Ready Capital Corporation (RC) Earnings

Management highlights

### Core Strategic Priorities for 2026 - Strengthen liquidity to generate free cash flow in excess of 2026 debt maturities - Resolve non- and sub-performing CRE assets to eliminate ongoing earnings drag - Transition to a lower-cost business model by divesting non-core business lines and integrating CRE lending with the external manager Waterfall - Prioritize growth in the small business SBA 7A lending platform ### Completed Liquidity Initiatives Post-Q1 2026 - Sold a $167 million construction portfolio, generating $64 million in net liquidity and removing $172 million in future funding obligations - Securitized $158 million of unguaranteed SBA 7A loans, generating $25 million in net liquidity and unlocking $500 million in additional 7A production funding capacity - Disposed of $445 million in CRE assets, generating $85 million in net liquidity - Successfully refinanced the Portland Ritz asset into a CPACE loan - Total cumulative cash generated from all prior and recent actions is approximately $1.9 billion, which has been used to pay down $1.7 billion in asset-level and corporate debt, meeting 81% of the company's total liquidity target ### CRE Portfolio Performance Updates - 37% of the current CRE loan book is sub- and non-performing; management has determined holding these assets for active balance sheet management generates higher net present value than selling in the current secondary market - The Portland Ritz mixed-use property is on track with its stabilization strategy: 40% of condominium units have been sold or are under contract. Hotel operating performance improved year-over-year, with trailing 12-month occupancy rising 10% to 52% and RevPAR increasing 20% to $244 - Total earnings drag from non-/sub-performing assets and REO was 29 cents per share in Q2 ### Cost Optimization Progress - The company is executing a targeted cost optimization program to align expenses with its go-forward business model, including organizational efficiency initiatives, non-core business/asset divestitures, and deeper platform integration with Waterfall - Operating expenses fell to $48.7 million in Q2 from $67.7 million in Q1, driven largely by a normalization of servicing expenses after non-recurring costs related to Q1 CLO collapses

Guidance

- Management does not anticipate additional large-scale portfolio sales after completing the current round of asset dispositions, as the program successfully hit its liquidity and repositioning goals - The SBA 7A lending platform targets $1.5 billion in annual originations, with steady production growth expected following the recent securitization that unlocked new production capacity - Management expects a 25-35% reduction in operating expenses from current levels, driven by portfolio runoff, non-core divestitures, and operational integration - Net interest income is expected to continue improving as non-performing loans and REO are resolved, corporate and asset-level debt is reduced, and capital is recycled into assets with current market yields - Management expects to complete all remaining liquidity initiatives in time to meet all 2026 corporate debt obligations and return the company to sustainable profitability after repositioning is complete

Segment performance

1. Commercial Real Estate (CRE) Segment: Total legacy CRE loan book stands at $2.7 billion across 172 positions, plus an additional $218 million of CMBS exposure. 37% ($1 billion) of the loan book consists of sub- and non-performing assets, which hold $436 million in current equity. The performing CRE loan book holds $572 million in equity with leveraged yields of 10.1%. The company holds $588 million in REO across 24 properties; the Portland Ritz mixed-use property is the largest REO asset, representing 66% of total REO and 22% of end-of-quarter stockholders' equity. CRE portfolio contraction led to lower interest income of $77.4 million this quarter. This segment contributed 57% of total assets at quarter end. 2. SBA 7A Lending Segment: Q2 2026 origination volume was $82 million, limited by earlier capital constraints. A completed $158 million securitization of unguaranteed SBA 7A loans added $500 million in additional production funding capacity. Post-securitization, $43 million in new 7A loans have been originated, with a current pipeline of $78 million. This segment is the primary growth focus for the company.

Risks & headwinds

- The Portland Ritz mixed-use property represents a large concentration of the company's REO portfolio and 22% of total end-of-quarter stockholders' equity, meaning performance or sale delays for this asset could materially impact book value and earnings - Residual legacy non- and sub-performing CRE assets continue to create an earnings drag on the business, with a 29 cent per share drag recorded in Q2 2026 - The company still needs to complete remaining liquidity initiatives to meet its 2026 debt maturity obligations, and if these initiatives do not generate sufficient liquidity, the company could face refinancing or default risk - Office occupancy at the Portland mixed-use property is only 26%, which could slow stabilization or reduce the total value of the asset upon monetization

Analyst Q&A

• Q: What steps are still needed to meet Q4 2026 debt maturities, what disposition/runoff is targeted for the rest of 2026, and how close is the company to its liquidity goal? /

  A: Management has already raised almost $2 billion in liquidity, paid down $1.7 billion in debt, and is in the final stage of hitting its target. Large-scale loan sales are no longer budgeted, with only opportunistic small asset sales planned going forward. Remaining liquidity will come from three core sources: financing optimization for $950 million of CRE loans, sale/financing of the $118 million unencumbered joint venture LP position, and $900 million in expected portfolio runoff in H2 2026. Management is confident these actions will generate more than enough liquidity to cover remaining 2026 maturities.

• Q: Can you share details on the $118 million joint venture investment, including what it is, whether it has underlying leverage, and how it can generate liquidity? /

  A: This position is an unlevered LP interest in a Waterfall-managed CRE equity fund in its harvest period, made up of roughly 30 underlying CRE equity investments. The fund has a short duration, and the company is evaluating both fund financing for the LP interest and a sale through the existing secondary market for fund positions, both of which are viable options to generate liquidity from this unencumbered asset.

• Q: Why did you stop large loan sales to raise liquidity, and can the company return to profitability after repositioning is complete? /

  A: Management stops large sales because current secondary market discounts are deeper than the value that can be captured via on-balance sheet active management and financing of the remaining smaller set of non-performing assets. The company will return to profitability via three core drivers: short-duration runoff of the remaining legacy non-performing and REO portfolio, ramped up profitable origination growth in the now-capitalized SBA 7A platform, and a 25-35% operating expense reduction from cost optimization initiatives.