercised the extension choice upon the
satisfaction of sure circumstances, and prolonged the time period maturity to August 19,
2021. Moreover, in 2020 the dedicated financing quantity was downsized from
$300 million to $200 million.

(5) On November 17, 2020, the Firm exercised the extension choice upon the
satisfaction of sure circumstances, and prolonged the time period maturity to November
21, 2021. There are two extra one-year extension choices accessible on the
Firm's discretion.

(6) There may be one one-year extension choice accessible on the Firm’s
discretion.

(7) Contains two one-year extensions on the Firm’s choice.

Different financing and mortgage participation – Business Mortgage Loans

On March 23, 2020, the Firm transferred $15.2 million of its curiosity in a
time period mortgage to Sterling Nationwide Financial institution ("SNB") through a participation settlement.
Throughout 2020, the Firm's excellent mortgage elevated resultant of future
fundings, resulting in a rise in quantity excellent through the participation
settlement. The Firm incurred $0.9 million of curiosity expense on SNB for the
yr ended December 31, 2021. As of December 31, 2021 and December 31, 2020 the
excellent participation steadiness was $37.9 million and $31.4 million,
respectively. The mortgage matures on February 9, 2023.

Mortgage Word Payable

On October 15, 2019, the Firm obtained a industrial mortgage mortgage for $29.2
million associated to the true property owned portfolio. The Firm incurred
$0.9 million of curiosity expense for the twelve months ended December 31, 2021.
As of December 31, 2021 the mortgage has been assumed by the purchaser of the
underlying asset and is not held by the Firm (see Word 5 - Actual Property
Owned).

On September 17, 2021, the Firm, in reference to the consolidating joint
enterprise (as mentioned in Word 5 - Actual Property Owned), originated a
$112.7 million mortgage be aware payable, of which $88.7 million is eradicated in
consolidation (see Word 5 - Actual Property Owned). As of December 31, 2021 the
Firm incurred $0.2 million of curiosity expense, of which $0.2 million is
eradicated in consolidation, for the twelve months ended December 31, 2021. The
remaining mortgage be aware payable of $24 million is included within the consolidated
steadiness sheets below the caption Mortgage be aware payable. As of December 31, 2021,
the mortgage accrued curiosity at an annual charge of three.1% and matures on October 9,
2024.
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Unsecured Debt

Within the merger with Capstead we acquired 30-year junior subordinated notes issued
in 2005 and 2006 and maturing in 2035 and 2036, with a complete face quantity of
$100.0 million. Word balances web of deferred issuance prices, and associated
weighted common rates of interest as of the indicated dates (calculated together with
issuance value amortization and adjusted for the consequences of associated derivatives
held as money circulation hedges) had been as follows ({dollars} in 1000's):

                                                               December 31, 2021                                 December 31, 2020
                                                       Borrowings                Common                 Borrowings                Common
                                                       Excellent                 Fee                 Excellent                  Fee

Junior subordinated notes maturing in:

  October 2035 ($35,000 face quantity)               $         34,470                   7.86  %       $            -                         -  %
  December 2035 ($40,000 face quantity)                        39,474                   7.63  %                    -                         -  %
  September 2036 ($25,000 face quantity)                       24,650                   7.67  %                    -                         -  %
                                                   $         98,594                   7.72  %       $            -                         -  %


The notes are presently redeemable, in entire or partially, with out penalty, on the
Firm's choice. Curiosity paid on unsecured debt, together with associated by-product
money flows, totaled $0.6 million for the twelve months ended December 31, 2021.

Pursuant to a lending and safety settlement with Safety Profit Life
Insurance coverage Firm ("SBL"), which was entered into in February 2020 and amended
in March and August 2020, the Firm might borrow as much as $100.0 million at a charge
of one-month LIBOR + 4.5%. The ability has a maturity of February 10, 2023 and
is secured by a pledge of fairness pursuits in sure of the Firm's
subsidiaries. The Firm incurred $2.0 million of curiosity expense on the
lending settlement with SBL for the twelve months ended December 31, 2021. As of
December 31, 2021 the excellent steadiness was $50.0 million.

Repurchase Agreements – Actual Property Securities

The Firm has entered into numerous Grasp Repurchase Agreements (the "MRAs")
that permit the Firm to promote actual property securities whereas offering a hard and fast
repurchase value for a similar actual property securities sooner or later. The
repurchase contracts on every safety below an MRA usually mature in 30-90
days and phrases are adjusted for present market charges as mandatory.

Under is a abstract of the Firm's MRAs as of December 31, 2021 and 2020
({dollars} in 1000's):
                                                                                                                      Weighted Common
                                          Quantity               Accrued              Collateral
Counterparty                            Excellent            Curiosity             Pledged (1)           Curiosity Fee          Days to Maturity
As of December 31, 2021
JP Morgan Securities LLC              $     19,025          $       261          $       24,087                  1.14  %                         10
Wells Fargo Securities, LLC                      -                    -                       -                      N/A                        N/A
Goldman Sachs Worldwide                      -                   37                       -                      N/A                        N/A
Barclays Capital Inc.                       15,286                  526                  19,131                  1.21  %                         14
Credit score Suisse AG                                 -                    -                       -                      N/A                        N/A
Citigroup World Markets, Inc.                   -                   81                       -                      N/A                        N/A
Complete/Weighted Common                $     34,311          $       905          $       43,218                  1.17  %                         12

As of December 31, 2020
JP Morgan Securities LLC              $     33,791          $     1,668          $       43,612                  1.75  %                         31
Wells Fargo Securities, LLC                      -                1,057                       -                      N/A                        N/A
Goldman Sachs Worldwide                 22,440                  455                  30,794                  1.68  %                         16
Barclays Capital Inc.                       76,809                2,102                  97,244                  1.71  %                         33
Credit score Suisse AG                                 -                  905                       -                      N/A                        N/A
Citigroup World Markets, Inc.              53,788                2,532                  71,723                     -                            29
Complete/Weighted Common                $    186,828          $     8,719          $      243,373                  1.71  %                         33


________________________

(1) Contains $43.2 million and $72.2 million of CLO notes, held by the Firm,
which is eradicated inside the Actual property securities, at truthful worth line of the
consolidated steadiness sheets as of as of December 31, 2021 and December 31, 2020,
respectively.
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Repurchase Agreements – Actual Property Securities Categorized As Buying and selling

On account of the Capstead merger which closed on October 19, 2021, the Firm
acquired a major portfolio of residential adjustable-rate mortgage
pass-through securities issued and assured by government-sponsored
enterprises or by an company of the federal authorities which the Firm accounts
for as actual property securities labeled as buying and selling. The Firm pledges its
actual property securities labeled as buying and selling as collateral for repurchase
agreements with industrial banks and different monetary establishments. Repurchase
preparations entered into by the Firm contain the sale and a simultaneous
settlement to repurchase the transferred property at a future date and are
accounted for as financings. The Firm maintains the helpful curiosity in
the particular securities pledged through the time period of every repurchase association
and receives the associated principal and curiosity funds.

The phrases and circumstances of repurchase agreements are negotiated on a
transaction-by-transaction foundation when every such settlement is initiated or
renewed. The quantity borrowed is usually equal to the truthful worth of the
securities pledged, as decided by the lending counterparty, much less an
agreed-upon low cost, known as a "haircut." Rates of interest are usually
fastened primarily based on prevailing charges comparable to the phrases of the borrowings.
Curiosity could also be paid month-to-month or on the termination of an settlement at which era
the Firm might enter into a brand new settlement at prevailing haircuts and charges with
the identical lending counterparty or repay that counterparty and negotiate financing
with a distinct lending counterparty. Not one of the Firm's lending
counterparties are obligated to resume or in any other case enter into new agreements at
the conclusion of current agreements. In response to declines in truthful worth of
pledged securities as a consequence of modifications in market circumstances or the publishing of
month-to-month safety pay-down elements, lending counterparties usually require the
Firm to submit further securities as collateral, pay down borrowings or fund
money margin accounts with the counterparties with a view to re-establish the
agreed-upon collateral necessities. These actions are known as margin
calls. Conversely, in response to will increase in truthful worth of pledged securities,
the Firm routinely margin calls its lending counterparties with a view to have
beforehand pledged collateral returned.

Repurchase agreements (and associated pledged collateral, together with accrued
curiosity receivable), labeled by collateral sort and remaining maturities,
and associated weighted common borrowing charges as of the indicated dates had been as
follows ({dollars} in 1000's):

                                                     Collateral            Accrued                                     Common
                                                      Carrying             Curiosity            Borrowings             Borrowing
              Collateral Sort                          Quantity             Receivable          Excellent               Charges
December 31, 2021
Repurchase preparations secured by Company
securities with maturities of 30 days or
much less                                               $ 4,327,020          $     8,908          $ 4,144,473                     0.13  %
                                                   $ 4,327,020          $     8,908          $ 4,144,473                     0.13  %

December 31, 2020
Repurchase preparations secured by Company
securities with maturities of 30 days or
much less                                               $         -          $         -          $         -                        -  %
                                                   $         -          $         -          $         -                        -  %


As of December 31, 2021, the Firm's repurchase agreements collateralized by
RMBS totaled $4.14 billion with 13 counterparties at common charges of 0.13%,
earlier than the consequences of currently-paying rate of interest swap agreements. Common
repurchase agreements excellent had been $3.97 billion in 2021. Common repurchase
agreements excellent differed from respective year-end balances through the
indicated intervals primarily as a consequence of modifications in portfolio ranges and variations
within the timing of portfolio acquisitions relative to portfolio runoff and asset
gross sales. Curiosity paid on repurchase agreements, together with associated Spinoff money
flows, totaled $1.24 million through the twelve months ended December 31, 2021.

The Firm funds its residential mortgage investments primarily by borrowing
below repurchase preparations, the phrases and circumstances of that are negotiated
on a transaction-by-transaction foundation, when every such settlement is initiated or
renewed.

Future agreements are dependent upon the willingness of lenders to take part
within the financing of mortgage investments, lender collateral necessities and the
lenders' willpower of the truthful worth of the investments pledged as
collateral, which fluctuates with modifications in rates of interest and liquidity
circumstances inside the industrial banking and mortgage finance industries. None
of our repurchase settlement counterparties are obligated to resume or in any other case
enter into new agreements on the conclusion of current borrowings. Repurchase
agreements averaged $3.97 billion throughout 2021 and ended the yr at $4.14
billion, all maturing inside 90 days. Common repurchase agreements can differ
from period-end balances for numerous causes together with portfolio development or
contraction, in addition to variations within the timing of portfolio acquisitions
relative to portfolio runoff.
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To assist mitigate publicity to rising short-term rates of interest, we economically
hedge the portfolio of repurchase agreements utilizing derivatives supplemented with
longer-maturity repurchase agreements when accessible at engaging charges and
phrases. At year-end, we held $3.6 billion notional quantity of portfolio
financing-related rate of interest swap agreements with contract expirations
occurring at numerous dates via the Second quarter 2024 and a weighted
common expiration of 18 months. At December 31, 2021, we count on to haven't any web
money obligations associated to repurchase agreement-related rate of interest swap
agreements after contemplating the variable-rate funds owed to us below the
agreements' phrases primarily based on market rate of interest expectations as of year-end.

Repurchase Agreements

The next tables summarize our Repurchase Agreements, Business Mortgage
Loans, Buying and selling Securities and our MRAs for the years ended December 31, 2021,
December 31, 2020 and December 31, 2019 respectively:

                                                                                             As of December 31, 2021
                                                        Quantity Excellent                                                        Common Excellent Stability
                                   Q1                 Q2                 Q3                  This autumn                  Q1                 Q2                 Q3                  This autumn
Repurchase Agreements,
Business Mortgage
Loans                         $ 152,925          $ 287,462          $ 550,156          $ 1,019,600          $ 340,485          $ 282,891          $ 331,871          $   959,729
Repurchase Agreements,
Actual Property Securities        $  88,272          $  46,510          $  46,531          $    34,311          $ 123,322          $  57,301          $  46,527          $    37,735
Repurchase Agreements,
Actual Property Securities
Categorized As Buying and selling         $       -          $       -          $       -          $ 4,144,473          $       -          $       -          $       -          $ 4,266,556
                                                                                             As of December 31, 2020
                                                        Quantity Excellent                                                        Common Excellent Stability
                                   Q1                 Q2                 Q3                  This autumn                  Q1                 Q2                 Q3                  This autumn
Repurchase Agreements,
Business Mortgage
Loans                         $ 234,524          $ 226,224          $ 183,033          $   276,340          $ 282,282          $ 238,280          $ 197,632          $   279,187
Repurchase Agreements,
Actual Property Securities        $ 496,880          $ 335,256          $ 177,541          $   186,828          $ 412,809          $ 351,202          $ 316,229          $   183,632
                                                                                             As of December 31, 2019
                                                        Quantity Excellent                                                        Common Excellent Stability
                                   Q1                 Q2                 Q3                  This autumn                  Q1                 Q2                 Q3                  This autumn

Repurchase Agreements,
Business Mortgage
Loans                         $ 370,889          $ 132,870          $ 

111,937 $ 252,543 $ 357,850 $ 337,970 $ 132,126 $ 214,812

Repurchase Agreements,
Actual Property Securities $ 22,078 $ 85,022 $ 244,308 $ 394,359 $ 52,711 $ 84,179 $ 181,198 $ 324,545

The usage of our repurchase services relies upon numerous elements
together with however not restricted to: origination quantity, mortgage repayments and
prepayments, our use of different financing sources reminiscent of collateralized mortgage
obligations, our liquidity wants and varieties of mortgage property and underlying
collateral that we maintain.

Throughout the twelve months ended December 31, 2021 the utmost month-to-month common
excellent steadiness was $5.84 billion, of which $0.68 billion was associated to
repurchase agreements on our industrial mortgage loans and $0.04 billion for
repurchase agreements on our actual property securities and $5.12 billion for
repurchase agreements on our actual property securities held for buying and selling.

Throughout the twelve months ended December 31, 2020 the utmost month-to-month common
excellent steadiness was $721.0 million, of which $268.2 million was associated to
repurchase agreements on our industrial mortgage loans and $452.8 million for
repurchase agreements on our actual property securities.

Throughout the twelve months ended December 31, 2019, the utmost month-to-month common
excellent steadiness was $612.0 million, on the finish of November 30, 2019, of
which $266.6 million was associated to repurchase agreements on our industrial
mortgage loans and $345.4 million for repurchase agreements on our actual property
securities.
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Money Flows

Money Flows for the 12 months Ended December 31, 2021

Web money supplied by working actions for the yr ended December 31, 2021
was $146.5 million. Money inflows had been primarily pushed by web earnings of
$25.7 million, web proceeds of $33.4 million associated to originations and gross sales
of economic mortgage loans, measured at truthful worth and a non-cash adjustment
of $34.8 million associated to buying and selling losses on actual property securities.

Web money supplied by investing actions for the yr ended December 31, 2021
was $1,068.7 million. Money inflows had been primarily pushed by proceeds from
principal repayments of $1,225.6 million acquired on industrial mortgage loans,
held for funding, proceeds acquired from the sale/compensation of actual property
securities of $2,059.4 million, $541.3 million acquired from principal
collateral on mortgage investments and money acquired of $174.1 million associated
to the merger with Capstead. Inflows had been partially offset by the origination
and acquisition of $2,881.9 million of economic mortgage loans.

Web money utilized in financing actions for the yr ended December 31, 2021 was
$1,139.2 million. Money outflows had been primarily pushed by web cost on CMBS
repurchase agreements of $2,429.3 million, $68.0 million in money distributions
to stockholders and $11.4 million of inventory repurchases. Outflows had been offset by
$6.5 million of proceeds acquired from borrowing on different financing and mortgage
participation for industrial mortgage loans, $23.9 million from borrowing on
mortgage be aware payable and web proceeds of $743.3 million and $540.3 million
acquired from repurchase agreements on industrial mortgage loans and CLOs,
respectively.

Money Flows for the 12 months Ended December 31, 2020

Web money supplied by working actions for the yr ended December 31, 2020
was $115.3 million. Money inflows had been primarily pushed by web earnings of
$54.7 million and web proceeds of $44.7 million associated to originations of and
proceeds from gross sales of economic mortgage loans, measured at truthful worth.

Web money supplied by investing actions for the yr ended December 31, 2020
was $240.7 million. Money inflows had been primarily pushed by proceeds from
principal repayments of $1,228.2 million acquired on industrial mortgage loans,
held for funding, proceeds acquired from the sale/compensation of actual property
securities of $346.2 million, $77.2 million of proceeds acquired from the sale
of economic mortgage loans, held on the market and $22.5 million of proceeds
acquired from sale of actual property owned property. Inflows had been partially offset by
the origination and acquisition of $1,281.2 million of economic mortgage loans
and the acquisition of actual property securities of $148.6 million.

Web money utilized in financing actions for the yr ended December 31, 2020 was
$373.0 million. Money outflows had been primarily pushed by repayments on CLOs of
$182.7 million, web cost on CMBS repurchase agreements of $207.5 million,
$49.8 million in money distributions to stockholders and $10.3 million of inventory
repurchases. Outflows had been offset by $31.4 million of proceeds acquired from
borrowing on different financing and mortgage participation for industrial mortgage
loans, $11.7 million from borrowing on mortgage be aware payable and web proceeds of
$23.8 million acquired from repurchase agreements on industrial mortgage loans.

Election as a REIT

We elected to be taxed as a REIT below Sections 856 via 860 of the Inner
Income Code commencing with the taxable yr ended December 31, 2013. As a
REIT, if we meet sure organizational and operational necessities and
distribute not less than 90% of our "REIT taxable earnings" (decided earlier than the
deduction of dividends paid and excluding web capital beneficial properties) to our stockholders
in a yr, we won't be topic to U.S. federal earnings tax to the extent of
the earnings that we distribute. Even when we qualify for taxation as a REIT, we might
be topic to sure state and native taxes on our earnings and property, and U.S.
federal earnings and excise taxes on our undistributed earnings.

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Contractual Obligations and Commitments
Our contractual obligations, excluding curiosity obligations (as quantities usually are not
fastened or determinable), as of December 31, 2021 are summarized as follows
({dollars} in 1000's):
                                                                                                                   Greater than 5
                                          Lower than 1 yr           1 to three years           3 to five years              years                Complete
Unfunded mortgage commitments (1)           $               -          $     

149,724 $ 308,381 $ – $ 458,105

Repurchase agreements -                           627,268                      -                392,332                     -            1,019,600
industrial mortgage loans
Repurchase agreements - actual                    4,178,784                      -                      -                     -            4,178,784
property securities
CLOs (2)                                                -                      -                      -             2,179,514            2,179,514
Mortgage Word Payable                                   -                      -                      -                23,998               23,998
Unsecured debt                                          -                      -                      -               150,000              150,000
Different financing and mortgage
participation - industrial                              -                 37,903                      -                     -               37,903
mortgage loans
Complete                                   $       4,806,052          $     187,627          $     700,713          $  2,353,512          $ 8,047,904

________________________

(1) The allocation of our unfunded mortgage commitments relies on the sooner of
the dedication expiration date or the mortgage maturity date.

(2) Excludes $320.6 million of CLO notes, held by the Firm, that are
eradicated inside the collateralized mortgage obligation line of the consolidated
steadiness sheets as of December 31, 2021.

Along with its money necessities, the Firm pays a quarterly dividend and
has an current share repurchase authorization. As of December 31, 2021, the
Firm's quarterly money dividend was $0.355 per share of frequent inventory (which
was paid on an as-converted foundation on the Firm's shares of Collection C
convertible most popular inventory ("Collection C Most popular Inventory"), Collection D convertible
most popular inventory ("Collection D Most popular Inventory") and Collection F convertible most popular
inventory ("Collection F Most popular Inventory")), and $0.46875 per share on the Firm's
shares of seven.50% Collection E Cumulative Redeemable Most popular Inventory ("Collection E
Most popular Inventory"). The cost of future dividends is topic to declaration by
the Board of Administrators. The Firm's Board of Administrators additionally has approved a
$65.0 million share repurchase program, that shall be operative following the
conclusion of the $35.0 million open market share buy program the Advisor
agreed to implement in reference to the Firm's merger with Capstead. The
authorization doesn't obligate the Firm to amass any particular variety of
shares.

Associated Get together Preparations

Profit Avenue Companions L.L.C.

Amended Advisory Settlement

Seek advice from "Word 11 - Associated Get together Transactions and Preparations" for a abstract
of the Firm's Advisory Settlement with the Advisor and quantities paid to the
Advisor pursuant to the Advisory Settlement for the years ended December 31, 2021
and December 31, 2020.

The Nominating and Company Governance Committee (the "Committee") of the
Firm's board of administrators, which consists solely of the Firm's unbiased
administrators, negotiated, authorised and advisable that the board of administrators
approve, the amended Advisory Settlement. The Committee engaged unbiased authorized
counsel to help the Committee in negotiating the amended Advisory Settlement.

Pursuant to the amended Advisory Settlement, the Advisor offers the day by day
administration for the Firm and the Working Partnership, together with an
funding program in keeping with the funding aims and insurance policies of the
Firm as decided and adopted on occasion by the board of administrators.
The preliminary time period of the amended Advisory Settlement was three-years and was
routinely renewed for a further one-year interval on January 19, 2022 and
will proceed to routinely renew for added one-year intervals until
both celebration elects to not renew.

The Firm might terminate the amended Advisory Settlement for a Trigger Occasion (as
outlined within the amended Advisory Settlement) with out cost of a termination charge.
Following the expiration of a time period, and upon 180 days' prior written discover, the
Firm might, with out trigger, elect to not renew the amended Advisory Settlement
upon the willpower by two-thirds of the Firm's unbiased administrators that
(i) there was unsatisfactory efficiency by the Advisor or (ii) that the
asset administration charge and annual subordinated efficiency charge payable to the
Advisor usually are not truthful, topic to sure circumstances. In such case, the Firm
shall be obligated to pay a termination charge.

Throughout the time period of the amended Advisory Settlement, the Advisor shall not,
instantly or not directly, handle or advise one other REIT that's engaged within the
enterprise of the Firm in any geographical area wherein the Firm has a
important funding, or present any providers associated to fixed-rate conduit
lending to every other individual, topic to sure circumstances.
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Advisory Settlement Charges and Reimbursements

Pursuant to the Advisory Settlement, the Firm is or was required to make the
following funds and reimbursements to the Advisor:

•The Firm reimburses the Advisor's prices of offering providers pursuant to
the Advisory Settlement, besides the salaries and advantages paid by the Advisor to
the Firm's govt officers.

•The Firm pays the Advisor, or its associates, a month-to-month asset administration charge
equal to one-twelfth of 1.5% of stockholders' fairness as calculated pursuant to
the Advisory Settlement.

•The Firm pays the Advisor an annual subordinated efficiency charge
calculated on the premise of complete return to stockholders, payable month-to-month in
arrears, such that for any yr wherein complete return on stockholders' capital
exceeds 6.0% every year, the Advisor shall be entitled to fifteen.0% of the surplus
complete return; supplied that in no occasion will the annual subordinated efficiency
charge payable to the Advisor exceed 10.0% of the combination complete return for such
yr.

•The Firm reimburses the Advisor for insourced bills incurred by the
Advisor on the Firm's behalf associated to choosing, evaluating, originating
and buying investments in an quantity as much as 0.5% of the principal quantity funded
by the Firm to originate or purchase industrial mortgage loans and as much as 0.5%
of the anticipated web fairness funded by the Firm to amass actual property
securities investments.

Funding in Widespread and Most popular Inventory

Seek advice from Word 9 - Inventory Transactions for an outline of the Firm's non-public
placements. Officers of the Firm and different staff of the Advisor and its
associates ("Supervisor Buyers"), in addition to members of the Firm's board of
administrators, have acquired frequent inventory and Collection A Convertible Most popular Inventory
("Collection A Most popular Inventory") in these non-public placements on considerably the
identical phrases making use of to purchases by third celebration accredited traders
unaffiliated with the Firm or the Advisor. On October 19, 2021, every share of
Collection A Most popular Inventory transformed into 299.2 shares of frequent inventory, pursuant
to the phrases of the Articles Supplementary for the Collection A Most popular Inventory, and
no shares of Collection A Most popular Inventory had been excellent as of December 31, 2021.

The Supervisor Buyers have agreed with the Advisor to not promote or in any other case
switch the securities bought within the non-public placement with out the consent
of the Advisor, previous to 180 days after the itemizing of the Firm’s frequent
inventory on the NYSE.

The board of administrators and the Nominating and Company Governance Committee of
the board of administrators every reviewed and unanimously authorised the Firm’s
issuance of shares to the Supervisor Buyers and the phrases of the providing.

Lending Settlement with Stockholder

Pursuant to a lending and safety settlement with Safety Profit Life
Insurance coverage Firm ("SBL"), which was entered into in February 2020 and amended
in March and August 2020, the Firm might borrow as much as $100.0 million at a charge
of one-month LIBOR + 4.5%. The ability has a maturity of February 10, 2023 and
is secured by a pledge of fairness pursuits in sure of the Firm's
subsidiaries. The Firm incurred $2.0 million and $0.2 million of curiosity
expense on the lending settlement with SBL for the years ended December 31, 2021
and 2020, respectively. As of December 31, 2021 there was a $50.0 million
excellent steadiness below the lending settlement.

SBL additionally holds 17,950 of the Firm's excellent shares of Collection D Most popular
Inventory. SBL acquired these shares in March 2021: 14,950 shares had been acquired in
trade for an equal variety of shares of Collection A Most popular Inventory and
3,000 shares of Collection D Most popular Inventory had been bought on the liquidation
choice of $15.0 million (web of accrued and unpaid dividends on the
exchanged Collection A Most popular Inventory) in the identical transaction.

Acquisitions

In August 2021 the Firm and an funding fund managed by the Advisor entered
right into a three way partnership settlement and shaped a three way partnership entity, Jeffersonville
Member, LLC (the "Jeffersonville JV") to amass a $139.5 million triple web
lease property in Jeffersonville, GA. The Firm has a 79% curiosity within the
Jeffersonville JV, whereas the affiliated fund has a 21% curiosity. The Firm
invested a complete of $109.8 million, made up of $88.7 million in debt and
$21.1 million in fairness, representing 79% of the possession curiosity within the
Jeffersonville JV. The affiliated fund made up the remaining $29.8 million
composed of a $24.0 million mortgage be aware payable and $5.7 million in fairness.
The Firm has management of Jeffersonville JV with 79% possession and, due to this fact,
consolidates Jeffersonville JV on its consolidated steadiness sheet. The Firm's
$88.7 million mortgage be aware payable to Jeffersonville JV is eradicated in
consolidation (see Word 7 - Debt).
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The desk under exhibits the prices incurred as a consequence of preparations with our Advisor
and its associates through the years ended December 31, 2021, 2020 and 2019 and
the related quantities payable as of December 31, 2021 and 2020 ({dollars} in
1000's). See Word 11 - Associated Get together Transactions and Preparations for
additional element.
                                                       12 months Ended December 31,                     Payable as of December 31,
                                              2021              2020              2019               2021              2020
Acquisition bills (1)                   $  1,203          $    696          $    900          $       -          $      -
Administrative providers bills              7,658            13,120            16,363                  -             2,940
Asset administration and subordinated
efficiency charge                              28,110            15,178            16,226             15,595             4,773
Different associated celebration bills (2)(3)             355               703             1,610              1,943             1,812
Complete associated celebration charges and
reimbursements                             $ 37,326          $ 29,697          $ 35,099          $  17,538          $  9,525


______________________

(1) Complete acquisition charges and bills paid through the years ended December 31,
2021, 2020 and 2019 had been $15 million, $7.1 million and $8.4 million
respectively, of which $13.8 million, $6.4 million and $7.5 million had been
capitalized inside the industrial mortgage loans, held for funding line of
the consolidated steadiness sheets for the years ended December 31, 2021, 2020 and
2019.

(2) These are associated to reimbursable prices incurred for the rise in mortgage
origination actions and are included in Different bills within the Firm’s
consolidated statements of operations.

(3) The associated celebration payable contains $1.9 million and $1.8 million,
respectively, of funds made by the Advisor to 3rd celebration distributors on behalf
of the Firm.

The quantities payable as of December 31, 2021 and 2020 within the desk above are
included in Resulting from associates on the Firm’s consolidated steadiness sheets.

Off Stability Sheet Preparations

We presently haven’t any off steadiness sheet preparations as of December 31, 2021 and
via the date of the submitting of this Kind 10-Ok.

Non-GAAP Monetary Measures

Distributable Earnings

Starting within the third quarter of 2021 to extra appropriately mirror the
principal objective of the measure, "modified funds from operations ("MFFO")" or
"funds from operations ("FFO")" was relabeled "Distributable Earnings", a
non-GAAP monetary measure. Distributable Earnings is a non-GAAP measure, which
we outline as GAAP web earnings (loss), adjusted for (i) non-cash CLO amortization
acceleration and amortization over our anticipated helpful lifetime of our CLOs, (ii)
unrealized beneficial properties and losses on loans, derivatives and ARMs, together with CECL
reserves and impairments, (iii) non-cash fairness compensation expense, (iv)
depreciation and amortization, (v) non-cash incentive charge accruals, (vi) sure
different non-cash objects, and (vii) impairments of acquisition property associated to the
Capstead merger.

We imagine that Distributable Earnings offers significant info to
take into account along with our GAAP outcomes. We imagine Distributable Earnings is a
helpful monetary metric for current and potential future holders of our frequent
inventory as traditionally, additional time, Distributable Earnings has been an indicator of
our dividends per share. As a REIT, we usually should distribute yearly at
least 90% of our web taxable earnings, topic to sure changes, and
due to this fact we imagine our dividends are one of many principal causes stockholders
might spend money on our frequent inventory. Additional, Distributable Earnings helps us to
consider our efficiency excluding the consequences of sure transactions and GAAP
changes that we imagine usually are not essentially indicative of our present mortgage
portfolio and operations and is among the efficiency metrics we take into account when
declaring our dividends.

Distributable Earnings doesn't symbolize web earnings (loss) and shouldn't be
thought-about as an alternative choice to GAAP web earnings (loss). Our methodology for
calculating Distributable Earnings might differ from the methodologies employed by
different firms and thus might not be corresponding to the Distributable Earnings
reported by different firms.
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The next desk offers a reconciliation of GAAP web earnings to
Distributable Earnings for the years ended December 31, 2021, December 31, 2020
and December 31, 2019 ({dollars} in 1000’s):

                                                                            12 months Ended December 31,
                                                                  2021                2020                2019
GAAP Web Revenue:                                             $    25,702          $   54,746          $   83,924
Changes:
CLO amortization acceleration (1)                                    250                 264              (2,881)
Unrealized (acquire)/loss on monetary devices (2)               (1,049)              1,102              (2,081)
Unrealized acquire/(loss) reversal - ARMs                            13,867                   -               1,989
Impairment of acquired property                                     88,282                   -                   -
Incentive charges                                                     9,846                   -                   -
Depreciation and amortization                                      2,107               2,234                 507
Improve/(lower) in provision for credit score losses                (5,192)             13,296                   -
Impairment losses on actual property owned property                          -                 398                   -
Distributable earnings                                       $   133,813          $   72,040          $   81,458
Common Fairness                                               $ 1,146,009          $  974,184          $  946,801
7.5% Cumulative Redeemable Most popular Inventory, Collection E
Dividend                                                     $     4,842          $        -          $        -
GAAP Widespread ROE                                                      1.8  %              5.6  %              8.9  %
Distributable Earnings ROE                                          11.3  %              7.4  %              8.6  %
GAAP Web Revenue Per Share, Absolutely Transformed                   $      0.33          $     0.96          $     1.59
Distributable Earnings Per Share, Absolutely Transformed            $      2.02    

$ 1.27 $ 1.54


(1) Adjusted for non-cash CLO amortization acceleration to successfully amortize
issuance prices of our CLOs over the anticipated lifetime of the CLOs. We assume our
CLOs shall be excellent for 4 years and amortized the financing prices over
4 years in our distributable earnings as in comparison with efficient yield
methodology in our GAAP earnings.

(2) Adjusted for unrealized beneficial properties and losses on loans and derivatives.

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