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INVESTMENTS IN CDO SERVICING RIGHTS
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6 Months Ended | ||
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Jun. 30, 2013
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| Investments In Cdo Servicing Rights | |||
| INVESTMENTS IN CDO SERVICING RIGHTS |
In February 2011, Newcastle, through one of its subsidiaries, purchased the management rights with respect to certain C-BASS Investment Management LLC (“C-BASS”) CDOs pursuant to a bankruptcy proceeding for $2.2 million. Newcastle initially recorded the cost of acquiring the collateral management rights as a servicing asset and subsequently amortizes this asset in proportion to, and over the period of, estimated net servicing income. Servicing assets are assessed for impairment on a quarterly basis, with impairment recognized as a valuation allowance. Key economic assumptions used in measuring any potential impairment of the servicing assets include the prepayment speeds of the underlying loans, default rates, loss severities and discount rates. During the six months ended June 30, 2013 and 2012, respectively, Newcastle recorded $0.2 million and $0.2 million of servicing rights amortization and no servicing rights impairment. As of June 30, 2013, Newcastle’s servicing asset had a carrying value of $1.6 million recorded in Receivables and Other Assets.
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- Definition
The entire disclosure regarding the company's investments in CDO servicing rights. No definition available.
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