# Dear Fellow Shareholders

_Source: `DeepSeekOCR_Ardian_pruned_1k/real-estate-reit-mortgage/NYSE_LADR_2019/NYSE_LADR_2019.mmd` · pages 2-8_

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Dear Fellow Shareholders,

I would be remiss if I opened this letter without acknowledging the difficult and unprecedented time that we are in. The global scale and rapid spread of the COVID-19 pandemic, as well as the impact of responses to it, requires us to shift our focus to navigating these challenges together. We have moved swiftly to activate our business continuity plan and ensure our employees are working as safely as possible. The uniqueness and extremes of these circumstances make it hard for us to look too far ahead with clarity.

Unlike many public companies, what is certain is that my fellow directors and executives are not just employees and board members – we stand alongside our shareholders as owners of 10% of Ladder Capital's equity. Our commitment to protecting your capital, as well as our own, through the challenges ahead is unwavering.

We believe that Ladder is well-positioned to meet these challenges. Importantly, we entered this period of upheaval bolstered by strong results from last year. We ended 2019 with \(6.7 billion in total assets and \)1.6 billion of total equity. Our assets included \(3.4 billion of loans, \)1.7 billion of securities, and $1.0 billion of real estate investments. Our performance resulted in a robust book value per share as of December 31, 2019 of \(13.56 on a GAAP basis and \)15.23 per share on an undepreciated basis*.

For the year ending December 31, 2019, we:

• Earned \(190.6 million of core earnings*, or \)1.60 of core EPS*, generating an after-tax core return on average equity* of 11.6%;

- Originated or purchased \(2.4 billion of commercial mortgage loans, composed of \)956 million of mortgage loans held for sale and $1.5 billion of mortgage loans held for investment;

• Made $105 million of real estate investments and securitized or sold $1.0 billion of loans;

• Realized approximately $45 million of core gains on sales of loans, securities and real estate;

- Generated net interest income and net rental income that accounted for approximately 85% of the net revenues from our investment assets for the year; and

- Ended the year with over \(1.1 billion of unsecured corporate bonds outstanding with no maturities until 2021.

Additionally, during 2019 and the early part of 2020, we continued to take deliberate steps to strengthen our capital structure by:

Issuing $750 million of 7-year unsecured corporate bonds in January 2020 bringing Ladder's total corporate bonds outstanding to $1.9 billion. The newly issued bonds carry a 4.25% interest rate, Ladder's lowest rate on an unsecured bond issuance to date; and

• Extending the terms of our unsecured and secured funding facilities.

As stewards of your capital, we remain highly aligned with all of you through our significant insider ownership and internal management structure. Our current primary focus is on enhancing liquidity and preserving financial flexibility in the face of uncertain macroeconomic conditions. We remain confident that Ladder is well-positioned to weather and eventually take advantage of these challenging times, including through Ladder's:

• Disciplined credit-oriented culture and strategy that focuses primarily on senior secured assets;

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- More than $2 billion portfolio of high-quality unencumbered assets, including investment grade commercial real estate securities and first mortgage loans, that serve as a reserve of additional liquidity;

- Diversified portfolio of primarily first mortgage loans, investment grade commercial real estate securities and equity that provides stable cash flows;

- Strong balance sheet with a best-in-class capital structure that is focused on diversity and the use of modest leverage; and

- Multiple committed, long-term funding sources, including secured and unsecured debt as well as non-recourse financing.

On behalf of all of us at Ladder, and for everyone who depends upon the care and skill with which we perform our responsibilities, thank you for investing alongside us. We hope you and your loved ones remain safe and healthy during these extraordinary times.

Sincerely,

![](images/3_0.jpg)

Brian Harris

Chief Executive Officer

Ladder Capital Corp