Matt Howlett: My $0.02 for what it’s worth is if you can put capital where it’s something that could be worth 100% up versus — I know you’re getting 20% on new investments, but clearly share repurchases at these type of discounts, NAV, just look like the best use of capital, I mean, obviously, in the context of all the other liquidity that you’re managing. And I appreciate you guys are out there doing it, and it’s nice to see. Last question, Andrew, what was the coupon on the term loan? And then, we’re seeing the REITs out now issuing five-year paper, 8%, 9% unsecured. What can you tell me on the non-secured side? Maybe you’re going to be out in the market? Is that a channel open to you?
Andrew Ahlborn: Yeah. So, the term loan price is SOFR plus 5.50% on a not tax affected though. So, we will be able to tax back the interest cost of this issuance, which will bring it down into the 7%s. In terms of accessing other corporate markets, we certainly see deals get done and we explore them on a continuous basis. And I do think as we move forward and we evaluate the liquidity needs of the company, we’ll consider all options.
Matt Howlett: Great. I look forward to that. Thanks everybody.
Operator: [Operator Instructions] Our next question comes from Jade Rahmani with KBW. Please proceed with your question.
Jade Rahmani: Thank you very much. Can you give any color on the other income line, which is around $15 million, and also the other operating expenses, which was about $30 million?
Andrew Ahlborn: Yeah. So, in the other income, the biggest driver is going to be the contingent equity rate, which was offset by losses that are also included in core. So the net impact of that is zero. On the operating side, the biggest one in there is impairment on REO, which flow through that line item. That was roughly $17 million in the quarter. There’s also carry costs on REO like tax expenses, et cetera, that flow through there. But the main one was the REO impairment this quarter.
Jade Rahmani: So, I guess on the $15 million of other income, I mean in the 10-K the description is that it includes a whole variety of stuff, your 10-Q is not out, but origination income, change in repair and denial reserve, employee retention, credit consulting income. Are those line items expected to continue?
Andrew Ahlborn: Origination income will continue. So, what will flow through there are mainly fees received from Redstone. That was down slightly down $2 million quarter-over-quarter. So that will be a continuous item. The repair and denial reserve relates to the reserve we put on the books on the guaranteed portion of 7(a) loans, in the event that a loan goes delinquent and we do have to repair the SBA for that default. The reason it’s there in the income line item is that when we purchased the business from CIT, there is a fairly large reserve put in there. I would expect that dollar, that line item to get smaller over time. Employee retention credit income in that line item was down $27 million quarter-over-quarter, it’s now included $2.5 million in Q1.
I would expect that to trend toward zero as we move throughout the other — throughout the rest of the year. And then, the contingent equity right, which is sort of the last remaining bucket that’s flowing through there, will also fade away as we get to the end of the Mosaic transaction. So the main items inside other income absent other things that come through the business in the future really is going to be our origination income.
Jade Rahmani: Okay. That’s great. And then, capital plans aside from a potential CLO, are you contemplating anything at this point?
Andrew Ahlborn: We are not.
Jade Rahmani: Okay. I thought there was a plan for some sort of unsecured debt or preferred, I guess the term loan was issued and maybe that’s what you were previously referring to?
Andrew Ahlborn: Yes. With the execution of the term loan, the proceeds from the sale of the held for sale loans, as well as just the natural liquidity projections in the business, we’re pretty well positioned for the immediate term. Obviously, as we move to the back half of the year, we will balance the opportunity set on the investment side with the opportunity for raising additional debt at that point. But in the short term, the liquidity forecast for the company is quite healthy.
Jade Rahmani: Thanks a lot.
Operator: We have reached the end of the question-and-answer session. I’d now like to turn the call back over to Tom Capasse for closing comments.
Tom Capasse: I appreciate everybody’s time and look forward to the second quarter earnings call.
Operator: This concludes today’s conference. You may disconnect your lines at this time, and we thank you for your participation.
