ﾌﾗﾝｸﾘﾝBSPﾘｱﾙﾃｨﾄﾗｽﾄの適時開示・決算・その他

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934

Date of Report (Date of earliest event reported): July 29, 2022

Franklin BSP Realty Trust, Inc.

(Exact Name of Registrant as Specified in Its Charter)


Maryland	001-40923	46-1406086
(State or other jurisdiction	(Commission File Number)	(I.R.S. Employer
of incorporation)		Identification No.)

1345 Avenue of the Americas, Suite 32A

New York, New York 10105

(Address of principal executive offices, including zip code)

Registrant’s telephone number, including area code: (212) 588-6770

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2 below):


o			Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o			Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o			Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o			Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, par value $0.01 per share	FBRT	New York Stock Exchange
7.50% Series E Cumulative Redeemable Preferred Stock, par value $0.01 per share	FBRT PRE	New York Stock Exchange

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company ¨

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨

Item 2.02. Results of Operations and Financial Condition.

On July 29, 2022, Franklin BSP Realty Trust, Inc. (the “Company”) issued a press release and supplemental slide presentation reporting the Company’s financial results for the quarter ended June 30, 2022. Copies of the press release and supplemental slide presentation are attached hereto as Exhibit 99.1 and Exhibit 99.2, respectively, and are incorporated herein by reference.

The information in this Item 2.02 (including Exhibits 99.1 and 99.2) shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liability of that section, and shall not be incorporated by reference into any registration statement or other document filed under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such filing.

Item 7.01. Regulation FD Disclosure.

On July 26, 2022, the Company (through a subsidiary) filed a lawsuit in the District Court of Dallas County, Texas that is described in more detail in Item 8.01 below. The complaint can be accessed https://courtsportal.dallascounty.org/DALLASPROD/DocumentViewer/Embedded/4dIKwaLUYdacs9Aq_PlQ-Jlovzpms7DlZWMIp5hItNq7HygPXg664cmib_MyxlPKaoO26tNyKFWMGeHHZPcVGg2. The information included in the complaint is furnished hereby for informational purposes only and is not incorporated by reference into this Current Report on Form 8-K.

Item 8.01. Other Events.

On July 26, 2022, the Company (through a subsidiary) filed a lawsuit in the District Court of Dallas County, Texas, against, among others, the borrower, the individual sponsor of the borrower, and the guarantors under a first priority mortgage loan that the Company, along with a separate fund affiliated with the Company's external manager, originated in April 2022. On July 27, 2022, the court issued a temporary restraining order freezing the assets of the borrower, the borrower’s sponsor and his parents, and any proceeds from our loan, pending the next scheduled legal proceeding in August 2022. The original principal balance of the Company’s loan is $113.2 million. The loan is secured by a portfolio of twenty-four properties that are net leased to Walgreens (the “Collateral Properties”).

As described in more detail in the complaint, in July 2022, the Company determined that the borrower had provided the Company with approximately 100 falsified and forged documents in connection with the underwriting of the loan, including bank statements, leases, purchase and sale agreements, closing statements, payoff letters, subordination, non-disturbance and attornment agreements and tenant estoppels. Such documentation significantly and fraudulently inflated the purported value of the Collateral Properties by misrepresenting the rent rates and maturity dates of the Walgreens leases at the Collateral Properties, among other things.

The Company identified the fraud after the borrower attempted a similar scheme in connection with an application for a second loan. After flagging irregularities in the borrower-provided information for the second loan application (which application was rejected), the Company conducted extraordinary forensic inquiries related to borrower-provided documentation on the first loan, which ultimately exposed the fraud. The borrower subsequently confessed verbally and in writing to the fraudulent acts.

In accordance with GAAP, the Company has recognized, as of June 30, 2022, a credit loss provision of $28.4 million on the loan. This amount is based on the Company’s estimate of the value of the Collateral Properties, net of estimated sales costs.

Subsequent to identifying the fraud, the Company has taken or is taking the following steps to mitigate the actual loss:

•the Company reconfirmed through updated title reports that the borrower has title to the Collateral Properties and that the Company has perfected and recorded first mortgage liens on the Collateral Properties;

•the Company obtained full recourse personal guarantees on the loan from the individual sponsor of the borrower and his parents;

•the Company is actively working with Walgreens to redirect all future rents on the underlying leases directly to the Company;

•the Company is initiating foreclosure proceedings on the Collateral Properties; and

•the Company obtained a temporary freeze on the assets of the borrower, the borrower’s sponsor and his parents, and any proceeds from our loan, as noted above.

The Company has reported the fraud to criminal authorities and will assist such authorities with their consideration of the matter.

The Company intends to pursue all available legal remedies as set forth in the complaint against any party determined to have been involved in, or that improperly benefitted from, the scheme. Any amounts recovered through these legal processes, net of expenses, will reduce the amount of the actual loss ultimately recognized.

Forward-Looking Statements

This Current Report on Form 8-K includes forward-looking statements. These forward-looking statements generally can be identified by phrases such as “will,” “should,” “expects,” “anticipates,” “foresees,” “forecasts,” “estimates” or other words or phrases of similar import. Similarly, statements herein that describe management’s beliefs, intentions or goals also are forward-looking statements. It is uncertain whether any of the events anticipated by the forward-looking statements will transpire or occur, or if any of them do, what impact they will have on the results of operations and financial condition of the Company or the price of its stock. These forward-looking statements involve certain risks and uncertainties, many of which are beyond our control, that could cause actual results to differ materially from those indicated in such forward-looking statements. Further, forward-looking statements speak only as of the date they are made, and we undertake no obligation to update or revise forward-looking statements to reflect changed assumptions, the occurrence of unanticipated events or changes to future operating results over time, unless required by law.

Our forward-looking statements are subject to various risks and uncertainties, including but not limited to the risks and important factors contained and identified in our filings with the Securities and Exchange Commission (“SEC”), including our Annual Report on Form 10-K for the fiscal year ended December 31, 2021 and our subsequent filings with the SEC, any of which could cause actual results to differ materially from the forward-looking statements. The forward-looking statements included in this Current Report on Form 8-K are made only as of the date hereof.

Item 9.01. Financial Statements and Exhibits.

(d) Exhibits.


						EXHIBIT INDEX
Exhibit No.						Description
99.1						Press Release dated July 29, 2022 announcing the Company’s financial results for the quarter ended June 30, 2022

99.2						Supplemental Presentation for the quarter ended June 30, 2022

104.1						Cover Page Interactive Data File (embedded within the Inline XBRL document)

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.


			FRANKLIN BSP REALTY TRUST, INC.


			By:			/s/ Jerome S. Baglien
			Name:			Jerome S. Baglien
			Title:			Chief Financial Officer, Chief Operating Officer and Treasurer

Date: July 29, 2022

EX-99.1 2 fbrtq22022earningsrelease.htm EX-99.1 Document

Exhibit 99.1


Investor Relations Contact: Lindsey Crabbe l.crabbe@benefitstreetpartners.com (214) 874-2339

Franklin BSP Realty Trust, Inc. Announces Second Quarter 2022 Results

New York City, NY – July 29, 2022 – Franklin BSP Realty Trust, Inc. (NYSE: FBRT) (“FBRT” or the “Company”) today announced financial results for the quarter ended June 30, 2022.

Reported GAAP net income (loss) of $(25.7) million or $(0.43) per diluted share for the three months ended June 30, 2022 compared to $(22.5) million or $(0.99) per diluted share for the three months ended March 31, 2022. Fully converted(1) GAAP net income (loss) of $(25.7) million or $(0.34) per diluted share for the three months ended June 30, 2022 compared to $(22.5) million or $(0.30) per diluted share for the three months ended March 31, 2022.

Reported Distributable Earnings (a non-GAAP financial measure) of $30.7 million or $0.29 per fully converted share(1) for the three months ended June 30, 2022 compared to $12.1 million or $0.08 per fully converted share(1) for the three months ended March 31, 2022.

Reported Distributable Earnings before trading and derivative gain/loss on residential adjustable-rate mortgage securities (“Run-Rate Distributable Earnings”) (a non-GAAP financial measure) of $24.8 million or $0.22 per fully converted share(1) for the three months ended June 30, 2022 compared to $40.1 million or $0.39 per fully converted share(1) for the three months ended March 31, 2022.

Second Quarter 2022 Summary

•Produced a second quarter GAAP ROE of (8.3)% and a Distributable Earnings ROE of 7.0%

•Book value of $15.81 per fully converted share(1)

•Declared second quarter common stock cash dividend of $0.355 representing an 9.0% yield on book value

•Core portfolio ended the quarter at $5.3 billion of principal balance

•Closed an $803 million managed Commercial Real Estate Collateralized Loan Obligation (“FL9 CRE CLO”) with a two-year re-investment period, initial advance rate of 83.5% and a weighted average interest rate of SOFR+2.80% before accounting for discount and transaction costs

•Fair market value of the residential adjustable-rate mortgage (“ARM”) portfolio was $270.4 million compared to $1.9 billion at March 31, 2022

•Recognized provision for credit losses of $32.5 million, inclusive of a credit loss provision of $28.4 million specific to one loan

Richard Byrne, Chairman and Chief Executive Officer of FBRT, said, “The second quarter was a transitional quarter for FBRT, which was consistent with our expectations. Our performance was also negatively affected by certain one-time events. Now that we have nearly completed the divestiture of our residential ARM securities, our complete focus is on our core commercial real estate strategy. In the quarter, we produced a distributable earnings ROE of 7.0% despite continued challenging market conditions and are moving into the third quarter with a strong balance sheet and ample liquidity. We expect to have a fully-optimized portfolio in the fourth quarter. Looking forward, we expect our returns to be more in-line with our historical performance.”

Further commenting on our results, Michael Comparato, Head of Commercial Real Estate of BSP, added, “We grew our commercial real estate portfolio to approximately $5.3 billion this quarter, bringing FBRT closer to our target stabilized core portfolio of $6.2 billion. The second quarter saw a decline in transactional volume across the commercial lending market and we continue to witness the repricing of assets, most notably in multifamily and industrial sectors. We issued our 9th CLO this quarter, and while the economics were not as accretive as our last several CLO's, it was a proactive step toward strengthening our balance sheet and clearing our warehouse facilities giving us additional flexibility to originate attractive investments going into the third quarter.”

Portfolio and Investment Activity

Core portfolio: For the quarter ended June 30, 2022, we closed $1.0 billion of loan commitments, funded $907 million of principal balance on new and existing loans and received loan repayments of $217 million. This activity resulted in

1 Fully converted per share information in this press release assumes applicable conversion of our series of outstanding convertible preferred stock into common stock and the vesting of our outstanding equity compensation awards.

net core portfolio growth of $690 million. Our core portfolio at the end of the quarter had 174 loans with an aggregate principal balance of approximately $5.3 billion. The average loan size was $30 million. Over 99% of our aggregate principal balance is in senior mortgage loans with approximately 98% in floating rate loans. When looking at the sector composition of our portfolio, approximately 75% is collateralized by multifamily properties. As of June 30, 2022, we had two non-performing loans.

Residential ARM portfolio: As of June 30, 2022, the value of the Company’s residential ARM Agency Securities portfolio was $270.4 million. The reduction in the value of this portfolio in the second quarter is due in part to (i) $115 million of principal paydowns and (ii) $1.6 billion of sales. During that period, the Company experienced trading losses net of derivatives of $15.5 million related to these assets.

Conduit: For the quarter ended June 30, 2022, the Company closed $186 million of fixed rate loans that we sold or plan to sell through our conduit program. For the same period, we sold $162 million of conduit loans for a gain of $2.5 million net of realized derivatives.

Asset CECL Provision: As of June 30, 2022, the Company had two loans with a total amortized cost basis of $167.7 million designated as non-performing. For one of these loans, the Company recognized a credit loss provision of $28.4 million during the quarter ended June 30, 2022. The Company provided details regarding this loan in its Form 8-K filed with the SEC today in connection with this earnings press release.

Financing: On June 29, 2022, the Company closed an $803 million managed CRE CLO. The FL9 CRE CLO featured a two-year reinvestment period with an initial advance rate of 83.5% and a weighted average interest rate of SOFR+2.80% before accounting for discount and transaction costs.

Book Value

As of June 30, 2022, book value was $15.81 per fully converted common share(1).

Advisor Purchase Program

During the quarter, Benefit Street Partners L.L.C. (the “Advisor”), the Company’s external manager, purchased 1,794,505 shares of the Company’s common stock for an aggregate of $24.9 million at an average gross price of $13.89 per share, inclusive of any broker’s fees or commissions, under the $35 million open market share purchase program that the Advisor agreed to implement in connection with the Company’s acquisition of Capstead Mortgage Corporation ("Capstead"). Subsequent to quarter end, from July 1, 2022 through July 8, 2022, the Advisor purchased an aggregate of 190,199 additional shares of the Company’s common stock for an aggregate of $2.5 million at an average price of $13.33 per share, inclusive of any broker’s fees or commissions, leaving no remaining balance under the Advisor’s program.

Company Repurchase Program

The Company’s board of directors has authorized a $65 million share repurchase program that became operative following the conclusion of the Advisor’s program. No shares were repurchased under this program during the quarter or subsequent to quarter-end.

Distributable Earnings and Run-Rate Distributable Earnings

Distributable Earnings is a non-GAAP measure, which we define as GAAP net income (loss), adjusted for (i) non-cash CLO amortization acceleration and amortization over our expected useful life of our CLOs, (ii) unrealized gains and losses on loans, derivatives and ARMS, including CECL reserves and impairments, (iii) non-cash equity compensation expense, (iv) depreciation and amortization, (v) non-cash incentive fees, (vi) certain other non-cash items, (vii) loan workout expenses the Company deems likely to recover and non-recurring in nature, and (viii) impairments of non-financial assets related to the Capstead merger. Run-Rate Distributable Earnings, a non-GAAP measure, presents Distributable Earnings before trading gain/loss and derivative gain/loss on residential adjustable-rate mortgage securities.

We believe that Distributable Earnings and Run-Rate Distributable Earnings provide meaningful information to consider in addition to our GAAP results. We believe Distributable Earnings is a useful financial metric for existing and potential future holders of our common stock as historically, overtime, Distributable Earnings has been an indicator of our dividends per share. As a REIT, we generally must distribute annually at least 90% of our net taxable income, subject to certain adjustments, and therefore we believe our dividends are one of the principal reasons stockholders may invest in our common stock. Further, Distributable Earnings helps us to evaluate our performance excluding the effects of certain transactions and GAAP adjustments that we believe are not necessarily indicative of our current loan portfolio and operations and is one of the performance metrics we consider when declaring our dividends. We believe

Run-Rate Distributable Earnings is a useful financial metric because it presents the Distributable Earnings of our core businesses, net of the impacts of the trading and derivative gain/loss on the residential adjustable-rate mortgage securities we acquired from Capstead that we are currently in the process of liquidating from our portfolio.
Distributable Earnings and Run-Rate Distributable Earnings do not represent net income (loss) and should not be considered as an alternative to GAAP net income (loss). Our methodology for calculating Distributable Earnings and Run-Rate Distributable Earnings may differ from the methodologies employed by other companies and thus may not be comparable to the Distributable Earnings reported by other companies.

Please refer to the financial statements and reconciliation of GAAP Net Income to Distributable Earnings and Run-Rate Distributable Earnings included at the end of this release for further information.

Supplemental Information

The Company has published a supplemental earnings presentation for the quarter ended June 30, 2022 on its website to provide additional disclosure and financial information. These materials can be found on the Company’s website at http://www.fbrtreit.com under the Presentations tab.

Conference Call and Webcast

The Company will host a conference call and live audio webcast to discuss its financial results on Friday, July 29, 2022 at 8:00 a.m. ET. Participants are encouraged to pre-register for the call and webcast at https://dpregister.com/sreg/10169273/f3aee6b40f. If you are unable to pre-register, the conference call may be accessed by dialing (844) 701-1166 (Domestic) or (412) 317-5795 (International). Ask to join the Franklin BSP Realty Trust conference call. Participants should call in at least five minutes prior to the start of the call.

The call will also be accessible via live webcast at https://ccmediaframe.com/?id=EBSJYP8A. Please allow extra time prior to the call to download and install audio software, if needed. A slide presentation containing supplemental information may also be accessed through the Company’s website in advance of the call.

An audio replay of the live broadcast will be available approximately one hour after the end of the conference call on FBRT’s website. The replay will be available for 90 days on the Company’s website.

About Franklin BSP Realty Trust, Inc.

Franklin BSP Realty Trust, Inc. (NYSE: FBRT) is a real estate investment trust that originates, acquires and manages a diversified portfolio of commercial real estate debt secured by properties located in the United States. As of June 30, 2022, FBRT had over $6.3 billion of assets. FBRT is externally managed by Benefit Street Partners L.L.C., a wholly owned subsidiary of Franklin Resources, Inc. For further information, please visit www.fbrtreit.com.

Forward-Looking Statements

This communication includes forward-looking statements. These forward-looking statements generally can be identified by phrases such as “will,” “should,” “expects,” “anticipates,” “foresees,” “forecasts,” “estimates” or other words or phrases of similar import. Similarly, statements herein that describe management’s beliefs, intentions or goals also are forward-looking statements. It is uncertain whether any of the events anticipated by the forward-looking statements will transpire or occur, or if any of them do, what impact they will have on the results of operations and financial condition of the Company or the price of FBRT stock. These forward-looking statements involve certain risks and uncertainties, many of which are beyond our control, that could cause actual results to differ materially from those indicated in such forward-looking statements. Further, forward-looking statements speak only as of the date they are made, and we undertake no obligation to update or revise forward-looking statements to reflect changed assumptions, the occurrence of unanticipated events or changes to future operating results over time, unless required by law. Currently, one of the most significant factors that could cause actual outcomes to differ materially from our forward-looking statements is the continuing adverse effect of the current COVID-19 pandemic on the financial condition, operating results and cash flows of the Company, its borrowers, the real estate market, the global economy and the financial markets. The extent to which the COVID-19 pandemic continues to impact us and our borrowers will depend on future developments, which are highly uncertain and cannot be predicted with confidence, including the scope, severity and duration of the pandemic, including resurgences of the virus and its variants, the speed, effectiveness and adoption of vaccine (including boosters) and treatment developments and the direct and indirect economic effects of the pandemic and containment measures, among others.

Our forward-looking statements are subject to various risks and uncertainties, including but not limited to the risks and important factors contained and identified in FBRT’s filings with the Securities and Exchange Commission (“SEC”), including its Annual Report on Form 10-K for the fiscal year ended December 31, 2021 and its subsequent filings with the SEC, any of which could cause actual results to differ materially from the forward-looking statements.

The forward-looking statements included in this communication are made only as of the date hereof.

FRANKLIN BSP REALTY TRUST, INC.

CONSOLIDATED BALANCE SHEETS

(In thousands, except share and per share data)


	June 30, 2022		December 31, 2021
ASSETS	(Unaudited)
Cash and cash equivalents	$	445,812	$	154,929
Restricted cash	11,354		13,270
Commercial mortgage loans, held for investment, net of allowance of $47,025 and $15,827 as of June 30, 2022 and December 31, 2021, respectively	5,182,535		4,211,061
Commercial mortgage loans, held for sale, measured at fair value	129,275		34,718
Real estate securities, trading, measured at fair value	270,381		4,566,871
Derivative instruments, measured at fair value	2,622		436
Other real estate investments, measured at fair value	—		2,074
Receivable for loan repayment (1)	44,729		252,351
Accrued interest receivable	22,899		30,109
Prepaid expenses and other assets	14,697		13,595
Intangible lease asset, net of amortization	47,033		48,472
Real estate owned, net of depreciation	88,897		90,048
Cash collateral receivable from derivative counterparties	1,672		56,767
Total assets	$	6,261,906	$	9,474,701
LIABILITIES AND STOCKHOLDERS' EQUITY
Collateralized loan obligations	$	3,203,577	$	2,162,190
Repurchase agreements - commercial mortgage loans	832,034		1,019,600
Repurchase agreements - real estate securities	293,288		4,178,784
Mortgage note payable	23,998		23,998
Other financing and loan participation - commercial mortgage loans	47,181		37,903
Unsecured debt	98,645		148,594
Derivative instruments, measured at fair value	510		32,295
Interest payable	4,859		2,692
Distributions payable	36,801		30,346
Accounts payable and accrued expenses	13,568		12,705
Due to affiliates	19,754		17,538
Total liabilities	$	4,574,215	$	7,666,645
Commitment and contingencies (See Note 10)
Redeemable convertible preferred stock:
Redeemable convertible preferred stock Series C, $0.01 par value, 20,000 authorized and 1,400 issued and outstanding as of June 30, 2022 and December 31, 2021	$	6,975	$	6,971
Redeemable convertible preferred stock Series D, $0.01 par value, 20,000 authorized and 17,950 issued and outstanding as of December 31, 2021	—		89,684
Redeemable convertible preferred stock Series H, $0.01 par value, 20,000 authorized and 17,950 issued and outstanding as of June 30, 2022	89,748		—
Total redeemable convertible preferred stock	$	96,723	$	96,655
Equity:
Preferred stock, $0.01 par value, 10,000,000 authorized and none issued or outstanding as of June 30, 2022 and December 31, 2021, respectively	$	—	$	—
Preferred stock, $0.01 par value; 100,000,000 shares authorized, 7.5% Cumulative Redeemable Preferred Stock, Series E, 10,329,039 shares issued and outstanding as of June 30, 2022 and December 31, 2021	258,742		258,742
Series F Preferred stock, $0.01 par value, 40,000,000 authorized, none issued or outstanding as of June 30, 2022, and 39,733,299 issued and outstanding as of December 31, 2021	—		710,431
Common stock, $0.01 par value, 900,000,000 shares authorized, 84,226,628 and 43,965,928 shares issued and outstanding as of June 30, 2022 and December 31, 2021, respectively	838		441
Additional paid-in capital	1,614,610		903,264
Accumulated other comprehensive income (loss)	—		(62)
Accumulated deficit	(288,986)		(167,179)
Total stockholders' equity	$	1,585,204	$	1,705,637
Non-controlling interest	5,764		5,764
Total equity	$	1,590,968	$	1,711,401
Total liabilities, redeemable convertible preferred stock and equity	$	6,261,906	$	9,474,701

______________________________________________________________________

(1) Includes $43.7 million and $187.0 million of cash held by servicer related to the CLOs as of June 30, 2022 and December 31, 2021, respectively, as well as $1.0 million and $65.3 million of RMBS principal paydowns receivable as of June 30, 2022 and December 31, 2021, respectively.

FRANKLIN BSP REALTY TRUST, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except share and per share data)

(Unaudited)


	Three Months Ended June 30,				Six Months Ended June 30,
	2022		2021		2022		2021
Income:
Interest income	$	70,213	$	48,985	$	145,471	$	91,222
Less: Interest expense	32,807		12,637		55,287		24,006
Net interest income	37,406		36,348		90,184		67,216
Revenue from real estate owned	2,312		716		4,624		1,432
Total income	$	39,718	$	37,064	$	94,808	$	68,648
Expenses:
Asset management and subordinated performance fee	6,601		6,001		13,346		11,417
Acquisition expenses	319		169		634		322
Administrative services expenses	3,048		3,078		6,401		6,552
Professional fees	8,736		2,777		15,395		4,774
Depreciation and amortization	1,296		406		2,591		812
Other expenses	1,663		911		3,425		1,406
Total expenses	$	21,663	$	13,342	$	41,792	$	25,283
Other (income)/loss:
Provision/(benefit) for credit losses	$	32,530	$	(1,508)	$	31,575	$	(3,839)
Realized (gain)/loss on extinguishment of debt	(15)		—		(15)		—

Realized (gain)/loss on sale of commercial mortgage loans, held for sale	(39)		—		(39)		—
Realized (gain)/loss on sale of real estate owned assets, held for sale	—		(1,112)		—		(1,112)
Realized (gain)/loss on sale of commercial mortgage loans, held for sale, measured at fair value	1,833		(6,520)		(56)		(13,150)
Realized (gain)/loss on other real estate investments, measured at fair value	—		—		33		—
Unrealized (gain)/loss on commercial mortgage loans, held for sale, measured at fair value	2,797		(625)		3,736		(1,104)
Unrealized (gain)/loss on other real estate investments, measured at fair value	—		(20)		(4)		(26)
Trading (gain)/loss	22,538		315		110,973		1,375
Unrealized (gain)/loss on derivatives	9,427		3,163		14,390		1,054
Realized (gain)/loss on derivatives	(25,193)		(281)		(59,223)		(2,259)
Total other (income)/loss	$	43,878	$	(6,588)	$	101,370	$	(19,061)
Income/(loss) before taxes	(25,823)		30,310		(48,354)		62,426
Provision/(benefit) for income tax	(114)		300		(138)		2,270
Net income/(loss)	$	(25,709)	$	30,010	$	(48,216)	$	60,156


Net income/(loss) applicable to common stock	$	(32,664)	$	22,998	$	(76,182)	$	46,402

Basic earnings per share	$	(0.43)	$	0.52	$	(1.27)	$	1.05
Diluted earnings per share	$	(0.43)	$	0.52	$	(1.27)	$	1.05
Basic weighted average shares outstanding	75,837,621		44,262,934		59,985,361		44,276,480
Diluted weighted average shares outstanding	75,837,621		44,278,939		59,985,361		44,292,427

FRANKLIN BSP REALTY TRUST, INC.

RECONCILIATION OF GAAP NET INCOME TO DISTRIBUTABLE EARNINGS

(In thousands, except share and per share data)

(Unaudited)

The following table provides a reconciliation of GAAP net income to Distributable Earnings and Run-Rate Distributable Earnings as of June 30, 2022 and June 30, 2021 (amounts in thousands, except share and per share data):


	Three Months Ended June 30,						Six Months Ended June 30,
	2022			2021			2022			2021
GAAP Net Income	$	(25,709)		$	30,010		$	(48,216)		$	60,156
Adjustments:
CLO amortization acceleration (1)	3,202			(839)			2,225			(1,534)
Unrealized (gain)/loss on financial instruments (2)	12,224			2,518			18,122			1,299
Unrealized (gain)/loss reversal - ARMs	7,658			—			35,120			—
Incentive fees	(3,456)			2,104			(3,456)			3,765
Depreciation and amortization	1,296			406			2,591			812
Increase/(decrease) in provision for credit losses	32,530			(1,508)			31,575			(3,839)
Loan Workout Charges (3)	3,000			—			4,900			—
Realized trading and derivatives (gain)/loss on ARMs	(5,946)			—			22,082			—
Run Rate Distributable Earnings (4)	$	24,799		$	32,691		$	64,943		$	60,659
Realized trading and derivatives gain/(loss) on ARMs	5,946			—			(22,082)			—
Distributable Earnings	$	30,745		$	32,691		$	42,861		$	60,659
Average Equity	$	1,470,643		$	1,047,109		$	1,495,106		$	1,035,161
7.5% Cumulative Redeemable Preferred Stock, Series E Dividend	$	4,842		$	—		$	9,683		$	—
GAAP Net Income (Loss) ROE	(8.3)		%	11.5		%	(7.7)		%	11.6		%
Run-Rate Distributable Earnings ROE	5.4		%	12.5		%	7.4		%	11.7		%
Distributable Earnings ROE	7.0		%	12.5		%	4.4		%	11.7		%
GAAP Net Income Per Share, Fully Converted	$	(0.34)		$	0.52		$	(0.64)		$	1.05
Run-Rate Distributable Earnings Per Share, Fully Converted	$	0.22		$	0.57		$	0.61		$	1.06
Distributable Earnings Per Share, Fully Converted	$	0.29		$	0.57		$	0.37		$	1.06

___________________________________________________________________

(1) Adjusted for non-cash CLO amortization acceleration to effectively amortize issuance costs of our CLOs over the expected lifetime of the CLOs. We assume our CLOs will be outstanding for four years and amortized the financing costs over four years in our Distributable Earnings and Run-Rate Distributable Earnings as compared to effective yield methodology in our GAAP earnings.

(2) Adjusted for unrealized gain/loss on commercial mortgage loans, held for sale, measured at fair value and unrealized gain/loss on derivatives.

(3) Represents loan workout expenses the Company incurred, which the Company deems likely to be recovered and is non-recurring in nature.

(4) Distributable Earnings before trading and derivative gain/loss on residential adjustable-rate mortgage securities (“Run-Rate Distributable Earnings”) (a non-GAAP financial measure).

EX-99.2 3 a2q22investorsupplementa.htm EX-99.2 a2q22investorsupplementa

Franklin BSP Realty Trust Supplemental Information Second Quarter 2022

Important Information 2 The information herein relates to the Company’s business and financial information as of March 31, 2022 and does not reflect subsequent developments. Risk Factors Investing in and owning our common stock involves a high degree of risk. See the section entitled “Risk Factors” in our Annual Report on Form 10-K filed February 25, 2022 and in our Quarterly Report on Form 10-Q filed May 4, 2022 for a discussion of these risks. Forward-Looking Statements Certain statements included in this presentation are forward-looking statements. Those statements include statements regarding the intent, belief or current expectations of Franklin BSP Realty Trust, Inc. (“FBRT” or the “Company”) and may include the assumptions on which such statements are based, and generally are identified by the use of words such as "may," "will," "seeks," "anticipates," "believes," "estimates," "expects," "plans," "intends," "should" or similar expressions. Actual results may differ materially from those contemplated by such forward-looking statements. Factors that could cause actual outcomes to differ materially from our forward-looking statements include, the extent of any recoveries on delinquent loans, continuing adverse effects from the COVID-19 pandemic on our financial condition, operating results and cash flows, and the financial stability of our borrowers, and the other factors set forth in the risk factors section of our most recent Form 10-K and Form 10-Q. The extent to which these factors impact us and our borrowers will depend on future developments, which are highly uncertain and cannot be predicted with confidence. Further, forward-looking statements speak only as of the date they are made, and we undertake no obligation to update or revise forward-looking statements to reflect changed assumptions, the occurrence of unanticipated events or changes to future operating results over time, except as required by law. Additional Important Information The summary information provided in this presentation does not purport to be complete and no obligation to update or otherwise revise such information is being assumed. Nothing shall be relied upon as a promise or representation as to the future performance of the Company. This summary is not an offer to sell securities and is not soliciting an offer to buy securities in any jurisdiction where the offer or sale is not permitted. This summary is not advice, a recommendation or an offer to enter into any transaction with us or any of our affiliated funds. There is no guarantee that any of the goals, targets or objectives described in this summary will be achieved. The information contained herein is not intended to provide, and should not be relied upon for, accounting, legal, ERISA or tax advice or investment recommendations. Investors should also seek advice from their own independent tax, accounting, financial, ERISA, investment and legal advisors to properly assess the merits and risks associated with their investment in light of their own financial condition and other circumstances. The information contained herein is qualified in its entirety by reference to our most recent Annual Report on Form 10-K and Quarterly Report on Form 10-Q. You may obtain a copy of the most recent Annual Report or Quarterly Report by calling (844) 785-4393 and/or visiting www.fbrtreit.com. PAST PERFORMANCE IS NOT A GUARANTEE OR INDICATIVE OF FUTURE RESULTS. INVESTMENTS INVOLVE SIGNIFICANT RISKS, INCLUDING LOSS OF THE ENTIRE INVESTMENT. There is no guarantee that any of the estimates, targets or projections illustrated in this summary will be achieved. Any references herein to any of the Company’s past or present investments, portfolio characteristics, or performance, have been provided for illustrative purposes only. It should not be assumed that these investments were or will be profitable or that any future investments will be profitable or will equal the performance of these investments. There can be no guarantee that the investment objective of the Company will be achieved. Any investment entails a risk of loss. An investor could lose all or substantially all of his or her investment. Please refer to our most recent Annual Report on Form 10-K and Quarterly Report on Form 10-Q for a more complete list of risk factors. The following slides contain summaries of certain financial information about the Company. The information contained in this presentation is summary information that is intended to be considered in the context of our filings with the Securities and Exchange Commission and other public announcements that we may make, by press release or otherwise, from time to time.

FBRT 2Q 2022 Financial Update 3

FBRT 2Q 2022 Financial Update: Second Quarter 2022 Highlights 4 1. Fully converted per share information assumes applicable conversion of our outstanding series of convertible preferred stock into common stock and the vesting of our outstanding equity compensation awards. 2. Please see appendix for GAAP net income to Distributable Earnings and Run-Rate Distributable Earnings calculation. 3. Cost of debt is shown before discount and transaction costs. Earnings ― GAAP Net Income (Loss) of ($25.7) million or ($0.34) per fully converted share (1) ― Distributable Earnings (2) of $30.7 million or $0.29 per fully converted share (1) ― Declared a cash dividend of $0.355 per share, representing a yield of 9.0% on book value per share, fully converted(1) or a yield of 9.3% on share price of $15.23 as of 7/25/22 Capitalization ― Book value per share, fully converted is $15.81 (1) ― Net debt to equity is 2.4x; recourse net debt to equity is 0.5x ― Closed BSPRT 2022-FL9 in June 2022, a $803 million managed CLO with an advance rate of 83.5%, weighted average interest rate of S+280 (3) and a 2-year reinvestment period ― 76% of financing sources are non-mark-to-market on our core book (excludes repo-securities) Investments ― Core portfolio: closed $1.0 billion of new loan commitments and funded $907 million of principal balance including future funding on existing loans. Received loan repayments of $217 million for a net core portfolio growth of $690 million in the quarter ― Conduit: sold $162 million of conduit loans in the quarter ― ARMs portfolio: less than 2% of total equity is remaining in the Adjustable-Rate Mortgage Securities (“ARMs”) portfolio Portfolio ― Core portfolio of 174 CRE loans and $5.3 billion of principal balance, average size of $30 million. Two loans on non-accrual

FBRT 2Q 2022 Financial Update: QTD Highlights 5 Note: All numbers in millions except per share and share data. 1. Does not include conduit operating expenses which are reported under Other income / (loss). 2. Please see appendix for the detail on the adjustments from GAAP net income to Distributable Earnings and Run Rate Distributable Earnings. 3. Fully converted per share information assumes applicable conversion of our outstanding series of convertible preferred stock into common stock and the vesting of our outstanding equity compensation awards. 4. Includes $7 million of preferred equity that converts to common equity on 10/19/22, subject to FBRT's right to accelerate the conversion, and $90 million of preferred equity that converts to common equity on 1/19/23, subject to the holder's right to accelerate the conversion. These amounts are reflected as temporary equity on the consolidated balance sheets. The remaining $258 million of preferred equity represents the E class, which does not convert to common equity. 5. Includes non-controlling interest. Income Statement Balance Sheet - Assets Net interest income / other income $37.3 Total core portfolio - end of quarter $5,182.5 Operating expenses (1) (18.0) Total ARMs - end of quarter $270.4 Trading and derivatives gain/(loss) on ARMs (15.5) Cash - end of quarter $457.2 Provision for credit loss (32.5) Other Assets - end of quarter $351.8 Other income/(loss) 3.0 Total assets - end of quarter $6,261.9 GAAP net income (loss) (25.7) Adjustments to GAAP net income (loss) (2) 56.5 Core loan total commitment in the quarter $1,020.3 Distributable Earnings (2) $30.7 Net originations required for stabilization $1,017.5 Realized trading and derivatives (gain)/loss on ARMs (5.9) Target core portfolio at stabilization $6,200.0 Run-Rate Distributable Earnings (2) $24.8 Balance Sheet - Debt & Equity Run-Rate Distributable Earnings per share, fully converted (2),(3) $0.22 Collateralized loan obligations 3,203.6 Run-Rate Distributable Earnings return on common equity (2) 5.4% Warehouse 832.0 Repo - Securities 293.3 GAAP net income (loss) per share, fully converted (3) ($0.34) Asset specific financings 71.2 GAAP return on common equity (8.3%) Unsecured Debt 98.6 Total Debt $4,498.7 Distributable Earnings per share, fully converted (2), (3) $0.29 Preferred Equity (4) 355.5 Distributable Earnings return on common equity (2) 7.0% Common Stock/Retained Earnings (5) 1,332.2 Total equity (4) 1,687.7 Dividend per share $0.355 Net debt/total equity 2.39x Dividend per share yield on book value 9.0% Recourse net debt/total equity 0.50x Book value per share, fully converted (3) $15.81

FBRT 2Q 2022 Financial Update: Book Value Per Share, Fully Converted 6 Book Value Per Share Roll (1) 1. Fully converted per share information assumes applicable conversion of our outstanding series of convertible preferred stock into common stock and the vesting of our outstanding equity compensation awards. 2. Please see appendix for GAAP net income to Distributable Earnings calculation. Distributable earnings per share shown is net of the preferred equity E class distribution. 3. Represents the difference between distributable earnings and GAAP net income (loss) for the Securities segment. (2) (3)

FBRT 2Q 2022 Financial Update: Earnings and Distributions 7 Note: All numbers in millions except per share data. 1. Please see appendix for GAAP net income to Distributable Earnings and Run-Rate Distributable Earnings calculation. 2. Fully converted per share information assumes applicable conversion of our outstanding series of convertible preferred stock into common stock and the vesting of our outstanding equity compensation awards. GAAP Net Income (Loss) ($M)Distributable Earnings ($M) (1) Run-Rate Distributable Earnings (1) $48.2 $40.1 $30.1 $30.0 $38.5 ($72.9) ($22.5) ($25.7) 1Q'21 2Q'21 3Q'21 4Q'21 1Q'22 2Q'22$26.6 $32.7 $40.0 $34.6 $12.1 $30.7 1Q'21 2Q'21 3Q'21 4Q'21 1Q'22 2Q'22 $24.8 $0.275 $0.275 $0.355 $0.355 $0.355 $0.355 Dividend per share $0.47 $0.57 $0.69 $0.52 $0.39 $0.22 Run-Rate Distributable Earnings per share, fully converted (1), (2) 170% 206% 195% 147% 111% 62% Run-Rate Distributable Earnings dividend coverage, fully converted (1),(2)

FBRT 2Q 2022 Financial Update: Core Loan Originations 8Note: All numbers in millions. Numbers in charts above represent principal balance. 1. Includes full paydowns, dispositions, partial paydowns and amortization. 2Q 2022 YTD 2022 Total Commitment $5,907 $1,020 Total Commitment $5,070 (1)(1) Total Commitment $4,815 $1,623 Total Commitment $5,907 +$837M Total Commitment +$1.1Bn Total Commitment

FBRT 2Q 2022 Financial Update: Capitalization Overview 1. On our core book (excluding repo-securities), 76% of financings are non-mark-to-market. 9 Collateralized Loan Obligations 71% Warehouse 18% Repo - Securities 7% Asset Specific Financings 2% Unsecured Debt 2% Financing Sources (1) FBRT average debt cost including financing costs was 2.9% in 2Q22 vs. 1.4% last quarter Net Leverage $4.5Bn Total Debt 0.50x 2.39x 0.00x 0.50x 1.00x 1.50x 2.00x 2.50x 3.00x Recourse Leverage Total Leverage

FBRT 2Q 2022 Financial Update: Financing Detail 10 CLO Name Debt Amount (2) Reinvest End Date Cost of Debt BSPRT 2018-FL4 Called 2Q22 n/a n/a BSPRT 2019-FL5 $293 million Ended L + 1.65% BSPRT 2021-FL6 $585 million 9/15/23 L + 1.42% BSPRT 2021-FL7 $722 million 12/15/23 L + 1.64% BSPRT 2022-FL8 $960 million 2/15/24 S + 1.72% BSPRT 2022-FL9 (4) $671 million 7/15/24 S + 2.80% Total $3,231 million CLO reinvestment available $11 million Repo – Securities (outstanding) $293 million Name Commitment (1) Barclays (Warehouse) $500 million Wells Fargo $500 million JP Morgan $500 million Credit Suisse $300 million Barclays (Secured Revolver) $250 million Security Benefit Life Insurance Company (Unsecured Revolver) $100 million Sterling National Bank loan participation $40 million Customers Bank loan participation $7 million Total $2,197 million Liquidity at 6/30/22 (3) ~$1.8 billion 1. Commitment for loans. Excludes bond repurchase agreements 2. Outstanding balance at June 30, 2022 and net of tranches held by FBRT. 3. Represents warehouse and revolver availability, cash and CLO reinvestment available. 4. Cost of debt is shown before discount and transaction costs. CLOs Warehouse/Revolver/Other

Portfolio 11

Portfolio: ARMs Securities 12Note: All numbers in millions except marks. 9/30/21 represents the date at which the equity exchange ratio was determined for the merger with Capstead. ARMs Portfolio Balances ($M) and Marks Total Change in portfolio - (2,567) (2,618) (1,613) (66) (6,864) Portfolio size vs. 9/30 - 64.0% 27.3% 4.7% 3.8% 3.8% $7,134 $4,567 $1,949 $336 $270 $104.1 $103.0 $101.5 $101.8 $100.3 99.70 104. 70 109. 70 114. 70 119. 70 124. 70 129. 70 $0 $1, 00 $2, 00 $3, 00 $4, 00 $5, 00 $6, 00 $7, 00 9/30/21 12/31/21 3/31/22 5/16/22 6/30/22 Balance Marks

Portfolio: Core Loan Portfolio Composition 13 Mezzanine 0.3% Senior 99.7% New England 1% Mideast 15% Great Lakes 3% Plains 1% Southeast 36% Southwest 36% Rocky Mountain 1% Far West 5% Various 2% Floating 98% Fixed 2% Portfolio Summary Collateral Summary Collateral by Region Rate Type Portfolio Overview − Total portfolio of $5.3 billion − 170 senior loans with average size of ~$31 million − 4 mezzanine loans with average size of ~$4 million − Two non-performing loans Multifamily 75% Office 9% Hospitality 9%Retail 3% Industrial 1% Mixed-Use 1% Self-Storage 1% Other 1%

Portfolio: Core Originations in the Quarter 14 Note: All numbers in millions. Charts shown above are based on the initial funding/unpaid principal balance of the newly originated loans. 1. All-in coupon based on 6/30 LIBOR and SOFR indexes − Originated 19 loans for a total commitment of $1.0 billion ($843 million of initial funding and $177 million of future funding) − Weighted average spread of 4.30% with an all-in coupon of approx. 6.00%1. Weighted average originations and exit fees of 1.1% and 0.1%, respectively By Collateral By Region By State Overview North Carolina 39% Georgia 17% Various 13% Texas 11% Virginia 7% Kentucky 7% Other 7% Multifamily 87% Retail 13% Southeast 71% Various 13% Southwest 11% Far West 4%

Portfolio: Core Portfolio - Case Studies: Watch List Loans (Risk Rating 4&5) 15 Investment Brooklyn Hotel Single Tenant Retail Portfolio Loan Type Floating Rate Senior Loan Floating Rate Senior Loan Investment Date Q4 2017 Q2 2022 Default Date Q2 2019 Q2 2022 Collateral 147-Key Hotel 24 Freestanding Retail Properties Loan Purpose Refinance Refinance Location Brooklyn, New York Various Total Commitment $57 million $113 million Principal Amount $57 million $113 million Spread L + 5.2% S + 4.5% Loan Risk Rating 4 5

Appendix 16

Appendix: Core Portfolio - FBRT Portfolio Details – Top 15 Loans 17 Loan Type Origination Date Total Commitment Principal Balance Carrying Value Spread All-in Yield (1) Fully Extended Maturity State Collateral Type As-is LTV (2) Loan 1 Senior Loan 6/1/22 $153 $127 $126 + 3.95% 6.13% 6/9/27 North Carolina Multifamily 67.5% Loan 2 Senior Loan 5/26/21 129 75 74 + 6.50% 8.94% 6/9/26 Florida Multifamily —% Loan 3 (3) Senior Loan 4/18/22 113 113 112 + 4.50% 7.60% 5/9/24 Various Retail n/a Loan 4 Senior Loan 1/30/18 100 14 14 + 4.50% 6.54% 12/31/22 New York Multifamily 22.4% Loan 5 Senior Loan 10/8/21 89 89 88 + 2.75% 4.70% 10/9/26 District of Columbia Multifamily 50.3% Loan 6 Senior Loan 6/1/22 86 81 80 + 3.95% 6.13% 6/9/27 North Carolina Multifamily 71.8% Loan 7 Senior Loan 2/25/22 86 86 86 + 3.24% 5.41% 3/9/26 New Jersey Multifamily 60.0% Loan 8 Senior Loan 2/24/22 86 86 85 + 3.15% 5.57% 3/9/27 North Carolina Multifamily 69.6% Loan 9 Senior Loan 12/15/21 84 78 78 + 3.21% 5.14% 1/9/27 North Carolina Multifamily 76.1% Loan 10 Senior Loan 2/10/22 82 82 82 + 3.20% 5.26% 2/9/27 Florida Multifamily 74.5% Loan 11 Senior Loan 12/21/21 79 78 78 + 3.45% 5.33% 1/9/27 Florida Multifamily 78.8% Loan 12 Senior Loan 3/31/21 79 73 73 + 2.95% 4.94% 4/9/26 Texas Multifamily 72.6% Loan 13 Senior Loan 12/20/21 74 65 65 + 6.14% 8.80% 7/9/26 New York Multifamily 74.7% Loan 14 Senior Loan 5/18/22 71 71 70 + 3.80% 5.97% 6/9/27 Georgia Multifamily 77.9% Loan 15 Senior Loan 6/14/22 71 69 68 + 3.45% 5.94% 6/9/27 Georgia Multifamily 71.6% Loans 16 - 174 Senior & Mezz Loans Various 4,527 4,066 4,051 + 3.85% 6.18% Various Various Various 69.0% CECL Reserve (48) Total/Wtd. avg. $5,907 $5,252 $5,183 + 3.85% 6.17% 3.7 years 66.5% Average Loan Size $34 $30 $30 Note: All numbers in millions. 1. All-in Yield defined as: (1) current spread of the loan plus (2) any applicable index or index floor plus (3) origination and exit fees amortized over the initial maturity date of the loan. 2. As-is loan to value percentage is from metrics at origination. Predevelopment construction loans at origination will not have an LTV and therefore is nil. 3. Loan is on non-accrual status.

Appendix: Core Portfolio - Risk Ratings 18 Note: Principal balance in millions. Our average risk rating was 2.1 for the quarter vs. 2.1 last quarter # of Loans 0 156 16 1 1 +/- vs 1Q’22 - +6 +1 - +1 Principal Balance $- $4,829 $253 $57 $113 Non-Accrual - - - 1 1 0.0% 91.9% 4.8% 1.1% 2.2% 1 2 3 4 5

Appendix: Earnings Sensitivity 19 − Positive earnings correlation to rising rates Note: Reflects illustrative earnings impact of an increase in the floating-rate indices referenced by our portfolio, assuming no change in credit spreads, portfolio composition or asset performance. ($0.02) $0.00 $0.05 $0.11 $0.16 $0.22 -0.25% Base +0.50% +1.00% +1.50% +2.00% Change in Floating Base Rate Indices Sensitivity on Index Rates (Annual EPS Impact) As of 7/25/22: 1M LIBOR: 2.30% 1M SOFR: 2.29% As of 6/30/22 1M LIBOR = 1.79% 1M SOFR = 1.69%

Appendix: Core Portfolio – Allowance For Loan Loss 20 Note: All numbers in millions. Allowance for loan loss above includes future funding. Allowance for Loan Loss by Collateral Type – Before Asset-Specific Reserve Retail 61% Multifamily 31% Hospitality 7% Other 2% $ millions Allowance for Loan Loss Balance at 3/31/22 $15.1 Provision for Credit Loss - General Reserve 4.1 Allowance for Loan Loss Balance at 6/30/22 - Before Asset-Specific Reserve $19.2 Provision for Credit Loss - Asset Specific 28.4 Allowance for Loan Loss Balance at 6/30/22 - Including Asset-Specific Reserve $47.6 Portfolio Principal Balance $5,252 Total Allowance for Loan Loss % of Portfolio 0.9%Allowance for Loan Loss by Collateral Type – Including Asset-Specific Reserve Multifamily 77% Hospitality 16% Office 3% Other 3%

Appendix: Segment Reporting Summary 21 Note: All numbers in thousands except share and per share data. “nm” represents not meaningful. 1. Please see appendix for the detail on the adjustments from GAAP net income to Distributable Earnings and Run Rate Distributable Earnings. 2. Includes the real estate debt and other real estate investments segment, TRS segment and real estate owned segment. The preferred E dividend is subtracted from the earnings for the earnings per share and return on common equity calculations. 3. Fully converted per share information assumes applicable conversion of our outstanding series of convertible preferred stock into common stock and the vesting of our outstanding equity compensation awards. Nominal ($000s) Weighted Average Shares Outstanding, Fully Converted (3) Earnings Per Share, Fully Converted (3) Daily Average Common Equity ($000s) Return on Common Equity GAAP Net Income (Loss) ($25,710) 89,995,323 ($0.34) $1,470,643 (8.3%) Run-Rate Distributable Earnings (1) $24,797 89,995,323 $0.22 $1,470,643 5.4% Distributable Earnings (1) $30,743 89,995,323 $0.29 $1,470,643 7.0% GAAP Net Income (Loss): Core (2) (10,796) 88,506,153 ($0.18) 1,446,308 (4.3%) Securities (14,914) 1,489,169 ($10.01) 24,335 nm Total ($25,710) 89,995,323 ($0.34) $1,470,643 (8.3%) Run-Rate Distributable Earnings: (1) Core (2) 24,176 88,506,153 $0.22 1,446,308 5.3% Securities 621 1,489,169 $0.42 24,335 nm Total $24,797 89,995,323 $0.22 $1,470,643 5.4% Distributable Earnings: (1) Core (2) 24,176 88,506,153 $0.22 1,446,308 5.3% Securities 6,567 1,489,169 $4.41 24,335 nm Total $30,743 89,995,323 $0.29 $1,470,643 7.0%

Appendix: GAAP Net Income to Distributable Earnings Reconciliation 22 Note: All numbers in millions except share and per share data. 1. Represents transaction costs associated with the merger with Capstead on October 19, 2021. 2. Adjusted for non-cash CLO amortization acceleration to effectively amortize issuance costs of our CLOs over the expected lifetime of the CLOs. We assume our CLOs will be outstanding for four years and amortized the financing costs over four years in our distributable earnings as compared to effective yield methodology in our GAAP earnings 3. Adjusted for unrealized gain and loss on loans, derivatives and ARMs securities. 4. Incentive fees that are positive represents incentive fees that were accrued during the quarter, but not paid in cash. Incentive fees that are negative represents incentive fees that were paid in cash in the quarter related to accruals from prior quarters. 5. Represents costs related to loan workouts where they are either viewed as one-time and non-recurring or we expect such costs may be recuperated in the future. 6. Equal to Distributable Earnings excluding the realized trading and derivatives gain/loss on ARMs. 7. Distributable Earnings to common is net of preferred equity E class dividend payment. 8. Represents the average of all equity except the preferred equity E class. 9. Fully converted per share information assumes applicable conversion of our outstanding series of convertible preferred stock into common stock and the vesting of our outstanding equity compensation awards. 10. Calculated as GAAP net income less preferred dividend on preferred equity E class or Distributable Earnings to Common divided by fully converted weighted average shares outstanding. 3Q'21 4Q'21 1Q'22 2Q'22 GAAP Net Income (Loss) 38.5 (72.9) (22.5) (25.7) Adjustments: Impairment of Acquired Assets (1) - 88.3 - - CLO Amortization Acceleration/CLO Call (2) (0.9) 2.7 (1.0) 3.2 Unrealized (Gain)/Loss Reversal (3) (0.3) 13.2 33.4 19.9 Incentive Fees (4) 4.3 1.8 - (3.5) Depreciation & Amortization - 1.3 1.3 1.3 (Reversal of) / Provision for Credit Loss (1.6) 0.3 (1.0) 32.5 Loan Workout Charges (5) - - 1.9 3.0 Realized trading and derivatives (gain)/loss on ARMs - 13.6 28.0 (5.9) Run-Rate Distributable Earnings (6) 40.0 48.2 40.1 24.8 Realized trading and derivatives gain/(loss) on ARMs - (13.6) (28.0) 5.9 Distributable Earnings 40.0 34.6 12.1 30.7 Preferred Equity E Class Dividend - (4.8) (4.8) (4.8) Distributable Earnings to Common (7) 40.0 29.7 7.3 25.9 Average Equity (8) 1,063.4 1,451.2 1,519.6 1,470.6 GAAP Net Income (Loss) ROE 14.5% (21.4%) (7.2%) (8.3%) Run-Rate Distributable Earnings ROE 15.0% 11.9% 9.3% 5.4% Distributable Earnings ROE 15.0% 8.2% 1.9% 7.0% Fully Converted Weighted Average Shares Outstanding (9) 57,625,192 83,251,034 89,850,478 89,995,323 GAAP Earnings Per Share, Fully Converted (10) $0.67 ($0.93) ($0.30) ($0.34) Run-Rate Distributable Earnings Per Share, Fully Converted (10) $0.69 $0.52 $0.39 $0.22 Distributable Earnings Per Share, Fully Converted (10) $0.69 $0.36 $0.08 $0.29

Appendix: Book Value Per Share & Shares Outstanding 23Note: All numbers in thousands except per share and share data. June 30, 2022 December 31, 2021 Stockholders' equity applicable to convertible common stock $ 1,423,185 $ 1,543,550 Shares: Common stock 83,709,798 43,951,382 Restricted stock 516,830 14,546 Series C convertible preferred stock 418,880 418,880 Series D convertible preferred stock — 5,370,640 Series F convertible preferred stock — 39,733,299 Series H convertible preferred stock 5,370,640 — Total outstanding 90,016,148 89,488,747 Fully-converted book value per share $ 15.81 $ 17.25

24 Appendix: FBRT Income Statement

25 Appendix: FBRT Balance Sheet