Company: ABR-PF
Filing Date: 2025-08-01
Form Type: 10-Q
Source: 0001253986-25-000014
Chunk: 16

Company: ARBOR REALTY TRUST INC
Filing Date: 2025-08-01
Form: 10-Q
Item: Part I, Item 2
Chunk 16
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 in interest income was mainly due to a $129.9 million decrease from our Structured Business. The decline was primarily due to a decrease in the average yield on core interest-earning assets and a decrease in the average balance of our core interest-earning assets, as loan runoff exceeded loan originations in 2024. The decrease in the average yield was mainly from a decrease in SOFR and a reduction in back interest earned on delinquent and modified loans, as well as an increase in new delinquencies. To a lesser extent, the decline also reflects a decrease in interest earned on our cash balances, as a result of lower average balances and a decrease in SOFR.

The decrease in interest expense was mainly due to a $88.2 million decrease from our Structured Business, primarily due to a decline in the average balance of our interest-bearing liabilities, from loan runoff and note paydowns in our securitizations and senior unsecured notes, and a decrease in the average cost of interest-bearing liabilities, mainly from a decrease in SOFR.

Agency Business Revenue

The decrease in gain on sales, including fee-based services, net was primarily due to a 31% decrease in loan sales volume ($682.8 million), partially offset by a 12% increase in the sales margin from 1.54% to 1.72%. The increase in the sales margin was mainly due to the portfolio mix in 2025 that produced higher margins.  

The decrease in income from MSRs was primarily due to a 26% decrease in loan commitment volume ($535.8 million), partially offset by a 4% increase in the MSR rate from 1.22% to 1.27%. 

The decrease in servicing revenue, net was primarily due to a decrease in earnings on escrow balances from lower average balances and a decrease in the applicable interest rate.

Other Income (Loss)

The increases in property operating income and expenses were due to the addition of several new REO assets. This is also the reason for the increase in depreciation and amortization.

63

The gains and losses on derivative instruments in 2025 and 2024 were related to changes in the fair values of our forward sale commitments and swaps held by our Agency Business as a result of changes in market interest rates as well as from the timing of GSE Agency loan sales.

The increase in other income, net was primarily due to increases in the fair values of our Private Label loans and loan fees from our Agency Business. 

Other Expenses