Quarterly report pursuant to Section 13 or 15(d)

Our Portfolio - Financing Receivables, Investments and Real Estate (Tables)

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Our Portfolio - Financing Receivables, Investments and Real Estate (Tables)
9 Months Ended
Sep. 30, 2014
Receivables [Abstract]  
Analysis of Portfolio by Type of Obligor and Credit Quality

The following is an analysis of our Portfolio by type of obligor and credit quality as of September 30, 2014.

 

     Investment Grade              
     Federal(1)     State, Local,
Institutions
(2)
    Commercial
Externally
Rated
(3)
    Commercial
Rated
Internally
(4)
    Commercial
Other
(5)
    Total  
     (amounts in millions, except for percentages)  

Financing receivables

   $ 201.4      $ 73.3      $ 22.1      $ 180.3      $ 0.8      $ 477.9   

Financing receivables held-for-sale

     7.2        —          —          —          —          7.2   

Investments available-for-sale

     —          —          21.1        7.9        14.4        43.4   

Real estate(6)

     —          —          —          81.6        —          81.6   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total

   $ 208.6      $ 73.3      $ 43.2      $ 269.8      $ 15.2      $ 610.1   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

% of Total Portfolio

     34.2     12.0     7.1     44.2     2.5     100.0

Average Balance(7)

   $ 7.6      $ 24.4      $ 21.6      $ 12.9      $ 14.4      $ 11.2   

 

(1) Transactions where the ultimate obligor is the U.S. Federal Government. Transactions may have guaranties of energy savings from third party service providers, the majority of which are investment grade rated entities.

 

(2) Transactions where the ultimate obligors are state or local governments or institutions such as hospitals or universities where the obligors are rated investment grade (either by an independent rating agency or based upon our credit analysis). Transactions may have guaranties of energy savings from third party service providers, the majority of which are investment grade rated entities.
(3) Transactions where the projects or the ultimate obligors are commercial entities that have been rated investment grade by one or more independent rating agencies. This includes an investment grade rated debt security with a fair value of $21.1 million that matures in 2035 whose obligor is an entity whose ultimate parent is Berkshire Hathaway Inc.
(4) Transactions where the projects or the ultimate obligors are commercial entities that have been rated investment grade using our internal credit analysis.
(5) Transactions where the projects or the ultimate obligors are commercial entities that have ratings below investment grade either by an independent rating agency or using our internal credit analysis. Financing receivables are net of an allowance for credit losses of $11.0 million. Investments include a senior debt investment of $14.4 million on a wind project that is owned by NRG Energy, Inc.
(6) Includes the real estate and the lease intangible assets
(7) Average Remaining Balance excludes 66 transactions each with outstanding balances that are less than $1.0 million and that in the aggregate total $17.1 million.
Components of Financing Receivables

The components of financing receivables as of September 30, 2014 and December 31, 2013, were as follows:

 

     September 30, 2014     December 31, 2013  
     (amounts in thousands)  

Financing receivables

    

Financing or minimum lease payments(1)

   $ 761,421      $ 504,688   

Unearned interest income

     (269,256     (142,366

Allowance for credit losses

     (11,000     (11,000

Unearned fee income, net of initial direct costs

     (3,232     (3,451
  

 

 

   

 

 

 

Financing receivables(1)

   $ 477,933      $ 347,871   
  

 

 

   

 

 

 

 

(1) Excludes $7.2 million in financing receivables held-for-sale at September 30, 2014 and $24.8 million in financing receivables held-for-sale at December 31, 2013 that were securitized in the three months ended March 31, 2014.
Components of Real Estate Portfolio

The components of our real estate portfolio as of September 30, 2014 and December 31, 2013, were as follows:

 

     September 30, 2014     December 31, 2013  
     (amounts in thousands)  

Real Estate

    

Land

   $ 63,313      $ —     

Lease Intangibles

     18,424        —     

Accumulated amortization of lease intangibles

     (148     —     
  

 

 

   

 

 

 

Real Estate

   $ 81,589      $ —     
  

 

 

   

 

 

 
Future Amortization Expenses Related to Intangible Assets

As of September 30, 2014, the future amortization expense to be recognized related to these intangible assets is:

 

Year Ending December 31,    (Amounts in Thousands)  

From October 1, 2014 to December 31, 2014

   $ 112   

2015

     450   

2016

     450   

2017

     450   

2018

     450   

2019

     450   

Thereafter

     15,914   
  

 

 

 

Total

   $ 18,276   
  

 

 

 
Summary of Anticipated Maturity Dates of Financing Receivables (Excluding Financing Receivable Held-for-Sale) and Investments and Weighted Average Yield

The following table provides a summary of our anticipated maturity dates of our financing receivables (excluding the financing receivable held-for-sale) and investments and the weighted average yield for each range of maturities as of September 30, 2014:

 

     Total     Less than
1 year
    1-5 years     5-10 years     More than
10 years
 
     (in thousands, except for interest rate data)  

Financing Receivables

          

Payment due by period

   $ 477,933      $ 9,825      $ 52,562      $ 28,356      $ 387,190   

Weighted average yield by period(1)

     5.63     6.02     7.50     5.05     5.40

Investments

          

Payment due by period

   $ 43,447      $ —        $ 14,434      $ —        $ 29,013   

Weighted average yield by period

     5.49     —       5.76     —       5.36

 

(1) Excludes yield on remaining $0.8 million loan balance that is on non-accrual status after the $11.0 million allowance for loan loss recorded in December 2013.

 

Future Minimum Rental Income under Land Lease Agreements

As of September 30, 2014, the future minimum rental income under our land lease agreements is as follows:

 

Year Ending December 31,    (Amounts in Thousands)  

From October 1, 2014 to December 31, 2014

   $ 1,404   

2015

     5,616   

2016

     5,616   

2017

     5,616   

2018

     5,616   

2019

     5,616   

Thereafter

     198,798   
  

 

 

 

Total

   $ 228,282