SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
-----------------------------------------------
PURSUANT TO SECTION 13 OR 15(D) OF
THE SECURITIES EXCHANGE ACT OF 1934
DATE OF REPORT (DATE OF EARLIEST EVENT REPORTED): JANUARY 26, 1998
OCWEN ASSET INVESTMENT CORP.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
VIRGINIA 000-22389 65-0736120
(STATE OR OTHER (COMMISSION (I.R.S. EMPLOYER
JURISDICTION FILE NUMBER) IDENTIFICATION NO.)
OF INCORPORATION)
THE FORUM, SUITE 1000
1675 PALM BEACH LAKES BOULEVARD, WEST PALM BEACH, FLORIDA 33401
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICE)
(561) 681-8000
(REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE)
N/A
(FORMER NAME OR FORMER ADDRESS, IF CHANGED SINCE LAST REPORT)
PAGE 1 OF 8
EXHIBIT INDEX ON PAGE 4
<PAGE>
ITEM 5. OTHER EVENTS
The news release of Ocwen Asset Investment Corp. dated January 26, 1998,
regarding its financial results for the three month period ended December 31,
1997 and the period of May 19, 1997 through December 31, 1997, including
consolidated financial statements for the three month period ended December 31,
1997 and the period of May 19, 1997 through December 31, 1997, are attached and
filed herewith as Exhibit 99.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
(c) Exhibits
The following exhibit is filed as part of this report:
(99) News release of Ocwen Asset Investment Corp. dated
January 26, 1998.
2
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned, hereunto duly authorized.
OCWEN ASSET INVESTMENT CORP.
(Registrant)
By: /s/ Mark S. Zeidman
-----------------------------------------------------
Mark S. Zeidman
Senior Vice President and Chief Financial Officer
Date: January 28, 1998
3
<PAGE>
INDEX TO EXHIBIT
Exhibit No. Description Page
- ----------- ----------- ----
99 News release of Ocwen Asset Investment Corp. dated 5
January 26, 1998 regarding its financial results for
the three month period ended December 31, 1997 and
the period of May 19, 1997 through December 31,
1997.
4
EXHIBIT 99
================================================================================
Ocwen Asset Investment Corp.
1675 Palm Beach Lakes Boulevard
West Palm Beach, FL 33401
NASDAQ Symbol: OAIC
================================================================================
NEWS RELEASE: IMMEDIATE JANUARY 26, 1998
OCWEN ASSET INVESTMENT CORP. REPORTS QUARTERLY RESULTS
Ocwen Asset Investment Corp. ("OAIC") today reported funds from operations of
$0.28 per share for the quarter ended December 31, 1997 as compared to $0.22 per
share for the prior quarter. OAIC's funds from operations for the period from
its inception in May 1997 to December 31, 1997 ("Short Period") were $11.97
million or $0.61 per share. Net income for the quarter ending December 31, 1997
was $5.38 million as compared to $4.35 million for the prior quarter. OAIC's net
income for the Short Period was $11.79 million or $0.60 per share. All per share
amounts are based on diluted weighted average common shares outstanding.
Christine A. Reich, President of OAIC stated, "We are pleased with our financial
results for the first seven and one-half months of operations and that we have
closed transactions totaling $279.8 million while having maintained our
disciplined approach to investing. We continue to expect that during 1998 OAIC
will fully leverage and invest the proceeds from its initial public offering."
QUARTERLY RESULTS AT A GLANCE:
For the quarters ended December 31 and September 30, 1997 (dollars in thousands,
except per share data):
<TABLE>
<CAPTION>
December 31, 1997 September 30, 1997
--------------------------- ------------------------
Amount Per Share (1) Amount Per Share (1)
---------- ------------- -------- -------------
<S> <C> <C> <C> <C>
Operating Results:
Total Income $ 6,894 $ 5,579
Expenses 1,513 1,229
Net Income 5,381 $ 0.28 4,350 $ 0.22
Funds From Operations 5,536 $ 0.28 4,372 $ 0.22
Dividend $ 0.39 $ 0.24
Summary of Financial Position:
Cash & Cash Equivalents $ 48,677 138,473
Securities Available for sale 146,027 89,521
Loan Portfolio, net 15,831 3,773
Discount Loans, net 26,979 25,184
Investment in Real Estate, net 45,430 26,264
Total Shareholders' Equity 271,258 285,202
</TABLE>
(1) Per share amounts are based on diluted weighted average common shares
outstanding.
5
<PAGE>
Annualized yields for the quarter ended December 31, 1997 were 5.41% for
repurchase agreements and interest bearing deposits, 11.25% for securities
available for sale, 13.52% for discount loans and 11.76% for loans. The overall
annualized portfolio yield for the quarter was 9.05%. The yield on securities
available for sale declined from the previous quarter due to declining market
interest rates and a resulting increase in prepayments on fixed rate mortgages
securing certain of OAIC's securities portfolio. As a result of these factors,
stockholders' equity includes a $7.3 million charge relating to the fair value
of securities available for sale at December 31, 1997.
Included in net operating income from real estate investments are revenues of
$890,000 resulting from a buyout of a lease by a tenant in connection with
OAIC's repositioning strategy for one of its office properties. In addition, as
a result of the strengthening U.S. dollar, OAIC incurred a fourth quarter mark
to market non-cash expense of $568,565 related to its ownership of Canadian
mortgage loans with unpaid principal balances of $38.2 million Canadian dollars.
SUBSEQUENT TRANSACTIONS
On January 12, 1998, an $11.6 million mezzanine construction loan for a 160 unit
apartment rental project was closed with $1.56 million of initial fundings. On
January 23, 1998, OAIC purchased for $13.7 million, a 124,668 square foot office
building located in San Francisco. Both transactions were previously disclosed
commitments.
In order to match fund OAIC's asset base with anticipated borrowings and thereby
immunize OAIC from changes in net interest income due to changes in 1-month
LIBOR, on January 15, 1998, OAIC placed a 5 year, $100 million notional swap.
The terms of the swap are as follows: OAIC pays a fixed rate of 5.75% on $100
million in exchange for 1-month LIBOR.
CERTAIN STATEMENTS CONTAINED HEREIN ARE "FORWARD-LOOKING STATEMENTS" WITHIN THE
MEANING OF SECTION 27A OF THE SECURITIES ACT OF 1933, AS AMENDED, AND SECTION
21E OF THE SECURITIES ACT OF 1934, AS AMENDED. THESE FORWARD-LOOKING STATEMENTS
MAY BE IDENTIFIED BY REFERENCE TO A FUTURE PERIOD(S) OR BY THE USE OF
FORWARD-LOOKING TERMINOLOGY. ACTUAL RESULTS COULD DIFFER MATERIALLY FROM THOSE
INDICATED IN SUCH STATEMENTS DUE TO A VARIETY OF FACTORS, INCLUDING, BUT NOT
LIMITED TO, CHANGES IN INTERNATIONAL, NATIONAL, REGIONAL OR LOCAL ECONOMIC
ENVIRONMENTS, COMPETITIVE PRODUCTS AND PRICING, GOVERNMENT FISCAL AND MONETARY
POLICIES, CHANGES IN PREVAILING INTEREST RATES, THE COURSE OF NEGOTIATIONS, THE
FULFILLMENT OF CONTRACTUAL CONDITIONS, FACTORS INHERENT TO THE VALUATION AND
PRICING OF RESIDUAL INTERESTS AND OTHER FACTORS GENERALLY UNDERSTOOD TO AFFECT
THE REAL ESTATE ACQUISITION, MORTGAGE AND LEASING MARKETS AND SECURITY
INVESTMENTS.
ATTACHED ARE THE CONSOLIDATED FINANCIAL STATEMENTS.
6
<PAGE>
OCWEN ASSET INVESTMENT CORP.
CONSOLIDATED STATEMENT OF FINANCIAL CONDITION
December 31, 1997
ASSETS
Cash and amounts due from depository institutions............. $ 331,047
Interest bearing deposits..................................... 48,346,076
Securities available for sale, at market value................ 146,026,907
Loan portfolio, net........................................... 15,831,479
Discount loan portfolio, net.................................. 26,978,888
Principal and interest receivable............................. 2,518,272
Investment in real estate, net................................ 45,430,039
Deposits on pending asset acquisitions........................ 1,000,000
Other assets.................................................. 1,540,633
-------------
$ 288,003,341
=============
LIABILITIES AND STOCKHOLDERS' EQUITY
LIABILITIES:
Dividends and distributions payable........................... $ 7,458,750
Accrued expenses, payables and other liabilities.............. 6,344,783
-------------
13,803,533
-------------
Minority interest ............................................ 2,941,541
-------------
STOCKHOLDERS' EQUITY:
Preferred stock, $.01 par value; 25,000,000 shares authorized;
0 shares issued and outstanding........................... --
Common Stock, $.01 par value; 200,000,000 shares authorized;
19,125,000 shares issued (18,965,000 shares outstanding).. 191,250
Additional paid-in capital.................................... 283,496,750
Distributions in excess of earnings........................... (2,107,331)
Unrealized loss on securities available for sale.............. (7,327,890)
Treasury stock at cost (160,000 shares)....................... (2,994,512)
-------------
Total stockholders' equity................................ 271,258,267
-------------
$ 288,003,341
=============
7
<PAGE>
<TABLE>
<CAPTION>
OCWEN ASSET INVESTMENT CORP.
CONSOLIDATED STATEMENT OF OPERATIONS
For the For the Period
Three Months May 19, 1997
Ended to
December 31, December 31,
1997 1997
------------ ------------
<S> <C> <C>
Repurchase agreements and interest bearing deposits .... $ 1,388,089 $ 5,538,946
Securities available for sale .......................... 2,865,553 6,362,909
Loans .................................................. 305,592 311,157
Discount loans ......................................... 907,737 1,248,703
------------ ------------
5,466,971 13,461,715
------------ ------------
Operating income:
Real estate investments, net ........................... 1,424,390 1,481,633
Other .................................................. 2,870 12,665
------------ ------------
1,427,260 1,494,298
------------ ------------
Operating expenses:
Management fees......................................... 735,397 1,796,311
Due diligence expenses ................................. 40,213 326,025
Foreign currency loss .................................. 568,565 568,565
Other .................................................. 159,604 464,164
------------ ------------
1,503,779 3,155,065
------------ ------------
Income before minority interest......................... 5,390,452 11,800,948
Minority interest in net income of operating partnership (9,430) (9,430)
------------ ------------
Net Income.............................................. $ 5,381,022 $ 11,791,518
============ ============
Earnings per share:
Basic............................................... $ 0.28 $ 0.62
============ ============
Diluted............................................. $ 0.28 $ 0.60
============ ============
Weighted average common shares outstanding:
Basic............................................... 19,085,000 19,108,789
============ ============
Diluted............................................. 19,477,532 19,564,770
============ ============
</TABLE>
8
