Ready Capital (RC) Q4 2025 earnings summary

Executive summary

• Advanced a comprehensive balance sheet repositioning strategy, including major CRE asset sales, liquidity strengthening, and leadership changes, with Dominick Scali promoted to Chief Credit Officer and Co-President of CRE operations and Gary Taylor to President of SBA lending.

• Reported a GAAP net loss of $232.6 million for Q4 2025 and $221.1 million for the full year, with a net loss from continuing operations of $(1.46) per share and distributable losses of $(0.43) per share.

• Book value per share declined to $8.79 at quarter end, down from $10.28 in Q3 2025, primarily due to increased valuation allowances and CECL reserves.

• Total loan portfolio stood at $5.9 billion, with $374.6 million in new originations and $442.3 million in repayments in Q4 2025.

• Completed the acquisition of United Development Funding IV and the sale of GMFS.

Financial highlights

• Net loss including dividends on preferred stock was $(234.6) million for Q4 2025, with distributable loss per share of $(0.43) and distributable loss before realized losses of $(0.09) per share.

• Recurring revenue was $41.5 million, down from $47.3 million in the prior quarter, mainly due to lower SBA and USDA loan sales.

• Operating expenses increased to $59.9 million, driven by higher compensation, legal fees, and reduced tax benefit.

• Provision for loan losses was $149.9 million in Q4 2025.

• Dividends declared per share of common stock were $0.01 for Q4 2025.

Outlook and guidance

• Liquidity plan anticipates generating an additional $500 million in free cash by year-end 2026, with $250 million from portfolio runoff and $250 million from planned loan sales.

• Loan sales, especially of NPL and sub-yielding assets, expected to be substantially complete by end of Q2 2026.

• Management is focused on repositioning equity away from Covid-vintage production and improving financial stability.

• Targeting a 25% reduction in operating costs and increased capital allocation to SBA lending from 10% to 20%.

• Completed sale of 34 loans totaling $855.3 million in unpaid principal balance in February 2026.