Annual report pursuant to Section 13 and 15(d)

FAIR VALUE OF FINANCIAL INSTRUMENTS - Fair Value of Assets and Liabilities (Details)

v2.4.0.8
FAIR VALUE OF FINANCIAL INSTRUMENTS - Fair Value of Assets and Liabilities (Details) (USD $)
In Thousands, unless otherwise specified
Dec. 31, 2013
Dec. 31, 2012
Financial Instruments    
Real estate securities, available-for-sale $ 984,263 [1] $ 1,691,575 [1]
Real estate related loans, held-for-sale, net 437,530 843,132
Residential mortgage loans, held-for-investment, net 255,450 292,461
Residential mortgage loans, held-for-sale, net 2,185 2,471
Subprime mortgage loans subject to call option 406,217 405,814
Restricted Cash 12,366 2,064
Cash and Cash Equivalents 105,944 231,898
Non-hedge derivative assets 43,662 165
Investments in senior housing real estate, net 1,362,900 162,801
Investments in other real estate 266,170 6,672
Property, Plant and Equipment 270,188   
Goodwill and Intangibles 471,811  
Other investments 25,468 24,907
Receivables and other assets 252,071 17,362
Assets of discontinued operations    245,069
Total Assets 4,852,563 3,945,312
Financial Instruments    
CDO bonds payable 544,525 1,091,354
Other bonds and notes payable 230,279 183,390
Repurchase agreements 556,347 929,435
Mortgage notes payable 1,076,828 120,525
Credit facilities, media and golf - Note 14 334,514   
Financing of subprime mortgage loans subject to call option (B) 406,217 405,814
Junior subordinated notes payable 51,237 51,243
Liabilities of discontinued operations    480
Total Liabilities 3,626,439 2,872,252
Total Mortgage Notes Payable
    
Weighted Average    
Weighted Average Yield/Funding Cost 4.75%  
Weighted Average Maturity (Years) 6 years 9 months 18 days  
Media and Golf Credit Facilities
    
Weighted Average    
Weighted Average Yield/Funding Cost 6.68%  
Weighted Average Maturity (Years) 4 years 4 months 24 days  
Junior Subordinated Debt
    
Weighted Average    
Weighted Average Yield/Funding Cost 7.39%  
Weighted Average Maturity (Years) 21 years 3 months 18 days  
CDO Bonds Payable
    
Weighted Average    
Weighted Average Yield/Funding Cost 2.26% [2]  
Weighted Average Maturity (Years) 1 year 10 months 24 days [2]  
Other Bonds and Notes Payable
    
Weighted Average    
Weighted Average Yield/Funding Cost 3.50% [2]  
Weighted Average Maturity (Years) 3 years 1 month 6 days [2]  
Repurchase Agreements
    
Weighted Average    
Weighted Average Yield/Funding Cost 0.52%  
Weighted Average Maturity (Years) 0 years 1 month 6 days  
Financing on Subprime Mortgage Loans subject to Call Options
    
Weighted Average    
Weighted Average Yield/Funding Cost 9.09% [3]  
Weighted Average Maturity (Years) (B) [3]  
Interest Rate Swap Agreements
    
Weighted Average    
Weighted Average Yield/Funding Cost N/A [4],[5]  
Weighted Average Maturity (Years) (C) [4],[5]  
Non-Hedge Derivative Liabilities
    
Weighted Average    
Weighted Average Yield/Funding Cost N/A [4],[6]  
Weighted Average Maturity (Years) (D) [4],[6]  
Real Estate Related and Other Loans Held For Sale
    
Weighted Average    
Weighted Average Yield/Funding Cost 13.92%  
Weighted Average Maturity (Years) 1 year 1 month 6 days  
Residential Mortgage Loans Held For Investment
    
Weighted Average    
Weighted Average Yield/Funding Cost 8.50%  
Weighted Average Maturity (Years) 5 years 4 months 24 days  
Residential Mortgage Loans Held For Sale
    
Weighted Average    
Weighted Average Yield/Funding Cost 19.34%  
Weighted Average Maturity (Years) 4 years 4 months 24 days  
Subprime Mortgage Loans Subject to Call
    
Weighted Average    
Weighted Average Yield/Funding Cost 9.09% [3]  
Weighted Average Maturity (Years) (B) [3]  
Real Estate Securities Available For Sale
    
Weighted Average    
Weighted Average Yield/Funding Cost 5.44%  
Weighted Average Maturity (Years) 2 years 10 months 24 days  
Non-Hedge Derivative Assets
    
Weighted Average    
Weighted Average Yield/Funding Cost N/A [4],[6]  
Weighted Average Maturity (Years) (D) [4],[6]  
Principal Balance
    
Financial Instruments    
Real estate securities, available-for-sale 1,170,905 [7]  
Real estate related loans, held-for-sale, net 567,829  
Residential mortgage loans, held-for-investment, net 277,624  
Residential mortgage loans, held-for-sale, net 3,129  
Subprime mortgage loans subject to call option 406,217 [3]  
Non-hedge derivative assets 116,806 [4],[6],[7]  
Financial Instruments    
CDO bonds payable 543,516 [2]  
Other bonds and notes payable 243,475 [2]  
Repurchase agreements 556,347  
Mortgage notes payable 1,077,163  
Credit facilities, media and golf - Note 14 335,498 [8]  
Financing of subprime mortgage loans subject to call option (B) 406,217 [3]  
Junior subordinated notes payable 51,004  
Interest rate swaps, treated as hedges 105,031 [4],[5],[7]  
Non-hedge derivatives 185,871 [4],[6],[7]  
Carrying Amount
    
Financial Instruments    
Real estate securities, available-for-sale 984,263 [7] 1,691,575 [7]
Real estate related loans, held-for-sale, net 437,530 843,132
Residential mortgage loans, held-for-investment, net 255,450 292,461
Residential mortgage loans, held-for-sale, net 2,185 2,471
Subprime mortgage loans subject to call option 406,217 [3] 405,814 [3]
Restricted Cash 12,366 [7] 2,064 [7]
Cash and Cash Equivalents 105,944 [7] 231,898 [7]
Non-hedge derivative assets 43,662 [4],[6],[7] 165 [4],[6],[7]
Investments in senior housing real estate, net 1,362,900 162,801
Investments in other real estate 266,170 6,672
Property, Plant and Equipment 270,188   
Goodwill and Intangibles 471,811 19,086
Other investments 25,468 24,907
Receivables and other assets 208,409 17,197
Assets of discontinued operations    245,069
Total Assets 4,852,563 3,945,312
Financial Instruments    
CDO bonds payable 544,525 [2] 1,091,354 [2]
Other bonds and notes payable 230,279 [2] 183,390 [2]
Repurchase agreements 556,347 929,435
Mortgage notes payable 1,076,828 120,525
Credit facilities, media and golf - Note 14 334,514 [8]  
Financing of subprime mortgage loans subject to call option (B) 406,217 [3] 405,814 [3]
Junior subordinated notes payable 51,237 51,243
Interest rate swaps, treated as hedges 6,203 [4],[5],[7] 12,175 [4],[5],[7]
Non-hedge derivatives 7,592 [4],[6],[7] 19,401 [4],[6],[7]
Dividends payable, accounts payable, accrued expenses and other liabilities 412,697 58,435
Liabilities of discontinued operations    480
Total Liabilities 3,626,439 2,872,252
Estimated Fair Value
    
Financial Instruments    
Real estate securities, available-for-sale 984,263 [7] 1,691,575 [7]
Real estate related loans, held-for-sale, net 456,535 853,102
Residential mortgage loans, held-for-investment, net 252,039 297,030
Residential mortgage loans, held-for-sale, net 2,185 2,471
Subprime mortgage loans subject to call option 406,217 [3] 405,814 [3]
Restricted Cash 12,366 [7]  
Cash and Cash Equivalents 105,944 [7]  
Non-hedge derivative assets 43,662 [4],[6],[7] 165 [4],[6],[7]
Financial Instruments    
CDO bonds payable 395,689 [2] 781,856 [2]
Other bonds and notes payable 235,464 [2] 190,302 [2]
Repurchase agreements 556,347 929,435
Mortgage notes payable 1,075,390 120,525
Credit facilities, media and golf - Note 14 334,514 [8]  
Financing of subprime mortgage loans subject to call option (B) 406,217 [3] 405,814 [3]
Junior subordinated notes payable 35,479 31,545
Interest rate swaps, treated as hedges 6,203 [4],[5],[7] 12,175 [4],[5],[7]
Non-hedge derivatives $ 7,592 [4],[6],[7] $ 19,401 [4],[6],[7]
[1] See Note 13 regarding the estimation of fair value, which is equal to carrying value for all securities.
[2] Newcastle notes that the unrealized gain on the liabilities within such structures cannot be fully realized. Assets held within CDOs and other non- recourse structures are generally not available to satisfy obligations outside of such financings, except to the extent Newcastle receives net cash flow distributions from such structures. Furthermore, creditors or beneficial interest holders of these structures have no recourse to the general credit of Newcastle. Therefore, Newcastle's exposure to the economic losses from such structures is limited to its invested equity in them and economically their book value cannot be less than zero. As a result, the fair value of Newcastle's net investments in these non-recourse financing structures is equal to the present value of their expected future net cash flows.
[3] These two items results from an option, not an obligation, to repurchase loans from Newcastle's subprime mortgage loan securitizations (Note 7), are noneconomic until such option is exercised, and are equal and offsetting.
[4] Newcastle's derivatives fall into two categories. As of December 31, 2013, all derivatives liabilities, which represent three interest rate swaps, were held within Newcastle's nonrecourse structures. An aggregate notional balance of $290.9 million, is only subject to the credit risks of the respective CDO structures. As they are senior to all the debt obligations of the respective CDOs and the fair value of each of the CDOs' total investments exceeded the fair value of each of the CDOs' derivative liabilities, no credit valuation adjustments were recorded. A derivative asset with an aggregate notional balance of $116.8 million, represents linked transactions with $116.8 million face amount of underlying financed securities. Newcastle's interest rate swap counterparties include Bank of America and Bank of New York Mellon. Newcastle's derivatives are included in other assets or other liabilities in the consolidated balance sheets, as applicable.
[5] Represents derivative agreements as follows: (See Schedule of fair value of derivative assets)
[6] This represents a linked transaction entered into in June 2013 with $116.8 million face amount of underlying financial securities. This derivative agreement was not designated as a hedge for accounting purposes as of December 31, 2013.
[7] Measured at fair value on a recurring basis.
[8] These credit facilities were entered into late in the fourth quarter of 2013 and Newcastle believes their terms are market terms as of December 31, 2013.