Company: ABR-PF
Filing Date: 2025-10-31
Form Type: 10-Q
Source: 0001253986-25-000022
Chunk: 262

Company: ARBOR REALTY TRUST INC
Filing Date: 2025-10-31
Form: 10-Q
Item: Part I, Item 8
Chunk 262
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curitization26,832 664 9.82 %164,046 3,423 8.28 %Total interest-bearing liabilities$9,959,114 176,158 7.02 %$10,092,663 192,945 7.58 %Net interest income$32,096 $81,157 

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(1)Based on UPB for loans, amortized cost for securities and principal amount of debt.

(2)Weighted average yield calculated based on annualized interest income or expense divided by average carrying value.

Net Interest Income

The decrease in interest income was mainly due to a $65.8 million decrease from our Structured Business. The decline was primarily due to a decrease in the average yield on core interest-earning assets and, to a lesser extent, a decrease in the average balance of our core interest-earning assets (loan runoff exceeded loan originations in 2024) and lower average bank balances. The decrease in the average yield was mainly from a decrease in SOFR, the reversal of interest that was previously accrued on modified loans and a reduction in back interest earned on delinquent and modified loans, as well as an increase in new delinquencies and modified loans at lower rates. 

The decrease in interest expense was mainly due to a $16.8 million decrease from our Structured Business, primarily due to a reduction in the average cost of interest-bearing liabilities (mainly from a decrease in SOFR) and a decline in the average balance of our interest-bearing liabilities from a decrease in the average loan portfolio, note paydowns in our securitizations and the payoff of our 7.50% convertible senior notes.

Agency Business Revenue

The increase in gain on sales, including fee-based services, net was primarily due to a 81% increase in loan sales volume ($907.8 million), partially offset by a 31% decrease in the sales margin from 1.67% to 1.15%. The decrease in the sales margin was mainly due to larger portfolio deals that closed in the current quarter that produced lower margins.  

The increase in income from MSRs was primarily due to a 90% increase in loan commitment volume ($947.0 million), largely offset by a 38% decrease in the MSR rate from 1.25% to 0.78%. The decrease in the MSR rate was mainly due to higher percentage of Freddie Mac loan commitments which contain lower servicing fees,