Company: CMCT
Filing Date: 2025-08-14
Form Type: 10-Q
Source: 0000908311-25-000067
Chunk: 62

Company: Creative Media & Community Trust Corp
Filing Date: 2025-08-14
Form: 10-Q
Item: Item 1
Chunk 62
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 securitization transaction. The proceeds received from the transfer were reflected as loan-backed notes payable (Note 7). These loans are subject to credit risk.SBA 7(a) Loans Receivable, Subject to Secured Borrowings—Represents the government guaranteed portions of loans originated under the SBA 7(a) Program which were sold with the proceeds received from the sale reflected as secured borrowings—government guaranteed loans. There is no credit risk associated with these loans since the SBA guarantees payment of the principal.SBA 7(a) Loans Receivable, Held for Sale— Represents the government guaranteed portion of loans held for sale at the end of the period or that had been sold but in respect of which proceeds had not been received as of the end of the period. 

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Table of ContentsCREATIVE MEDIA & COMMUNITY TRUST CORPORATION AND SUBSIDIARIESNOTES TO CONSOLIDATED FINANCIAL STATEMENTSJune 30, 2025 (Unaudited) – (Continued)

Current Expected Credit Losses CECL reflects the Company’s current estimate of potential credit losses related to loans receivable included in the Company’s consolidated balance sheets as of June 30, 2025 pursuant to ASU 2016-13 as implemented effective January 1, 2023. Refer to Note 2 for further discussion of CECL.The following table presents the activity in the Company’s CECL for the six months ended June 30, 2025 and June 30, 2024 (dollar amounts in thousands):Loans ReceivableCurrent expected credit losses as of December 31, 2024$2,032 Net adjustment to reserve for expected credit losses39 Current expected credit losses as of March 31, 20252,071 Net adjustment to reserve for expected credit losses380 Current expected credit losses as of June 30, 2025$2,451 Current expected credit losses as of December 31, 2023$1,680 Net adjustment to reserve for expected credit losses(36)Current expected credit losses as of March 31, 20241,644 Net adjustment to reserve for expected credit losses(37)Current expected credit losses as of June 30, 2024$1,607 The net adjustments to the reserve for expected credit losses are recognized through net income on the Company’s consolidated statements of operations. During the three and six months ended June 30, 2025, the Company recorded an increase of $380