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| Delaware                        |   | 72-0654145          |
|---------------------------------|--------|---------------------|
| (State or other jurisdiction of |   | (I.R.S. Employer    |
| incorporation or organization)  |   | Identification No.) |

| One Crescent Drive, Suite 203, Navy Yard Corporate Center, Philadelphia, PA  19112 |
|----------------------------------------------------------------------------------------------|
| (Address of principal executive offices) (Zip code)                                          |
| (215) 546-5005                                                                               |
| (Registrant's telephone number, including area code)                                         |
|                                                                                         |
| Securities registered pursuant to Section 12(g) of the Act:                                  |
| Common stock, par value $.01 per share                                                       |   | NASDAQ |
| Title of class                                                                               |   | Name of exchange on which registered |

| Large accelerated filer                                     ̈           |                                          | Accelerated filer                        R |
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|-----------------------------------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| Non-accelerated filer                                       ̈ | (Do not check if a smaller reporting company) | Smaller reporting company ̈                                                                                                                                    |

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INDEX TO ANNUAL REPORT

|       |     | Page                                                                                                        |
|------------|----------|-------------------------------------------------------------------------------------------------------------|
| PART I     |     |                                                                                                        |
|       | Item 1:  | Business                                                                                                    | 3 |
|       | Item 1A: | Risk Factors                                                                                                | 10 |
|       | Item 1B: | Unresolved Staff Comments                                                                                   | 15 |
|       | Item 2:  | Properties                                                                                                  | 15 |
|       | Item 3:  | Legal Proceedings                                                                                           | 15 |
|       | Item 4:  | [Removed and Reserved]                                                                                      | 15 |
|       |     |                                                                                                        |   |
| PART II    |     |                                                                                                        |
|       | Item 5:  | Market for Registrant's Common Equity, Related Stockholder Matters andIssuer Purchases of Equity Securities | 16 |
|       | Item 6:  | Selected Financial Data                                                                                     | 18 |
|       | Item 7:  | Management’s Discussion and Analysis of Financial Condition and Results of Operations                 | 19 |
|       | Item 7A: | Quantitative and Qualitative Disclosures About Market Risk                                                  | 45 |
|       | Item 8:  | Financial Statements and Supplementary Data                                                                 | 46 |
|       | Item 9:  | Changes in and Disagreements with Accountants on Accounting and Financial Disclosure                        | 92 |
|       | Item 9A: | Controls and Procedures                                                                                     | 92 |
|       | Item 9B: | Other Information                                                                                           | 94 |
|       |     |                                                                                                        |   |
| PART III   |     |                                                                                                        |
|       | Item 10: | Directors, Executive Officers and Corporate Governance                                                      | 94 |
|       | Item 11: | Executive Compensation                                                                                      | 94 |
|       | Item 12: | Security Ownership of Certain Beneficial Owners and Management andRelated Stockholder Matters               | 94 |
|       | Item 13: | Certain Relationships and Related Transactions, and Director Independence                                   | 94 |
|       | Item 14: | Principal Accounting Fees and Services                                                                      | 94 |
|       |     |                                                                                                        |   |
| PART IV    |     |                                                                                                        |
|       | Item 15: | Exhibits and Financial Statement Schedules                                                                  | 95 |
|       |     |                                                                                                        |   |
| SIGNATURES | 98       |

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| ITEM 1. | BUSINESS. |
|---------|-----------|

|   | ● | In July 2009, Resource Real Estate, Inc., or Resource Real Estate, our wholly-owned real estate subsidiary, filed a registration statement with the Securities and Exchange Commission, or SEC, for Resource Real Estate Opportunity REIT, Inc., or RRE Opportunity REIT, which will seek to obtain up to $750.0 million in investor funding.  The registration statement became effective during June 2010 and $16.1 million of investor funds have been raised through September 30, 2010. |
|--------|---------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | ● | In December 2009, Resource Real Estate closed its real estate opportunity fund, which focuses on acquiring discounted real estate assets and related debt, having raised $41.4 million. |
|--------|---------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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|                                             |   |                                  |   |   | September 30, |   |
|--------------------------------------------------|--------|---------------------------------------|--------|--------|---------------|--------|
|                                             |   | September 30, 2010                    |   |   | 2009          |   |
|                                             |   | Institutional and IndividualInvestors |   |   | RCC           |   |   | Company |   |   | Total |   |   | Total |   |
| Trust preferred securities (1)              |   | $                                     | 4,213  |   |          | $      | − |   |   | $ | − |   |   | $ | 4,213 |   |   | $ | 4,458 |   |
| Bank loans (1)                              |   |                                  | 3,083  |   |          |   | 954 |   |   |   | − |   |   |   | 4,037 |   |   |   | 4,016 |   |
| Asset-backed securities (1)                 |   |                                  | 1,689  |   |          |   | − |   |   |   | − |   |   |   | 1,689 |   |   |   | 2,186 |   |
| Real properties (2)                         |   |                                  | 588    |   |          |   | 13 |   |   |   | − |   |   |   | 601 |   |   |   | 643 |   |
| Mortgage and other real estate-related loans (2) |   |                                  | 29     |   |          |   | 748 |   |   |   | 179 |   |   |   | 956 |   |   |   | 1,039 |   |
| Commercial finance assets (3)               |   |                                  | 751    |   |          |   | 115 |   |   |   | 12 |   |   |   | 878 |   |   |   | 1,361 |   |
| Private equity and other assets (1)         |   |                                  | 70     |   |          |   | − |   |   |   | − |   |   |   | 70 |   |   |   | 66 |   |
|                                             |   | $                                     | 10,423 |   |          | $      | 1,830 |   |   | $ | 191 |   |   | $ | 12,444 |   |   | $ | 13,769 |   |

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| (1) | We value these assets at their amortized cost. |
|-----|------------------------------------------------|

| (2) | We value our managed real estate assets as the sum of:  (i) the amortized cost of our commercial real estate loans; and (ii) the book value of each of the following: (a) real estate and other assets held by our real estate investment entities, (b) our outstanding legacy loan portfolio, and (c) our interests in real estate. |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (3) | We value our commercial finance assets as the sum of the book value of the equipment, leases and notes and future payment card receivables financed by us. |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------|

|                        |   | CDOs   |    |   | Limited Partnerships |   |   | TIC Programs |   |   | Other Investment Funds |   |
|-----------------------------|--------|--------|---------|--------|----------------------|--------|--------|--------------|--------|--------|------------------------|--------|
| As of September 30, 2010(1) |   |   |    |   |                 |   |   |         |   |   |                   |   |
| Financial fund management   |   |   | 32      |   |                 |   | 13     |         |   |   | −                |   |   |   | − |   |
| Real estate                 |   |   | 2       |   |                 |   | 8      |         |   |   | 7                      |   |   |   | 4 |   |
| Commercial finance          |   |   | − |   |                 |   | 4      |         |   |   | −                |   |   |   | 1 |   |
|                        |   |   | 34      |   |                 |   | 25     |         |   |   | 7                      |   |   |   | 5 |   |
| As of September 30, 2009(1) |   |   |    |   |                 |   |   |         |   |   |                   |   |   |   |   |   |
| Financial fund management   |   |   | 32      |   |                 |   | 13     |         |   |   | −                |   |   |   | − |   |
| Real estate                 |   |   | 2       |   |                 |   | 8      |         |   |   | 7                      |   |   |   | 5 |   |
| Commercial finance          |   |   | − |   |                 |   | 4      |         |   |   | −                |   |   |   | 1 |   |
|                        |   |   | 34      |   |                 |   | 25     |         |   |   | 7                      |   |   |   | 6 |   |

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| (1) | All of our operating segments manage assets on behalf of RCC. |
|-----|---------------------------------------------------------------|

|   | ● | the acquisition, ownership and management of portfolios of discounted real estate and real estate related debt, which we have acquired through two sponsored real estate investment entities as well as through joint ventures with institutional investors; |
|--------|---------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | ● | the sponsorship and management of real estate investment entities that principally invest in multifamily housing; |
|--------|---------|-------------------------------------------------------------------------------------------------------------------|

|   | ● | the management, principally for RCC, of general investments in commercial real estate debt, including first mortgage debt, whole loans, mortgage participations, B notes, mezzanine debt and related commercial real estate securities; and |
|--------|---------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | ● | to a lesser extent, the management and resolution of a portfolio of real estate loans and property interests that we acquired at various times between 1991 and 1999, which we collectively refer to as our legacy portfolio. |
|--------|---------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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|   | ● | Apidos Capital Management, LLC, or Apidos, finances, structures and manages investments in bank loans, high yield bonds and equity investments; |
|--------|---------|-------------------------------------------------------------------------------------------------------------------------------------------------|

|   | ● | Trapeza Capital Management, LLC, or TCM, a joint venture between us and an unrelated third-party, originates, structures, finances and manages investments in trust preferred securities and senior debt securities of banks, bank holding companies, insurance companies and other financial companies through CDO issuers and related partnerships.  TCM together with the Trapeza CDO issuers and Trapeza Partnerships are collectively referred to as Trapeza |
|--------|---------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | ● | Resource Capital Markets, Inc., through our registered broker-dealer subsidiary, Chadwick Securities, Inc., or Chadwick, acts as an agent in the primary and secondary markets for trust preferred in the financial services and real estate sectors and manages accounts for institutional investors; |
|--------|---------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | ● | Resource Europe Management Ltd., or Resource Europe, structures and manages investments in international bank loans; |
|--------|---------|----------------------------------------------------------------------------------------------------------------------|

|   | ● | Resource Financial Institutions Group, Inc., or RFIG, serves as the general partner for seven company-sponsored affiliated partnerships which invest in financial institutions; |
|--------|---------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | ● | Ischus Capital Management, LLC, or Ischus, finances, structures and manages investments in asset-backed securities or ABS, including residential mortgage-backed securities, or RMBS, and commercial mortgage-backed securities, or CMBS; and |
|--------|---------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | ● | Resource Capital Manager, Inc., or RCM, an indirect wholly-owned subsidiary, provides investment management and administrative services to RCC under a management agreement between RCM and RCC. |
|--------|---------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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| Sponsor/Manager |   | Asset Class                |   | Number ofCDO Issuers |   |   | Assets Under Management (1) |   |
|-----------------|--------|----------------------------|--------|----------------------|--------|--------|-----------------------------|--------|
|            |   |                       |   |                 |   |   | (in billions)               |   |
| Trapeza (2)(3)  |   | Trust preferred securities |   |                 | 13     |   |                        | $      | 4.2 |   |
| Apidos          |   | Bank loans                 |   |                 | 11     |   |                        |   | 3.6 |   |
| Ischus (2)      |   | RMBS/CMBS/ABS              |   |                 | 7      |   |                        |   | 1.7 |   |
| Resource Europe |   | Bank loans                 |   |                 | 1      |   |                        |   | 0.4 |   |
|            |   |                       |   |                 | 32     |   |                        | $      | 9.9 |   |

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| (1) | Calculated as set forth in “Assets Under Management,” above. |
|-----|--------------------------------------------------------------------------|

| (2) | We also own a 50% interest in the general partners of the limited partnerships that own a portion of the equity interests in each of five Trapeza CDO issuers. |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (3) | Through Trapeza, we own a 50% interest in an entity that manages 11 of the Trapeza CDO issuers and a 33.33% interest in another entity that manages two of the Trapeza CDO issuers. |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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|                     |   | Total  |   |   | Real Estate |   |   | CommercialFinance |   |   | FinancialFundManagement |   |   | Corporate/ Other |    |
|--------------------------|--------|--------|--------|--------|-------------|--------|--------|-------------------|--------|--------|-------------------------|--------|--------|------------------|---------|
| September 30, 2010       |   |   |   |   |        |   |   |              |   |   |                    |   |   |             |    |
| Investment professionals |   |   | 101    |   |        |   | 32     |              |   |   | 37                      |   |   |             | 30      |   |   |   | 2 |   |
| Other                    |   |   | 222    |   |        |   | 15     |              |   |   | 158                     |   |   |             | 13      |   |   |   | 36 |   |
|                     |   |   | 323    |   |        |   | 47     |              |   |   | 195                     |   |   |             | 43      |   |   |   | 38 |   |
| Property management      |   |   | 333    |   |        |   | 333    |              |   |   | −                 |   |   |             | − |   |   |   | − |   |
| Total                    |   |   | 656    |   |        |   | 380    |              |   |   | 195                     |   |   |             | 43      |   |   |   | 38 |   |
|                     |   |   |   |   |        |   |   |              |   |   |                    |   |   |             |    |   |   |   |   |   |
| September 30, 2009       |   |   |   |   |        |   |   |              |   |   |                    |   |   |             |    |   |   |   |   |   |
| Investment professionals |   |   | 121    |   |        |   | 26     |              |   |   | 61                      |   |   |             | 32      |   |   |   | 2 |   |
| Other                    |   |   | 330    |   |        |   | 17     |              |   |   | 259                     |   |   |             | 16      |   |   |   | 38 |   |
|                     |   |   | 451    |   |        |   | 43     |              |   |   | 320                     |   |   |             | 48      |   |   |   | 40 |   |
| Property management      |   |   | 318    |   |        |   | 318    |              |   |   | −                 |   |   |             | − |   |   |   | − |   |
| Total                    |   |   | 769    |   |        |   | 361    |              |   |   | 320                     |   |   |             | 48      |   |   |   | 40 |   |

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| ITEM 1A. | RISK FACTORS. |
|----------|---------------|

|   | ● | existing capital markets conditions.  As a result of the ongoing credit market turmoil, we may not be able to obtain debt financing on attractive terms.  As a result, we may be required to use a greater proportion of our equity funds to complete asset acquisitions and originations, reducing the number of investments we would otherwise make.  If the current capital markets environment persists, we may modify our investment strategy in order to optimize our portfolio performance.  Our options would include limiting or eliminating the use of debt and focusing on those investments that do not require the use of leverage to meet our portfolio goals.  During fiscal 2010, the market constraints on our ability to obtain debt financing caused our commercial finance operations to reduce originations of leases and loans held for our investment entities, as well as for our account, which reduced our operating revenues.  For our financial fund management operations, the availability of financing has been largely halted; |
|--------|---------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | ● | market acceptance of the types of funds we sponsor and market perceptions about the types of assets which we seek to acquire for our funds which has been impaired by current market conditions; |
|--------|---------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | ● | the willingness or ability of retail investors, a principal source of investment funds for our commercial finance and real estate investment funds, to invest in long-term, relatively illiquid investments of the type sponsored by us; |
|--------|---------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | ● | the performance of our existing funds.  During fiscal 2010, several of our funds reduced or ceased to make equity distributions as a result of reduced operations.  Accordingly, we have waived our management fees and anticipate waiving these fees in the future; |
|--------|---------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | ● | the availability of qualified personnel to manage our funds; |
|--------|---------|--------------------------------------------------------------|

|   | ● | the availability of suitable investments in the types of loans, real estate, commercial finance assets and other assets that we seek to acquire for our funds; and |
|--------|---------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | ● | interest rate changes and their effect on both the assets we seek to acquire for our funds, and the amount, cost and availability of acquisition financing. |
|--------|---------|-------------------------------------------------------------------------------------------------------------------------------------------------------------|

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|   | ● | are junior mortgage loans; |
|--------|---------|----------------------------|

|   | ● | involve payment structures other than equal periodic payments that retire a loan over its term; |
|--------|---------|-------------------------------------------------------------------------------------------------|

|   | ● | require the borrower to pay a large lump sum at loan maturity (which will depend upon the borrower’s ability to obtain financing or otherwise raise a substantial amount of cash at maturity); and |
|--------|---------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | ● | while producing income, do not generate sufficient revenues to pay the full amount of debt service on the loan as originally structured. |
|--------|---------|------------------------------------------------------------------------------------------------------------------------------------------|

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| ITEM 1B. | UNRESOLVED STAFF COMMENTS. |
|----------|----------------------------|

| ITEM 2. | PROPERTIES. |
|---------|-------------|

| ITEM 3. | LEGAL PROCEEDINGS. |
|---------|--------------------|

| ITEM 4. | [Removed and Reserved.] |
|---------|-------------------------|

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| ITEM 5. | MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER |
|---------|------------------------------------------------------------|
|    | MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES.         |

|           |   | As Reported |   |
|----------------|--------|-------------|--------|
|           |   | High        |   |   | Low |   |
| Fiscal 2010    |   |        |   |   |   |   |
| Fourth Quarter |   | $           | 5.68   |   |   | $ | 3.59 |   |
| Third Quarter  |   | $           | 6.30   |   |   | $ | 3.59 |   |
| Second Quarter |   | $           | 5.39   |   |   | $ | 3.81 |   |
| First Quarter  |   | $           | 5.17   |   |   | $ | 3.69 |   |
|           |   |        |   |   |   |   |   |   |
| Fiscal 2009    |   |        |   |   |   |   |   |   |
| Fourth Quarter |   | $           | 6.23   |   |   | $ | 4.68 |   |
| Third Quarter  |   | $           | 6.60   |   |   | $ | 3.42 |   |
| Second Quarter |   | $           | 4.19   |   |   | $ | 2.76 |   |
| First Quarter  |   | $           | 9.36   |   |   | $ | 3.25 |   |

|                                                       | (a)                                                                                         | (b)                                                                         | (c)                                                                                                                                       |
|------------------------------------------------------------|---------------------------------------------------------------------------------------------|-----------------------------------------------------------------------------|-------------------------------------------------------------------------------------------------------------------------------------------|
| Plan category                                              | Number of securities to be issued upon exercise of outstanding options, warrants and rights | Weighted-average exercise price of outstanding options, warrants and rights | Number of securities remaining available for future issuance under equity compensation plans excluding securities reflected in column (a) |
| Equity compensation plansapproved by security holders | 3,281,736                                                                                   | $9.05                                                                       | 259,426                                                                                                                                   |

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|   |  | Assumes $100 was invested on October 1, 2005 in our common stock or in the indicated index and that all cash dividends were reinvested as received. |
|--------|----------|-----------------------------------------------------------------------------------------------------------------------------------------------------|

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| ITEM 6. | SELECTED FINANCIAL DATA. |
|---------|--------------------------|

|                                                                                                |   | As of and for the Years Ended September 30, |    |
|-----------------------------------------------------------------------------------------------------|--------|---------------------------------------------|---------|
|                                                                                                |   | 2010                                        |    |   | 2009 |   |   | 2008 |   |   | 2007 |   |   | 2006 |   |
| Statement of operations data:                                                                       |   |                                        |    |   |   |   |   |   |   |   |   |   |   |   |   |
| Revenues:                                                                                           |   |                                        |    |   |   |   |   |   |   |   |   |   |   |   |   |
| Real estate                                                                                         |   | $                                           | 31,911  |   |   | $ | 25,417 |   |   | $ | 31,519 |   |   | $ | 22,987 |   |   | $ | 23,076 |   |
|    Commercial finance                                                                |   |                                        | 23,677  |   |   |   | 48,767 |   |   |   | 93,016 |   |   |   | 40,124 |   |   |   | 23,842 |   |
| Financial fund management                                                                           |   |                                        | 33,140  |   |   |   | 33,344 |   |   |   | 27,536 |   |   |   | 63,089 |   |   |   | 28,457 |   |
| Total revenues                                                                                      |   | $                                           | 88,728  |   |   | $ | 107,528 |   |   | $ | 152,071 |   |   | $ | 126,200 |   |   | $ | 75,375 |   |
| (Loss) income from continuing operationsbefore cumulative effect of a change inaccounting principle |   | $                                           | (17,297 | ) |   | $ | (16,090 | ) |   | $ | (29,949 | ) |   | $ | 7,211 |   |   | $ | 17,402 |   |
| Income (loss) from discontinued operations,net of tax                                               |   |                                        | 622     |   |   |   | (444 | ) |   |   | (1,299 | ) |   |   | (1,558 | ) |   |   | 1,231 |   |
| Cumulative effect of a change in accountingprinciple, net of tax                                    |   |                                        | − |   |   |   | − |   |   |   | − |   |   |   | − |   |   |   | 1,074 |   |
| Net (loss) income                                                                                   |   |                                        | (16,675 | ) |   |   | (16,534 | ) |   |   | (31,248 | ) |   |   | 5,653 |   |   |   | 19,707 |   |
| Less:  Net loss (income) attributable tononcontrolling interests                          |   |                                        | 3,224   |   |   |   | 1,603 |   |   |   | 5,005 |   |   |   | (1,957 | ) |   |   | (1,734 | ) |
| Net (loss) income attributable to commonshareholders                                                |   | $                                           | (13,451 | ) |   | $ | (14,931 | ) |   | $ | (26,243 | ) |   | $ | 3,696 |   |   | $ | 17,973 |   |
|                                                                                                |   |                                        |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                |   |                                        |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Basic (loss) earnings per share attributable tocommon shareholders:                                 |   |                                        |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Continuing operations                                                                               |   | $                                           | (0.74   | ) |   | $ | (0.78 | ) |   | $ | (1.40 | ) |   | $ | 0.30 |   |   | $ | 0.89 |   |
| Discontinued operations                                                                             |   |                                        | 0.03    |   |   |   | (0.03 | ) |   |   | (0.07 | ) |   |   | (0.09 | ) |   |   | 0.07 |   |
| Cumulative effect of a change in accounting principle                                               |   |                                        | − |   |   |   | − |   |   |   | − |   |   |   | − |   |   |   | 0.06 |   |
| Net (loss) income                                                                                   |   | $                                           | (0.71   | ) |   | $ | (0.81 | ) |   | $ | (1.47 | ) |   | $ | 0.21 |   |   | $ | 1.02 |   |
|                                                                                                |   |                                        |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Diluted (loss) earnings per share attributable  to common shareholders:                   |   |                                        |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Continuing operations                                                                               |   | $                                           | (0.74   | ) |   | $ | (0.78 | ) |   | $ | (1.40 | ) |   | $ | 0.27 |   |   | $ | 0.80 |   |
| Discontinued operations                                                                             |   |                                        | 0.03    |   |   |   | (0.03 | ) |   |   | (0.07 | ) |   |   | (0.08 | ) |   |   | 0.06 |   |
| Cumulative effect of a change in accountingprinciple                                                |   |                                        | − |   |   |   | − |   |   |   | − |   |   |   | − |   |   |   | 0.06 |   |
| Net (loss) income                                                                                   |   | $                                           | (0.71   | ) |   | $ | (0.81 | ) |   | $ | (1.47 | ) |   | $ | 0.19 |   |   | $ | 0.92 |   |
|                                                                                                |   |                                        |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Dividends declared per common share                                                                 |   | $                                           | 0.09    |   |   | $ | 0.20 |   |   | $ | 0.28 |   |   | $ | 0.27 |   |   | $ | 0.24 |   |
|                                                                                                |   |                                        |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Amounts attributable to common shareholders:                                                        |   |                                        |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| (Loss) income from continuing operations                                                            |   | $                                           | (14,073 | ) |   | $ | (14,487 | ) |   | $ | (24,944 | ) |   | $ | 5,254 |   |   | $ | 15,668 |   |
| Discontinued operations                                                                             |   |                                        | 622     |   |   |   | (444 | ) |   |   | (1,299 | ) |   |   | (1,558 | ) |   |   | 1,231 |   |
| Cumulative effect of a change in accountingprinciple                                                |   |                                        | − |   |   |   | − |   |   |   | − |   |   |   | − |   |   |   | 1,074 |   |
| Net (loss) income                                                                                   |   | $                                           | (13,451 | ) |   | $ | (14,931 | ) |   | $ | (26,243 | ) |   | $ | 3,696 |   |   | $ | 17,973 |   |
|                                                                                                |   |                                        |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Balance sheet data:                                                                                 |   |                                        |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Total assets                                                                                        |   | $                                           | 234,253 |   |   | $ | 375,840 |   |   | $ | 758,357 |   |   | $ | 966,452 |   |   | $ | 418,858 |   |
| Borrowings                                                                                          |   | $                                           | 66,110  |   |   | $ | 191,383 |   |   | $ | 554,059 |   |   | $ | 706,372 |   |   | $ | 172,238 |   |
| Total equity                                                                                        |   | $                                           | 129,084 |   |   | $ | 140,141 |   |   | $ | 146,343 |   |   | $ | 191,918 |   |   | $ | 204,769 |   |
|                                                                                                |   |                                        |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |

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| ITEM 7. | MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION |
|---------|-------------------------------------------------------------|
|    | AND RESULTS OF OPERATIONS.                                  |

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|                      |   | September 30, |   |   | Decrease |   |
|---------------------------|--------|---------------|--------|--------|----------|--------|
|                      |   | 2010          |   |   | 2009     |   |   | Amount |   |   | Percentage |   |
| Financial fund management |   | $             | 10,009 |   |     | $      | 10,726 |   |   | $ | (717 | ) (2) |   |   |   (7)% |   |
| Real estate               |   |          | 1,557  |   |     |   | 1,682 |   |   |   | (125 | ) |   |   |   (7)% |   |
| Commercial finance        |   |          | 878    |   |     |   | 1,361 |   |   |   | (483 | ) (3) |   |   | (35)% |   |
|                      |   | $             | 12,444 |   |     | $      | 13,769 |   |   | $ | (1,325 | ) |   |   | (10)% |   |

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| (1) | For information on how we calculate assets under management, see Item 1, “Business-Assets Under Management.” |
|-----|--------------------------------------------------------------------------------------------------------------------------|

| (2) | Reduction primarily due to a decrease in the eligible collateral bases of our ABS ($497.1 million) and trust preferred portfolios ($245.4 million) resulting from defaults, paydowns, sales and calls. |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (3) | Reduction primarily reflects the decrease in new originations and paydowns of existing loans and leases. |
|-----|----------------------------------------------------------------------------------------------------------|

|                        |   | CDOs   |    |   | Limited Partnerships |   |   | TIC Programs |   |   | Other Investment Funds |   |
|-----------------------------|--------|--------|---------|--------|----------------------|--------|--------|--------------|--------|--------|------------------------|--------|
| As of September 30, 2010(1) |   |   |    |   |                 |   |   |         |   |   |                   |   |
| Financial fund management   |   |   | 32      |   |                 |   | 13     |         |   |   | −                |   |   |   | − |   |
| Real estate                 |   |   | 2       |   |                 |   | 8      |         |   |   | 7                      |   |   |   | 4 |   |
| Commercial finance          |   |   | − |   |                 |   | 4      |         |   |   | −                |   |   |   | 1 |   |
|                        |   |   | 34      |   |                 |   | 25     |         |   |   | 7                      |   |   |   | 5 |   |
| As of September 30, 2009(1) |   |   |    |   |                 |   |   |         |   |   |                   |   |   |   |   |   |
| Financial fund management   |   |   | 32      |   |                 |   | 13     |         |   |   | −                |   |   |   | − |   |
| Real estate                 |   |   | 2       |   |                 |   | 8      |         |   |   | 7                      |   |   |   | 5 |   |
| Commercial finance          |   |   | − |   |                 |   | 4      |         |   |   | −                |   |   |   | 1 |   |
|                        |   |   | 34      |   |                 |   | 25     |         |   |   | 7                      |   |   |   | 6 |   |

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| (1) | All of our operating segments manage assets on behalf of RCC. |
|-----|---------------------------------------------------------------|

|                                   |   | Years Ended September 30, |   |
|----------------------------------------|--------|---------------------------|--------|
|                                   |   | 2010                      |   |   | 2009 |   |   | 2008 |   |
| Finance and rental revenues (1)   |   | $                         | 20,281 |   |   | $ | 38,491 |   |   | $ | 80,660 |   |
| Fund management revenues (2)      |   |                      | 51,411 |   |   |   | 57,588 |   |   |   | 51,182 |   |
| RCC management fees                    |   |                      | 10,649 |   |   |   | 7,357 |   |   |   | 6,021 |   |
| Gains on resolution of loans (3)  |   |                      | 2,870  |   |   |   | 1,030 |   |   |   | 9,571 |   |
| Other (4)                         |   |                      | 3,517  |   |   |   | 3,062 |   |   |   | 4,637 |   |
|                                   |   | $                         | 88,728 |   |   | $ | 107,528 |   |   | $ | 152,071 |   |

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| (1) | Includes accreted discount income from our real estate operations and revenues from certain real estate assets, interest and rental income from our commercial finance operations and interest income on bank loans from our financial fund management operations. |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (2) | Includes fees from each of our real estate, commercial finance and financial fund management operations and our share of the income or loss from limited and general partnership interests we own in our real estate, commercial finance and financial fund management operations. |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (3) | Includes the resolution of loans we hold in our real estate segment. |
|-----|----------------------------------------------------------------------|

| (4) | Includes primarily insurance fees, documentation fees and other charges from our commercial finance operations and for fiscal 2010, includes a break-up fee related to an unsuccessful bank transaction for our financial fund management operations. |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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|   | ● | the acquisition, ownership and management of portfolios of discounted real estate and real estate related debt, which we have acquired through two sponsored real estate investment entities as well as through joint ventures with institutional investors; |
|--------|---------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | ● | the sponsorship and management of real estate investment entities that principally invest in multifamily housing; |
|--------|---------|-------------------------------------------------------------------------------------------------------------------|

|   | ● | the management, principally for RCC, of general investments in commercial real estate debt, including first mortgage debt, whole loans, mortgage participations, B notes, mezzanine debt and related commercial real estate securities; and |
|--------|---------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | ● | to a lesser extent, the management and resolution of a portfolio of real estate loans and property interests that we acquired at various times between 1991 and 1999, which we collectively refer to as our legacy portfolio. |
|--------|---------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|                                      |   | September 30, |   |
|-------------------------------------------|--------|---------------|--------|
|                                      |   | 2010          |   |   | 2009 |   |
|                                      |   | (in millions) |   |
| Assets under management(1):               |   |          |   |   |   |   |
| Commercial real estate debt               |   | $             | 761    |   |   | $ | 864 |   |
| Real estate investment funds and programs |   |          | 566    |   |   |   | 547 |   |
| Institutional portfolios                  |   |          | 51     |   |   |   | 105 |   |
| Distressed portfolios                     |   |          | 149    |   |   |   | 88 |   |
| Legacy portfolio                          |   |          | 30     |   |   |   | 78 |   |
|                                      |   | $             | 1,557  |   |   | $ | 1,682 |   |

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| (1) | For information on how we calculate assets under management, see Item 1, “Business − “Assets under Management.” |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------|

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|                                                                                    |   | Years Ended September 30, |   |
|-----------------------------------------------------------------------------------------|--------|---------------------------|--------|
|                                                                                    |   | 2010                      |   |   | 2009 |   |   | 2008 |   |
| Revenues:                                                                               |   |                      |   |   |   |   |   |   |   |
| Management fees:                                                                        |   |                      |   |   |   |   |   |   |   |
| Asset management fees                                                                   |   | $                         | 4,842  |   |   | $ | 3,935 |   |   | $ | 2,407 |   |
| Resource Residential property management fees                                           |   |                      | 5,296  |   |   |   | 4,362 |   |   |   | 2,682 |   |
| REIT management fees from RCC                                                           |   |                      | 7,775  |   |   |   | 5,321 |   |   |   | 4,465 |   |
|                                                                                    |   |                      | 17,913 |   |   |   | 13,618 |   |   |   | 9,554 |   |
| Other revenue:                                                                          |   |                      |   |   |   |   |   |   |   |   |   |   |
| Fee income from sponsorship of partnerships, joint ventures andother property interests |   |                      | 1,500  |   |   |   | 1,929 |   |   |   | 3,583 |   |
| Master lease revenues                                                                   |   |                      | 4,002  |   |   |   | 3,994 |   |   |   | 3,660 |   |
| Rental property income and revenues of consolidated VIEs (1)                            |   |                      | 4,644  |   |   |   | 5,014 |   |   |   | 5,208 |   |
| Interest, including accreted loan discount                                              |   |                      | 113    |   |   |   | 492 |   |   |   | 1,549 |   |
| Gains and fees on resolution of loans and other property interests                      |   |                      | 2,870  |   |   |   | 1,030 |   |   |   | 9,571 |   |
| Equity in earnings (losses) of unconsolidated entities                                  |   |                      | 869    |   |   |   | (660 | ) |   |   | (1,606 | ) |
|                                                                                    |   | $                         | 31,911 |   |   | $ | 25,417 |   |   | $ | 31,519 |   |
| Cost and expenses:                                                                      |   |                      |   |   |   |   |   |   |   |   |   |   |
| General and administrative expenses                                                     |   | $                         | 7,718  |   |   | $ | 9,276 |   |   | $ | 12,278 |   |
| Resource Residential expenses                                                           |   |                      | 4,870  |   |   |   | 4,459 |   |   |   | 3,043 |   |
| Master lease expenses                                                                   |   |                      | 4,791  |   |   |   | 4,577 |   |   |   | 4,081 |   |
| Rental property expenses and expenses of consolidated VIEs (1)                          |   |                      | 3,401  |   |   |   | 3,726 |   |   |   | 3,200 |   |
|                                                                                    |   | $                         | 20,780 |   |   | $ | 22,038 |   |   | $ | 22,602 |   |

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| (1) | We generally consolidate a variable interest entity, or VIE, when we are deemed to be the primary beneficiary or, for non-VIEs, where we control the entity. |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | ● | a $907,000 increase in asset management fees due to an increase in equity deployed in properties in our investment entities, primarily the assets acquired by Resource Real Estate Opportunity Fund, L.P. |
|--------|---------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | ● | a $934,000 increase in property management fees earned by Resource Residential, reflecting the 728 unit increase (6%) in multifamily units under management to 13,522 units at September 30, 2010 from 12,794 at September 30, 2009; and |
|--------|---------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | ● | a $2.5 million increase in REIT management fees from RCC as a result of an increase in incentive management fees and in equity capital (upon which our base management fee is calculated) resulting from RCC’s success in raising capital through common stock offerings. |
|--------|---------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | ● | a $429,000 decrease in fee income in connection with the purchase and third-party financing of property through our real estate investment entities.  During fiscal 2010, we earned fees from the acquisition of six distressed notes for $81.1 million and four property acquisitions with an aggregate purchase price of $19.3 million, as compared to the acquisition of seven properties with an aggregate purchase price of $62.7 million during fiscal 2009.  Since we do not place financing on our distressed note acquisitions, the decrease is primarily attributable to the reduction in debt placement fees for the properties we acquired in fiscal 2010 as compared to fiscal 2009; |
|--------|---------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | ● | a $370,000 decrease in rental property income and revenues of consolidated VIEs due to the sale of a consolidated VIE interest in January 2010; |
|--------|---------|-------------------------------------------------------------------------------------------------------------------------------------------------|

|   | ● | a $379,000 decrease in interest income attributable to the payoff of one loan in June 2010 (book value of $2.8 million); |
|--------|---------|--------------------------------------------------------------------------------------------------------------------------|

|   | ● | a $1.8 million increase in gains and fees on the resolution of loans and other property interests.  During fiscal 2010, we recorded a gain of $1.9 million (proceeds of $4.8 million) on the settlement of one loan.  We also received proceeds of $2.1 million, including a cost reimbursement of $101,000, from the sale of a joint venture interest to RCC and recorded a gain of $145,000 from another asset sale (proceeds of $260,000).  In addition, we recorded a gain of $642,000 (proceeds of $642,000) from the sale of an asset by a joint venture; and |
|--------|---------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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|   | ● | a $1.5 million increase in equity earnings primarily reflecting a $700,000 increase due to a favorable change in an interest rate swap held by one of our investment entities and a $500,000 increase in income in the underlying investment held by another entity, reflecting primarily increased rental income and lease termination fees. |
|--------|---------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | ● | a $1.6 million decrease in general and administrative expenses, primarily reflecting the $1.5 million allocation of wages and benefits to RRE Opportunity REIT; and |
|--------|---------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | ● | a $325,000 decrease in rental property expenses and consolidated VIE expenses due to the sale of our interests in a consolidated VIE entity which held a property. |
|--------|---------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | ● | a $1.5 million increase in asset management fees due to an increase in equity deployed in properties that we manage in our investment entities; |
|--------|---------|-------------------------------------------------------------------------------------------------------------------------------------------------|

|   | ● | a $1.7 million increase in fees earned by Resource Residential.  Multifamily units under management increased to 12,794 at September 30, 2009 from 10,877 at September 30, 2008; and |
|--------|---------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | ● | an $856,000 increase in REIT management fees due principally to higher RCC net income which increased the incentive management fee. |
|--------|---------|-------------------------------------------------------------------------------------------------------------------------------------|

|   | ● | a $1.7 million decrease in fee income.  During fiscal 2009, we earned fees from the acquisition of four distressed notes for $31.9 million and seven property acquisitions with an aggregate purchase price of $62.7 million, as compared to the acquisition of seven properties with an aggregate purchase price of $89.7 million during fiscal 2008.  During fiscal 2009, the fees earned were 1.0% to 1.75% of the acquisition price as compared to 1.75% of the acquisition price during fiscal 2008; |
|--------|---------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | ● | a $334,000 increase in master lease revenues from one TIC property due to improved occupancy; |
|--------|---------|-----------------------------------------------------------------------------------------------|

|   | ● | a $194,000 decrease in rental property income and revenues of consolidated VIEs due to a 17% reduction in the daily rate charged at the Savannah, Georgia hotel we own in addition to the sale of our entire interest in another asset to one of our real estate investment funds; |
|--------|---------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | ● | a $1.1 million decrease in interest income attributable to the principal paydown of two loans and the foreclosure of another loan; |
|--------|---------|------------------------------------------------------------------------------------------------------------------------------------|

|   | ● | an $8.5 million decrease in gains and fees on the resolution of loans and other property interests.  During fiscal 2009, we received proceeds of $9.9 million from the payoff of one loan, resulting in a gain of $991,000, received discounted proceeds of $1.2 million from the payoff of another loan resulting in a loss of $313,000 and recorded a $330,000 gain on an asset sold in the prior year.  In fiscal 2008, we collected $18.4 million in connection with a substantial settlement of a discounted loan, which was secured by an office building in Washington, D.C.  As a result of this repayment, we recognized a pre-tax gain in the quarter ended September 30, 2008 of approximately $7.5 million.  Also, in fiscal 2008, we received $1.0 million in net proceeds plus a $130,000 structuring fee from the sale of a 19.99% interest in a partnership that owns a hotel property resulting in a gain of $574,000, and received $1.9 million in net proceeds from the sale of a 10% interest in a real estate venture resulting in a gain of $891,000; and |
|--------|---------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | ● | a $946,000 decrease in equity losses of unconsolidated entities due to a favorable change in an interest rate swap. |
|--------|---------|---------------------------------------------------------------------------------------------------------------------|

|   | ● | a $3.0 million decrease in general and administrative expenses, primarily $1.7 million of wages and benefits, of which $1.2 million related to reduced bonuses; |
|--------|---------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------|

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|   | ● | a $1.4 million increase in Resource Residential expenses due to an increase in wages and benefits related to an increase in the number of employees required to manage the increase in properties; and |
|--------|---------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | ● | a $496,000 increase in master lease expenses from one TIC asset due to turnover costs related to occupancy. |
|--------|---------|-------------------------------------------------------------------------------------------------------------|

|   | ● | terminating debt that had unfavorable terms by selling investments; |
|--------|---------|---------------------------------------------------------------------|

|   | ● | lowering our overhead expenses by eliminating operating redundancies following the integration of our fiscal 2009 acquisitions; and |
|--------|---------|-------------------------------------------------------------------------------------------------------------------------------------|

|   | ● | reducing staff in conjunction with the reduced origination capabilities brought on by the recession and tight debt markets. |
|--------|---------|-----------------------------------------------------------------------------------------------------------------------------|

|   | ● | ceased raising new funds when it became apparent that the debt markets were not improving rapidly enough; |
|--------|---------|-----------------------------------------------------------------------------------------------------------|

|   | ● | deferred expense reimbursement to us; |
|--------|---------|---------------------------------------|

|   | ● | for fiscal 2010, we waived $3.8 million of our asset management fees for our sponsored leasing partnerships, and anticipate that we will continue to waive our fees in the future which, accordingly, will reduce our revenues.  We believe that, as a result, cash flow in these partnerships will improve significantly, which will help pay down loans and generate liquidity for investments in new leases; |
|--------|---------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | ● | negotiated with the partnerships’ lenders to keep them from foreclosing on partnership collateral; and |
|--------|---------|--------------------------------------------------------------------------------------------------------------|

|   | ● | paid down existing debt and reduced exposure with lenders that had unfavorable terms in part by completing three securitizations in fiscal 2010 totaling $380 million. |
|--------|---------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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|                        |   | September 30, |   |
|-----------------------------|--------|---------------|--------|
|                        |   | 2010          |   |   | 2009 |   |
| Managed for our own account |   | $             | 12     |   |   | $ | 147 |   |
| Managed for others:         |   |          |   |   |   |   |   |   |
| LEAF investment entities    |   |          | 735    |   |   |   | 1,181 |   |
| RCC                         |   |          | 115    |   |   |   | 2 |   |
| Other                       |   |          | 16     |   |   |   | 31 |   |
|                        |   |          | 866    |   |   |   | 1,214 |   |
|                        |   | $             | 878    |   |   | $ | 1,361 |   |

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| (1) | For information on how we calculate assets under management, see Item 1, “Business − “Assets under Management.” |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------|

|                                            |   | Years Ended September 30, |   |
|-------------------------------------------------|--------|---------------------------|--------|
|                                            |   | 2010                      |   |   | 2009 |   |   | 2008 |   |
| Revenues:(1)                                    |   |                      |   |   |   |   |   |   |   |
| Finance revenues                                |   | $                         | 10,662 |   |   | $ | 22,974 |   |   | $ | 53,680 |   |
| Acquisition fees                                |   |                      | 1,327  |   |   |   | 4,943 |   |   |   | 18,466 |   |
| Fund management fees                            |   |                      | 10,905 |   |   |   | 19,133 |   |   |   | 18,275 |   |
| Equity in losses of unconsolidated partnerships |   |                      | (1,896 | ) |   |   | (1,133 | ) |   |   | (333 | ) |
| Other                                           |   |                      | 2,679  |   |   |   | 2,850 |   |   |   | 2,928 |   |
|                                            |   | $                         | 23,677 |   |   | $ | 48,767 |   |   | $ | 93,016 |   |
| Costs and expenses:                             |   |                      |   |   |   |   |   |   |   |   |   |   |
| Wages and benefit costs                         |   | $                         | 9,245  |   |   | $ | 13,263 |   |   | $ | 24,212 |   |
| Other costs and expenses                        |   |                      | 8,919  |   |   |   | 11,916 |   |   |   | 18,529 |   |
|                                            |   | $                         | 18,164 |   |   | $ | 25,179 |   |   | $ | 42,741 |   |

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| (1) | Total revenues include RCC servicing and origination fees of $444,000, $1.0 million and $1.5 million for fiscal 2010, 2009 and 2008, respectively. |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------|

|   | ● | a $12.3 million decrease in commercial finance revenues during fiscal 2010.  The decreases were caused by the reduction in the size of the portfolio of commercial finance assets managed for our own account primarily due to the sale to RCC; |
|--------|---------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | ● | a $3.6 million decrease in asset acquisition fees during fiscal 2010.  The difficulty in obtaining and maintaining debt financing by the investment funds we manage has limited their ability to acquire equipment financings from us.  Consequently, we have reduced our commercial finance originations to match their asset acquisition capabilities; |
|--------|---------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | ● | a $8.2 million decrease in management fees during fiscal 2010.  Our management fees include fees we receive to service the commercial finance assets we manage, offering fees earned for raising capital in our investment entities as well as fees received for originating loans for those entities.  The decline in fund management fees during fiscal 2010 was caused primarily by a waiver of the fees we earn to manage the commercial finance assets, lower offering fees received as LEAF Equipment Finance Fund 4, our most recently sponsored investment entity, closed its offering in October 2009, and finally, due to the lower fees as a result of the previously discussed reduction in the portfolio of leases and loans held by our investment entities. |
|--------|---------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | ● | a $763,000 increase in equity losses during fiscal 2010, reflecting an increase in the provision for credit losses recorded by our investment entities.  The negative impact of the economic recession in the United States on the ability of our investment funds’ customers to make payments on their leases and loans, has accordingly, increased our exposure from non-performing assets; and |
|--------|---------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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|   | ● | other income decreased $171,000 during fiscal 2010 principally due to the decrease in customer service charges.  These fees typically vary widely from period to period and are driven by the amount and seasoning of commercial finance assets held by us. |
|--------|---------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | ● | a $4.0 million reduction in wage and benefit costs during fiscal 2010.  In response to lower origination volume and assets under management, we have reduced payroll and other overhead costs and have continued to eliminate redundant positions.  In total, we have reduced the number of full-time employees in our commercial finance operations by 125 to 195 at September 30, 2010 from 320 at September 30, 2009; and |
|--------|---------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | ● | a reduction in other costs and expenses of $3.0 million during fiscal 2010.  The decrease reflects the reduction in costs, primarily legal, to service our smaller portfolio of assets, as well as our ongoing cost saving and consolidation efforts which targeted eliminating overhead redundancies and increasing operating efficiencies. |
|--------|---------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | ● | a $30.7 million decrease in commercial finance revenues.  In fiscal 2008, we held a significantly higher portfolio balance of leases and loans as a result of the $412.5 million NetBank portfolio acquired in November 2007 and held by us until being completely sold in April 2008.  In addition, as of March 2009, we no longer consolidated LCFF, a $195.0 million portfolio.  As a result of the deconsolidation of LCFF, our finance revenues significantly decreased, offset in part by $1.1 million of management fees earned after deconsolidation.  For the period subsequent to the deconsolidation (March 2009 to September 2009), LCFF generated $8.8 million of revenues which, because LCFF was no longer consolidated with us, were not recorded in our consolidated statement of operations.  Similarly, we did not record LCFF’s costs and expenses which aggregated $6.9 million in addition to $5.5 million of interest expense; |
|--------|---------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | ● | a $13.5 million decrease in acquisition fees resulting from the $1.0 billion decrease in the amount of leases sold to our funds and RCC to $281.3 million.  This decrease reflects the portfolio acquisitions we sold to our investment entities in fiscal 2008.  Additionally, the difficulty in obtaining debt financing by our investment funds has limited their ability to acquire equipment financings from us.  Consequently, we have reduced our commercial finance originations to match the asset acquisition capabilities of our funds; |
|--------|---------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | ● | an $858,000 increase in fund management fees.  Our management fees include fees we receive to service the commercial finance assets we manage, offering fees earned for raising capital in our investment entities as well as fees received for originating loans for those entities.  During fiscal 2009, management fees earned to service leases increased by $816,000 due to the growth in assets under management created by the $1.2 billion of lease originations in fiscal 2008.  These increases were offset, in part, by decreased offering fees of $136,000 related to the time between the closing of one investment fund and the opening of another investment fund.  In addition, during fiscal 2009, we waived $425,000 of fund management fees in one of our investment entities when we reduced that entity’s monthly cash distribution to its partners; and |
|--------|---------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | ● | a $78,000 decrease in other income, primarily due to reduction in late fees derived from commercial finance assets held by us.  These fees typically vary widely from period to period and are driven by the amount and seasoning of commercial finance assets held by us.  The large decrease in fiscal 2009 was due to the sale of the well-seasoned NetBank portfolio in fiscal 2008. |
|--------|---------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | ● | a $10.9 million reduction in wages and benefits.  Our costs have decreased due to several factors: (i) in fiscal 2008, we held significantly higher assets and accordingly, incurred higher servicing costs; (ii) for fiscal 2009, many of these costs were reimbursed by the investment entities to whom we have sold these assets; and (iii) in conjunction with converting the operations we acquired in fiscal 2008 onto the LEAF platform, we have reduced overhead costs by eliminating redundant positions.  Furthermore, in response to the ongoing recession and reduced originations, we have increased collection and customer service staff, while to a greater extent, we have decreased sales, credit and lease processing staff.  In total, we reduced the number of full-time employees in our commercial finance operations by 78 to 320 as of September 30, 2009 from 398 at September 30, 2008; and |
|--------|---------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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|   | ● | a $6.7 million reduction in other costs and expenses.  This decrease is due to the decline in assets managed for our own account, which resulted in reduced costs to service our portfolio, primarily legal costs, and to our ongoing cost saving and consolidation efforts.  These efforts targeted eliminating overhead redundancies occurring through our acquisitions and taking advantage of efficiencies obtained by operating on a single platform.  In addition, fiscal 2008 included costs related to the portfolio acquisitions we made, which did not recur in fiscal 2009. |
|--------|---------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | ● | Apidos Capital Management, LLC, or Apidos, finances, structures and manages investments in bank loans, high yield bonds and equity investments; |
|--------|---------|-------------------------------------------------------------------------------------------------------------------------------------------------|

|   | ● | Trapeza Capital Management, LLC, or TCM, a joint venture between us and an unrelated third-party, originates, structures, finances and manages investments in trust preferred securities and senior debt securities of banks, bank holding companies, insurance companies and other financial companies through CDO issuers and related partnerships.  TCM, together with the Trapeza CDO issuers and Trapeza partnerships, are collectively referred to as Trapeza; |
|--------|---------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | ● | Resource Capital Markets, Inc., through our registered broker-dealer subsidiary, Chadwick Securities, Inc., or Chadwick, acts as an agent in the primary and secondary markets for trust preferred in the financial services and real estate sectors and manages accounts for institutional investors; |
|--------|---------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | ● | Resource Europe Management, Ltd., or Resource Europe, structures and manages investments in international bank loans; |
|--------|---------|-----------------------------------------------------------------------------------------------------------------------|

|   | ● | Resource Financial Institutions Group, Inc., or RFIG, serves as the general partner for seven company-sponsored affiliated partnerships which invest in financial institutions; |
|--------|---------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | ● | Ischus Capital Management, LLC, or Ischus, finances, structures and manages investments in asset-backed securities, or ABS, including residential mortgage-backed securities, or RMBS, and commercial mortgage-backed securities, or CMBS; and |
|--------|---------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | ● | Resource Capital Manager, Inc., or RCM, an indirect wholly-owned subsidiary, provides investment management and administrative services to RCC under a management agreement between us, RCM and RCC. |
|--------|---------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|                                 |   | September 30, 2010                    |   |
|--------------------------------------|--------|---------------------------------------|--------|
|                                 |   | Institutional and IndividualInvestors |   |   | RCC |   |   | Total by Type |   |
| Trapeza                              |   | $                                     | 4,213  |   |   | $ | − |   |   | $ | 4,213 |   |
| Apidos                               |   |                                  | 2,672  |   |   |   | 954 |   |   |   | 3,626 |   |
| Ischus                               |   |                                  | 1,689  |   |   |   | − |   |   |   | 1,689 |   |
| Resource Europe                      |   |                                  | 411    |   |   |   | − |   |   |   | 411 |   |
| Other company-sponsored partnerships |   |                                  | 70     |   |   |   | − |   |   |   | 70 |   |
|                                 |   | $                                     | 9,055  |   |   | $ | 954 |   |   | $ | 10,009 |   |

|                                 |   | September 30, 2009                    |   |
|--------------------------------------|--------|---------------------------------------|--------|
|                                 |   | Institutional and IndividualInvestors |   |   | RCC |   |   | Total by Type |   |
| Trapeza                              |   | $                                     | 4,458  |   |   | $ | − |   |   | $ | 4,458 |   |
| Apidos                               |   |                                  | 2,643  |   |   |   | 937 |   |   |   | 3,580 |   |
| Ischus                               |   |                                  | 2,186  |   |   |   | − |   |   |   | 2,186 |   |
| Resource Europe                      |   |                                  | 436    |   |   |   | − |   |   |   | 436 |   |
| Other company-sponsored partnerships |   |                                  | 66     |   |   |   | − |   |   |   | 66 |   |
|                                 |   | $                                     | 9,789  |   |   | $ | 937 |   |   | $ | 10,726 |   |

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| (1) | For information on how we calculate assets under management, see the table and related notes at the end of “Assets under Management,” as presented earlier in this section. |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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|   | ● | Collateral management fees − we receive fees for managing the assets held by CDO issuers we have sponsored, including incentive and subordinated fees.  These fees vary by CDO issuer, with our annual fees ranging between 0.10% and 0.60% of the aggregate principal balance of the eligible collateral owned by the CDO issuers.  CDO indentures require the maintenance of certain overcollateralization test ratios, or O/C ratios, which measure the ratio of assets (collateral) to liabilities (notes) of a given CDO issuer.  Losses incurred on collateral due to payment defaults, payment deferrals or rating agency downgrades reduce the O/C ratios.  If O/C ratios are not met, incentive or subordinate management fees, which are discussed in the following sections, are deferred and interest collections from collateral are applied to outstanding principal note balances. |
|--------|---------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | ● | Management fees − we receive fees for managing the assets held by our company-sponsored partnerships and credit opportunities fund.  These fees vary by limited partnership, with our annual fee ranging between 0.75% and 2.00% of the partnership capital balance. |
|--------|---------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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|                                        |   | Years Ended September 30, |   |
|---------------------------------------------|--------|---------------------------|--------|
|                                        |   | 2010                      |   |   | 2009 |   |   | 2008 |   |
| Revenues:                                   |   |                      |   |   |   |   |   |   |   |
| Fund and RCC management fees                |   | $                         | 19,137 |   |   | $ | 20,673 |   |   | $ | 24,232 |   |
| Introductory agent fees                     |   |                      | 7,713  |   |   |   | 5,166 |   |   |   | 2,593 |   |
| Earnings from unconsolidated CDOs           |   |                      | 2,118  |   |   |   | 1,610 |   |   |   | 2,670 |   |
| Interest income on loans                    |   |                      | 860    |   |   |   | 6,017 |   |   |   | 16,563 |   |
| Other                                       |   |                      | 838    |   |   |   | 212 |   |   |   | 2,209 |   |
|                                        |   |                      | 30,666 |   |   |   | 33,678 |   |   |   | 48,267 |   |
|                                        |   |                      |   |   |   |   |   |   |   |   |   |   |
| Limited and general partner interests:      |   |                      |   |   |   |   |   |   |   |   |   |   |
| Fair value adjustments                      |   |                      | 2,490  |   |   |   | (266 | ) |   |   | (23,483 | ) |
| Operations                                  |   |                      | (16    | ) |   |   | (68 | ) |   |   | 2,752 |   |
| Total limited and general partner interests |   |                      | 2,474  |   |   |   | (334 | ) |   |   | (20,731 | ) |
|                                        |   | $                         | 33,140 |   |   | $ | 33,344 |   |   | $ | 27,536 |   |
|                                        |   |                      |   |   |   |   |   |   |   |   |   |   |
| Costs and expenses:                         |   |                      |   |   |   |   |   |   |   |   |   |   |
| General and administrative                  |   | $                         | 20,799 |   |   | $ | 20,399 |   |   | $ | 27,539 |   |
| Equity compensation expense − RCC     |   |                      | 200    |   |   |   | 3 |   |   |   | 134 |   |
| Other                                       |   |                      | 29     |   |   |   | 66 |   |   |   | 64 |   |
|                                        |   | $                         | 21,028 |   |   | $ | 20,468 |   |   | $ | 27,737 |   |

|   | ● | a $1.5 million decrease in fund and RCC management fees, primarily from the following: |
|--------|---------|----------------------------------------------------------------------------------------|

|   | – | a $2.3 million decrease in collateral management fees from our Ischus operations primarily as a result of rating agency downgrades which had the effect of reducing the eligible collateral base upon which our management fees are calculated.  In addition, two of the CDO issuers managed by Ischus were liquidated during fiscal 2009; |
|--------|---------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | – | a $552,000 net decrease in base, subordinated and incentive management fees from our Trapeza operations, primarily from the following: |
|--------|---------|----------------------------------------------------------------------------------------------------------------------------------------|

|   | – | a $292,000 decrease in base management fees as a result of portfolio defaults which reduced the eligible collateral base upon which our management fees are calculated; |
|--------|---------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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|   | – | a $648,000 increase in our share of expenses for TCM, including a $389,000 allowance against advances made to certain Trapeza partnerships and a $132,000 increase in legal fees. |
|--------|---------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | – | a $277,000 increase in subordinated management fees.  During fiscal 2010 and 2009, we recorded subordinated management fees of $34,000 and ($243,000) on one and 11 CDO issuers, respectively.  The loss recorded during fiscal 2009 was primarily the result of the write-off of cumulative accrued fees on nine CDO issuers; and |
|--------|---------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | – | a $57,000 increase in incentive management fees.  During fiscal 2009, we recorded a loss of $57,000 on two CDO issuers principally due to the write-off of cumulative accrued fees.  There was no write-off of fees in fiscal 2010. |
|--------|---------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | – | a $259,000 decrease in collateral management fees from the European CDO issuer we manage due to the variance in foreign currency exchange rates. |
|--------|---------|--------------------------------------------------------------------------------------------------------------------------------------------------|

|   | – | a $809,000 increase in RCC management fees primarily due to an increase in incentive management fees and in RCC’s equity capital (upon which our base management fee is calculated) resulting primarily from RCC’s success in raising capital through common stock offerings; |
|--------|---------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | – | a $484,000 increase in management and incentive fees earned on separate managed accounts.  No such fees were earned during fiscal 2009; and |
|--------|---------|-------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | – | a $308,000 increase in management fees for the credit opportunities fund primarily due to a $220,000 incentive fee we earned after exceeding certain investor hurdle returns; |
|--------|---------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | ● | a $2.5 million increase in introductory agent fees as a result of fees earned in connection with 103 trust preferred security transactions with an average fee of $75,000 for fiscal 2010 as compared to 91 transactions with an average fee of $57,000 for fiscal 2009; |
|--------|---------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | ● | a $508,000 net increase in earnings from nine unconsolidated CDO issuers we previously sponsored and manage.  In March 2010, we sold one of our CDO equity investments and in June 2010, we sold the majority of our interest in another CDO equity investment.  As of September 30, 2010, we have fully impaired four of these CDO investments and will utilize the cost-recovery method to realize any future income; |
|--------|---------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | ●  | a $508,000 net increase in earnings from nine unconsolidated CDO issuers we previously sponsored and manage. In March 2010, we sold one of our CDO equity investments and in June 2010, we sold the majority of our interest in another CDO equity investment. As of September 30, 2010, we have fully impaired four of these CDO investments and will utilize the cost-recovery method to realize any future income; |
|--------|---------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | ● | a $5.2 million decrease in interest income on loans, primarily as a result of the following: |
|--------|---------|----------------------------------------------------------------------------------------------|

|   | – | a $6.0 million decrease in interest from Apidos CDO VI due to the sale of our interests in March 2009, at which time we ceased to consolidate that entity.  This decrease was partially offset by: |
|--------|---------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | – | an $860,000 increase due to the recovery of excess interest spread earned on loan assets accumulating during the warehouse period of the European CDO issuer we sponsored and manage.  We do not expect to receive any additional income from this source in the future; |
|--------|---------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | ● | a $626,000 increase in other income, primarily related to the following: |
|--------|---------|--------------------------------------------------------------------------|

|   | – | an $800,000 break-up fee received in connection with an unsuccessful bank transaction to reimburse us for a significant portion of our costs.  We do not anticipate receiving such a fee in the future; partially offset by |
|--------|---------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | – | a $158,000 decrease in earnings from SFF partnerships relating to four CDO investments which have been fully impaired.  As of December 31, 2009, the SFF partnerships assigned their interest in these investments to an affiliated third party.  The SFF partnerships were dissolved in March 2010; |
|--------|---------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | ● | Limited and general partner interests: |
|--------|---------|----------------------------------------|

|   | – | during fiscal 2010, we repurchased, along with the co-manager of the general partners, substantially all the remaining limited partner interests in two Trapeza partnerships which reduced our clawback liability and recorded a gain of $2.3 million.  During fiscal 2009, we had reduced our clawback liability and recorded a gain of $1.6 million; and |
|--------|---------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | – | during fiscal 2010 and 2009, we recorded $229,000 and ($1.9 million), respectively, in realized and unrealized fair value adjustments in the book value of securities we hold in unconsolidated other company-sponsored partnerships. |
|--------|---------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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|   | ● | a $3.6 million decrease in fund and RCC management fees, primarily from the following: |
|--------|---------|----------------------------------------------------------------------------------------|

|   | – | a $3.8 million net decrease in collateral management fees from our Ischus operations primarily due to a reduction in subordinated management fees as a result of an increase in rating agency downgrades which reduced our collateral base and the liquidation of two of our CDO issuers during fiscal 2009; |
|--------|---------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | – | a $1.3 million net decrease in senior, subordinated and incentive management fees from our Trapeza operations, primarily from the following: |
|--------|---------|----------------------------------------------------------------------------------------------------------------------------------------------|

|   | – | a $2.6 million decrease in subordinated management fees.  During fiscal 2009 and 2008, we recorded subordinated management fees of ($242,000) and $2.3 million, respectively, on 11 CDO issuers.  The loss recorded during fiscal 2009 was primarily the result of the write-off of cumulative accrued subordinated management fees that we no longer expect to receive from nine CDO issuers; and |
|--------|---------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | – | a $278,000 decrease in senior management fees as a result of portfolio defaults which reduced our collateral base. |
|--------|---------|--------------------------------------------------------------------------------------------------------------------|

|   | – | an $851,000 decrease in our share of expenses for the management of Trapeza Capital Management LLC and Trapeza Management Group LLC, primarily due to a decrease in asset management personnel and state taxes; and |
|--------|---------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | – | a $738,000 increase in incentive management fees.  During fiscal 2009, we wrote-off $57,000 in incentive management fees from two CDO issuers as compared to a write-off of $795,000 of similar fees from three CDO issuers during fiscal 2008. |
|--------|---------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | – | a $481,000 decrease in management fees from other company-sponsored partnerships primarily due to the liquidation of our previously sponsored hedge fund and a decline in fair values of other company-sponsored partnership investments.  These management fees are net asset based; and |
|--------|---------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | – | a $262,000 decrease in collateral management fees from the European CDO issuer we manage due to a decrease in the euro to dollar exchange rate. |
|--------|---------|-------------------------------------------------------------------------------------------------------------------------------------------------|

|   | – | a $1.4 million increase in collateral management fees resulting from a full year of fees on four bank loan CDO issuers whose management we assumed from an unaffiliated third-party asset manager in May 2008; and |
|--------|---------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | – | a $940,000 increase in RCC management fees and equity compensation, reflecting a $440,000 increase in management fees and a $500,000 increase in equity compensation. |
|--------|---------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | ● | a $2.6 million increase in introductory agent fees as a result of fees earned in connection with 91 trust preferred security transactions with an average fee of $57,000 for fiscal 2009 as compared to 16 transactions with an average of $162,000 for fiscal 2008. |
|--------|---------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | ● | a $1.1 million net decrease in earnings from 12 unconsolidated CDO issuers we previously sponsored and manage.  Through fiscal 2009, we have fully impaired nine CDO investments.  The cost-recovery method will be used to realize any future income on these investments; |
|--------|---------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | ● | a $10.5 million decrease in interest income on loans held for investment, resulting primarily from the following: |
|--------|---------|-------------------------------------------------------------------------------------------------------------------|

|   | – | a $3.2 million decrease in interest income from CDO issuers whose loan assets were held by us in warehouse facilities and consolidated in our financial statements for fiscal 2008, including one Apidos and one Resource Europe CDO issuer.  The weighted average loan balance was $49.3 million at a weighted average interest rate of 7.16%.  We had no outstanding warehouse facilities during fiscal 2009; and |
|--------|---------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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|   | – | a $7.3 million decrease from Apidos CDO VI.  In December 2007, we closed Apidos CDO VI, repaid all borrowings under the warehouse facility and purchased 100% of the subordinated notes.  The weighted average loan balances of Apidos CDO VI for fiscal 2009 and 2008 was $115.5 million and $221.0 million, respectively, at an effective interest rate of 4.38% and 5.81%, respectively.  As of March 31, 2009, we agreed to sell our interest in Apidos CDO VI and no longer consolidated it.  This transaction settled on May 6, 2009. |
|--------|---------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | ● | a $2.0 million decrease in other income, primarily as a result of following: |
|--------|---------|------------------------------------------------------------------------------|

|   | – | a $1.5 million decrease in the earnings of our SFF partnerships related to a decrease in earnings from four CDO investments which we have fully impaired.  We will utilize the cost-recovery method to realize any future income on these investments; and |
|--------|---------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | – | a $514,000 decrease in interest income we earned on the restricted cash balances of Apidos CDO VI. |
|--------|---------|----------------------------------------------------------------------------------------------------|

|   | ● | Limited and general partner interests: |
|--------|---------|----------------------------------------|

|   | – | during fiscal 2009 and 2008, we recorded $1.6 million and ($23.2 million), respectively, in realized and unrealized fair value adjustments on Trapeza partnership securities and swap agreements and ($1.9 million) and ($287,000), respectively, in realized and unrealized fair value adjustments in the book value of securities we hold in unconsolidated other company-sponsored partnerships; and |
|--------|---------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | – | during fiscal 2009 and 2008, we recorded ($4,000) and $3.2 million, respectively, in revenues (other than fair value adjustments) from our limited and general partner share of operating results of the unconsolidated Trapeza partnerships and ($64,000) and ($402,000), respectively, from our share of operating results of unconsolidated other company-sponsored partnerships. |
|--------|---------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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|                      |   | Years Ended September 30, |   |
|---------------------------|--------|---------------------------|--------|
|                      |   | 2010                      |   |   | 2009 |   |   | 2008 |   |
| Commercial finance        |   | $                         | 5,159  |   |   | $ | 6,410 |   |   | $ | 7,505 |   |
| Financial fund management |   |                      | 1      |   |   |   | 1,738 |   |   |   | 2,622 |   |
| Real estate               |   |                      | 49     |   |   |   | 456 |   |   |   | 500 |   |
|                      |   | $                         | 5,209  |   |   | $ | 8,604 |   |   | $ | 10,627 |   |

|   | ● | Commercial finance – The year over year provisions for credit losses in fiscal 2010 and 2009 decreased by $1.3 million and $1.1 million, respectively, due primarily to the decrease in the assets we held.   During fiscal 2010, we sold a portfolio of commercial assets to RCC and in March 2009, we sold our interests in LCFF, which held a $195.0 million portfolio of leases and loans, inclusive of a $900,000 credit loss reserve.  In fiscal 2008, we had recorded a provision of $4.1 million on our Merit future credit card payment business, which had higher interest rate spreads and a greater risk of credit loss; |
|--------|---------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | ● | Financial fund management – The year over year provisions in fiscal 2010 and 2009 decreased by $1.7 million and $884,000, respectively, due primarily to the sale in March 2009 of our investment in Apidos CDO VI, a $240.0 million securitization of corporate loans, for which we had recorded a $1.7 million and $2.6 million provision for credit losses during fiscal 2009 and fiscal 2008, respectively; and |
|--------|---------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | ● | Real estate - While we continued to monetize our legacy loan portfolio to reduce our overall exposure, we determined that economic conditions continued to negatively impact one of the remaining loans in the portfolio.  Accordingly, we recorded a provision for credit losses of $456,000 and $500,000 during fiscal 2009 and 2008, respectively, which fully reserved that loan. |
|--------|---------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|                      |   | Years Ended September 30, |   |
|---------------------------|--------|---------------------------|--------|
|                      |   | 2010                      |   |   | 2009 |   |   | 2008 |   |
| Commercial finance        |   | $                         | 6,271  |   |   | $ | 10,524 |   |   | $ | 27,466 |   |
| Financial fund management |   |                      | 3      |   |   |   | 5,014 |   |   |   | 14,559 |   |
| Real estate               |   |                      | 1,074  |   |   |   | 966 |   |   |   | 1,222 |   |
| Corporate                 |   |                      | 5,738  |   |   |   | 3,695 |   |   |   | 4,019 |   |
|                      |   | $                         | 13,086 |   |   | $ | 20,199 |   |   | $ | 47,266 |   |

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|                                                   | Years Ended September 30, |
|--------------------------------------------------------|---------------------------|
|                                                   | 2010                      |   | 2009 |   | 2008 |
|                                                   |                      |   |   |   |   |
| Corporate – secured credit facilities:           |                      |   |   |   |   |
| Average borrowings                                     | $18.2                     |   | $42.8 |   | $56.8 |
| Average interest rates                                 | 10.5%                     |   | 11.1% |   | 6.9% |
|                                                   |                      |   |   |   |   |
| Corporate – Senior Notes:                        |                      |   |   |   |   |
| Average borrowings                                     | $18.8                     |   | − |   | − |
| Average interest rates                                 | 20.0%                     |   | − |   | − |
|                                                   |                      |   |   |   |   |
| Commercial finance – secured credit facility:    |                      |   |   |   |   |
| Average borrowings                                     | $77.0                     |   | $201.2 |   | $423.6 |
| Average interest rates                                 | 7.7%                      |   | 5.0% |   | 6.4% |
|                                                   |                      |   |   |   |   |
| Commercial finance – short-term bridge facility: |                      |   |   |   |   |
| Average borrowings                                     | $1.6                      |   | − |   | − |
| Average interest rates                                 | 8.2%                      |   | − |   | − |
|                                                   |                      |   |   |   |   |
| Financial fund management:                             |                      |   |   |   |   |
| Average borrowings                                     | −                   |   | $108.7 |   | $255.6 |
| Average interest rates                                 | −                   |   | 4.6% |   | 5.6% |
|                                                   |                      |   |   |   |   |

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|                                        |   | Years Ended September 30, |    |
|---------------------------------------------|--------|---------------------------|---------|
|                                        |   | 2010                      |    |   | 2009 |   |   | 2008 |   |
| RCC dividend income (1)                |   | $                         | 2,278   |   |   | $ | 3,405 |   |   | $ | 2,421 |   |
| Loss on sale of equity securities (2)  |   |                      | − |   |   |   | (393 | ) |   |   | − |   |
| Interest income (3)                    |   |                      | 434     |   |   |   | 340 |   |   |   | 547 |   |
| Other (expense) income, net (4)        |   |                      | (121    | ) |   |   | (196 | ) |   |   | 68 |   |
| Other income, net                           |   | $                         | 2,591   |   |   | $ | 3,156 |   |   | $ | 3,036 |   |

----

| (1) | In fiscal 2009, we recognized five dividend payments on our investment in RCC as compared to four and three dividend payments in fiscal 2010 and 2008, respectively. |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (2) | In fiscal 2009, we sold 99,318 shares of common stock of TBBK, at loss of $393,000.  No shares of TBBK were sold during fiscal 2010 and 2008. |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------|

| (3) | Interest income decreased in fiscal 2009 by $207,000, principally as a result of lower cash balances due to the deconsolidation of LCFF. |
|-----|------------------------------------------------------------------------------------------------------------------------------------------|

| (4) | Included in other (expense) income, net for fiscal 2010 and 2009 is $263,000 and $192,000, respectively, of amortized losses in the securities held in the retirement plan for our former CEO. |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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|                                                                                |   | Years Ended September 30, |    |
|-------------------------------------------------------------------------------------|--------|---------------------------|---------|
|                                                                                |   | 2010                      |    |   | 2009 |   |   | 2008 |   |
| Commercial finance minority ownership, net of tax of $(1,699), $0and $520 (1)  |   | $                         | 3,155   |   |   | $ | − |   |   | $ | (965 | ) |
| Real estate minority holder (2)                                                |   |                      | 61      |   |   |   | 54 |   |   |   | (61 | ) |
| SFF partnerships (3)                                                           |   |                      | 8       |   |   |   | 1,549 |   |   |   | 6,578 |   |
| Commercial finance fund participation, net of tax of $0, $0and $242 (4)        |   |                      | − |   |   |   | − |   |   |   | (451 | ) |
| Other (5)                                                                      |   |                      | − |   |   |   | − |   |   |   | (96 | ) |
|                                                                                |   | $                         | 3,224   |   |   | $ | 1,603 |   |   | $ | 5,005 |   |

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| (1) | Senior executives of LEAF hold a 14.1% interest in LEAF. |
|-----|----------------------------------------------------------|

| (2) | A related party holds a 19.99% interest in our investment in a hotel property in Savannah, Georgia. |
|-----|-----------------------------------------------------------------------------------------------------|

| (3) | Limited partners, excluding us, owned an 85% and 64% limited partner interest in SFF I and SFF II, respectively, which invested in the equity of certain of the CDO issuers we sponsored.  As of March 31, 2010, the SFF partnerships were dissolved. |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (4) | During fiscal 2008, LEAF sold (in two separate transactions) its interest in a subsidiary that held a portfolio leases and loans acquired from NetBank to one of its investment entities. |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (5) | Included the interest spread earned by warehouse providers while assets were in the accumulation stage.  As of January 2008, all warehouse facilities were terminated. |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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|                                                    |   | Years Ended September 30, |    |
|---------------------------------------------------------|--------|---------------------------|---------|
|                                                    |   | 2010                      |    |   | 2009 |   |   | 2008 |   |
| Income (loss) from discontinued operations before taxes |   | $                         | 626     |   |   | $ | (370 | ) |   | $ | (1,104 | ) |
| Income tax (provision) benefit                          |   |                      | − |   |   |   | (70 | ) |   |   | 386 |   |
| Discontinued income (loss), net of tax                  |   | $                         | 626     |   |   | $ | (440 | ) |   | $ | (718 | ) |

|                                           |   | Years Ending September 30, |    |
|------------------------------------------------|--------|----------------------------|---------|
|                                           |   | 2010                       |    |   | 2009 |   |   | 2008 |   |
| Loss from discontinued operations before taxes |   | $                          | − |   |   | $ | (14 | ) |   | $ | (856 | ) |
| Benefit for income taxes                       |   |                       | − |   |   |   | 5 |   |   |   | 300 |   |
| Loss from discontinued operations, net of tax  |   | $                          | − |   |   | $ | (9 | ) |   | $ | (556 | ) |

|   | ● | cash on hand of $11.2 million; and |
|--------|---------|------------------------------------|

|   | ● | cash generated from operations, including asset and property management fees as well as payments received on leases and loans, sales of equipment and the continued resolution of our real estate legacy portfolio. |
|--------|---------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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|                                         |   |   |   |   | Payments Due By Period |   |
|----------------------------------------------|--------|--------|--------|--------|------------------------|--------|
|                                         |   | Total  |   |   | Less than 1 Year       |   |   | 1 – 3 Years |   |   | 4 – 5 Years |   |   | After 5 Years |   |
| Contractual obligations:                     |   |   |   |   |                   |   |   |   |   |   |   |   |   |   |   |
| Recourse to RAI:                             |   |   |   |   |                   |   |   |   |   |   |   |   |   |   |   |
| Other debt (1)                          |   | $      | 35,341 |   |                   | $      | 13,143 |   |   | $ | 18,858 |   |   | $ | 1,985 |   |   | $ | 1,355 |   |
| Capital lease obligations (1)                |   |   | 395    |   |                   |   | 282 |   |   |   | 98 |   |   |   | 15 |   |   |   | − |   |
| Secured credit facilities (1)           |   |   | 14,127 |   |                   |   | 1,800 |   |   |   | 12,327 |   |   |   | − |   |   |   | − |   |
| Operating lease obligations                  |   |   | 13,736 |   |                   |   | 2,415 |   |   |   | 4,001 |   |   |   | 2,167 |   |   |   | 5,153 |   |
| Other long-term liabilities                  |   |   | 10,047 |   |                   |   | 1,310 |   |   |   | 4,398 |   |   |   | 1,438 |   |   |   | 2,901 |   |
|                                         |   | $      | 73,646 |   |                   | $      | 18,950 |   |   | $ | 39,682 |   |   | $ | 5,605 |   |   | $ | 9,409 |   |
| Non-recourse to RAI:                         |   |   |   |   |                   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Secured short-term bridge facility (2)  |   |   | 20,750 |   |                   |   | 20,750 |   |   |   | − |   |   |   | − |   |   |   | − |   |
| Total contractual obligations                |   | $      | 94,396 |   |                   | $      | 39,700 |   |   | $ | 39,682 |   |   | $ | 5,605 |   |   | $ | 9,409 |   |

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| (1) | Not included in the table above are estimated interest payments calculated at rates in effect at September 30, 2010; less than 1 year: $4.3 million; 1-3 years:  $2.9 million; 4-5 years:  $454,000; and after 5 years: $1.5 million. |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (2) | Not included in the table above are estimated interest payments at rates in effect at September 30, 2010; less than 1 year:  $562,000. |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------|

|                          |   |   |   |   | Amount of Commitment Expiration Per Period |   |
|-------------------------------|--------|--------|--------|--------|--------------------------------------------|--------|
|                          |   | Total  |   |   | Less than1 Year                            |   |   | 1 – 3Years |   |   | 4 – 5Years |   |   | After5 Years |   |
| Other commercial commitments: |   |   |   |   |                                       |   |   |   |   |   |   |   |   |   |   |
| Guarantees                    |   | $      | 3,458  |   |                                       | $      | 3,458 |   |   | $ | − |   |   | $ | − |   |   | $ | − |   |
| Standby letters of credit     |   |   | 701    |   |                                       |   | 701 |   |   |   | − |   |   |   | − |   |   |   | − |   |
| Total commercial commitments  |   | $      | 4,159  |   |                                       | $      | 4,159 |   |   | $ | − |   |   | $ | − |   |   | $ | − |   |

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| ITEM 7A. | QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK. |
|----------|-------------------------------------------------------------|

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| ITEM 8. | FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA. |
|---------|----------------------------------------------|

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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

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CONSOLIDATED BALANCE SHEETS

|                                                                                                                                                                                        |   | September 30, |    |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|---------------|---------|
|                                                                                                                                                                                        |   | 2010          |    |   | 2009 |   |
| ASSETS                                                                                                                                                                                      |   |          |    |   |   |   |
| Cash                                                                                                                                                                                        |   | $             | 11,243  |   |   | $ | 26,197 |   |
| Restricted cash                                                                                                                                                                             |   |          | 12,018  |   |   |   | 2,741 |   |
| Receivables                                                                                                                                                                                 |   |          | 1,671   |   |   |   | 1,358 |   |
| Receivables from managed entities and related parties, net                                                                                                                                  |   |          | 66,416  |   |   |   | 55,047 |   |
| Investments in commercial finance - held for investment, net                                                                                                                                |   |          | 12,176  |   |   |   | 2,429 |   |
| Investments in commercial finance - held for sale, net                                                                                                                                      |   |          | − |   |   |   | 142,701 |   |
| Investments in real estate, net                                                                                                                                                             |   |          | 27,114  |   |   |   | 28,923 |   |
| Investment securities, at fair value                                                                                                                                                        |   |          | 22,358  |   |   |   | 19,500 |   |
| Investments in unconsolidated entities                                                                                                                                                      |   |          | 13,825  |   |   |   | 16,241 |   |
| Property and equipment, net                                                                                                                                                                 |   |          | 9,984   |   |   |   | 13,435 |   |
| Deferred tax assets                                                                                                                                                                         |   |          | 43,703  |   |   |   | 45,656 |   |
| Goodwill                                                                                                                                                                                    |   |          | 7,969   |   |   |   | 7,969 |   |
| Intangible assets, net                                                                                                                                                                      |   |          | − |   |   |   | 3,637 |   |
| Other assets                                                                                                                                                                                |   |          | 5,776   |   |   |   | 10,006 |   |
| Total assets                                                                                                                                                                                |   | $             | 234,253 |   |   | $ | 375,840 |   |
|                                                                                                                                                                                        |   |          |    |   |   |   |   |   |
| LIABILITIES AND EQUITY                                                                                                                                                                      |   |          |    |   |   |   |   |   |
| Liabilities:                                                                                                                                                                                |   |          |    |   |   |   |   |   |
| Accrued expenses and other liabilities                                                                                                                                                      |   | $             | 38,492  |   |   | $ | 40,986 |   |
| Payables to managed entities and related parties                                                                                                                                            |   |          | 156     |   |   |   | 1,284 |   |
| Borrowings                                                                                                                                                                                  |   |          | 66,110  |   |   |   | 191,383 |   |
| Deferred tax liabilities                                                                                                                                                                    |   |          | 411     |   |   |   | 2,046 |   |
| Total liabilities                                                                                                                                                                           |   |          | 105,169 |   |   |   | 235,699 |   |
|                                                                                                                                                                                        |   |          |    |   |   |   |   |   |
| Commitments and contingencies                                                                                                                                                               |   |          |    |   |   |   |   |   |
|                                                                                                                                                                                        |   |          |    |   |   |   |   |   |
| Equity:                                                                                                                                                                                     |   |          |    |   |   |   |   |   |
| Preferred stock, $1.00 par value, 1,000,000 shares authorized;none outstanding                                                                                                              |   |          | – |   |   |   | – |   |
| Common stock, $.01 par value, 49,000,000 shares authorized; 28,167,909and 27,757,849 shares issued, respectively (including nonvestedrestricted stock of 741,086 and 552,461, respectively) |   |          | 274     |   |   |   | 272 |   |
| Additional paid-in capital                                                                                                                                                                  |   |          | 281,378 |   |   |   | 277,944 |   |
| Accumulated deficit                                                                                                                                                                         |   |          | (37,558 | ) |   |   | (22,471 | ) |
| Treasury stock, at cost; 9,125,253 and 9,213,665 shares, respectively                                                                                                                       |   |          | (99,330 | ) |   |   | (100,367 | ) |
| Accumulated other comprehensive loss                                                                                                                                                        |   |          | (12,807 | ) |   |   | (15,560 | ) |
| Total stockholders’ equity                                                                                                                                                            |   |          | 131,957 |   |   |   | 139,818 |   |
| Noncontrolling interests                                                                                                                                                                    |   |          | (2,873  | ) |   |   | 323 |   |
| Total equity                                                                                                                                                                                |   |          | 129,084 |   |   |   | 140,141 |   |
|                                                                                                                                                                                        |   | $             | 234,253 |   |   | $ | 375,840 |   |

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CONSOLIDATED STATEMENTS OF OPERATIONS

|                                                                 |   | Years Ended September 30, |    |
|----------------------------------------------------------------------|--------|---------------------------|---------|
|                                                                 |   | 2010                      |    |   | 2009 |   |   | 2008 |   |
| REVENUES                                                             |   |                      |    |   |   |   |   |   |   |
| Real estate                                                          |   | $                         | 31,911  |   |   | $ | 25,417 |   |   | $ | 31,519 |   |
| Commercial finance                                                   |   |                      | 23,677  |   |   |   | 48,767 |   |   |   | 93,016 |   |
| Financial fund management                                            |   |                      | 33,140  |   |   |   | 33,344 |   |   |   | 27,536 |   |
|                                                                 |   |                      | 88,728  |   |   |   | 107,528 |   |   |   | 152,071 |   |
| COSTS AND EXPENSES                                                   |   |                      |    |   |   |   |   |   |   |   |   |   |
| Real estate                                                          |   |                      | 20,780  |   |   |   | 22,038 |   |   |   | 22,602 |   |
| Commercial finance                                                   |   |                      | 18,164  |   |   |   | 25,179 |   |   |   | 42,741 |   |
| Financial fund management                                            |   |                      | 21,028  |   |   |   | 20,468 |   |   |   | 27,737 |   |
| General and administrative                                           |   |                      | 12,972  |   |   |   | 14,369 |   |   |   | 16,080 |   |
| Loss (gain) on sale of leases and loans                              |   |                      | 8,097   |   |   |   | (628 | ) |   |   | (3,865 | ) |
| Impairment of intangibles                                            |   |                      | 2,828   |   |   |   | − |   |   |   | − |   |
| Provision for credit losses                                          |   |                      | 5,209   |   |   |   | 8,604 |   |   |   | 10,627 |   |
| Depreciation and amortization                                        |   |                      | 7,842   |   |   |   | 6,922 |   |   |   | 4,660 |   |
|                                                                 |   |                      | 96,920  |   |   |   | 96,952 |   |   |   | 120,582 |   |
| OPERATING (LOSS) INCOME                                              |   |                      | (8,192  | ) |   |   | 10,576 |   |   |   | 31,489 |   |
|                                                                 |   |                      |    |   |   |   |   |   |   |   |   |   |
| OTHER (EXPENSE) INCOME                                               |   |                      |    |   |   |   |   |   |   |   |   |   |
| Total other-than-temporary impairment losses oninvestment securities |   |                      | (809    | ) |   |   | (8,539 | ) |   |   | (14,467 | ) |
| Portion recognized in other comprehensive loss                       |   |                      | − |   |   |   | − |   |   |   | − |   |
| Net other-than-temporary impairment losses recognized in earnings    |   |                      | (809    | ) |   |   | (8,539 | ) |   |   | (14,467 | ) |
| Loss on sale of loans and investment securities, net                 |   |                      | (451    | ) |   |   | (11,588 | ) |   |   | (17,674 | ) |
| Interest expense                                                     |   |                      | (13,086 | ) |   |   | (20,199 | ) |   |   | (47,266 | ) |
| Other income, net                                                    |   |                      | 2,591   |   |   |   | 3,156 |   |   |   | 3,036 |   |
|                                                                 |   |                      | (11,755 | ) |   |   | (37,170 | ) |   |   | (76,371 | ) |
| Loss from continuing operations before taxes                         |   |                      | (19,947 | ) |   |   | (26,594 | ) |   |   | (44,882 | ) |
| Income tax benefit                                                   |   |                      | (2,650  | ) |   |   | (10,504 | ) |   |   | (14,933 | ) |
| Loss from continuing operations                                      |   |                      | (17,297 | ) |   |   | (16,090 | ) |   |   | (29,949 | ) |
| Income (loss) from discontinued operations, net of tax               |   |                      | 622     |   |   |   | (444 | ) |   |   | (1,299 | ) |
| Net loss                                                             |   |                      | (16,675 | ) |   |   | (16,534 | ) |   |   | (31,248 | ) |
| Less:  Net loss attributable to noncontrolling interests   |   |                      | 3,224   |   |   |   | 1,603 |   |   |   | 5,005 |   |
| Net loss attributable to common shareholders                         |   | $                         | (13,451 | ) |   | $ | (14,931 | ) |   | $ | (26,243 | ) |
|                                                                 |   |                      |    |   |   |   |   |   |   |   |   |   |
| Basic loss per share attributable to common shareholders:            |   |                      |    |   |   |   |   |   |   |   |   |   |
| Continuing operations                                                |   | $                         | (0.74   | ) |   | $ | (0.78 | ) |   | $ | (1.40 | ) |
| Discontinued operations                                              |   |                      | 0.03    |   |   |   | (0.03 | ) |   |   | (0.07 | ) |
| Net loss                                                             |   | $                         | (0.71   | ) |   | $ | (0.81 | ) |   | $ | (1.47 | ) |
| Weighted average shares outstanding                                  |   |                      | 18,942  |   |   |   | 18,507 |   |   |   | 17,804 |   |
|                                                                 |   |                      |    |   |   |   |   |   |   |   |   |   |
| Diluted loss per share attributable to common shareholders:          |   |                      |    |   |   |   |   |   |   |   |   |   |
| Continuing operations                                                |   | $                         | (0.74   | ) |   | $ | (0.78 | ) |   | $ | (1.40 | ) |
| Discontinued operations                                              |   |                      | 0.03    |   |   |   | (0.03 | ) |   |   | (0.07 | ) |
| Net loss                                                             |   | $                         | (0.71   | ) |   | $ | (0.81 | ) |   | $ | (1.47 | ) |
| Weighted average shares outstanding                                  |   |                      | 18,942  |   |   |   | 18,507 |   |   |   | 17,804 |   |
|                                                                 |   |                      |    |   |   |   |   |   |   |   |   |   |
| Amounts attributable to common shareholders:                         |   |                      |    |   |   |   |   |   |   |   |   |   |
| Loss from continuing operations, net of tax                          |   | $                         | (14,073 | ) |   | $ | (14,487 | ) |   | $ | (24,944 | ) |
| Discontinued operations, net of tax                                  |   |                      | 622     |   |   |   | (444 | ) |   |   | (1,299 | ) |
| Net loss                                                             |   | $                         | (13,451 | ) |   | $ | (14,931 | ) |   | $ | (26,243 | ) |
|                                                                 |   |                      |    |   |   |   |   |   |   |   |   |   |
| Dividends declared per common share                                  |   | $                         | 0.09    |   |   | $ | 0.20 |   |   | $ | 0.28 |   |

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CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY

|                                                                                                                      |   | Attributable to Common Shareholders |    |   |       |   |    |         |   |   |     |   |
|---------------------------------------------------------------------------------------------------------------------------|--------|-------------------------------------|---------|--------|------------|--------|---------|--------------|--------|--------|----------|--------|
|                                                                                                                      |   |                                |    |   |       |   |    | Retained     |   |   |     |   |   |   |   |   | Accumulated |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                                      |   |                                |    |   | Additional |   |    | Earnings     |   |   |     |   |   | ESOP |   |   | Other |   |   | Total |   |   |   |   |   |   |   |   |   |   |
|                                                                                                                      |   | Common                              |    |   | Paid-In    |   |    | (Accumulated |   |   | Treasury |   |   | Loan |   |   | Comprehensive |   |   | Stockholders’ |   |   | Noncontrolling |   |   | Total |   |   | Comprehensive |   |
|                                                                                                                      |   | Stock                               |    |   | Capital    |   |    | Deficit)     |   |   | Stock    |   |   | Receivable |   |   | Income (Loss) |   |   | Equity |   |   | Interest |   |   | Equity |   |   | Income (Loss) |   |
| Balance, October 1, 2007                                                                                                  |   | $                                   | 268     |   |       | $      | 264,747 |         |   | $      | 27,171   |   |   | $ | (102,014 | ) |   | $ | (223 | ) |   | $ | (4,602 | ) |   | $ | 185,347 |   |   | $ | 6,571 |   |   | $ | 191,918 |   |   |   |   |
| Net loss                                                                                                                  |   |                                | − |   |       |   | − |         |   |   | (26,243  | )      |   |   | − |   |   |   | − |   |   |   | − |   |   |   | (26,243 | ) |   |   | (5,005 | ) |   |   | (31,248 | ) |   | $ | (31,248 | ) |
| Treasury shares issued                                                                                                    |   |                                | − |   |       |   | 306     |         |   |   | −  |   |   |   | 811 |   |   |   | − |   |   |   | − |   |   |   | 1,117 |   |   |   | − |   |   |   | 1,117 |   |   |   |   |   |
| Stock-based compensation                                                                                                  |   |                                | − |   |       |   | 1,007   |         |   |   | −  |   |   |   | − |   |   |   | − |   |   |   | − |   |   |   | 1,007 |   |   |   | − |   |   |   | 1,007 |   |   |   |   |   |
| Restricted stock awards                                                                                                   |   |                                | − |   |       |   | 3,448   |         |   |   | −  |   |   |   | − |   |   |   | − |   |   |   | − |   |   |   | 3,448 |   |   |   | 3 |   |   |   | 3,451 |   |   |   |   |   |
| Issuance of common shares                                                                                                 |   |                                | 1       |   |       |   | 181     |         |   |   | −  |   |   |   | − |   |   |   | − |   |   |   | − |   |   |   | 182 |   |   |   | − |   |   |   | 182 |   |   |   |   |   |
| Purchase of treasury shares                                                                                               |   |                                | − |   |       |   | − |         |   |   | −  |   |   |   | (237 | ) |   |   | − |   |   |   | − |   |   |   | (237 | ) |   |   | − |   |   |   | (237 | ) |   |   |   |   |
| Cash dividends                                                                                                            |   |                                | − |   |       |   | − |         |   |   | (4,908   | )      |   |   | − |   |   |   | − |   |   |   | − |   |   |   | (4,908 | ) |   |   | − |   |   |   | (4,908 | ) |   |   |   |   |
| Distributions                                                                                                             |   |                                | − |   |       |   | − |         |   |   | −  |   |   |   | − |   |   |   | − |   |   |   | − |   |   |   | − |   |   |   | (1,509 | ) |   |   | (1,509 | ) |   |   |   |   |
| Sale/repurchase of partialownership of entity, net                                                                        |   |                                | − |   |       |   | − |         |   |   | −  |   |   |   | − |   |   |   | − |   |   |   | − |   |   |   | − |   |   |   | (48 | ) |   |   | (48 | ) |   |   |   |   |
| Other comprehensive loss                                                                                                  |   |                                | − |   |       |   | − |         |   |   | −  |   |   |   | − |   |   |   | − |   |   |   | (16,203 | ) |   |   | (16,203 | ) |   |   | 2,598 |   |   |   | (13,605 | ) |   |   | (13,605 | ) |
| Repayment of ESOP loan                                                                                                    |   |                                | − |   |       |   | − |         |   |   | −  |   |   |   | − |   |   |   | 223 |   |   |   | − |   |   |   | 223 |   |   |   | − |   |   |   | 223 |   |   |   |   |   |
| Balance, September 30, 2008                                                                                               |   |                                | 269     |   |       |   | 269,689 |         |   |   | (3,980   | )      |   |   | (101,440 | ) |   |   | − |   |   |   | (20,805 | ) |   |   | 143,733 |   |   |   | 2,610 |   |   |   | 146,343 |   |   | $ | (44,853 | ) |
| Net loss                                                                                                                  |   |                                | − |   |       |   | − |         |   |   | (14,931  | )      |   |   | − |   |   |   | − |   |   |   | − |   |   |   | (14,931 | ) |   |   | (1,603 | ) |   |   | (16,534 | ) |   | $ | (16,534 | ) |
| Treasury shares issued                                                                                                    |   |                                | − |   |       |   | (650    | )            |   |   | −  |   |   |   | 1,073 |   |   |   | − |   |   |   | − |   |   |   | 423 |   |   |   | − |   |   |   | 423 |   |   |   |   |   |
| Stock-based compensation                                                                                                  |   |                                | − |   |       |   | 613     |         |   |   | −  |   |   |   | − |   |   |   | − |   |   |   | − |   |   |   | 613 |   |   |   | − |   |   |   | 613 |   |   |   |   |   |
| Restricted stock awards                                                                                                   |   |                                | − |   |       |   | 3,615   |         |   |   | −  |   |   |   | − |   |   |   | − |   |   |   | − |   |   |   | 3,615 |   |   |   | 2 |   |   |   | 3,617 |   |   |   |   |   |
| Issuance of warrants inSenior Notes offering                                                                              |   |                                | − |   |       |   | 4,941   |         |   |   | −  |   |   |   | − |   |   |   | − |   |   |   | − |   |   |   | 4,941 |   |   |   | − |   |   |   | 4,941 |   |   |   |   |   |
| Issuance of common shares                                                                                                 |   |                                | 3       |   |       |   | − |         |   |   | −  |   |   |   | − |   |   |   | − |   |   |   | − |   |   |   | 3 |   |   |   | − |   |   |   | 3 |   |   |   |   |   |
| Purchase of subsidiary     stock held by a    noncontrolling     stockholder |   |                                | − |   |       |   | (264    | )            |   |   | −  |   |   |   | − |   |   |   | − |   |   |   | − |   |   |   | (264 | ) |   |   | − |   |   |   | (264 | ) |   |   |   |   |
| Cash dividends                                                                                                            |   |                                | − |   |       |   | − |         |   |   | (3,560   | )      |   |   | − |   |   |   | − |   |   |   | − |   |   |   | (3,560 | ) |   |   | − |   |   |   | (3,560 | ) |   |   |   |   |
| Distributions                                                                                                             |   |                                | − |   |       |   | − |         |   |   | −  |   |   |   | − |   |   |   | − |   |   |   | − |   |   |   | − |   |   |   | (72 | ) |   |   | (72 | ) |   |   |   |   |
| Other                                                                                                                     |   |                                | − |   |       |   | − |         |   |   | −  |   |   |   | − |   |   |   | − |   |   |   | − |   |   |   | − |   |   |   | (1,831 | ) |   |   | (1,831 | ) |   |   |   |   |
| Other comprehensive income                                                                                                |   |                                | − |   |       |   | − |         |   |   | −  |   |   |   | − |   |   |   | − |   |   |   | 5,245 |   |   |   | 5,245 |   |   |   | 1,217 |   |   |   | 6,462 |   |   |   | 6,462 |   |
| Balance, September 30, 2009                                                                                               |   |                                | 272     |   |       |   | 277,944 |         |   |   | (22,471  | )      |   |   | (100,367 | ) |   |   | − |   |   |   | (15,560 | ) |   |   | 139,818 |   |   |   | 323 |   |   |   | 140,141 |   |   | $ | (10,072 | ) |
| Net loss                                                                                                                  |   |                                | − |   |       |   | − |         |   |   | (13,451  | )      |   |   | − |   |   |   | − |   |   |   | − |   |   |   | (13,451 | ) |   |   | (3,224 | ) |   |   | (16,675 | ) |   | $ | (16,675 | ) |
| Treasury shares issued                                                                                                    |   |                                | − |   |       |   | (655    | )            |   |   | −  |   |   |   | 1,037 |   |   |   | − |   |   |   | − |   |   |   | 382 |   |   |   | − |   |   |   | 382 |   |   |   |   |   |
| Stock-based compensation                                                                                                  |   |                                | − |   |       |   | 226     |         |   |   | −  |   |   |   | − |   |   |   | − |   |   |   | − |   |   |   | 226 |   |   |   | − |   |   |   | 226 |   |   |   |   |   |
| Restricted stock awards                                                                                                   |   |                                | − |   |       |   | 2,765   |         |   |   | −  |   |   |   | − |   |   |   | − |   |   |   | − |   |   |   | 2,765 |   |   |   | 46 |   |   |   | 2,811 |   |   |   |   |   |
| Issuance of warrants                                                                                                      |   |                                | − |   |       |   | 1,042   |         |   |   | −  |   |   |   | − |   |   |   | − |   |   |   | − |   |   |   | 1,042 |   |   |   | − |   |   |   | 1,042 |   |   |   |   |   |
| Issuance of common shares                                                                                                 |   |                                | 2       |   |       |   | 56      |         |   |   | −  |   |   |   | − |   |   |   | − |   |   |   | − |   |   |   | 58 |   |   |   | − |   |   |   | 58 |   |   |   |   |   |
| Cash dividends                                                                                                            |   |                                | − |   |       |   | − |         |   |   | (1,636   | )      |   |   | − |   |   |   | − |   |   |   | − |   |   |   | (1,636 | ) |   |   | − |   |   |   | (1,636 | ) |   |   |   |   |
| Other                                                                                                                     |   |                                | − |   |       |   | − |         |   |   | −  |   |   |   | − |   |   |   | − |   |   |   | − |   |   |   | − |   |   |   | 7 |   |   |   | 7 |   |   |   |   |   |
| Other comprehensive      income (loss)                                                                |   |                                | − |   |       |   | − |         |   |   | −  |   |   |   | − |   |   |   | − |   |   |   | 2,753 |   |   |   | 2,753 |   |   |   | (25 | ) |   |   | 2,728 |   |   |   | 2,728 |   |
| Balance, September 30, 2010                                                                                               |   | $                                   | 274     |   |       | $      | 281,378 |         |   | $      | (37,558  | )      |   | $ | (99,330 | ) |   |   | − |   |   | $ | (12,807 | ) |   | $ | 131,957 |   |   | $ | (2,873 | ) |   | $ | 129,084 |   |   | $ | (13,947 | ) |

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CONSOLIDATED STATEMENTS OF CASH FLOWS

|                                                                                     |   | Years Ended September 30, |     |
|------------------------------------------------------------------------------------------|--------|---------------------------|----------|
|                                                                                     |   | 2010                      |     |   | 2009 |   |   | 2008 |   |
| CASH FLOWS FROM OPERATING ACTIVITIES:                                                    |   |                      |     |   |   |   |   |   |   |
| Net loss                                                                                 |   | $                         | (16,675  | ) |   | $ | (16,534 | ) |   | $ | (31,248 | ) |
| Adjustments to reconcile net loss to net cash provided by (used in)operating activities: |   |                      |     |   |   |   |   |   |   |   |   |   |
| Loss on sale of loans and investment securities, net                                     |   |                      | 451      |   |   |   | 11,588 |   |   |   | 17,674 |   |
| Net other-than-temporary impairment losses recognized in earnings                        |   |                      | 3,637    |   |   |   | 8,539 |   |   |   | 14,467 |   |
| Depreciation and amortization                                                            |   |                      | 12,088   |   |   |   | 8,876 |   |   |   | 6,024 |   |
| Provision for credit losses                                                              |   |                      | 5,209    |   |   |   | 8,604 |   |   |   | 10,627 |   |
| Equity in (earnings) losses of unconsolidated entities                                   |   |                      | (4,870   | ) |   |   | (1,279 | ) |   |   | 15,656 |   |
| Distributions from unconsolidated entities                                               |   |                      | 5,104    |   |   |   | 6,128 |   |   |   | 15,647 |   |
| Loss (gain) on sale of leases and loans                                                  |   |                      | 8,097    |   |   |   | (628 | ) |   |   | (3,865 | ) |
| Gain on sale of assets                                                                   |   |                      | (2,420   | ) |   |   | (642 | ) |   |   | (9,488 | ) |
| Deferred income tax benefits                                                             |   |                      | (4,564   | ) |   |   | (13,249 | ) |   |   | (16,031 | ) |
| Equity-based compensation issued                                                         |   |                      | 3,573    |   |   |   | 4,654 |   |   |   | 5,708 |   |
| Equity-based compensation received                                                       |   |                      | (1,441   | ) |   |   | (867 | ) |   |   | 159 |   |
| Decrease (increase) in commercial finance investments − held for sale              |   |                      | 17,603   |   |   |   | (37,330 | ) |   |   | 65,297 |   |
| Changes in operating assets and liabilities                                              |   |                      | 1,289    |   |   |   | (19,016 | ) |   |   | (15,331 | ) |
| Net cash provided by (used in) operating activities                                      |   |                      | 27,081   |   |   |   | (41,156 | ) |   |   | 75,296 |   |
| CASH FLOWS FROM INVESTING ACTIVITIES:                                                    |   |                      |     |   |   |   |   |   |   |   |   |   |
| Capital expenditures                                                                     |   |                      | (782     | ) |   |   | (335 | ) |   |   | (6,401 | ) |
| Payments received on real estate loans and real estate                                   |   |                      | 8,563    |   |   |   | 10,052 |   |   |   | 23,182 |   |
| Investments in unconsolidated real estate entities                                       |   |                      | (1,821   | ) |   |   | (4,694 | ) |   |   | (9,802 | ) |
| Purchase of commercial finance assets − held for investment                        |   |                      | (11,771  | ) |   |   | (41,942 | ) |   |   | (111,700 | ) |
| Payments received on commercial finance assets − held for investment               |   |                      | −  |   |   |   | 46,246 |   |   |   | 74,332 |   |
| Purchase of loans and investment                                                         |   |                      | (1,445   | ) |   |   | (19,290 | ) |   |   | (251,585 | ) |
| Proceeds from sale of loans and investment securities                                    |   |                      | 4,094    |   |   |   | 5,367 |   |   |   | 40,360 |   |
| Principal payments received on loans                                                     |   |                      | −  |   |   |   | 4,061 |   |   |   | 13,931 |   |
| Net cash paid for acquisitions                                                           |   |                      | −  |   |   |   | − |   |   |   | (8,022 | ) |
| Other                                                                                    |   |                      | −  |   |   |   | − |   |   |   | (17,050 | ) |
| Net cash used in investing activities                                                    |   |                      | (3,162   | ) |   |   | (535 | ) |   |   | (252,755 | ) |
| CASH FLOWS FROM FINANCING ACTIVITIES:                                                    |   |                      |     |   |   |   |   |   |   |   |   |   |
| Increase in borrowings                                                                   |   |                      | 103,401  |   |   |   | 438,897 |   |   |   | 930,731 |   |
| Principal payments on borrowings                                                         |   |                      | (128,767 | ) |   |   | (395,905 | ) |   |   | (715,914 | ) |
| Repayment from managed entity on RCC lease portfolio purchase                            |   |                      | −  |   |   |   | 4,500 |   |   |   | − |   |
| Dividends paid                                                                           |   |                      | (1,636   | ) |   |   | (3,560 | ) |   |   | (4,908 | ) |
| (Increase) decrease in restricted cash                                                   |   |                      | (9,277   | ) |   |   | 10,297 |   |   |   | (31,194 | ) |
| Other                                                                                    |   |                      | (2,594   | ) |   |   | (809 | ) |   |   | 260 |   |
| Net cash (used in) provided by financing activities                                      |   |                      | (38,873  | ) |   |   | 53,420 |   |   |   | 178,975 |   |
| CASH FLOWS FROM DISCONTINUED OPERATIONS:                                                 |   |                      |     |   |   |   |   |   |   |   |   |   |
| Operating activities                                                                     |   |                      | −  |   |   |   | (2 | ) |   |   | (494 | ) |
| Financing activities                                                                     |   |                      | −  |   |   |   | (440 | ) |   |   | (736 | ) |
| Net cash used in discontinued operations                                                 |   |                      | −  |   |   |   | (442 | ) |   |   | (1,230 | ) |
| (Decrease) increase in cash                                                              |   |                      | (14,954  | ) |   |   | 11,287 |   |   |   | 286 |   |
| Cash, beginning of year                                                                  |   |                      | 26,197   |   |   |   | 14,910 |   |   |   | 14,624 |   |
| Cash, end of year                                                                        |   | $                         | 11,243   |   |   | $ | 26,197 |   |   | $ | 14,910 |   |

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

|   | ● | Resource Capital Partners, Inc. acts as the general partner for most of the Company’s real estate investment entities and provides asset management services to the entire portfolio; |
|--------|---------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | ● | Resource Real Estate Management, Inc. (“Resource Residential”) provides property management services to the entire multifamily apartment portfolio, including fund assets, distressed assets and joint venture assets; |
|--------|---------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | ● | Resource Real Estate Funding, Inc., on behalf of RCC, manages the commercial real estate debt portfolio comprised principally of A notes, whole mortgage loans, mortgage participations, B notes, mezzanine debt and related commercial real estate securities.  In addition, it manages a separate portfolio of discounted real estate and real estate loans; and |
|--------|---------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | ● | Resource Real Estate manages loans, owned assets and ventures, which are collectively referred to as the “legacy portfolio.” |
|--------|---------|------------------------------------------------------------------------------------------------------------------------------------------|

|   | ● | Apidos Capital Management, LLC (“Apidos”), finances, structures and manages investments in bank loans, high yield bonds and equity investments; |
|--------|---------|-------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | ● | Trapeza Capital Management, LLC (“TCM”), a joint venture between us with an unrelated third-party, originates, structures, finances and manages investments in trust preferred securities and senior debt securities of banks, bank holding companies, insurance companies and other financial companies through collateralized debt obligation (“CDO”)  issuers and related partnerships.  TCM together with the Trapeza CDO issuers and Trapeza partnerships, are collectively referred to as Trapeza; |
|--------|---------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | ● | Resource Capital Markets, Inc., through the Company’s registered broker-dealer subsidiary, Chadwick Securities, Inc., (“Chadwick”) acts as an agent in the primary and secondary markets for trust preferred in the financial services and real estate sectors and manages accounts for institutional investors; |
|--------|---------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | ● | Resource Europe Management, Ltd. (“Resource Europe”), structures and manages investments in international bank loans; |
|--------|---------|-----------------------------------------------------------------------------------------------------------------------------------|

|   | ● | Resource Financial Institutions Group, Inc. (“RFIG”), serves as the general partner for seven company-sponsored affiliated partnerships which invest in financial institutions; |
|--------|---------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | ● | Ischus Capital Management, LLC (“Ischus”), finances, structures and manages investments in asset-backed securities (“ABS”) including residential mortgage-backed securities (“RMBS”) and commercial mortgage-backed securities (“CMBS”); and |
|--------|---------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | ● | Resource Capital Manager, Inc. (“RCM”), an indirect wholly-owned subsidiary, provides investment management and administrative services to RCC under a management agreement between RCM and RCC. |
|--------|---------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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|                                                              |   | Years Ended September 30, |    |
|-------------------------------------------------------------------|--------|---------------------------|---------|
|                                                              |   | 2010                      |    |   | 2009 |   |   | 2008 |   |
| Cash paid for:                                                    |   |                      |    |   |   |   |   |   |   |
| Interest                                                          |   | $                         | (9,433  | ) |   | $ | (18,975 | ) |   | $ | (57,845 | ) |
| Income taxes                                                      |   | $                         | (1,325  | ) |   | $ | (2,638 | ) |   | $ | (3,880 | ) |
| Refunds of income tax                                             |   | $                         | 2,860   |   |   | $ | − |   |   | $ | − |   |
| Non-cash activities include the following:                        |   |                      |    |   |   |   |   |   |   |   |   |   |
| Sale of commercial finance assets to RCC (see Note 4):            |   |                      |    |   |   |   |   |   |   |   |   |   |
| Reduction of investments in commercial finance assets             |   | $                         | 99,386  |   |   | $ | − |   |   | $ | − |   |
| Termination of associated secured warehouse facility              |   | $                         | (99,386 | ) |   | $ | − |   |   | $ | − |   |
| Fair value of warrants recorded as a discount to the Senior Notes |   | $                         | 2,339   |   |   | $ | 4,941 |   |   | $ | − |   |
| Leasehold improvements paid by the landlord                       |   | $                         | 668     |   |   | $ | − |   |   | $ | − |   |
|     Transfer of loans held for investment:    |   |                      |    |   |   |   |   |   |   |   |   |   |
| Reduction of investments in commercial finance assets             |   | $                         | − |   |   | $ | − |   |   | $ | 325,365 |   |
| Termination of associated secured warehouse facility              |   | $                         | − |   |   | $ | − |   |   | $ | (337,276 | ) |
| Activity on secured warehouse facilities related to bank loans:   |   |                      |    |   |   |   |   |   |   |   |   |   |
| Purchase of loans                                                 |   | $                         | − |   |   | $ | − |   |   | $ | (51,524 | ) |
| Repayments of borrowings to fund purchases of loans               |   | $                         | − |   |   | $ | − |   |   | $ | (100,368 | ) |
| Proceeds from sale of loans                                       |   | $                         | − |   |   | $ | − |   |   | $ | 7,366 |   |
| Principal payments received on loans                              |   | $                         | − |   |   | $ | − |   |   | $ | 6,322 |   |
| Settlement of loans traded, including use of escrow funds         |   | $                         | − |   |   | $ | − |   |   | $ | (152,706 | ) |
| Acquisition of commercial finance assets:                         |   |                      |    |   |   |   |   |   |   |   |   |   |
| Commercial finance assets acquired                                |   | $                         | − |   |   | $ | − |   |   | $ | 412,439 |   |
| Purchase of building and other assets                             |   | $                         | − |   |   | $ | − |   |   | $ | 7,835 |   |
| Goodwill acquired                                                 |   | $                         | − |   |   | $ | − |   |   | $ | 28 |   |
| Debt incurred for acquisitions                                    |   | $                         | − |   |   | $ | − |   |   | $ | (391,176 | ) |
| Liabilities assumed                                               |   | $                         | − |   |   | $ | − |   |   | $ | (21,176 | ) |
| Receipt of notes upon the resolution of real estate investments   |   | $                         | − |   |   | $ | − |   |   | $ | 1,500 |   |
| Property received on foreclosure of a real estate loan:           |   |                      |    |   |   |   |   |   |   |   |   |   |
| Investment in real estate loan                                    |   | $                         |    |   |   | $ | (2,837 | ) |   | $ | − |   |
| Investment in real estate owned                                   |   | $                         |    |   |   | $ | 2,837 |   |   | $ | − |   |
| Effects from the deconsolidation of entities (1):                 |   |                      |    |   |   |   |   |   |   |   |   |   |
| Cash                                                              |   | $                         | 43      |   |   | $ | 959 |   |   | $ | − |   |
| Restricted cash                                                   |   | $                         | − |   |   | $ | 10,651 |   |   | $ | − |   |
| Due from affiliates                                               |   | $                         | − |   |   | $ | (8,410 | ) |   | $ | − |   |
| Receivables                                                       |   | $                         | 9       |   |   | $ | (6,564 | ) |   | $ | − |   |
| Loans held for investment                                         |   | $                         | − |   |   | $ | 229,097 |   |   | $ | − |   |
| Investments in commercial finance-held for investment, net        |   | $                         | − |   |   | $ | 185,784 |   |   | $ | − |   |
| Investments in unconsolidated entities                            |   | $                         | 6       |   |   | $ | − |   |   | $ | − |   |
| Property and equipment, net                                       |   | $                         | 1,638   |   |   | $ | − |   |   | $ | − |   |
| Other assets                                                      |   | $                         | 749     |   |   | $ | 4,230 |   |   | $ | − |   |
| Accrued expense and other liabilities                             |   | $                         | (174    | ) |   | $ | (7,540 | ) |   | $ | − |   |
| Borrowings                                                        |   | $                         | (1,013  | ) |   | $ | (401,162 | ) |   | $ | − |   |
| Equity                                                            |   | $                         | (1,258  | ) |   | $ | (7,045 | ) |   | $ | − |   |

----

| (1) | Reflects the deconsolidation of a real estate entity and two financial fund management partnerships during fiscal 2010 and two entities, Apidos CDO VI and LCFF, during fiscal 2009.  As a result of the deconsolidation of these entities, the amounts noted above were removed from the Company’s consolidated balance sheets.  The sum of the assets removed equates to the sum of the liabilities and equity that were similarly eliminated and, as such, there was no change in the Company’s net assets. |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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|                                        |   | September 30, 2010  |   |   | September 30, 2009 |   |
|---------------------------------------------|--------|---------------------|--------|--------|--------------------|--------|
|                                        |   | Held for Investment |   |   | Held for Sale      |   |   | Total |   |   | Held for Investment |   |   | Held for Sale |   |   | Total |   |
| Loans (1)                              |   | $                   | 1,661  |   |               | $      | − |   |   | $ | 1,661 |   |   | $ | 385 |   |   | $ | 60,441 |   |   | $ | 60,826 |   |
| Direct financing leases, net                |   |                | 8,888  |   |               |   | − |   |   |   | 8,888 |   |   |   | 1,480 |   |   |   | 72,236 |   |   |   | 73,716 |   |
| Future payment card receivables, net        |   |                | 316    |   |               |   | − |   |   |   | 316 |   |   |   | 3,774 |   |   |   | − |   |   |   | 3,774 |   |
| Assets subject to operating leases, net (2) |   |                | 2,211  |   |               |   | − |   |   |   | 2,211 |   |   |   | − |   |   |   | 10,024 |   |   |   | 10,024 |   |
| Allowance for credit losses                 |   |                | (900   | )      |               |   | − |   |   |   | (900 | ) |   |   | (3,210 | ) |   |   | − |   |   |   | (3,210 | ) |
| Investments in commercial finance, net      |   | $                   | 12,176 |   |               | $      | − |   |   | $ | 12,176 |   |   | $ | 2,429 |   |   | $ | 142,701 |   |   | $ | 145,130 |   |

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| (1) | The interest rates on notes receivable generally range from 8% to 14%. |
|-----|------------------------------------------------------------------------|

| (2) | Net of accumulated depreciation of $0 and $737,000 for commercial finance assets held for sale as of September 30, 2010 and 2009, respectively, and $96,000 and $0 for those commercial assets held for investment as of September 30, 2010 and 2009, respectively. |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|                                           |   | September 30, 2010  |   |   | September 30, 2009 |   |
|------------------------------------------------|--------|---------------------|--------|--------|--------------------|--------|
|                                           |   | Held for Investment |   |   | Held for Sale      |   |   | Total |   |   | Held for Investment |   |   | Held for Sale |   |   | Total |   |
| Total future minimum lease paymentsreceivables |   | $                   | 10,467 |   |               | $      | − |   |   | $ | 10,467 |   |   | $ | 1,959 |   |   | $ | 84,534 |   |   | $ | 86,493 |   |
| Initial direct costs, net of amortization      |   |                | 156    |   |               |   | − |   |   |   | 156 |   |   |   | 6 |   |   |   | 1,157 |   |   |   | 1,163 |   |
| Unguaranteed residuals                         |   |                | 421    |   |               |   | − |   |   |   | 421 |   |   |   | 17 |   |   |   | 3,376 |   |   |   | 3,393 |   |
| Security deposits                              |   |                | (102   | )      |               |   | − |   |   |   | (102 | ) |   |   | (87 | ) |   |   | (69 | ) |   |   | (156 | ) |
| Unearned income                                |   |                | (2,054 | )      |               |   | − |   |   |   | (2,054 | ) |   |   | (415 | ) |   |   | (16,762 | ) |   |   | (17,177 | ) |
| Investments in direct financing leases, net    |   | $                   | 8,888  |   |               | $      | − |   |   | $ | 8,888 |   |   | $ | 1,480 |   |   | $ | 72,236 |   |   | $ | 73,716 |   |

|                          |   | Years Ended September 30, |    |
|-------------------------------|--------|---------------------------|---------|
|                          |   | 2010                      |    |   | 2009 |   |   | 2008 |   |
| Balance, beginning of year    |   | $                         | 3,210   |   |   | $ | 1,750 |   |   | $ | 120 |   |
| Provision for credit losses   |   |                      | 3,307   |   |   |   | 6,410 |   |   |   | 7,505 |   |
| Charge-offs                   |   |                      | (5,704  | ) |   |   | (3,557 | ) |   |   | (6,099 | ) |
| Recoveries                    |   |                      | 87      |   |   |   | 107 |   |   |   | 224 |   |
| Reduction due to sale of LCFF |   |                      | − |   |   |   | (1,500 | ) |   |   | − |   |
| Balance, end of year          |   | $                         | 900     |   |   | $ | 3,210 |   |   | $ | 1,750 |   |

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|       |   | NotesReceivable |   |   | Direct Financing Leases |   |   | OperatingLeases (1) |   |
|------------|--------|-----------------|--------|--------|-------------------------|--------|--------|---------------------|--------|
| 2011       |   | $               | 695    |   |                    | $      | 2,449  |                |   | $ | 819 |   |
| 2012       |   |            | 507    |   |                    |   | 2,437  |                |   |   | 762 |   |
| 2013       |   |            | 318    |   |                    |   | 2,374  |                |   |   | 677 |   |
| 2014       |   |            | 13     |   |                    |   | 1,897  |                |   |   | 48 |   |
| 2015       |   |            | 43     |   |                    |   | 1,283  |                |   |   | − |   |
| Thereafter |   |            | 85     |   |                    |   | 27     |                |   |   | − |   |
|       |   | $               | 1,661  |   |                    | $      | 10,467 |                |   | $ | 2,306 |   |

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| (1) | Operating lease amounts as shown are net of the residual value, if any, at the end of the lease term. |
|-----|-------------------------------------------------------------------------------------------------------|

|                                                        |   | September 30, |    |
|-------------------------------------------------------------|--------|---------------|---------|
|                                                        |   | 2010          |    |   | 2009 |   |
| Real estate loans:                                          |   |          |    |   |   |   |
| Balance, beginning of year                                  |   | $             | 4,447   |   |   | $ | 17,413 |   |
| Collection of principal                                     |   |          | (2,926  | ) |   |   | (9,373 | ) |
| Foreclosure                                                 |   |          | − |   |   |   | (2,837 | ) |
| Interest received                                           |   |          | − |   |   |   | (1,249 | ) |
| Charge-offs                                                 |   |          | (1,585  | ) |   |   | − |   |
| Accreted and accrued interest income                        |   |          | 113     |   |   |   | 493 |   |
| Balance, end of year                                        |   |          | 49      |   |   |   | 4,447 |   |
| Less allowance for credit losses                            |   |          | (49     | ) |   |   | (1,585 | ) |
| Real estate loans, net                                      |   |          | − |   |   |   | 2,862 |   |
| Real estate:                                                |   |          |    |   |   |   |   |   |
| Ventures                                                    |   |          | 9,727   |   |   |   | 8,189 |   |
| Owned, net of accumulated depreciation of $3,989 and $3,212 |   |          | 17,387  |   |   |   | 17,872 |   |
| Total real estate                                           |   |          | 27,114  |   |   |   | 26,061 |   |
|                                                        |   |          |    |   |   |   |   |   |
| Investments in real estate, net                             |   | $             | 27,114  |   |   | $ | 28,923 |   |

|                        |   | Years Ended September 30, |   |
|-----------------------------|--------|---------------------------|--------|
|                        |   | 2010                      |   |   | 2009 |   |   | 2008 |   |
| Balance, beginning of year  |   | $                         | 1,585  |   |   | $ | 1,129 |   |   | $ | 629 |   |
| Charge-offs                 |   |                      | (1,585 | ) |   |   | − |   |   |   | − |   |
| Provision for credit losses |   |                      | 49     |   |   |   | 456 |   |   |   | 500 |   |
| Balance, end of year        |   | $                         | 49     |   |   | $ | 1,585 |   |   | $ | 1,129 |   |

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|                                       |   | September 30, |   |
|--------------------------------------------|--------|---------------|--------|
|                                       |   | 2010          |   |   | 2009 |   |
| Available-for-sale securities              |   | $             | 21,530 |   |   | $ | 19,500 |   |
| Trading securities                         |   |          | 828    |   |   |   | − |   |
| Total investment securities, at fair value |   | $             | 22,358 |   |   | $ | 19,500 |   |

|                |   | Cost or Amortized Cost |   |   | Unrealized Gains |   |    | Unrealized Losses |   |   | Fair Value |   |
|---------------------|--------|------------------------|--------|--------|------------------|--------|---------|-------------------|--------|--------|------------|--------|
| September 30, 2010: |   |                   |   |   |             |   |    |              |   |   |       |   |
| CDO securities      |   | $                      | 5,515  |   |             | $      | 1,047   |              |   | $      | (339       | )      |   | $ | 6,223 |   |
| Equity securities   |   |                   | 31,847 |   |             |   | 18      |              |   |   | (16,558    | )      |   |   | 15,307 |   |
| Total               |   | $                      | 37,362 |   |             | $      | 1,065   |              |   | $      | (16,897    | )      |   | $ | 21,530 |   |
|                |   |                   |   |   |             |   |    |              |   |   |       |   |   |   |   |   |
| September 30, 2009: |   |                   |   |   |             |   |    |              |   |   |       |   |   |   |   |   |
| CDO securities      |   | $                      | 9,777  |   |             | $      | 268     |              |   | $      | (1,800     | )      |   | $ | 8,245 |   |
| Equity securities   |   |                   | 30,180 |   |             |   | − |              |   |   | (18,925    | )      |   |   | 11,255 |   |
| Total               |   | $                      | 39,957 |   |             | $      | 268     |              |   | $      | (20,725    | )      |   | $ | 19,500 |   |

|                |   | Less than 12 Months |    |   | More than 12 Months |   |
|---------------------|--------|---------------------|---------|--------|---------------------|--------|
|                |   | Fair Value          |    |   | Unrealized Losses   |   |   | Number of Securities |   |   | Fair Value |   |   | Unrealized Losses |   |   | Number of Securities |   |
| September 30, 2010: |   |                |    |   |                |   |   |   |   |   |   |   |   |   |   |   |   |   |
| CDO securities      |   | $                   | − |   |                | $      | − |   |   |   | − |   |   | $ | 3,980 |   |   | $ | (339 | ) |   |   | 1 |   |
| Equity securities   |   |                | − |   |                |   | − |   |   |   | − |   |   |   | 15,181 |   |   |   | (16,558 | ) |   |   | 1 |   |
| Total               |   | $                   | − |   |                | $      | − |   |   |   | − |   |   | $ | 19,161 |   |   | $ | (16,897 | ) |   |   | 2 |   |
|                |   |                |    |   |                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| September 30, 2009: |   |                |    |   |                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| CDO securities      |   | $                   | − |   |                | $      | − |   |   |   | − |   |   | $ | 7,111 |   |   | $ | (1,800 | ) |   |   | 4 |   |
| Equity securities   |   |                | − |   |                |   | − |   |   |   | − |   |   |   | 11,255 |   |   |   | (18,925 | ) |   |   | 1 |   |
| Total               |   | $                   | − |   |                | $      | − |   |   |   | − |   |   | $ | 18,366 |   |   | $ | (20,725 | ) |   |   | 5 |   |

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|                                  |   | Years Ended September 30, |    |
|---------------------------------------|--------|---------------------------|---------|
|                                  |   | 2010                      |    |   | 2009 |   |   | 2008 |   |
| Balance, beginning of year            |   | $                         | − |   |   | $ | 1,595 |   |   | $ | − |   |
| Provision for credit losses           |   |                      | − |   |   |   | 1,738 |   |   |   | 2,622 |   |
| Charge-offs                           |   |                      | − |   |   |   | (715 | ) |   |   | (1,027 | ) |
| Reduction due to the sale of interest |   |                      | − |   |   |   | (2,618 | ) |   |   | − |   |
| Balance, end of year                  |   | $                         | − |   |   | $ | − |   |   | $ | 1,595 |   |

|                                   |   | Range of Combined     |                  |   | September 30, |   |
|----------------------------------------|--------|-----------------------|-----------------------|--------|---------------|--------|
|                                   |   | Partnership Interests |                  |   | 2010          |   |   | 2009 |   |
| Real estate investment entities        |   |                  |   2% – 10% |   |          | $      | 9,317 |   |   | $ | 11,918 |   |
| Financial fund management partnerships |   |                  |   5% − 11% |   |          |   | 3,705 |   |   |   | 3,429 |   |
| Trapeza entities                       |   |                  | 33% − 50%       |   |          |   | 737 |   |   |   | 894 |   |
| Commercial finance investment entities |   |                  | 1% − 6%         |   |          |   | 66 |   |   |   | − |   |
| Investments in unconsolidated entities |   |                  |                  |   |          | $      | 13,825 |   |   | $ | 16,241 |   |

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|                                   |   | September 30, |    |
|----------------------------------------|--------|---------------|---------|
|                                   |   | 2010          |    |   | 2009 |   |
| Cash                                   |   | $             | − |   |   | $ | 42 |   |
| Property and equipment, net            |   |          | 1,072   |   |   |   | 2,868 |   |
| Other assets                           |   |          | − |   |   |   | 373 |   |
| Total assets                           |   | $             | 1,072   |   |   | $ | 3,283 |   |
|                                   |   |          |    |   |   |   |   |   |
| Accrued expenses and other liabilities |   | $             | 416     |   |   | $ | 170 |   |
| Borrowings                             |   |          | − |   |   |   | 1,057 |   |
| Total liabilities                      |   | $             | 416     |   |   | $ | 1,227 |   |

|                                        |   | Estimated Useful      |   | September 30, |    |
|---------------------------------------------|--------|-----------------------|--------|---------------|---------|
|                                        |   | Life                  |   | 2010          |    |   | 2009 |   |
| Land                                        |   |                  |   | $             | 200     |   |   | $ | 200 |   |
| Building                                    |   |    39 years |   |          | 1,666   |   |   |   | 1,666 |   |
| Leasehold improvements                      |   | 1-15 years            |   |          | 6,045   |   |   |   | 6,185 |   |
| Furniture and equipment                     |   | 3-10 years            |   |          | 12,397  |   |   |   | 12,699 |   |
| Real estate assets – consolidated VIE |   |    40 years |   |          | 1,600   |   |   |   | 3,900 |   |
|                                        |   |                  |   |          | 21,908  |   |   |   | 24,650 |   |
| Accumulated depreciation and amortization   |   |                  |   |          | (11,924 | ) |   |   | (11,215 | ) |
| Property and equipment, net                 |   |                  |   | $             | 9,984   |   |   | $ | 13,435 |   |

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|                     |   | Estimated Useful |   | September 30, |    |
|--------------------------|--------|------------------|--------|---------------|---------|
|                     |   | Life             |   | 2010          |    |   | 2009 |   |
| Customer lists           |   | 10 years         |   | $             | − |   |   | $ | 4,727 |   |
| Accumulated amortization |   |             |   |          | − |   |   |   | (1,090 | ) |
| Intangible assets, net   |   |             |   | $             | − |   |   | $ | 3,637 |   |

|                                 |   | As of September 30, |    |
|--------------------------------------|--------|---------------------|---------|
|                                 |   | 2010                |    |   | 2009 |   |
|                                 |   | Amount of Facility  |    |   | Borrowings Outstanding |   |   | Borrowings Outstanding |   |
| Commercial finance:                  |   |                |    |   |   |   |   |   |   |
| Short-term bridge financing          |   | $                   | 21,500  |   |   | $ | 20,750 |   |   | $ | − |   |
| PNC Bank secured warehouse facility  |   |                | − |   |   |   | − |   |   |   | 136,500 |   |
|                                 |   | $                   | 21,500  |   |   |   | 20,750 |   |   |   | 136,500 |   |
|                                 |   |                |    |   |   |   |   |   |   |   |   |   |
| Corporate:                           |   |                |    |   |   |   |   |   |   |   |   |   |
| Secured revolving credit facilities: |   |                |    |   |   |   |   |   |   |   |   |   |
| TD Bank (1)                     |   | $                   | 14,127  |   |   |   | 14,127 |   |   |   | 26,502 |   |
| Sovereign Bank                       |   |                | − |   |   |   | − |   |   |   | 577 |   |
|                                 |   | $                   | 14,127  |   |   |   | 14,127 |   |   |   | 27,079 |   |
| Senior Notes, net (2)           |   |                |    |   |   |   | 14,317 |   |   |   | 10,629 |   |
|                                 |   |                |    |   |   |   |   |   |   |   |   |   |
| Note payable to RCC                  |   |                |    |   |   |   | 2,000 |   |   |   | − |   |
| Other debt                           |   |                |    |   |   |   | 14,916 |   |   |   | 17,175 |   |
| Total borrowings outstanding         |   |                |    |   |   | $ | 66,110 |   |   | $ | 191,383 |   |

----

| (1) | Borrowings outstanding do not reflect letters of credit of $401,000 and $246,000 at September 30, 2010 and 2009, respectively; rather, the amount of the facility as shown has been reduced by the letter of credit amounts. |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (2) | The Company’s outstanding Senior Notes are reflected net of an unamortized discount of $4.5 million and $4.9 million at September 30, 2010 and 2009, respectively, related to the fair value of detachable warrants that were issued with the Senior Notes. |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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|   | ● | a $250.0 million line of credit with Morgan Stanley with an interest rate of one-month LIBOR plus 1.15%.  Weighted average borrowings for fiscal 2009 were $67.5 million, at an effective interest rate of 4.9%;   and |
|--------|---------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | ● | $9.4 million of LCFF fixed subordinated notes.  Weighted average borrowings for fiscal 2009 were $2.6 million, at an effective interest rate of 10.9%. |
|--------|---------|------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 2011       |   | $      | 35,975 |   |
|------------|--------|--------|--------|--------|
| 2012       |   |   | 27,974 |   |
| 2013       |   |   | 3,309  |   |
| 2014       |   |   | 37     |   |
| 2015       |   |   | 1,963  |   |
| Thereafter |   |   | 1,355  |   |
|       |   | $      | 70,613 |   |

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|                       |   | Year Ended    |    |
|----------------------------|--------|---------------|---------|
|                       |   | September 30, |    |
|                       |   | 2010          |    |
| Balance, beginning of year |   | $             | − |   |
| Additions                  |   |          | (2,478  | ) |
| Amortization (1)      |   |          | 116     |   |
| Balance, end of year       |   | $             | (2,362  | ) |

----

| (1) | Amortization of the servicing liability is included in commercial finance revenues in the consolidated statements of operations. |
|-----|----------------------------------------------------------------------------------------------------------------------------------|

|                                                                                                            |   | Years Ended September 30, |    |
|-----------------------------------------------------------------------------------------------------------------|--------|---------------------------|---------|
|                                                                                                            |   | 2010                      |    |   | 2009 |   |   | 2008 |   |
| Net loss                                                                                                        |   | $                         | (16,675 | ) |   | $ | (16,534 | ) |   | $ | (31,248 | ) |
|                                                                                                            |   |                      |    |   |   |   |   |   |   |   |   |   |
| Other comprehensive (loss) income:                                                                              |   |                      |    |   |   |   |   |   |   |   |   |   |
| Unrealized gain (loss) on investment securities available-for-sale,net of tax of $1,481, $(1,391) and $(11,375) |   |                      | 2,160   |   |   |   | 638 |   |   |   | (25,872 | ) |
| Less: reclassification for losses realized, net of tax of $568,$3,484 and $5,524                                |   |                      | 870     |   |   |   | 3,844 |   |   |   | 16,784 |   |
|                                                                                                            |   |                      | 3,030   |   |   |   | 4,482 |   |   |   | (9,088 | ) |
|                                                                                                            |   |                      |    |   |   |   |   |   |   |   |   |   |
| Minimum pension liability adjustments, net of tax of $(223), $(673)and $(941)                                   |   |                      | (257    | ) |   |   | (569 | ) |   |   | (1,680 | ) |
| Less:  reclassification for losses realized, net of tax of $116, $84 and $0                           |   |                      | 147     |   |   |   | 108 |   |   |   | − |   |
|                                                                                                            |   |                      | (110    | ) |   |   | (461 | ) |   |   | (1,680 | ) |
|                                                                                                            |   |                      |    |   |   |   |   |   |   |   |   |   |
| Unrealized gains (losses) on hedging contracts, net of tax of $109,$(2,256), and $(1,101)                       |   |                      | 192     |   |   |   | (768 | ) |   |   | (2,209 | ) |
| Transfer of interest rate swaps and caps to affiliated entities, net of taxof $0, $3,574 and $0                 |   |                      | − |   |   |   | 3,170 |   |   |   | − |   |
| Swap termination due to expiration, net of tax of $0, $233 and $0                                               |   |                      | − |   |   |   | 319 |   |   |   | − |   |
| Foreign currency translation loss                                                                               |   |                      | (384    | ) |   |   | (280 | ) |   |   | (628 | ) |
| Comprehensive loss                                                                                              |   |                      | (13,947 | ) |   |   | (10,072 | ) |   |   | (44,853 | ) |
| Less:  Comprehensive loss attributable to noncontrolling interests                                    |   |                      | 3,249   |   |   |   | 386 |   |   |   | 2,407 |   |
| Comprehensive loss attributable to common shareholders                                                          |   | $                         | (10,698 | ) |   | $ | (9,686 | ) |   | $ | (42,446 | ) |

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|                                                                          |   | Investment Securities Available-for-Sale |    |   | Cash Flow Hedges (1) |   |   | Foreign Currency Translation Adjustments |   |   | SERP Pension Liability |   |   | Total  |   |
|-------------------------------------------------------------------------------|--------|------------------------------------------|---------|--------|----------------------|--------|--------|------------------------------------------|--------|--------|------------------------|--------|--------|--------|--------|
| Balance, September 30, 2008, net of taxof $(10,202), $(1,804), $0 and (1,186) |   | $                                        | (16,662 | )      |                 | $      | (2,503 | )                                        |   | $      | 296                    |   |   | $      | (1,936 | ) |   | $ | (20,805 | ) |
| Changes during fiscal 2009                                                    |   |                                     | 3,871   |   |                 |   | 2,115  |                                     |   |   | (280                   | )      |   |   | (461   | ) |   |   | 5,245 |   |
| Balance, September 30, 2009, net of taxof $(8,119), $(252), $0 and $(1,859)   |   |                                     | (12,791 | )      |                 |   | (388   | )                                        |   |   | 16                     |   |   |   | (2,397 | ) |   |   | (15,560 | ) |
| Changes during fiscal 2010                                                    |   |                                     | 3,030   |   |                 |   | 217    |                                     |   |   | (384                   | )      |   |   | (110   | ) |   |   | 2,753 |   |
| Balance, September 30, 2010, net of taxof $(6,071), $(146), $0 and $(1,966)   |   | $                                        | (9,761  | )      |                 | $      | (171   | )                                        |   | $      | (368                   | )      |   | $      | (2,507 | ) |   | $ | (12,807 | ) |

----

| (1) | Included in accumulated other comprehensive loss as of September 30, 2010 and 2009 were net unrealized losses of $171,000 (net of tax benefit of $146,000 and noncontrolling interest of $25,000) and $388,000 (net of tax benefit of $253,000), respectively, related to hedging instruments held by the LEAF investment funds in which the Company owns an equity interest.  The Company has no other hedging activity. |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|                                                        |   | Year Ended    |    |
|-------------------------------------------------------------|--------|---------------|---------|
|                                                        |   | September 30, |    |
|                                                        |   | 2010          |    |
| Loss from continuing operations, net of tax                 |   | $             | (17,297 | ) |
| Net loss attributable to noncontrolling interests           |   |          | 63      |   |
| Discontinued operations, net                                |   |          | 622     |   |
| Net loss attributable to common shareholders                |   | $             | (16,612 | ) |
| Basic loss per share attributable to common shareholders:   |   |          |    |   |
| Continuing operations                                       |   | $             | (0.91   | ) |
| Discontinued operations                                     |   |          | 0.03    |   |
| Net loss                                                    |   | $             | (0.88   | ) |
| Weighted average shares outstanding                         |   |          | 18,942  |   |
| Diluted loss per share attributable to common shareholders: |   |          |    |   |
| Continuing operations                                       |   | $             | (0.91   | ) |
| Discontinued operations                                     |   |          | 0.03    |   |
| Net loss                                                    |   | $             | (0.88   | ) |
| Weighted average shares outstanding                         |   |          | 18,942  |   |

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|               |   | Years Ended September 30, |    |
|--------------------|--------|---------------------------|---------|
|               |   | 2010                      |    |   | 2009 |   |   | 2008 |   |
| Current provision: |   |                      |    |   |   |   |   |   |   |
| Federal            |   | $                         | 1,379   |   |   | $ | 2,238 |   |   | $ | 1,098 |   |
| State              |   |                      | 535     |   |   |   | 475 |   |   |   | − |   |
| Foreign            |   |                      | − |   |   |   | 32 |   |   |   | − |   |
| Total current      |   |                      | 1,914   |   |   |   | 2,745 |   |   |   | 1,098 |   |
|               |   |                      |    |   |   |   |   |   |   |   |   |   |
| Deferred:          |   |                      |    |   |   |   |   |   |   |   |   |   |
| Federal            |   |                      | (5,795  | ) |   |   | (10,777 | ) |   |   | (13,707 | ) |
| State              |   |                      | (223    | ) |   |   | (2,472 | ) |   |   | (1,770 | ) |
| Foreign            |   |                      | 1,454   |   |   |   | − |   |   |   | (554 | ) |
| Total deferred     |   |                      | (4,564  | ) |   |   | (13,249 | ) |   |   | (16,031 | ) |
| Income tax benefit |   | $                         | (2,650  | ) |   | $ | (10,504 | ) |   | $ | (14,933 | ) |

|                                                     |   | Years Ended September 30, |                                                              |
|----------------------------------------------------------|--------|---------------------------|-------------------------------------------------------------------|
|                                                     |   | 2010                      |                                                              |   | 2009 |   |   | 2008 |   |
| Statutory tax rate                                       |   |                      | 35%                                                               |   |   |   | 35% |   |   |   | 35%      |   |
| State and local taxes, net of federal benefit            |   |                      |         12                     |   |   |   |       5 |   |   |   |     5 |   |
| Valuation allowance for deferred tax assets              |   |                      |            (18) |   |   |   |       4 |   |   |   |        (4) |   |
| Equity compensation expense                              |   |                      |           (8)        |   |   |   |          (1) |   |   |   |        (1) |   |
| Deferred tax assets for state/local net operating leases |   |                      |         −                |   |   |   |          (5) |   |   |   |     1 |   |
| Deferred tax adjustment                                  |   |                      |           (7)   |   |   |   |       − |   |   |   |     − |   |
| Other items                                              |   |                      |           (1)        |   |   |   |       2 |   |   |   |        (3) |   |
|                                                     |   |                      |    13%                                                  |   |   |   |             40% |   |   |   |            33% |   |

|                                                 |   | September 30, |    |
|------------------------------------------------------|--------|---------------|---------|
|                                                 |   | 2010          |    |   | 2009 |   |
| Deferred tax assets related to:                      |   |          |    |   |   |   |
| Federal, foreign, state and local loss carryforwards |   | $             | 17,540  |   |   | $ | 6,533 |   |
| Capital loss carryforwards                           |   |          | 14,319  |   |   |   | 11,743 |   |
| Unrealized loss on investments                       |   |          | 10,079  |   |   |   | 11,955 |   |
| Employee stock option and restricted stock awards    |   |          | 3,456   |   |   |   | 4,653 |   |
| Investment in partnership interests                  |   |          | 1,756   |   |   |   | 7,757 |   |
| Provision for credit losses                          |   |          | − |   |   |   | 1,670 |   |
| Accrued expenses                                     |   |          | 277     |   |   |   | − |   |
| Investments in real estate assets                    |   |          | − |   |   |   | 2,310 |   |
| Property and equipment basis differences             |   |          | 774     |   |   |   | − |   |
| Gross deferred tax assets                            |   |          | 48,201  |   |   |   | 46,621 |   |
| Less:  valuation allowance                 |   |          | (4,498  | ) |   |   | (965 | ) |
| Total deferred tax assets, net                       |   | $             | 43,703  |   |   | $ | 45,656 |   |
|                                                 |   |          |    |   |   |   |   |   |
| Deferred tax liabilities related to:                 |   |          |    |   |   |   |   |   |
| Accrued expenses                                     |   | $             | − |   |   | $ | (484 | ) |
| Property and equipment basis differences             |   |          | − |   |   |   | (1,562 | ) |
| Provision for credit losses                          |   |          | (341    | ) |   |   | − |   |
| Investments in real estate assets                    |   |          | (70     | ) |   |   | − |   |
| Total deferred tax liabilities                       |   | $             | (411    | ) |   | $ | (2,046 | ) |

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|                                |   | Year Ended September 30, |                                                  |
|-------------------------------------|--------|--------------------------|-------------------------------------------------------|
|                                |   | 2008                     |                                                  |
| Fair value of stock options granted |   | $                        |          3.49 |   |
| Expected life (years)               |   |                     | 6.3                                                   |   |
| Expected stock volatility           |   |                     |  47.4%                                           |   |
| Risk-free interest rate             |   |                     | 3.9%                                                  |   |
| Dividend yield                      |   |                     | 2.9%                                                  |   |

| Unearned Performance-based Restricted Stock |   | Shares |     |
|---------------------------------------------|--------|--------|----------|
| Outstanding, beginning of year              |   |   | 260,364  |   |
| Awarded                                     |   |   | −  |   |
| Earned                                      |   |   | (20,589  | ) |
| Forfeited                                   |   |   | (139,775 | ) |
| Outstanding, end of year                    |   |   | 100,000  |   |

| Nonvested Performance-based Restricted Stock |   | Shares |    |
|----------------------------------------------|--------|--------|---------|
| Outstanding, beginning of year               |   |   | 20,589  |   |
| Earned                                       |   |   | − |   |
| Issued                                       |   |   | (20,589 | ) |
| Forfeited                                    |   |   | − |   |
| Outstanding, end of year                     |   |   | − |   |

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|                            |   |   |      |   | Weighted |   |    | Weighted    |   |   |      |   |
|---------------------------------|--------|--------|-----------|--------|----------|--------|---------|-------------|--------|--------|-----------|--------|
|                            |   |   |      |   | Average  |   |    | Average     |   |   | Aggregate |   |
|                            |   |   |      |   | Exercise |   |    | Contractual |   |   | Intrinsic |   |
| Stock Options Outstanding       |   | Shares |      |   | Price    |   |    | Life        |   |   | Value     |   |
| Balance, beginning of year      |   |   | 2,538,616 |   |     | $      | 9.04    |        |   |   |      |   |   |   |
| Granted                         |   |   | −   |   |     | $      | − |        |   |   |      |   |   |   |
| Exercised                       |   |   | (14,453   | )      |     | $      | (3.91   | )           |   |   |      |   |   |   |
| Forfeited                       |   |   | (17,563   | )      |     | $      | (15.58  | )           |   |   |      |   |   |   |
| Balance, end of year            |   |   | 2,506,600 |   |     | $      | 9.03    |        |   |   | 3.0       |   |   | $ | 1,298,000 |   |
|                            |   |   |      |   |     |   |    |        |   |   |      |   |   |   |   |   |
| Exercisable, September 30, 2010 |   |   | 2,446,100 |   |     | $      | 8.93    |        |   |   |      |   |   |   |   |   |
| Available for grant             |   |   | 220,407   | (1)    |     |   |    |        |   |   |      |   |   |   |   |   |

----

| (1) | Reduced for restricted stock awards granted, net of forfeitures, under the Company’s 2005 Plan. |
|-----|-------------------------------------------------------------------------------------------------------|

|                                     |   | Shares |     |   | Weighted Average Grant DateFair Value |   |
|------------------------------------------|--------|--------|----------|--------|---------------------------------------|--------|
| Nonvested Stock Options                  |   |   |     |   |                                  |   |
| Outstanding, beginning of year           |   |   | 103,938  |   |                                  | $      | 5.47 |   |
| Granted                                  |   |   | −  |   |                                  | $      | − |   |
| Vested                                   |   |   | (41,438  | )      |                                  | $      | (4.92 | ) |
| Exercised                                |   |   | −  |   |                                  | $      | − |   |
| Forfeited                                |   |   | (2,000   | )      |                                  | $      | (2.64 | ) |
| Outstanding, end of year                 |   |   | 60,500   |   |                                  | $      | (5.06 | ) |
|                                     |   |   |     |   |                                  |   |   |   |
| Nonvested Restricted Stock               |   |   |     |   |                                  |   |   |   |
| Outstanding, beginning of year (1)  |   |   | 552,461  |   |                                  | $      | 11.32 |   |
| Granted                                  |   |   | 399,156  |   |                                  | $      | 10.25 |   |
| Vested                                   |   |   | (186,608 | )      |                                  | $      | (12.57 | ) |
| Forfeited                                |   |   | (23,923  | )      |                                  | $      | (4.18 | ) |
| Outstanding, end of year (1)        |   |   | 741,086  |   |                                  | $      | 10.66 |   |

----

| (1) | At September 30, 2010 and 2009, includes 69,300 shares of nonvested restricted stock that do not have dividend equivalent rights and, therefore, were excluded from the shares reflected as outstanding in the consolidated balance sheets. |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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|                           |   | Shares |    |   | Weighted Average Grant DateFair Value |   |
|--------------------------------|--------|--------|---------|--------|---------------------------------------|--------|
| Director Units                 |   |   |    |   |                                  |   |
| Outstanding, beginning of year |   |   | 191,275 |   |                                  | $      | 6.63 |   |
| Granted                        |   |   | 26,232  |   |                                  | $      | 5.15 |   |
| Outstanding, end of year       |   |   | 217,507 |   |                                  | $      | 6.57 |   |
|                           |   |   |    |   |                                  |   |   |   |
| Vested units                   |   |   | 183,457 |   |                                  | $      | 6.59 |   |
| Available for grant            |   |   | 39,019  |   |                                  |   |   |   |

|                           |   | Shares |    |   | Weighted Average Grant DateFair Value |   |
|--------------------------------|--------|--------|---------|--------|---------------------------------------|--------|
| Nonvested Director Units       |   |   |    |   |                                  |   |
| Outstanding, beginning of year |   |   | 43,519  |   |                                  | $      | 8.61 |   |
| Granted                        |   |   | 26,232  |   |                                  | $      | 5.15 |   |
| Vested                         |   |   | (35,701 | )      |                                  | $      | (6.93 | ) |
| Forfeited                      |   |   | − |   |                                  | $      | − |   |
| Outstanding, end of year       |   |   | 34,050  |   |                                  | $      | 7.71 |   |

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|                                    |   | Years Ended September 30, |   |
|-----------------------------------------|--------|---------------------------|--------|
|                                    |   | 2010                      |   |   | 2009 |   |   | 2008 |   |
| Interest cost                           |   | $                         | 430    |   |   | $ | 484 |   |   | $ | 499 |   |
| Less: expected return on plan assets    |   |                      | (59    | ) |   |   | (53 | ) |   |   | (190 | ) |
| Plus: Amortization of unrecognized loss |   |                      | 263    |   |   |   | 192 |   |   |   | − |   |
| Net cost                                |   | $                         | 634    |   |   | $ | 623 |   |   | $ | 309 |   |

|                                                              |   | September 30, |   |
|-------------------------------------------------------------------|--------|---------------|--------|
|                                                              |   | 2010          |   |   | 2009 |   |
| Projected benefit obligation, beginning of year                   |   | $             | 7,486  |   |   | $ | 6,472 |   |
| Interest cost                                                     |   |          | 430    |   |   |   | 484 |   |
| Actuarial loss                                                    |   |          | 548    |   |   |   | 1,368 |   |
| Benefit payments                                                  |   |          | (838   | ) |   |   | (838 | ) |
| Projected benefit obligation, end of year                         |   | $             | 7,626  |   |   | $ | 7,486 |   |
|                                                              |   |          |   |   |   |   |   |   |
| Fair value of plan assets, beginning of year                      |   | $             | 979    |   |   | $ | 884 |   |
| Actual gain (loss) on plan assets                                 |   |          | 127    |   |   |   | 95 |   |
| Fair value of plan assets, end of year                            |   | $             | 1,106  |   |   | $ | 979 |   |
|                                                              |   |          |   |   |   |   |   |   |
| Unfunded status                                                   |   | $             | (6,520 | ) |   | $ | (6,507 | ) |
| Unrecognized net actuarial loss                                   |   |          | 4,473  |   |   |   | 4,256 |   |
| Net accrued cost                                                  |   | $             | (2,047 | ) |   | $ | (2,251 | ) |
|                                                              |   |          |   |   |   |   |   |   |
| Amounts recognized in the consolidated balance sheets consist of: |   |          |   |   |   |   |   |   |
| Accrued benefit liability                                         |   | $             | (6,520 | ) |   | $ | (6,507 | ) |
| Accumulated other comprehensive loss                              |   |          | 2,507  | (1) |   |   | 2,397 |   |
| Deferred tax assets                                               |   |          | 1,966  |   |   |   | 1,859 |   |
| Net liability recognized                                          |   | $             | (2,047 | ) |   | $ | (2,251 | ) |

----

| (1) | The estimated net loss for the plan that is expected to be amortized from accumulated other comprehensive loss into net periodic pension benefit cost over the next fiscal year is $297,000.  The unrealized loss included in accumulated other comprehensive loss related to the SERP was $2.5 million and $2.4 million as of September 30, 2010 and 2009, respectively. |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 2011       |   | $      | 824   |   |
|------------|--------|--------|-------|--------|
| 2012       |   |   | 796   |   |
| 2013       |   |   | 767   |   |
| 2014       |   |   | 736   |   |
| 2015       |   |   | 702   |   |
| Thereafter |   |   | 1,653 |   |
|       |   | $      | 5,478 |   |

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|                                                        |   | September 30, |   |
|-------------------------------------------------------------|--------|---------------|--------|
|                                                        |   | 2010          |   |   | 2009 |   |
| Receivables from managed entities and related parties, net: |   |          |   |   |   |   |
| Commercial finance investment entities (1)             |   | $             | 41,722 |   |   | $ | 36,285 |   |
| Real estate investment entities                             |   |          | 18,491 |   |   |   | 10,905 |   |
| Financial fund management investment entities, net          |   |          | 3,065  |   |   |   | 3,523 |   |
| RCC                                                         |   |          | 2,811  |   |   |   | 4,101 |   |
| Other                                                       |   |          | 327    |   |   |   | 233 |   |
| Receivables from managed entities and related parties       |   | $             | 66,416 |   |   | $ | 55,047 |   |
|                                                        |   |          |   |   |   |   |   |   |
| Payables due to managed entities and related parties, net:  |   |          |   |   |   |   |   |   |
| Real estate investment entities                             |   | $             | 122    |   |   | $ | 1,284 |   |
| RCC                                                         |   |          | 34     |   |   |   | − |   |
| Payables to managed entities and related parties            |   | $             | 156    |   |   | $ | 1,284 |   |

----

| (1) | Reflects discounts of $30,000 and $263,000 recorded in fiscal 2010 and 2009, respectively, in connection with management fees and reimbursed expenses that the Company expects to receive in the future.  In addition, the Company recorded a $1.1 million reserve for credit losses during fiscal 2010 related to management fees owed from one of its investment entities that, based on a change in estimated cash distributions, is not expected to be collectible. |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|                                                                                   |   | Years Ended September 30, |    |
|----------------------------------------------------------------------------------------|--------|---------------------------|---------|
|                                                                                   |   | 2010                      |    |   | 2009 |   |   | 2008 |   |
| Fees from unconsolidated investment entities:                                          |   |                      |    |   |   |   |   |   |   |
| Real estate (1)                                                              |   | $                         | 12,637  |   |   | $ | 11,343 |   |   | $ | 9,407 |   |
| Commercial finance (2)                                                            |   |                      | 10,637  |   |   |   | 20,168 |   |   |   | 35,193 |   |
| Financial fund management (3)                                                |   |                      | 3,445   |   |   |   | 3,105 |   |   |   | 7,996 | (4) |
| RCC:                                                                                   |   |                      |    |   |   |   |   |   |   |   |   |   |
| Management, incentive and servicing fees                                               |   |                      | 10,938  |   |   |   | 8,181 |   |   |   | 7,480 |   |
| Dividends                                                                              |   |                      | 2,278   |   |   |   | 3,405 |   |   |   | 2,421 |   |
| Reimbursement of costs and expenses                                                    |   |                      | 1,794   |   |   |   | 600 |   |   |   | 636 |   |
| Commitment fee                                                                         |   |                      | − |   |   |   | 180 |   |   |   | − |   |
| Resource Real Estate Opportunity REIT, Inc. –reimbursement of costs and expenses |   |                      | 1,824   |   |   |   | − |   |   |   | − |   |
| Atlas Energy- reimbursement of net costs and expenses                                  |   |                      | 871     |   |   |   | 1,369 |   |   |   | 1,269 |   |
| 1845 Walnut Associates Ltd. - payment of rent andoperating expenses                    |   |                      | (567    | ) |   |   | (475 | ) |   |   | (549 | ) |
| Ledgewood P.C. - payment for legal services                                       |   |                      | (295    | ) |   |   | (549 | ) |   |   | (1,255 | ) |
| 9 Henmar LLC - payment of broker/consulting fees                                  |   |                      | (55     | ) |   |   | (81 | ) |   |   | (417 | ) |

----

| (1) | Reflects discounts of $463,000, $394,000 and $956,000 recorded in fiscal 2010, 2009 and 2008 in connection with management fees the Company expects to receive in future periods. |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (2) | During fiscal 2010 and 2009, the Company waived $3.8 million and $425,000, respectively, of its fund management fees from four and one of its investment entities, respectively. |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (3) | For fiscal 2010, excludes a $2.3 million gain on the repurchase of limited partner interests in two of the Trapeza partnerships.  For fiscal 2009, excludes a $1.7 million reduction in the Company’s clawback liability associated with two Trapeza partnerships.  For fiscal 2008, excludes the $11.2 million non-cash incentive fee on the unrealized appreciation in the book value of Trapeza partnerships. |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (4) | Reflects a $2.3 million discount recorded in fiscal 2008 in connection with subordinate and incentive management fees that the Company expects to receive in future periods. |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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|                               |   | Years Ended September 30, |    |
|------------------------------------|--------|---------------------------|---------|
|                               |   | 2010                      |    |   | 2009 |   |   | 2008 |   |
| RCC dividend income                |   | $                         | 2,278   |   |   | $ | 3,405 |   |   | $ | 2,421 |   |
| Interest income                    |   |                      | 434     |   |   |   | 340 |   |   |   | 547 |   |
| Loss on sales of equity securities |   |                      | − |   |   |   | (393 | ) |   |   | − |   |
| Other (expense) income, net        |   |                      | (121    | ) |   |   | (196 | ) |   |   | 68 |   |
| Other income, net                  |   | $                         | 2,591   |   |   | $ | 3,156 |   |   | $ | 3,036 |   |

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|                                           |   | Level 1 |    |   | Level 2 |   |    | Level 3 |   |   | Total   |   |
|------------------------------------------------|--------|---------|---------|--------|---------|--------|---------|---------|--------|--------|---------|--------|
| Assets:                                        |   |    |    |   |    |   |    |    |   |   |    |   |
| Investment securities                          |   | $       | 16,135  |   |    | $      | − |    |   | $      | 6,223   |   |   | $ | 22,358 |   |
| Investment in RRE Opportunity REIT             |   |    | − |   |    |   | 204     |    |   |   | − |   |   |   | 204 |   |
| Retained financial interest-commercial finance |   |    | − |   |    |   | − |    |   |   | 273     |   |   |   | 273 |   |
| Total                                          |   | $       | 16,135  |   |    | $      | 204     |    |   | $      | 6,496   |   |   | $ | 22,835 |   |

|                                                                                                                                                                                                                                                                                                                                                                    |   | Level 1 |   |   | Level 2 |   |    | Level 3 |   |   | Total  |   |
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|---------|--------|--------|---------|--------|---------|---------|--------|--------|--------|--------|
| Assets (1):                                                                                                                                                                                                                                                                                                                                                             |   |    |   |   |    |   |    |    |   |   |   |   |
| Investment securities available-for-sale                                                                                                                                                                                                                                                                                                                                |   |    | 11,255 |   |    |   | − |    |   |   | 8,245  |   |   |   | 19,500 |   |
| Total                                                            |   | $       | 11,255 |   |    | $      | − |    |   | $      | 8,245  |   |   | $ | 19,500 |   |

----

| (1) | In fiscal 2010, receivables from managed entities are presented in the non-recurring table, and accordingly, the prior year presentation has been reclassified for comparative purposes (see the non-recurring table that follows). |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|                                                                                |   | Investment securities |    |   | Retainedfinancialinterest |   |
|-------------------------------------------------------------------------------------|--------|-----------------------|---------|--------|---------------------------|--------|
| Balance, beginning of year                                                          |   | $                     | 8,245   |   |                      | $      | − |   |
| Purchases, sales, issuances and settlements, net                                    |   |                  | (2,985  | )      |                      |   | 299 |   |
| Change in unrealized losses – included in accumulated othercomprehensive loss |   |                  | 1,894   |   |                      |   | − |   |
| Other-than-temporary impairment loss                                                |   |                  | (480    | )      |                      |   |   |   |
| Loss on sale of investment securities, net                                          |   |                  | (451    | )      |                      |   | − |   |
| Payments received and leases returned                                               |   |                  | − |   |                      |   | (26 | ) |
| Balance, end of year                                                                |   | $                     | 6,223   |   |                      | $      | 273 |   |

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|                                                                                       |   | Investment securities |   |
|--------------------------------------------------------------------------------------------|--------|-----------------------|--------|
| Balance, beginning of year                                                                 |   | $                     | 10,153 |   |
| Realized losses – impairment charges on investment securities included in operations |   |                  | (8,466 | ) |
| Change in unrealized losses – included in accumulated other comprehensive loss       |   |                  | 7,161  |   |
| Purchases, sales, issuances, and settlements, net                                          |   |                  | (603   | ) |
| Balance, end of year                                                                       |   | $                     | 8,245  |   |

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|                                                                        |   | Level 1 |    |   | Level 2 |   |    | Level 3 |   |   | Total   |   |
|-----------------------------------------------------------------------------|--------|---------|---------|--------|---------|--------|---------|---------|--------|--------|---------|--------|
| For the Year Ended September 30, 2010                                       |   |    |    |   |    |   |    |    |   |   |    |   |
| Assets:                                                                     |   |    |    |   |    |   |    |    |   |   |    |   |
| Investments in commercial finance –impaired loans and leases          |   | $       | − |   |    | $      | − |    |   | $      | 190     |   |   | $ | 190 |   |
| Receivables from managed entities –commercial finance and real estate |   |    | − |   |    |   | − |    |   |   | 9,922   |   |   |   | 9,922 |   |
| Total                                                                       |   | $       | − |   |    | $      | − |    |   | $      | 10,112  |   |   | $ | 10,112 |   |
|                                                                        |   |    |    |   |    |   |    |    |   |   |    |   |   |   |   |   |
| Liabilities:                                                                |   |    |    |   |    |   |    |    |   |   |    |   |   |   |   |   |
| Servicing liability                                                         |   | $       | − |   |    | $      | − |    |   | $      | 2,478   |   |   | $ | 2,478 |   |
| Senior notes                                                                |   |    | − |   |    |   | − |    |   |   | 2,239   |   |   |   | 2,239 |   |
| Total                                                                       |   | $       | − |   |    | $      | − |    |   | $      | 4,717   |   |   | $ | 4,717 |   |
|                                                                        |   |    |    |   |    |   |    |    |   |   |    |   |   |   |   |   |
| For the Year Ended September 30, 2009                                       |   |    |    |   |    |   |    |    |   |   |    |   |   |   |   |   |
| Assets:                                                                     |   |    |    |   |    |   |    |    |   |   |    |   |   |   |   |   |
| Investments in commercial finance –held for sale                      |   | $       | − |   |    | $      | − |    |   | $      | 142,701 |   |   | $ | 142,701 |   |
| Receivables from managed entities –commercial finance and real estate |   |    | − |   |    |   | − |    |   |   | 55,047  |   |   |   | 55,047 |   |
| Investments in commercial finance –impaired loans and leases          |   |    | − |   |    |   | − |    |   |   | 1,945   |   |   |   | 1,945 |   |
| Total                                                                       |   | $       | − |   |    | $      | − |    |   | $      | 199,693 |   |   | $ | 199,693 |   |
|                                                                        |   |    |    |   |    |   |    |    |   |   |    |   |   |   |   |   |
| Liabilities:                                                                |   |    |    |   |    |   |    |    |   |   |    |   |   |   |   |   |
| Senior notes                                                                |   | $       | − |   |    | $      | − |    |   | $      | 10,629  |   |   | $ | 10,629 |   |

|                                                               |   | September 30, 2010 |    |   | September 30, 2009   |   |
|--------------------------------------------------------------------|--------|--------------------|---------|--------|----------------------|--------|
|                                                               |   | Carrying Amount    |    |   | Estimated Fair Value |   |   | Carrying Amount |   |   | Estimated Fair Value |   |
| Assets                                                             |   |               |    |   |                 |   |   |   |   |   |   |   |
| Receivables from managed entities (1)                         |   | $                  | 66,416  |   |                 | $      | 60,204 |   |   | $ | 55,047 |   |   | $ | 55,047 |   |
| Investments in commercial finance –loans held for investment |   |               | 1,661   |   |                 |   | 1,011 |   |   |   | 385 |   |   |   | 385 |   |
| Investments in real estate loans, net                              |   |               | − |   |                 |   | − |   |   |   | 2,862 |   |   |   | 823 |   |
|                                                               |   | $                  | 68,077  |   |                 | $      | 61,215 |   |   | $ | 58,294 |   |   | $ | 56,255 |   |
| Borrowings(2)                                                      |   |               |    |   |                 |   |   |   |   |   |   |   |   |   |   |   |
| Commercial finance debt                                            |   | $                  | 20,750  |   |                 | $      | 20,750 |   |   | $ | 136,500 |   |   | $ | 136,500 |   |
| Corporate secured revolving credit facilities                      |   |               | 14,127  |   |                 |   | 14,127 |   |   |   | 27,079 |   |   |   | 27,079 |   |
| Real estate debt                                                   |   |               | 12,005  |   |                 |   | 11,265 |   |   |   | 13,198 |   |   |   | 11,305 |   |
| Senior notes                                                       |   |               | 14,317  |   |                 |   | 16,884 |   |   |   | 10,629 |   |   |   | 10,629 |   |
| Other debt                                                         |   |               | 4,911   |   |                 |   | 3,916 |   |   |   | 3,977 |   |   |   | 3,977 |   |
|                                                               |   | $                  | 66,110  |   |                 | $      | 66,942 |   |   | $ | 191,383 |   |   | $ | 189,490 |   |

----

| (1)   | Certain of the receivables from managed entities at September 30, 2010 have been valued using a present value discounted cash flow where market prices were not available.  The discount rate used in these calculations is the estimated current market rate adjusted for liquidity risk. |
|-----------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (2)   | The carrying value of the Company’s corporate secured revolving credit facilities approximates its fair value because of its variable interest rates. The carrying value of the Company’s commercial finance debt approximates its fair value due to its recent issuance at September 30, 2010, its short-term maturity and the variable interest rate as of September 30, 2009.  The Company’s real estate debt and other debt fair value is estimated using current interest rates for similar loans.  The Company approximated the fair value of the senior notes by applying the appreciation in a high yield fund.  This disclosure excludes instruments valued on a recurring basis. |
|-----------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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|       |   | Operating |   |   | Capital |   |    | Total  |   |
|------------|--------|-----------|--------|--------|---------|--------|---------|--------|--------|
| 2011       |   | $         | 2,415  |   |    | $      | 297     |   |   | $ | 2,712 |   |
| 2012       |   |      | 2,199  |   |    |   | 64      |   |   |   | 2,263 |   |
| 2013       |   |      | 1,802  |   |    |   | 41      |   |   |   | 1,843 |   |
| 2014       |   |      | 1,074  |   |    |   | 16      |   |   |   | 1,090 |   |
| 2015       |   |      | 1,093  |   |    |   | − |   |   |   | 1,093 |   |
| Thereafter |   |      | 5,153  |   |    |   | − |   |   |   | 5,153 |   |
|       |   | $         | 13,736 |   |    | $      | 418     |   |   | $ | 14,154 |   |

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|                                                   |   | Years Ended September 30, |    |
|--------------------------------------------------------|--------|---------------------------|---------|
|                                                   |   | 2010                      |    |   | 2009 |   |   | 2008 |   |
| Income (loss) from discontinued operations             |   | $                         | 626     |   |   | $ | (370 | ) |   | $ | (1,104 | ) |
| (Provision) benefit for income taxes                   |   |                      | − |   |   |   | (70 | ) |   |   | 386 |   |
| Income (loss) from discontinued operations, net of tax |   | $                         | 626     |   |   | $ | (440 | ) |   | $ | (718 | ) |

|                                          |   | Years Ended September 30, |    |
|-----------------------------------------------|--------|---------------------------|---------|
|                                          |   | 2010                      |    |   | 2009 |   |   | 2008 |   |
| Loss from discontinued operations             |   | $                         | − |   |   | $ | (14 | ) |   | $ | (856 | ) |
| Benefit for income taxes                      |   |                      | − |   |   |   | 5 |   |   |   | 300 |   |
| Loss from discontinued operations, net of tax |   | $                         | − |   |   | $ | (9 | ) |   | $ | (556 | ) |

|                                                   |   | Years Ended September 30, |    |
|--------------------------------------------------------|--------|---------------------------|---------|
|                                                   |   | 2010                      |    |   | 2009 |   |   | 2008 |   |
| Income (loss) from discontinued operations             |   | $                         | 622     |   |   | $ | (377 | ) |   | $ | (1,999 | ) |
| (Provision) benefit for income taxes                   |   |                      | − |   |   |   | (67 | ) |   |   | 700 |   |
| Income (loss) from discontinued operations, net of tax |   | $                         | 622     |   |   | $ | (444 | ) |   | $ | (1,299 | ) |

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|                                                                                          |   | Real estate  |    |   | Commercial finance  |   |    | Financial fund management  |   |   | All other (1)  |   |   | Total  |    |
|-----------------------------------------------------------------------------------------------|--------|-------------------|---------|--------|--------------------------|--------|---------|---------------------------------|--------|--------|---------------------|--------|--------|-------------|---------|
| Year Ended September 30, 2010                                                                 |   |              |    |   |                     |   |    |                            |   |   |                |   |   |        |    |
| Revenues from external customers                                                              |   | $                 | 31,042  |   |                     | $      | 25,573  |                            |   | $      | 27,243              |   |   | $           | − |   |   | $ | 83,858 |   |
| Equity in earnings (losses) of unconsolidated entities                                        |   |              | 869     |   |                     |   | (1,896  | )                               |   |   | 5,897               |   |   |        | − |   |   |   | 4,870 |   |
| Total revenues                                                                                |   |              | 31,911  |   |                     |   | 23,677  |                            |   |   | 33,140              |   |   |        | − |   |   |   | 88,728 |   |
| Segment operating expenses                                                                    |   |              | (20,780 | )      |                     |   | (18,164 | )                               |   |   | (21,028             | )      |   |        | − |   |   |   | (59,972 | ) |
| General and administrative expenses                                                           |   |              | (316    | )      |                     |   | (428    | )                               |   |   | (3,668              | )      |   |        | (8,560  | ) |   |   | (12,972 | ) |
| Loss on sale of leases and loans                                                              |   |              | − |   |                     |   | (8,097  | )                               |   |   | −             |   |   |        | − |   |   |   | (8,097 | ) |
| Impairment of intangible assets                                                               |   |              | − |   |                     |   | (2,828  | )                               |   |   | −             |   |   |        | − |   |   |   | (2,828 | ) |
| Provision for credit losses                                                                   |   |              | (49     | )      |                     |   | (5,159  | )                               |   |   | (1                  | )      |   |        | − |   |   |   | (5,209 | ) |
| Depreciation and amortization                                                                 |   |              | (1,304  | )      |                     |   | (5,693  | )                               |   |   | (196                | )      |   |        | (649    | ) |   |   | (7,842 | ) |
| Other-than-temporary impairment losses recognized inearnings                                  |   |              | − |   |                     |   | − |                            |   |   | (480                | )      |   |        | (329    | ) |   |   | (809 | ) |
| Interest expense                                                                              |   |              | (1,074  | )      |                     |   | (6,271  | )                               |   |   | (3                  | )      |   |        | (5,738  | ) |   |   | (13,086 | ) |
| Loss on sale of loans and investment securities, net                                          |   |              | − |   |                     |   | − |                            |   |   | (451                | )      |   |        | − |   |   |   | (451 | ) |
| Other income (expense), net                                                                   |   |              | 387     |   |                     |   | 1       |                            |   |   | 2,429               |   |   |        | (226    | ) |   |   | 2,591 |   |
| Pretax loss attributable to noncontrolling interests (2)                                      |   |              | 61      |   |                     |   | 4,854   |                            |   |   | 8                   |   |   |        | − |   |   |   | 4,923 |   |
| Income (loss) including noncontrolling interest beforeintercompany interest expense and taxes |   |              | 8,836   |   |                     |   | (18,108 | )                               |   |   | 9,750               |   |   |        | (15,502 | ) |   |   | (15,024 | ) |
| Intercompany interest (expense) income                                                        |   |              | − |   |                     |   | (6,115  | )                               |   |   | −             |   |   |        | 6,115   |   |   |   | − |   |
| Income (loss) from continuing operations includingnoncontrolling interests before taxes       |   | $                 | 8,836   |   |                     | $      | (24,223 | )                               |   | $      | 9,750               |   |   | $           | (9,387  | ) |   | $ | (15,024 | ) |
|                                                                                          |   |              |    |   |                     |   |    |                            |   |   |                |   |   |        |    |   |   |   |   |   |
| Year Ended September 30, 2009                                                                 |   |              |    |   |                     |   |    |                            |   |   |                |   |   |        |    |   |   |   |   |   |
| Revenues from external customers                                                              |   | $                 | 26,077  |   |                     | $      | 49,900  |                            |   | $      | 30,272              |   |   | $           | − |   |   | $ | 106,249 |   |
| Equity in (losses) earnings of unconsolidated entities                                        |   |              | (660    | )      |                     |   | (1,133  | )                               |   |   | 3,072               |   |   |        | − |   |   |   | 1,279 |   |
| Total revenues                                                                                |   |              | 25,417  |   |                     |   | 48,767  |                            |   |   | 33,344              |   |   |        | − |   |   |   | 107,528 |   |
| Segment operating expenses                                                                    |   |              | (22,038 | )      |                     |   | (25,179 | )                               |   |   | (20,468             | )      |   |        | − |   |   |   | (67,685 | ) |
| General and administrative expenses                                                           |   |              | (232    | )      |                     |   | (409    | )                               |   |   | (3,414              | )      |   |        | (10,314 | ) |   |   | (14,369 | ) |
| Gain on sale of leases and loans                                                              |   |              | − |   |                     |   | 628     |                            |   |   | −             |   |   |        | − |   |   |   | 628 |   |
| Provision for credit losses                                                                   |   |              | (456    | )      |                     |   | (6,410  | )                               |   |   | (1,738              | )      |   |        | − |   |   |   | (8,604 | ) |
| Depreciation and amortization                                                                 |   |              | (1,370  | )      |                     |   | (4,293  | )                               |   |   | (398                | )      |   |        | (861    | ) |   |   | (6,922 | ) |
| Other-than-temporary impairment losses recognized inearnings                                  |   |              | − |   |                     |   | − |                            |   |   | (8,466              | )      |   |        | (73     | ) |   |   | (8,539 | ) |
| Interest expense                                                                              |   |              | (966    | )      |                     |   | (10,524 | )                               |   |   | (5,014              | )      |   |        | (3,695  | ) |   |   | (20,199 | ) |
| Loss on sale of loans and investment securities, net                                          |   |              | − |   |                     |   | − |                            |   |   | (11,588             | )      |   |        | − |   |   |   | (11,588 | ) |
| Other income (expense), net                                                                   |   |              | 75      |   |                     |   | 79      |                            |   |   | 3,440               |   |   |        | (438    | ) |   |   | 3,156 |   |
| Pretax loss attributable to noncontrolling interests (2)                                      |   |              | 54      |   |                     |   | − |                            |   |   | 1,549               |   |   |        | − |   |   |   | 1,603 |   |
| Income (loss) including noncontrolling interest beforeintercompany interest expense and taxes |   |              | 484     |   |                     |   | 2,659   |                            |   |   | (12,753             | )      |   |        | (15,381 | ) |   |   | (24,991 | ) |
| Intercompany interest (expense) income                                                        |   |              | − |   |                     |   | (5,899  | )                               |   |   | −             |   |   |        | 5,899   |   |   |   | − |   |
| Income (loss) from continuing operations includingnoncontrolling interests before taxes       |   | $                 | 484     |   |                     | $      | (3,240  | )                               |   | $      | (12,753             | )      |   | $           | (9,482  | ) |   | $ | (24,991 | ) |

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----

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|                                                                                          |   | Real estate  |    |   | Commercial finance  |   |    | Financial fund management  |   |   | All other (1)  |   |   | Total  |    |
|-----------------------------------------------------------------------------------------------|--------|-------------------|---------|--------|--------------------------|--------|---------|---------------------------------|--------|--------|---------------------|--------|--------|-------------|---------|
| Year Ended September 30, 2008                                                                 |   |              |    |   |                     |   |    |                            |   |   |                |   |   |        |    |
| Revenues from external customers                                                              |   | $                 | 33,283  |   |                     | $      | 93,349  |                            |   | $      | 41,095              |   |   | $           | − |   |   | $ | 167,727 |   |
| Equity in losses of unconsolidated entities                                                   |   |              | (1,764  | )      |                     |   | (333    | )                               |   |   | (13,559             | )      |   |        | − |   |   |   | (15,656 | ) |
| Total revenues                                                                                |   |              | 31,519  |   |                     |   | 93,016  |                            |   |   | 27,536              |   |   |        | − |   |   |   | 152,071 |   |
| Segment operating expenses                                                                    |   |              | (22,602 | )      |                     |   | (42,741 | )                               |   |   | (27,737             | )      |   |        | − |   |   |   | (93,080 | ) |
| General and administrative expenses                                                           |   |              | (217    | )      |                     |   | (425    | )                               |   |   | (3,874              | )      |   |        | (11,564 | ) |   |   | (16,080 | ) |
| Gain on sale of leases and loans                                                              |   |              | − |   |                     |   | 3,865   |                            |   |   | −             |   |   |        | − |   |   |   | 3,865 |   |
| Provision for credit losses                                                                   |   |              | (500    | )      |                     |   | (7,505  | )                               |   |   | (2,622              | )      |   |        | − |   |   |   | (10,627 | ) |
| Depreciation and amortization                                                                 |   |              | (1,093  | )      |                     |   | (2,412  | )                               |   |   | (257                | )      |   |        | (898    | ) |   |   | (4,660 | ) |
| Other-than-temporary impairment losses recognized inearnings                                  |   |              | − |   |                     |   | − |                            |   |   | (14,467             | )      |   |        | − |   |   |   | (14,467 | ) |
| Interest expense                                                                              |   |              | (1,222  | )      |                     |   | (27,466 | )                               |   |   | (14,559             | )      |   |        | (4,019  | ) |   |   | (47,266 | ) |
| Loss on sale of loans and investment securities, net                                          |   |              | − |   |                     |   | − |                            |   |   | (17,660             | )      |   |        | (14     | ) |   |   | (17,674 | ) |
| Other income (expense), net                                                                   |   |              | 288     |   |                     |   | 352     |                            |   |   | 2,441               |   |   |        | (45     | ) |   |   | 3,036 |   |
| Pretax (income) loss attributable to noncontrolling interests (2)                             |   |              | (61     | )      |                     |   | (2,178  | )                               |   |   | 6,482               |   |   |        | − |   |   |   | 4,243 |   |
| Income (loss) including noncontrolling interest beforeintercompany interest expense and taxes |   |              | 6,112   |   |                     |   | 14,506  |                            |   |   | (44,717             | )      |   |        | (16,540 | ) |   |   | (40,639 | ) |
| Intercompany interest (expense) income                                                        |   |              | − |   |                     |   | (5,860  | )                               |   |   | −             |   |   |        | 5,860   |   |   |   | − |   |
| Income (loss) from continuing operations includingnoncontrolling interests before taxes       |   | $                 | 6,112   |   |                     | $      | 8,646   |                            |   | $      | (44,717             | )      |   | $           | (10,680 | ) |   | $ | (40,639 | ) |
|                                                                                          |   |              |    |   |                     |   |    |                            |   |   |                |   |   |        |    |   |   |   |   |   |
| Segment assets                                                                                |   |              |    |   |                     |   |    |                            |   |   |                |   |   |        |    |   |   |   |   |   |
| September 30, 2010                                                                            |   | $                 | 155,434 |   |                     | $      | 81,053  |                            |   | $      | 36,647              |   |   | $           | (38,881 | ) |   | $ | 234,253 |   |
| September 30, 2009                                                                            |   | $                 | 148,903 |   |                     | $      | 212,336 |                            |   | $      | 34,596              |   |   | $           | (19,995 | ) |   | $ | 375,840 |   |
| September 30, 2008                                                                            |   | $                 | 147,657 |   |                     | $      | 356,671 |                            |   | $      | 274,742             |   |   | $           | (20,713 | ) |   | $ | 758,357 |   |

----

| (1) | Includes general corporate expenses and assets not allocable to any particular segment. |
|-----|-----------------------------------------------------------------------------------------|

| (2) | In accordance with Company policy, certain corporate overhead expenses are allocated to the operating segments based on assets under management, which may be affected by, but not limited to, various market conditions. |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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|                                                              |   | December 31 |    |   | March 31 |   |   | June 30 |   |   | September 30 |   |
|-------------------------------------------------------------------|--------|-------------|---------|--------|----------|--------|--------|---------|--------|--------|--------------|--------|
| Quarterly results for fiscal 2010(1)                              |   |        |    |   |     |   |   |    |   |   |         |   |
| Revenues                                                          |   | $           | 25,422  |   |     | $      | 19,400 |    |   | $      | 25,238       |   |   | $ | 18,668 |   |
| Operating income (loss)                                           |   | $           | 4,420   |   |     | $      | (1,876 | )       |   | $      | (5,134       | )      |   | $ | (5,602 | ) |
| Income (loss) from continuing operations                |   | $           | 588     |   |     | $      | (1,845 | )       |   | $      | (6,589       | )      |   | $ | (9,451 | ) |
| (Loss)income from discontinued operations                         |   | $           | − |   |     | $      | (2     | )       |   | $      | (1           | )      |   | $ | 625 |   |
| Net income (loss)                                                 |   | $           | 588     |   |     | $      | (1,847 | )       |   | $      | (6,590       | )      |   | $ | (8,826 | ) |
| Less:  Net loss attributable to noncontrollinginterests |   | $           | 383     |   |     | $      | 615    |    |   | $      | 1,275        |   |   | $ | 951 |   |
| Net income (loss) attributable to commonshareholders              |   | $           | 971     |   |     | $      | (1,232 | )       |   | $      | (5,315       | )      |   | $ | (7,875 | ) |
|                                                              |   |        |    |   |     |   |   |    |   |   |         |   |   |   |   |   |
| Basic earnings (loss) per common share:                           |   |        |    |   |     |   |   |    |   |   |         |   |   |   |   |   |
| Continuing operations                                             |   | $           | 0.05    |   |     | $      | (0.06  | )       |   | $      | (0.28        | )      |   | $ | (0.44 | ) |
| Net income (loss)                                                 |   | $           | 0.05    |   |     | $      | (0.06  | )       |   | $      | (0.28        | )      |   | $ | (0.41 | ) |
|                                                              |   |        |    |   |     |   |   |    |   |   |         |   |   |   |   |   |
| Diluted earnings (loss) per common share:                         |   |        |    |   |     |   |   |    |   |   |         |   |   |   |   |   |
| Continuing operations                                             |   | $           | 0.05    |   |     | $      | (0.06  | )       |   | $      | (0.28        | )      |   | $ | (0.44 | ) |
| Net income (loss)                                                 |   | $           | 0.05    |   |     | $      | (0.06  | )       |   | $      | (0.28        | )      |   | $ | (0.41 | ) |

| Quarterly results for fiscal 2009(2)                                       |   | December 31 |   |   | March 31 |   |    | June 30 |   |   | September 30 |   |
|----------------------------------------------------------------------------|--------|-------------|--------|--------|----------|--------|---------|---------|--------|--------|--------------|--------|
| Revenues                                                                   |   | $           | 31,960 |   |     | $      | 27,119  |    |   | $      | 22,558       |   |   | $ | 25,891 |   |
| Operating income (loss)                                                    |   | $           | 3,799  |   |     | $      | 3,921   |    |   | $      | (73          | )      |   | $ | 2,929 |   |
| (Loss) income from continuing operations                                   |   | $           | (3,678 | )      |     | $      | (12,626 | )       |   | $      | (113         | )      |   | $ | 327 |   |
| Net (loss) income                                                          |   | $           | (3,603 | )      |     | $      | (12,789 | )       |   | $      | (191         | )      |   | $ | 49 |   |
| Less:  Net loss (income) attributable tononcontrolling interests |   | $           | 383    |   |     | $      | 1,156   |    |   | $      | (13          | )      |   | $ | 77 |   |
| Net (loss) income attributable to commonshareholders                       |   | $           | (3,220 | )      |     | $      | (11,633 | )       |   | $      | (204         | )      |   | $ | 126 |   |
|                                                                       |   |        |   |   |     |   |    |    |   |   |         |   |   |   |   |   |
| Basic (loss) earnings per common share:                                    |   |        |   |   |     |   |    |    |   |   |         |   |   |   |   |   |
| Continuing operations                                                      |   | $           | (0.18  | )      |     | $      | (0.62   | )       |   | $      | (0.01        | )      |   | $ | 0.02 |   |
| Net (loss) income                                                          |   | $           | (0.18  | )      |     | $      | (0.63   | )       |   | $      | (0.01        | )      |   | $ | 0.01 |   |
|                                                                       |   |        |   |   |     |   |    |    |   |   |         |   |   |   |   |   |
| Diluted (loss) earnings per common share:                                  |   |        |   |   |     |   |    |    |   |   |         |   |   |   |   |   |
| Continuing operations                                                      |   | $           | (0.18  | )      |     | $      | (0.62   | )       |   | $      | (0.01        | )      |   | $ | 0.02 |   |
| Net (loss) income                                                          |   | $           | (0.18  | )      |     | $      | (0.63   | )       |   | $      | (0.01        | )      |   | $ | 0.01 |   |

----

| (1) | Fiscal 2010 – significant events by quarter: |
|-----|----------------------------------------------------|

|   | ● | June 30 – included a $7.2 million ($5.9 million net of tax) loss on the sale of leases and loans to RCC ($0.31 per share-diluted). |
|--------|---------|------------------------------------------------------------------------------------------------------------------------------------------|

|   | ● | September 30 – reflected a $2.8 million charge for the impairment of intangible assets ($0.16 per share-diluted) as well as a $445,000 impairment charge for other investment securities ($0.03 per share-diluted) and $2.9 million ($0.15 per share diluted) income tax expense for the write-off of an unrealizable deferred tax asset and receivable.  In addition, the Company waived $1.8 million ($0.10 per share-diluted) of commercial finance management fees from four of its investment entities. |
|--------|---------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (2) | Fiscal 2009 – significant events by quarter: |
|-----|----------------------------------------------------|

|   | ● | December 31 – included a $4.9 million ($2.3 million net of tax) non-cash impairment charge taken on investments in CDO securities ($0.13 per share-diluted). |
|--------|---------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | ● | March 31 – the Company recorded a $11.6 million ($9.1 million net of tax) loss on the sale of bank loans ($0.49 per share diluted). |
|--------|---------|-------------------------------------------------------------------------------------------------------------------------------------------|

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| ITEM 9. | CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS |
|---------|-----------------------------------------------|
|    | ON ACCOUNTING AND FINANCIAL DISCLOSURE.       |

| ITEM 9A. | CONTROLS AND PROCEDURES. |
|----------|--------------------------|

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| ITEM 9B. | OTHER INFORMATION. |
|----------|--------------------|

| ITEM 10. | DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE. |
|----------|---------------------------------------------------------|

| ITEM 11. | EXECUTIVE COMPENSATION. |
|----------|-------------------------|

| ITEM 12. | SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND |
|----------|-----------------------------------------------------|
|     | MANAGEMENT AND RELATED STOCKHOLDER MATTERS.         |

| ITEM 13. | CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, |
|----------|-------------------------------------------------|
|     | AND DIRECTOR INDEPENDENCE.                      |

| ITEM 14. | PRINCIPAL ACCOUNTING FEES AND SERVICES. |
|----------|-----------------------------------------|

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----

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| ITEM 15. | EXHIBITS AND FINANCIAL STATEMENT SCHEDULES. |
|----------|---------------------------------------------|

|   | 1. | Financial Statements |
|--------|----|----------------------|

|   |   | Report of Independent Registered Public Accounting Firm |
|--------|--------|---------------------------------------------------------|

|   | Consolidated Balance Sheets at September 30, 2010 and 2009 |
|--------|------------------------------------------------------------|

|   | Consolidated Statements of Operations for the Years Ended September 30, 2010, 2009 and 2008 |
|--------|---------------------------------------------------------------------------------------------|

|   | Consolidated Statements of Changes in Equity for the Years Ended     September 30, 2010, 2009 and 2008 |
|--------|----------------------------------------------------------------------------------------------------------------------------|

|   | Consolidated Statements of Cash Flows for the Years Ended September 30, 2010, 2009 and 2008 |
|--------|---------------------------------------------------------------------------------------------|

|   | Notes to Consolidated Financial Statements − September 30, 2010 |
|--------|-----------------------------------------------------------------------|

|   | 2. | Financial Statement Schedules |
|--------|----|-------------------------------|

|   | Schedule II – Valuation and Qualifying Accounts |
|--------|-------------------------------------------------------|

|   | Schedule III - Investments in Real Estate |
|--------|-------------------------------------------|

|   | Schedule IV – Investments in Mortgage Loans on Real Estate |
|--------|------------------------------------------------------------------|

|   | 3. | Exhibits |
|--------|----|----------|

|   | Exhibit No. | Description                                                                                                                                                                                                                                                                                                                                                                                                                                        |
|--------|-------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   | 3.1         | Restated Certificate of Incorporation of Resource America. (1)                                                                                                                                                                                                                                                                                                                                                                                     |
|   | 3.2         | Amended and Restated Bylaws of Resource America. (1)                                                                                                                                                                                                                                                                                                                                                                                               |
|   | 4.1         | Note Purchase Agreement (including the form of Senior Note and form of Warrant). (2)                                                                                                                                                                                                                                                                                                                                                               |
|   | 4.2         | Indenture between LEAF Funding SPE 1, LLC and U.S. Bank National Association, dated August 20, 2010.                                                                                                                                                                                                                                                                                                                                               |
|   | 10.1(a)     | Loan and Security Agreement, dated May 24, 2007, between Resource America, Inc., Commerce Bank, N.A. and the other parties thereto. (3)                                                                                                                                                                                                                                                                                                            |
|   | 10.1(b)     | First Amendment and Joinder to Loan and Security Agreement, dated July 18, 2007. (5)                                                                                                                                                                                                                                                                                                                                                               |
|   | 10.1(c)     | Second Amendment and Joinder to Loan and Security Agreement, dated November 15, 2007. (5)                                                                                                                                                                                                                                                                                                                                                          |
|   | 10.1(d)     | Third Amendment to Loan and Security Agreement, dated August 7, 2008, dated May 24, 2007, between Resource America, Inc., TD Bank, N.A. (successor by merger to Commerce Bank, N.A.) and the other parties hereto. (6)                                                                                                                                                                                                                             |
|   | 10.1(e)     | Fourth Amendment to Loan and Security Agreement, dated September 30, 2008, dated May 24, 2007, between Resource America, Inc., TD Bank, N.A. (successor by merger to Commerce Bank, N.A.) and the other parties hereto. (7)                                                                                                                                                                                                                        |
|   | 10.1(f)     | Fifth Amendment to Loan and Security Agreement, dated December 19, 2008, dated May 24, 2007, between Resource America, Inc., TD Bank, N.A. (successor by merger to Commerce Bank, N.A.) and the other parties hereto. (4)                                                                                                                                                                                                                          |
|   | 10.1(g)     | Sixth Amendment to Loan and Security Agreement, dated March 26, 2009, dated May 24, 2007, between Resource America, Inc., TD Bank, N.A. and the other parties hereto. (10)                                                                                                                                                                                                                                                                         |
|   | 10.1(h)     | Seventh Amendment to Loan and Security Agreement, dated May 15, 2009, dated May 24, 2007, between Resource America, Inc., TD Bank, N.A. and the other parties hereto. (14)                                                                                                                                                                                                                                                                         |
|   | 10.1(i)     | Eighth Amendment to Loan and Security Agreement, dated November 6, 2009, dated May 24, 2007, between Resource America, Inc., TD Bank, N.A. and the other parties hereto. (17)                                                                                                                                                                                                                                                                      |
|   | 10.2        | Amended and Restated Employment Agreement between Michael S. Yecies and Resource America, Inc., dated December 29, 2008. (8)                                                                                                                                                                                                                                                                                                                       |
|   | 10.3        | Amended and Restated Employment Agreement between Thomas C. Elliott and Resource America, Inc., dated December 29, 2008. (8)                                                                                                                                                                                                                                                                                                                       |
|   | 10.4        | Amended and Restated Employment Agreement between Jeffrey F. Brotman and Resource America, Inc., dated December 29, 2008. (8)                                                                                                                                                                                                                                                                                                                      |
|   | 10.5        | Amended and Restated Employment Agreement between Jonathan Z. Cohen and Resource America, Inc., dated December 29, 2008. (8)                                                                                                                                                                                                                                                                                                                       |
|   | 10.6        | Amended and Restated Employment Agreement between Steven J. Kessler and Resource America, Inc., dated December 29, 2008. (8)                                                                                                                                                                                                                                                                                                                       |
|   | 10.7(a)     | U.S. $250,000,000 Receivables Loan and Security Agreement, dated as of October 31, 2006, among Resource Capital Funding II, LLC, as the Borrower, and LEAF Financial Corporation, as the Servicer, and Morgan Stanley Bank, as a Lender and Collateral Agent, and U.S. Bank National Association, as the Custodian and the Lender’s Bank and Lyon Financial Services, Inc. (D/B/A U.S. Bank Portfolio Services), as the Backup Servicer. (9) |
|   | 10.7(b)     | First Amendment to Receivables Loan and Security Agreement, dated as of December 21, 2006. (9)                                                                                                                                                                                                                                                                                                                                                     |
|   | 10.7(c)     | Purchase and Sale Agreement, dated as of October 31, 2006. (9)                                                                                                                                                                                                                                                                                                                                                                                     |
|   | 10.7(d)     | First Amendment to Purchase and Sale Agreement, dated as of December 21, 2006. (9)                                                                                                                                                                                                                                                                                                                                                                 |
|   | 10.7(e)     | Fifth Amendment to Receivables Loan and Security Agreement, dated as of May 23, 2008. (6)                                                                                                                                                                                                                                                                                                                                                          |

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|   | 10.7(f) | Amended and Restated Fee Letter, dated May 23, 2008. (6)                                                                                                                                                   |
|--------|---------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   | 10.7(g) | Sixth Amendment to Receivables Loan and Security Agreement, dated as of November 13, 2008. (8)                                                                                                             |
|   | 10.8(a) | Credit Agreement, dated July 31, 2006, by and among LEAF Financial Corporation, LEAF Funding, Inc. and National City Bank. (11)                                                                            |
|   | 10.8(b) | Guaranty and Suretyship Agreement by registrant and Resource Leasing, Inc. in favor of National City Bank. (11)                                                                                            |
|   | 10.8(c) | First Amendment to Credit Agreement, dated August 14, 2006, by and among LEAF Financial Corporation, LEAF Funding, Inc. and National City Bank. (12)                                                       |
|   | 10.8(d) | Second Amendment to Credit Agreement, dated December 22, 2006, between LEAF Financial Corporation, LEAF Funding, Inc. and National City Bank. (9)                                                          |
|   | 10.8(e) | Third Amendment to Credit Agreement, dated March 14, 2007, between LEAF Financial Corporation, LEAF Funding, Inc. and National City Bank. (13)                                                             |
|   | 10.8(f) | Seventh Amendment to Credit Agreement, dated July 31, 2009, between LEAF Financial Corporation, LEAF Funding, Inc. and National City Bank.(18)                                                             |
|   | 10.8(g) | Eighth Amendment to Credit Agreement, dated September 30, 2009, between LEAF Financial Corporation, LEAF Funding, Inc. and National City Bank. (18)                                                        |
|   | 10.8(h) | Ninth Amendment to Credit Agreement, dated November 30, 2009, between LEAF Financial Corporation, LEAF Funding, Inc. and PNC Bank, National Association (successor by merger to National City Bank.). (19) |
|   | 10.8(i) | Tenth Amendment to Credit Agreement, dated January 29, 2010, between LEAF Financial Corporation, LEAF Funding, Inc. and PNC Bank, National Association (successor by merger to National City Bank.). (19)  |
|   | 10.8(j) | Eleventh Amendment to Credit Agreement, dated March 31, 2010, between LEAF Financial Corporation, LEAF Funding, Inc. and PNC Bank, National Association (successor by merger to National City Bank.). (19) |
|   | 10.8(k) | Twelfth Amendment to Credit Agreement, dated May 14, 2010, between LEAF Financial Corporation, LEAF Funding, Inc. and PNC Bank, National Association (successor by merger to National City Bank.). (20)    |
|   | 12.1    | Ratio of Earnings to Fixed Charges.                                                                                                                                                                        |
|   | 14.1    | Insider Trader Policy (15)                                                                                                                                                                                 |
|   | 21.1    | Subsidiaries of Resource America, Inc.                                                                                                                                                                     |
|   | 23.1    | Consent of Grant Thornton LLP.                                                                                                                                                                             |
|   | 31.1    | Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.                                                                                                        |
|   | 31.2    | Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.                                                                                                        |
|   | 32.1    | Certification of Chief Executive Officer pursuant to Section 1350 18 U.S.C., as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.                                                         |
|   | 32.2    | Certification of Chief Financial Officer pursuant to Section 1350 18 U.S.C., as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.                                                         |

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|   | (1) | Filed previously as an exhibit to our Quarterly Report on Form 10-Q for the quarter ended December 31, 1999 and by this reference incorporated herein. |
|--------|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (2) | Files previously as an exhibit to our Current Report on Form 8-K filed on October 1, 2009 and by this reference incorporated herein. |
|--------|-----|--------------------------------------------------------------------------------------------------------------------------------------|

|   | (3) | Filed previously as an exhibit to our Current Report on Form 8-K filed on June 1, 2007 and by this reference incorporated herein. |
|--------|-----|-----------------------------------------------------------------------------------------------------------------------------------|

|   | (4) | Filed previously as an exhibit to our Current Report on Form 8-K filed on December 24, 2008 and by this reference incorporated herein. |
|--------|-----|----------------------------------------------------------------------------------------------------------------------------------------|

|   | (5) | Filed previously as an exhibit to our Annual Report on Form 10-K for the fiscal year ended September 30, 2007 and by this reference incorporated herein. |
|--------|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (6) | Filed previously as an exhibit to our Quarterly Report on Form 10-Q for the quarter ended June 30, 2008 and by this reference incorporated herein. |
|--------|-----|----------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (7) | Filed previously as an exhibit to our Current Report on Form 8-K filed on October 6, 2008 and by this reference incorporated herein. |
|--------|-----|--------------------------------------------------------------------------------------------------------------------------------------|

|   | (8) | Filed previously as an exhibit to our Quarterly Report on Form 10-Q for the quarter ended December 31, 2008 and by this reference incorporated herein. |
|--------|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (9) | Filed previously as an exhibit to our Quarterly Report on Form 10-Q for the quarter ended December 31, 2006 and by this reference incorporated herein. |
|--------|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (10) | Filed previously as an exhibit to our Current Report on Form 8-K filed on March 27, 2009 and by this reference incorporated herein. |
|--------|------|-------------------------------------------------------------------------------------------------------------------------------------|

|   | (11) | Filed previously as an exhibit to our Current Report on Form 8-K filed on August 4, 2006 and by this reference incorporated herein. |
|--------|------|-------------------------------------------------------------------------------------------------------------------------------------|

|   | (12) | Filed previously as an exhibit to our Current Report on Form 8-K filed on August 17, 2006 and by this reference incorporated herein. |
|--------|------|--------------------------------------------------------------------------------------------------------------------------------------|

|   | (13) | Filed previously as an exhibit to our Quarterly Report on Form 10-Q for the quarter ended March 31, 2007 and by this reference incorporated herein. |
|--------|------|-----------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (14) | Filed previously as an exhibit to our Quarterly Report on Form 10-Q for the quarter ended March 31, 2009 and by this reference incorporated herein. |
|--------|------|-----------------------------------------------------------------------------------------------------------------------------------------------------|

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|   | (15) | Filed previously as an exhibit to our Current Report on Form 8-K filed on August 31, 2007 and by this reference incorporated herein. |
|--------|------|--------------------------------------------------------------------------------------------------------------------------------------|

|   | (16) | Filed previously as an exhibit to our Current Report on Form 8-K filed on October 1, 2009 and by this reference incorporated herein. |
|--------|------|--------------------------------------------------------------------------------------------------------------------------------------|

|   | (17) | Filed previously as an exhibit to our Current Report on Form 8-K filed on November 9, 2009 and by this reference incorporated herein. |
|--------|------|---------------------------------------------------------------------------------------------------------------------------------------|

|   | (18) | Filed previously as an exhibit to our Annual Report on Form 10-K for the fiscal year ended September 30, 2009 and by this reference incorporated herein. |
|--------|------|----------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (19) | Filed previously as an exhibit to our Quarterly Report on Form 10-Q for the quarter ended March 31, 2010 and by this reference incorporated herein. |
|--------|------|-----------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (20) | Filed previously as an exhibit to our Quarterly Report on Form 10-Q for the quarter ended June 30, 2010 and by this reference incorporated herein. |
|--------|------|----------------------------------------------------------------------------------------------------------------------------------------------------|

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SIGNATURES

|              | RESOURCE AMERICA, INC.                     |
|-------------------|--------------------------------------------|
| December 13, 2010 | By:   /s/ Jonathan Z. Cohen |
|              | JONATHAN Z. Cohen                          |
|              | Chief Executive Officer and President      |

| /s/ Edward E. Cohen    |   | Chairman of the Board          |   | December 13, 2010 |
|------------------------|--------|--------------------------------|--------|-------------------|
| EDWARD E. COHEN        |   |                           |   |              |
|                   |   |                           |   |              |
| /s/ Jonathan Z. Cohen  |   | Director, President            |   | December 13, 2010 |
| JONATHAN Z. COHEN      |   | and Chief Executive Officer    |   |              |
|                   |   | (Principal Executive Officer)  |   |              |
|                   |   |                           |   |              |
| /s/ Michael J. Bradley |   | Director                       |   | December 13, 2010 |
| MICHAEL J. BRADLEY     |   |                           |   |              |
|                   |   |                           |   |              |
| /s/ Carlos C. Campbell |   | Director                       |   | December 13, 2010 |
| CARLOS C. CAMPBELL     |   |                           |   |              |
|                   |   |                           |   |              |
| /s/ Kenneth A. Kind    |   | Director                       |   | December 13, 2010 |
| KENNETH A. KIND        |   |                           |   |              |
|                   |   |                           |   |              |
| /s/ Hersh Kozlov       |   | Director                       |   | December 13, 2010 |
| HERSH KOZLOV           |   |                           |   |              |
|                   |   |                           |   |              |
| /s/ Andrew M. Lubin    |   | Director                       |   | December 13, 2010 |
| ANDREW M. LUBIN        |   |                           |   |              |
|                   |   |                           |   |              |
| /s/ John S. White      |   | Director                       |   | December 13, 2010 |
| JOHN S. WHITE          |   |                           |   |              |
|                   |   |                           |   |              |
| /s/ Thomas C. Elliott  |   | Senior Vice President          |   | December 13, 2010 |
| THOMAS C. ELLIOTT      |   | and Chief Financial Officer    |   |              |
|                   |   | (Principal Financial Officer)  |   |              |
|                   |   |                           |   |              |
| /s/ Arthur J. Miller   |   | Vice President,                |   | December 13, 2010 |
| ARTHUR J. MILLER       |   | and Chief Accounting Officer   |   |              |
|                   |   | (Principal Accounting Officer) |   |              |
|                   |   |                           |   |              |

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Schedule II 

|                                                      |   | Balance at Beginning of Year |    |   | Additions Charged to Costs and Expenses |   |    | Amounts Written-off Against the Allowance |   |   | Balance at End of Year |   |
|-----------------------------------------------------------|--------|------------------------------|---------|--------|-----------------------------------------|--------|---------|-------------------------------------------|--------|--------|------------------------|--------|
| Allowance for investments in real estate loans:           |   |                         |    |   |                                    |   |    |                                      |   |   |                   |   |
| September 30, 2010                                        |   | $                            | 1,585   |   |                                    | $      | 49      |                                      |   | $      | (1,585                 | )      |   | $ | 49 |   |
| September 30, 2009                                        |   | $                            | 1,129   |   |                                    | $      | 456     |                                      |   | $      | −                |   |   | $ | 1,585 |   |
| September 30, 2008                                        |   | $                            | 629     |   |                                    | $      | 500     |                                      |   | $      | −                |   |   | $ | 1,129 |   |
|                                                      |   |                         |    |   |                                    |   |    |                                      |   |   |                   |   |   |   |   |   |
| Allowance for investments in commercial finance assets:   |   |                         |    |   |                                    |   |    |                                      |   |   |                   |   |   |   |   |   |
| September 30, 2010                                        |   | $                            | 3,210   |   |                                    | $      | 3,307   |                                      |   | $      | (5,617                 | )      |   | $ | 900 |   |
| September 30, 2009                                        |   | $                            | 1,750   |   |                                    | $      | 6,410   |                                      |   | $      | (4,950                 | ) (1)  |   | $ | 3,210 |   |
| September 30, 2008                                        |   | $                            | 120     |   |                                    | $      | 7,505   |                                      |   | $      | (5,875                 | )      |   | $ | 1,750 |   |
|                                                      |   |                         |    |   |                                    |   |    |                                      |   |   |                   |   |   |   |   |   |
| Allowance for investments in loans held for investment:   |   |                         |    |   |                                    |   |    |                                      |   |   |                   |   |   |   |   |   |
| September 30, 2010                                        |   | $                            | − |   |                                    | $      | − |                                      |   | $      | −                |   |   | $ | − |   |
| September 30, 2009                                        |   | $                            | 1,595   |   |                                    | $      | 1,738   |                                      |   | $      | (3,333                 | ) (2)  |   | $ | − |   |
| September 30, 2008                                        |   | $                            | − |   |                                    | $      | 2,622   |                                      |   | $      | (1,027                 | )      |   | $ | 1,595 |   |
|                                                      |   |                         |    |   |                                    |   |    |                                      |   |   |                   |   |   |   |   |   |
| Allowance for management fees – commercial finance: |   |                         |    |   |                                    |   |    |                                      |   |   |                   |   |   |   |   |   |
| September 30, 2010                                        |   | $                            | − |   |                                    | $      | 1,852   |                                      |   | $      | (777                   | )      |   | $ | 1,075 |   |
| September 30, 2009                                        |   | $                            | − |   |                                    | $      | − |                                      |   | $      | −                |   |   | $ | − |   |
| September 30, 2008                                        |   | $                            | − |   |                                    | $      | − |                                      |   | $      | −                |   |   | $ | − |   |

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| (1) | Includes $1.5 million reduction due to the sale of LCFF. |
|-----|----------------------------------------------------------|

| (2) | Includes $2.6 million reduction due to the sale of Apidos CDO VI. |
|-----|-------------------------------------------------------------------|

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SCHEDULE III

| Column A                                                                                 |   | Column B     |    |   | Column C                        |   |   | Column D                                   |   |   | Column E                                         |   |   | Column F                 |   | Column G             |   | Column H      |   | Column I                                                |
|------------------------------------------------------------------------------------------|--------|--------------|---------|--------|---------------------------------|--------|--------|--------------------------------------------|--------|--------|--------------------------------------------------|--------|--------|--------------------------|--------|----------------------|--------|---------------|--------|---------------------------------------------------------|
| Description                                                                              |   | Encumbrances |    |   | Initial cost to Company         |   |   | Cost capitalized subsequent to acquisition |   |   | Gross Amount at which carried at close of period |   |   | Accumulated Depreciation |   | Date of Construction |   | Date Acquired |   | Life on which depreciation in latest income is computed |
|                                                                                     |   |         |    |   | Buildings and Land Improvements |   |   | Improvements Carrying Costs                |   |   | Buildings and Land Improvements Total            |   |   |                     |   |                 |   |          |   |                                                    |
| Real estate owned:                                                                       |   |         |    |   |                            |   |   |                                       |   |   |                                             |   |   |                     |   |                 |   |          |   |                                                    |
|    Hotel     Savannah, GA                                  |   | $            | 12,005  |   |                            | $      | 10,187 |                                       |   | $      | 2,114                                            |   |   | $                        | 16,505 |                 |   | $             | 3,846  |                                                    |   | 1853 |   | 06/30/2005 |   | 40 years |
|                                                                                     |   |         |    |   |                            |   |   |                                       |   |   |                                             |   |   |                     |   |                 |   |          |   |                                                    |   |   |   |   |   |   |
|    Commercial     Philadelphia, PA                         |   |         | − |   |                            |   | 2,874  |                                       |   |   | 389                                              |   |   |                     | 3,263  |                 |   |          | 143    |                                                    |   | 1924 |   | 01/9/2009 |   | 37 years |
|                                                                                     |   |         |    |   |                            |   |   |                                       |   |   |                                             |   |   |                     |   |                 |   |          |   |                                                    |   |   |   |   |   |   |
|     Office Building      Moberly, MO             |   |         | 1,472   |   |                            |   | 1,866  |                                       |   |   | −                                          |   |   |                     | 1,866  |                 |   |          | 123    |                                                    |   | 1998 |   | 11/30/2007 |   | 39 years |
|                                                                                     |   |         |    |   |                            |   |   |                                       |   |   |                                             |   |   |                     |   |                 |   |          |   |                                                    |   |   |   |   |   |   |
|  Assets of   Consolidated Variable    Interest Entity (a):      |   |         |    |   |                            |   |   |                                       |   |   |                                             |   |   |                     |   |                 |   |          |   |                                                    |   |   |   |   |   |   |
|     Commercial Retail       Elkins West, WV |   |         | − |   |                            |   | 1,600  |                                       |   |   | −                                          |   |   |                     | 1,600  |                 |   |          | 528    |                                                    |   | 1963 |   | 07/01/2003 |   | 40 years |
|                                                                                     |   |         |    |   |                            |   |   |                                       |   |   |                                             |   |   |                     |   |                 |   |          |   |                                                    |   |   |   |   |   |   |
|                                                                                     |   | $            | 13,477  |   |                            | $      | 16,527 |                                       |   | $      | 2,503                                            |   |   | $                        | 23,234 |                 |   | $             | 4,640  |                                                    |   |   |   |   |   |   |

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| (a) | The date acquired reflects the date the Company adopted the provisions of Financial Accounting Standards Board (or FASB) Financial Interpretation No. 46;  this pronouncement has been replaced by the FASB Accounting Standards Codification, or ASC, section 810-10);  amounts reflected are on a one-quarter lag (as of June 30, 2010) as permitted under ASC 810-10. |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|                            |   | Years Ended September 30, |    |
|---------------------------------|--------|---------------------------|---------|
|                            |   | 2010                      |    |   | 2009 |   |   | 2008 |   |
| Balance, beginning of year      |   | $                         | 25,241  |   |   | $ | 22,132 |   |   | $ | 19,410 |   |
|                            |   |                      |    |   |   |   |   |   |   |   |   |   |
| Additions:                      |   |                      |    |   |   |   |   |   |   |   |   |   |
| Acquired through foreclosure    |   |                      | − |   |   |   | 2,874 |   |   |   | − |   |
| Improvements, etc.              |   |                      | 293     |   |   |   | 235 |   |   |   | 2,722 |   |
| Other – basis adjustments |   |                      | − |   |   |   | − |   |   |   | − |   |
|                            |   |                      | 25,534  |   |   |   | 25,241 |   |   |   | 22,132 |   |
| Deductions:                     |   |                      |    |   |   |   |   |   |   |   |   |   |
| Cost of real estate sold        |   |                      | 2,300   |   |   |   | − |   |   |   | − |   |
| Other − write-down        |   |                      | − |   |   |   | − |   |   |   | − |   |
|                            |   |                      |    |   |   |   |   |   |   |   |   |   |
| Balance, end of year            |   | $                         | 23,234  |   |   | $ | 25,241 |   |   | $ | 22,132 |   |

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SCHEDULE IV

| Column A                   | Column B                  | Column C            | Column D              |   | Column E    |    |   | Column F                |   |   | Column G                    |   |   | Column H                                                           |   |
|----------------------------|---------------------------|---------------------|-----------------------|--------|-------------|---------|--------|-------------------------|--------|--------|-----------------------------|--------|--------|--------------------------------------------------------------------|--------|
| Description                | Interest rate             | Final maturity date | Periodic payment term |   | Prior liens |    |   | Face amount of mortgage |   |   | Carrying amount of mortgage |   |   | Principal amount of loan subjecttodelinquent principal or interest |   |
| Second Lien Loan           |                      |                |                  |   |        |    |   |                    |   |   |                        |   |   |                                                               |   |
|                       |                      |                |                  |   |        |    |   |                    |   |   |                        |   |   |                                                               |   |
| Office building -Omaha, NE | Fixed interest rate of 8% | 8/31/2011           | Monthly               |   | $           | − |   |                    | $      | 73     |                        |   | $      | 49                                                                 |   |   | $ | − |   |

|                       |   | Years Ended September 30, |    |
|----------------------------|--------|---------------------------|---------|
|                       |   | 2010                      |    |   | 2009 |   |   | 2008 |   |
| Balance, beginning of year |   | $                         | 4,447   |   |   | $ | 15,869 |   |   | $ | 27,759 | (a) |
|                       |   |                      |    |   |   |   |   |   |   |   |   |   |
| Additions:                 |   |                      |    |   |   |   |   |   |   |   |   |   |
| Other                      |   |                      | 2,027   |   |   |   | 266 |   |   |   | 4,795 | (a) |
|                       |   |                      | 6,474   |   |   |   | 16,135 |   |   |   | 32,554 |   |
| Deductions:                |   |                      |    |   |   |   |   |   |   |   |   |   |
| Foreclosed loans           |   |                      | − |   |   |   | 2,837 |   |   |   | − |   |
| Collections of principal   |   |                      | 4,840   |   |   |   | 8,851 |   |   |   | 16,685 | (a) |
| Charge-offs                |   |                      | 1,585   |   |   |   | − |   |   |   | − |   |
|                       |   |                      | 6,425   |   |   |   | 11,688 |   |   |   | 16,685 |   |
|                       |   |                      |    |   |   |   |   |   |   |   |   |   |
| Balance, end of year       |   | $                         | 49      |   |   | $ | 4,447 |   |   | $ | 15,869 | (a) |

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| (a) | This balance excludes a note receivable (not a mortgage) that related to a partial sale of our interest in a real estate venture.  The note was paid-off during fiscal 2009. |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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