Summary of Apollo Commercial Real Estate Finance (NYSE: ARI) Conference Call Company Overview - **Company**: Apollo Commercial Real Estate Finance, Inc. (ARI) - **Date of Call**: January 28, 2026 - **Speaker**: Stuart Rothstein, CEO Key Points Transaction Announcement - ARI has entered into a definitive agreement with Athene to sell its loan portfolio for a purchase price of **99.7%** based on total loan commitments, net of asset-specific CECL reserves, excluding two loans with a principal balance of **$146 million** expected to be repaid prior to closing [3][4] - The transaction is expected to provide ARI with approximately **$1.4 billion** of net cash after repayment of financing facilities and transaction expenses [4][6] Financial Implications - Post-transaction, ARI's common equity book value per share is expected to be approximately **$12.05** [4] - The purchase price represents a **23% premium** to ARI's recent trading levels and multiyear average price-to-book ratio [6] - ARI intends to pay a first-quarter dividend of **$0.25** per share, consistent with recent levels, targeting an approximately **8%** annualized yield based on post-transaction book value per share [7] Strategic Rationale - The transaction aims to close the valuation gap for ARI, as its common stock has traded at an average of **0.76** of net book value despite improving credit quality [5] - The sale validates ARI's book value and provides liquidity and balance sheet strength [6] - ARI's management will evaluate new commercial real estate strategies and consider strategic M&A opportunities to unlock additional value for stockholders [8][9] Future Outlook - If a new asset strategy or strategic transaction is not identified by year-end, Apollo intends to recommend exploring all strategic alternatives, including dissolution [9] - The management team will leverage Apollo's broader investment platform and origination capabilities to explore new strategies [9][10] - Apollo has agreed to a **50% reduction** in ARI's annual management fee rate, paid in shares of ARI common stock, to align interests with stockholders [10] Market Context - The demand for ARI's yield-generating assets is high in the private institutional market, which has influenced the timing of the transaction [5][6] - The strategic review will consider both internal and external opportunities, including potential M&A within the Apollo umbrella [39] Additional Considerations - The transaction includes a **25-day go-shop period** for the special committee to solicit additional interest in the portfolio [10][28] - ARI retains net equity interest in real estate properties valued at approximately **$466 million** as of September 30, 2025 [5] Conclusion - The transaction is viewed as a decisive step to unlock value not reflected in ARI's public market valuation, providing immediate validation of book value and positioning ARI for a new chapter with enhanced flexibility and liquidity [11]

Core Insights - Ottawa Bancorp, Inc. reported a net income of $0.5 million for Q2 2025, a significant improvement from a net loss of $(0.2) million in Q2 2024, indicating a positive operational turnaround [1][4] - For the first half of 2025, net income reached $0.9 million, compared to $0.1 million in the same period of 2024, showcasing consistent growth [1][8] - The company has initiated a stock repurchase program, repurchasing 59,053 shares at an average price of $14.74 per share, reflecting a commitment to enhancing shareholder value [2][3] Financial Performance - Total interest and dividend income for Q2 2025 was $4.2 million, up from $4.0 million in Q2 2024, driven by an increase in the average yield on interest-earning assets, which rose by 0.32% to 5.10% [4][24] - Interest expense decreased to $1.6 million in Q2 2025 from $1.8 million in Q2 2024, resulting in a lower average cost of funds of 2.13% compared to 2.29% [4][24] - Net interest income after provision for credit losses increased to $2.7 million in Q2 2025, up from $2.2 million in Q2 2024 [4][24] Asset Quality - The loan portfolio, net of allowance, increased to $302.2 million as of June 30, 2025, from $301.7 million at the end of 2024, indicating stable loan growth [1][14] - Non-performing loans decreased to $3.8 million at June 30, 2025, down from $4.8 million at December 31, 2024, improving the ratio of non-performing loans to gross loans from 1.58% to 1.23% [1][5] - The allowance for credit losses on loans was $4.1 million, or 1.34% of total gross loans, at June 30, 2025, compared to $4.3 million, or 1.40%, at June 30, 2024 [6][26] Financial Condition - Total consolidated assets decreased by $6.9 million, or 1.9%, to $346.8 million as of June 30, 2025, primarily due to a reduction in cash and cash equivalents [11][12] - Total deposits decreased by $6.0 million, or 2.1%, to $276.9 million at June 30, 2025, with notable declines in various account types [15][21] - Stockholders' equity decreased to $39.6 million at June 30, 2025, down from $40.2 million at December 31, 2024, reflecting share repurchases and cash dividends [17][21] Management Commentary - The CEO expressed satisfaction with the operational results, highlighting a reduction in the cost of funds and an increase in asset yields, which contributed to the expansion of the net interest margin [3][4] - The company remains cautiously optimistic about lending activities despite sluggish residential loan activity due to higher mortgage interest rates [3][4]