Climate Change Data

Environmental Metrics

ESG Focus Areas

• Diversity, Equity, and Inclusion (DEI)

Social Achievements

• Continued commitment to DEI in 2022, including steps to make that commitment clear to employees, investors, and stakeholders.
• Implemented a modern learning management platform for centralized training and organizational development, including compliance training for all consumer-facing employees.
• Strong focus on supporting employee mental health and partnering with mental healthcare providers; offering comprehensive benefits package with focus on physical and mental wellness.

Climate Goals & Targets

Environmental Challenges

• High interest rate and high inflation environments resulting in lower origination volumes and widening secondary market credit spreads.
• Geographic concentration of originations in California (44% in 2022), making results dependent on economic conditions and susceptibility to natural disasters.
• Need to obtain sufficient capital to meet financing requirements and comply with debt agreements.
• Risks associated with acquisitions, including integration challenges and potential liabilities.
• Potential for security breaches or cyberattacks.
• Climate change, climate change-related regulation, and increased focus on ESG issues.
• Reputational harm from actual or alleged conduct or public opinion.
• Risks related to Subservicers, including potential failures and compliance issues.
• Replacement of LIBOR with an alternative reference rate.
• Competition from national banks with greater financial resources and lower funding costs.
• Dependence on the secondary home loan market, including the MBS market.
• Maintaining compliance with extensive federal, state, and local regulations.
• Substantial leverage and high level of debt.
• Dependence on distributions from subsidiaries.
• Payments under Tax Receivable Agreements.
• Low trading volume of Class A Common Stock.
• Limited experience of executive management in operating a public company.
• Controlled company status under NYSE rules, resulting in exemptions from certain corporate governance requirements.

Mitigation Strategies

• Streamlining business to focus on reverse mortgage lending and retirement solutions.
• Winding down Mortgage Originations segment (except home improvement) and selling assets in Commercial Originations and Lender Services segments.
• Agreement to acquire American Advisors Group and raise $30 million in equity.
• Maintaining $2.8 billion in committed or uncommitted loan funding capacity.
• Conducting due diligence before acquisitions and negotiating purchase agreements to protect against liabilities.
• Using encryption and other information security technologies.
• Monitoring and addressing ESG matters.
• Implementing robust technology and monitoring by Compliance department to support compliance with consumer protection regulations.
• Actively monitoring the developments with respect to the phasing out of LIBOR and working to minimize the impact of any LIBOR transition.
• Maintaining high level of operational, technological, and managerial expertise.
• Maintaining multiple banking relationships and monitoring financial stability of institutions.
• Processes and systems in place to identify and interpret laws and regulations and implement them.
• Taking actions to address conditions that raise substantial doubt about the ability to continue as a going concern, including disposal of business segments, asset sales, and extension of credit lines.
• Retaining future earnings for operations, expansion, and debt repayment.
• Implementing corporate governance requirements and best practices, as well as internal controls and disclosure controls and procedures.

Supply Chain Management

Climate-Related Risks & Opportunities

Physical Risks

• Wildfires, mudslides, earthquakes, floods

Transition Risks

• Government restrictions and regulations to reduce greenhouse gas emissions

Environmental Metrics

Climate Goals & Targets

Environmental Challenges

• Requires additional time to compile and analyze information related to its recent asset purchase transaction with Bloom Retirement Holdings Inc. and its accounting for discontinued operations; needs to complete its financial reporting process.

Mitigation Strategies

• The Q1 10-Q will be filed on or before the fifth calendar day following the prescribed due date of the Company’s Form 10-Q.

Supply Chain Management

Climate-Related Risks & Opportunities