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Aug 6, 2026, 5:12 PM ETReal Estate

Ready Capital Corporation — Second Quarter 2026 Earnings Summary

RCREADY CAPITAL CORP
Source

Financial Performance

  • Reported a GAAP net loss of $99.683 million for the quarter ended June 30, 2026, compared to a net loss of $53.677 million in the same period in 2025.
  • GAAP loss per common share was $(0.63) for the quarter, compared to $(0.34) in the prior year period.
  • Distributable loss per common share was $(0.47), compared to a distributable loss per share of $(0.24) before realized losses.
  • Net interest income (loss) before provision for loan losses was $(5.452) million for the quarter, a decrease from $16.898 million in the prior year period.
  • Provision for loan losses was $21.554 million for the quarter, compared to $8.640 million in the prior year period.
  • Total non-interest expense was $77.573 million for the quarter, up from $70.277 million in the prior year period.
  • Cash and cash equivalents were $124.149 million as of June 30, 2026, down from $207.841 million as of December 31, 2025.
  • Total assets were $6.264 billion as of June 30, 2026, down from $7.770 billion as of December 31, 2025.
  • Total liabilities were $4.914 billion as of June 30, 2026, down from $6.118 billion as of December 31, 2025.
  • Book value per share was $6.83 as of June 30, 2026.
  • Total leverage was 3.0x with recourse leverage of 1.7x.

Guidance and Future Outlook

  • Management indicated the pace of book value reduction is decelerating and earnings pressure is narrowing.
  • The company is focused on meeting fourth-quarter debt maturities.
  • Management expressed intent to restart growth through core CRE debt investing and SBA 7(a) lending businesses.
  • The securitization of $158.2 million of unguaranteed SBA 7(a) loans generated $500 million of additional funding capacity for 7(a) production.

Business Segments and Product Lines

  • Total loan originations for the quarter were $278.8 million, comprising $155.9 million of LMM commercial real estate loans and $82.1 million of SBA 7(a) loans.
  • LMM Commercial Real Estate segment reported a net interest loss after provision of $(24.993) million and a total loss before income taxes of $(77.020) million for the quarter.
  • Small Business Lending segment reported a net interest loss after provision of $(2.013) million and a total loss before income taxes of $(20.094) million for the quarter.
  • The company retired the 6.20% Senior Unsecured Notes in April 2026.
  • Generated $1.4 billion in cash year-to-date from loan sales and portfolio runoff.
  • Paid down over $1 billion in asset-level financing and retired $184 million of corporate debt year-to-date.
  • Sold 50 Ritz-Carlton branded condominium units at the Portland Ritz project, representing 38% completion.

Market and Competitive Landscape

  • The Portland Ritz hotel occupancy increased 10% year-over-year to 52%.
  • Average Daily Rate (ADR) at the Portland Ritz decreased 4% year-over-year to $468.
  • Revenue per Available Room (RevPar) at the Portland Ritz increased 20% year-over-year to $244.

Risks and Challenges

  • The company reported a distributable loss before realized losses of $(0.24) per share, indicating ongoing earnings pressure.
  • Significant realized losses on the sale of investments contributed to the distributable loss, with realized losses on sale of investments totaling $41.234 million in the quarter.
  • An increase in the CECL reserve of $8.250 million was recorded for the quarter.
  • Unrealized loss on preferred equity at fair value was $10.065 million for the quarter.
  • The company faces the challenge of meeting fourth-quarter debt maturities.

Management Commentary and Tone

  • Thomas Capasse, Chairman and CEO, stated that second-quarter results demonstrate continued progress on the balance sheet repositioning plan.
  • Management noted that while work remains, they are encouraged by progress and are increasingly looking toward restarting growth.
  • The tone reflects a focus on balance sheet stability and debt management while preparing for future growth in core lending businesses.

Other Key Points

  • The company generated $24.6 million of net liquidity from the securitization of $158.2 million of unguaranteed SBA 7(a) loans priced at SOFR + 2.4% with a 92% advance.
  • The company ended the quarter with $124 million in cash and $690 million of unencumbered assets.
  • Dividends declared per share of common stock were $0.01 for the quarter, compared to $0.125 in the prior year period.
  • The company employs over 400 professionals nationwide.
  • A webcast and conference call were scheduled for August 7, 2026, to discuss the results.