Arbor Realty Trust Warns of Reduced Earnings, Dividend Amid Market Challenges

Key Takeaways:

* Arbor Realty Trust cautions of lower earnings and dividend amid increased loan delinquencies and interest rates.
* Apartment building loan lender's shares plunge over 13% on earnings call.
* Company faces increased legal and consulting fees due to short-seller reports.

Earnings and Financial Performance:

* Net income for 2024 declines by approximately 33% to $223.3 million compared to 2023.
* Cash and cash equivalents stand at $503.8 million as of December 31, 2024, down from $929 million the previous year.

Delinquencies and Market Challenges:

* Overall delinquency rate in the CRE CLO market reaches near-record levels.
* Serious delinquency rate for Arbor-issued CLOs increases significantly between December 2024 and January 2025.
* Arbor's total delinquencies total $819 million in the quarter ended December 31, 2024.

Company Actions and Outlook:

* Arbor modifies $4.1 billion of loans in 2024 to address borrower challenges and interest rate volatility.
* Company expects to have $400-$500 million of real estate-owned (REO) assets in the next few quarters.
* Arbor anticipates extended legal and consulting costs related to short-seller activity.
* Company declines to comment on regulatory inquiries.

Note: This article reflects the information available as of the date of publication and may have changed since then.