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What changed in Cohen & Co Inc.'s 10-K — 2023 vs 2024

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Paragraph-level year-over-year comparison of Cohen & Co Inc.'s 2023 and 2024 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2024 report.

+764 added−801 removedSource: 10-K (2025-03-12) vs 10-K (2024-03-06)

Top changes in Cohen & Co Inc.'s 2024 10-K

764 paragraphs added · 801 removed · 591 edited across 9 sections

Item 1. Business

Business — how the company describes what it does

343 edited+73 added−98 removed414 unchanged
Biggest changeSEGMENT INFORMATION Statement of Operations Information For the Year Ended December 31, 2023 (Dollars in Thousands) Capital Asset Principal Segment Markets Management Investing Total Unallocated (1) Total Net trading $ 30,926 $ - $ - $ 30,926 $ - $ 30,926 Asset management - 7,337 - 7,337 - 7,337 New issue and advisory 28,264 - - 28,264 - 28,264 Principal transactions and other income 1 1,071 15,382 16,454 - 16,454 Total revenues 59,191 8,408 15,382 82,981 - 82,981 Compensation and benefits 31,156 5,883 2,335 39,374 12,718 52,092 Other operating expense 15,746 2,218 1,117 19,081 4,947 24,028 Total operating expenses 46,902 8,101 3,452 58,455 17,665 76,120 Operating income / (loss) 12,289 307 11,930 24,526 (17,665 ) 6,861 Interest income (expense) (338 ) - - (338 ) (6,188 ) (6,526 ) Income / (loss) from equity method affiliates - - 15,609 15,609 - 15,609 Other non-operating income - - - - - - Income / (loss) before income taxes 11,951 307 27,539 39,797 (23,853 ) 15,944 Income tax expense / (benefit) - - - - 5,545 5,545 Net income / (loss) 11,951 307 27,539 39,797 (29,398 ) 10,399 Less: Net income (loss) attributable to the non-convertible non-controlling interest of the Operating LLC - 17 19,573 19,590 - 19,590 Enterprise net income (loss) 11,951 290 7,966 20,207 (29,398 ) (9,191 ) Less: Net income (loss) attributable to the convertible non-controlling interest of Cohen & Company Inc. - - - - (4,078 ) (4,078 ) Net income / (loss) attributable to Cohen & Company Inc. $ 11,951 $ 290 $ 7,966 $ 20,207 $ (25,320 ) $ (5,113 ) Other statement of operations data Depreciation and amortization (included in total operating expense) $ - $ 6 $ - $ 6 $ 557 $ 563 F- 69 Table of Contents SEGMENT INFORMATION Statement of Operations Information For the Year Ended December 31, 2022 (Dollars in Thousands) Capital Asset Principal Segment Markets Management Investing Total Unallocated (1) Total Net trading $ 40,009 $ - $ - $ 40,009 $ - $ 40,009 Asset management - 9,004 - 9,004 - 9,004 New issue and advisory 24,721 - - 24,721 - 24,721 Principal transactions and other income 2 854 (30,203 ) (29,347 ) - (29,347 ) Total revenues 64,732 9,858 (30,203 ) 44,387 - 44,387 Compensation and benefits 32,434 7,612 1,086 41,132 9,158 50,290 Other operating expense 14,539 2,173 728 17,440 4,620 22,060 Total operating expenses 46,973 9,785 1,814 58,572 13,778 72,350 Operating income / (loss) 17,759 73 (32,017 ) (14,185 ) (13,778 ) (27,963 ) Interest income (expense) (247 ) - - (247 ) (4,735 ) (4,982 ) Income / (loss) from equity method affiliates - - (20,931 ) (20,931 ) - (20,931 ) Other non-operating income - - - - - - Income / (loss) before income taxes 17,512 73 (52,948 ) (35,363 ) (18,513 ) (53,876 ) Income tax expense / (benefit) - - - - 4,794 4,794 Net income / (loss) 17,512 73 (52,948 ) (35,363 ) (23,307 ) (58,670 ) Less: Net income (loss) attributable to the non-convertible non-controlling interest of the Operating LLC - - (23,203 ) (23,203 ) - (23,203 ) Enterprise net income (loss) 17,512 73 (29,745 ) (12,160 ) (23,307 ) (35,467 ) Less: Net income (loss) attributable to the convertible non-controlling interest of Cohen & Company Inc. - - - - (22,078 ) (22,078 ) Net income / (loss) attributable to Cohen & Company Inc. $ 17,512 $ 73 $ (29,745 ) $ (12,160 ) $ (1,229 ) $ (13,389 ) Other statement of operations data Depreciation and amortization (included in total operating expense) $ - $ 5 $ - $ 5 $ 552 $ 557 F- 70 Table of Contents SEGMENT INFORMATION Statement of Operations Information For the Year Ended December 31, 2021 (Dollars in Thousands) Capital Asset Principal Segment Markets Management Investing Total Unallocated (1) Total Net trading $ 69,385 $ - $ - $ 69,385 $ - $ 69,385 Asset management - 10,923 - 10,923 - 10,923 New issue and advisory 28,736 - - 28,736 - 28,736 Principal transactions and other income (3 ) 768 36,559 37,324 - 37,324 Total revenues 98,118 11,691 36,559 146,368 - 146,368 Salaries/Wages 42,064 6,630 16,546 65,240 19,808 85,048 Other Operating Expense 13,914 2,151 387 16,452 5,275 21,727 Total operating expenses 55,978 8,781 16,933 81,692 25,083 106,775 Operating income / (loss) 42,140 2,910 19,626 64,676 (25,083 ) 39,593 Interest income (expense) (435 ) - - (435 ) (6,798 ) (7,233 ) Income / (loss) from equity method affiliates - - 36,010 36,010 - 36,010 Other non operating income / (expense) - - - - 2,127 2,127 Income / (loss) before income taxes 41,705 2,910 55,636 100,251 (29,754 ) 70,497 Income tax expense / (benefit) - - - - (3,541 ) (3,541 ) Net income / (loss) 41,705 2,910 55,636 100,251 (26,213 ) 74,038 Less: Net income (loss) attributable to the non-convertible non-controlling interest of the Operating LLC - 1,878 33,696 35,574 - 35,574 Enterprise net income (loss) 41,705 1,032 21,940 64,677 (26,213 ) 38,464 Less: Net income (loss) attributable to the convertible non-controlling interest of Cohen & Company Inc. - - - - 26,656 26,656 Net income / (loss) attributable to Cohen & Company Inc. $ 41,705 $ 1,032 $ 21,940 $ 64,677 $ (52,869 ) $ 11,808 Other statement of operations data Depreciation and amortization (included in total operating expense) $ 1 $ 2 $ - $ 3 $ 368 $ 371 ( 1 ) Unallocated includes certain expenses incurred by indirect overhead and support departments (such as the executive, finance, legal, information technology, human resources, risk, compliance and other similar overhead and support departments).
Biggest changeSEGMENT INFORMATION Statement of Operations Information For the Year Ended December 31, 2024 (Dollars in Thousands) Capital Asset Principal Segment Markets Management Investing Total Unallocated (1) Total Net trading $ 36,409 $ - $ - $ 36,409 $ - $ 36,409 Asset management - 9,009 - 9,009 - 9,009 New issue and advisory 63,422 - - 63,422 - 63,422 Principal transactions (22,644 ) - (10,240 ) (32,884 ) - (32,884 ) Other income 10 2,615 1,017 3,642 - 3,642 Total revenues 77,197 11,624 (9,223 ) 79,598 - 79,598 Compensation 42,536 6,059 1,648 50,243 1,477 51,720 Stock based compensation 575 144 - 719 3,949 4,668 Business development 1,377 250 14 1,641 641 2,282 Occupancy and equipment 2,976 213 - 3,189 1,146 4,335 Subscriptions, clearing, and execution 8,893 368 170 9,431 208 9,639 Professional fee and other operating 7,591 1,772 1,216 10,579 3,842 14,421 Depreciation and amortization - 6 - 6 550 556 Total operating expenses 63,948 8,812 3,048 75,808 11,813 87,621 Operating income / (loss) 13,249 2,812 (12,271 ) 3,790 (11,813 ) (8,023 ) Interest income (expense) (76 ) - - (76 ) (5,745 ) (5,821 ) Income from equity method affiliates - - 21,704 21,704 - 21,704 Income /(loss) before income taxes 13,173 2,812 9,433 25,418 (17,558 ) 7,860 Income tax expense (benefit) - - - - (329 ) (329 ) Net income / (loss) 13,173 2,812 9,433 25,418 (17,229 ) 8,189 Less: Net income attributable to the non-convertible non-controlling interest of the Operating LLC - 1 8,674 8,675 - 8,675 Enterprise net income /(loss) 13,173 2,811 759 16,743 (17,229 ) (486 ) Less: Net (loss) attributable to the convertible non-controlling interest of Cohen & Company Inc. - - - - (357 ) (357 ) Net income / (loss) attributable to Cohen & Company Inc. $ 13,173 $ 2,811 $ 759 $ 16,743 $ (16,872 ) $ (129 ) Other statement of operations data Cash compensation as a percentage of revenue 55.10 % 52.12 % (17.87 )% 63.12 % N/A 64.98 % Operating income / (loss) as a percentage of revenue 17.16 % 24.19 % (133.05 )% 4.76 % N/A (10.08 )% Net income / (loss) as a percentage of revenue 17.06 % 24.19 % (102.28 )% 31.93 % N/A 10.29 % Net income / (loss) attributable to Cohen & Company Inc. as a percentage of revenue 17.06 % 24.18 % (8.23 )% 21.03 % N/A (0.16 )% F- 71 Table of Contents SEGMENT INFORMATION Statement of Operations Information For the Year Ended December 31, 2023 (Dollars in Thousands) Capital Asset Principal Segment Markets Management Investing Total Unallocated (1) Total Net trading $ 30,926 $ - $ - $ 30,926 $ - $ 30,926 Asset management - 7,337 - 7,337 - 7,337 New issue and advisory 28,264 - - 28,264 - 28,264 Principal transactions (4,312 ) - 19,261 14,949 - 14,949 Other income 1 1,071 433 1,505 - 1,505 Total revenues 54,879 8,408 19,694 82,981 - 82,981 Compensation 30,641 5,777 2,335 38,753 8,948 47,701 Stock based compensation 515 106 - 621 3,770 4,391 Business development 741 268 23 1,032 383 1,415 Occupancy and equipment 2,560 202 - 2,762 1,027 3,789 Subscriptions, clearing, and execution 8,125 334 251 8,710 255 8,965 Professional fee and other operating 4,320 1,408 843 6,571 2,725 9,296 Depreciation and amortization - 6 - 6 557 563 Total operating expenses 46,902 8,101 3,452 58,455 17,665 76,120 Operating income / (loss) 7,977 307 16,242 24,526 (17,665 ) 6,861 Interest income (expense) (338 ) - - (338 ) (6,188 ) (6,526 ) Income from equity method affiliates - - 15,609 15,609 - 15,609 Income (loss) before income taxes 7,639 307 31,851 39,797 (23,853 ) 15,944 Income tax expense / (benefit) - - - - 5,545 5,545 Net income / (loss) 7,639 307 31,851 39,797 (29,398 ) 10,399 Less: Net income attributable to the non-convertible non-controlling interest of the Operating LLC - 17 19,573 19,590 - 19,590 Enterprise net income/ (loss) 7,639 290 12,278 20,207 (29,398 ) (9,191 ) Less: Net (loss) attributable to the convertible non-controlling interest of Cohen & Company Inc. - - - - (4,078 ) (4,078 ) Net income / (loss) attributable to Cohen & Company Inc. $ 7,639 $ 290 $ 12,278 $ 20,207 $ (25,320 ) $ (5,113 ) Other statement of operations data Cash compensation as a percentage of revenue 55.83 % 68.71 % 11.86 % 46.70 % N/A 57.48 % Operating income / (loss) as a percentage of revenue 14.54 % 3.65 % 82.47 % 29.56 % N/A 8.27 % Net income / (loss) as a percentage of revenue 13.92 % 3.65 % 161.73 % 47.96 % N/A 12.53 % Net income / (loss) attributable to Cohen & Company Inc. as a percentage of revenue 13.92 % 3.45 % 62.34 % 24.35 % N/A (6.16 )% F- 72 Table of Contents SEGMENT INFORMATION Statement of Operations Information For the Year Ended December 31, 2022 (Dollars in Thousands) Capital Asset Principal Segment Markets Management Investing Total Unallocated (1) Total Net trading $ 40,009 $ - $ - $ 40,009 $ - $ 40,009 Asset management - 9,004 - 9,004 - 9,004 New issue and advisory 24,721 - - 24,721 - 24,721 Principal transactions (3,075 ) - (27,556 ) (30,631 ) - (30,631 ) Other income 1 855 428 1,284 - 1,284 Total revenues 61,656 9,859 (27,128 ) 44,387 - 44,387 Compensation 31,919 7,480 1,086 40,485 5,415 45,900 Stock based compensation 515 132 - 647 3,743 4,390 Business development 582 529 22 1,133 450 1,583 Occupancy and equipment 2,722 168 - 2,890 603 3,493 Subscriptions, clearing, and execution 7,610 348 87 8,045 229 8,274 Professional fee and other operating 3,625 1,123 619 5,367 2,786 8,153 Depreciation and amortization - 5 - 5 552 557 Total operating expenses 46,973 9,785 1,814 58,572 13,778 72,350 Operating income / (loss) 14,683 74 (28,942 ) (14,185 ) (13,778 ) (27,963 ) Interest income (expense) (247 ) - - (247 ) (4,735 ) (4,982 ) (Loss) from equity method affiliates - - (20,931 ) (20,931 ) - (20,931 ) Income before income taxes 14,436 74 (49,873 ) (35,363 ) (18,513 ) (53,876 ) Income tax expense / (benefit) - - - - 4,794 4,794 Net income /(loss) 14,436 74 (49,873 ) (35,363 ) (23,307 ) (58,670 ) Less: Net (loss) attributable to the non-convertible non-controlling interest of the Operating LLC - - (23,203 ) (23,203 ) - (23,203 ) Enterprise net income /(loss) 14,436 74 (26,670 ) (12,160 ) (23,307 ) (35,467 ) Less: Net (loss) attributable to the convertible non-controlling interest of Cohen & Company Inc. - - - - (22,078 ) (22,078 ) Net income (loss) attributable to Cohen & Company Inc. $ 14,436 $ 74 $ (26,670 ) $ (12,160 ) $ (1,229 ) $ (13,389 ) Other statement of operations data Cash compensation as a percentage of revenue 51.77 % 75.87 % (4.00 )% 91.21 % N/A 103.41 % Operating income / (loss) as a percentage of revenue 23.81 % 0.75 % (106.69 )% (31.96 )% N/A (63.00 )% Net income / (loss) as a percentage of revenue 23.41 % 0.75 % (183.84 )% (79.67 )% N/A (132.18 )% Net income / (loss) attributable to Cohen & Company Inc. as a percentage of revenue 23.41 % 0.75 % (98.31 )% (27.40 )% N/A (30.16 )% ( 1 ) Unallocated includes certain expenses incurred by indirect overhead and support departments (such as the executive, finance, legal, information technology, human resources, risk, compliance, and other similar overhead and support departments).
Prior to March 31, 2023, the Vellar GP was the general partner of the SPAC Fund but did not consolidate it. Effective April 1, 2023, the Vellar GP began consolidating the SPAC Fund. The Vellar GP primarily invests in share forward arrangements. See notes 4 and 10. F- 8 Table of Contents 2.
Prior to March 31, 2023, the Vellar GP was the general partner of the SPAC Fund but did not consolidate it. Effective April 1, 2023, the Vellar GP began consolidating the SPAC Fund. The Vellar GP primarily invests in share forward arrangements. See notes 4, 10, and 31. F- 8 Table of Contents 2.
ASC 940 - 320 requires all financial instruments be carried at fair value with unrealized and realized gains included recorded in the consolidated statement of operations. The main difference between ASC 940 - 320 and ASC 320 is that ASC 940 - 320 does not allow for available for sale or held to maturity treatment.
ASC 940 - 320 requires all financial instruments to be carried at fair value with unrealized and realized gains included recorded in the consolidated statement of operations. The main difference between ASC 940 - 320 and ASC 320 is that ASC 940 - 320 does not allow for available for sale or held to maturity treatment.
Furthermore, due to the difficulty of determining the fair value of such an investment in the SPAC's pre-business combination period, the Company has chosen to not elect the fair value option. • If a SPAC completed its business combination, the sponsor entity's investment in the SPAC was converted to a combination of unrestricted and restricted shares in the post-business combination SPAC.
Furthermore, due to the difficulty of determining the fair value of such an investment in the SPAC's pre-business combination period, the Company has chosen not to elect the fair value option. • If a SPAC completed its business combination, the sponsor entity's investment in the SPAC was converted to a combination of unrestricted and restricted shares in the post-business combination SPAC.
Agency Repo : Similar to the on balance sheet repo, the Company first executes a reverse repo with the borrower and a matching repo (with the same collateral and maturity date) with the lender. However, in this case, all three parties (borrower, lender, and the Company) simultaneously enter into an assignment agreement.
Agency Repo : Similar to the on balance sheet repo, the Company first executes a reverse repo with the borrower and a matching repo (with the same collateral and maturity date) with the lender. However, in this case, all three parties (the borrower, the lender, and the Company) simultaneously enter into an assignment agreement.
Since the AFN Merger, Cohen & Company Inc. has been in violation of one covenant of Alesco Capital Trust I. As a result of this violation, Cohen & Company Inc. is prohibited from issuing additional debt that is either subordinated to or pari passu with Alesco Capital Trust I debt.
Since the AFN Merger, Cohen & Company Inc. has been in violation of one covenant of Alesco Capital Trust I. As a result of this violation, Cohen & Company Inc. is prohibited from issuing additional debt that is either subordinated to or pari passu with the Alesco Capital Trust I debt.
Generally, the employee's investment will be worthless if the SPAC in which the sponsor entity has invested is liquidated and it will become worth something if the SPAC completes its business combination. Therefore, the Company treats these grants as having a performance condition (i.e. the completion of the SPAC business combination).
Generally, the employee's investment will be worthless if the SPAC in which the sponsor entity has invested is liquidated and it will become worth something if the SPAC completes its business combination. Therefore, the Company treats these grants as having a performance condition (i.e. the completion of the SPAC business combination).
Further, at the time of the investments, the Company treats this performance condition as being non-probable. The effect of this is that the Company records no expense related to these investments until (and only if) the business combination is completed.
Further, at the time of the investments, the Company treats this performance condition as being non-probable. The effect of this is that the Company records no expense related to these investments until (and only if) the business combination is completed.
Upon completion of the business combination, the Company records compensation expense in an amount equal to the fair value of the grant.
Upon completion of the business combination, the Company records compensation expense in an amount equal to the fair value of the grant.
The Company received payments under this sublease agreement which payments are recorded as a reduction in rent and utility expenses. This sublease agreement commenced on August 1, 2018 and has a term that automatically renews for one year periods if not cancelled by either party upon 90 days’ notice prior to the end of the then-existing term.
The Company received payments under this sublease agreement, which are recorded as a reduction in rent and utility expenses. This sublease agreement commenced on August 1, 2018 and has a term that automatically renews for one year periods if not cancelled by either party upon 90 days’ notice prior to the end of the then-existing term.
The Operating LLC and the Insurance SPAC III entered into an administrative services agreement, dated December 17, 2020, pursuant to which the Operating LLC and the Insurance SPAC III agreed that, commencing on the date that the Insurance SPAC III’s securities were first listed on the NASDAQ Capital Market through the earlier of the Insurance SPAC III’s consummation of a business combination and its liquidation, the Insurance SPAC III would pay the Operating LLC $20 per month for certain office space, utilities, and shared personnel support as may be requested by Insurance SPAC III.
The Operating LLC and Insurance SPAC III entered into an administrative services agreement, dated December 17, 2020, pursuant to which the Operating LLC and Insurance SPAC III agreed that, commencing on the date that Insurance SPAC III’s securities were first listed on the NASDAQ Capital Market through the earlier of Insurance SPAC III’s consummation of a business combination and its liquidation, Insurance SPAC III would pay the Operating LLC $20 per month for certain office space, utilities, and shared personnel support as may be requested by Insurance SPAC III.
The related amounts receivable and payable for unsettled securities transactions are recorded net in receivables from or payables to brokers, dealers, and clearing agencies on the Company’s consolidated balance sheets. Receivables from clearing organizations are primarily comprised of cash received by the Company upon execution of short trades that is restricted from withdrawal by the clearing agent.
The related amounts receivable and payable for unsettled securities transactions are recorded net in receivables from or payables to brokers, dealers, and clearing agencies on the Company’s consolidated balance sheets. Receivables from clearing agencies are primarily comprised of cash received by the Company upon execution of short trades that is restricted from withdrawal by the clearing agent.
SFAs also impose various obligations on the SFA Counterparty, which may include registering a predetermined number of the interests in the SFA Counterparty (subject to the SFA) with the SEC, maintaining the listing of the SFA Counterparty securities on a national exchange, and/or that the closing price of the SFA Counterparty’s shares on the public exchange does not fall below a predetermined price for a specific period of time.
SFAs also impose various obligations on the SFA Counterparty, that may include registering a predetermined number of the interests in the SFA Counterparty (subject to the SFA) with the SEC, maintaining a listing of the SFA Counterparty securities on a national exchange, and/or that the closing price of the SFA Counterparty’s shares on the public exchange does not fall below a predetermined price for a specific period of time.
It is the Company’s policy to present the assets and liabilities o n a net basis if the conditions of ASC 210 are met. However, in general the Company does not enter in to offsetting derivatives with the same counterparties. Derivative financial instruments are recorded at fair value.
It is the Company’s policy to present the assets and liabilities o n a net basis if the conditions of ASC 210 are met. However, in general the Company does not enter into offsetting derivatives with the same counterparties. Derivative financial instruments are recorded at fair value.
Each Right entitles the registered holder to purchase from the Company a unit (a “Unit”) consisting of one ten -thousandth of a share of the Company’s Series C Junior Participating Preferred Stock, par value $0.001 per share (the “Series C Preferred Stock”), at a purchase price of $100.00 per Unit (the “Purchase Price”), subject to adjustment.
Each Right entitles the registered holder thereof to purchase from the Company a unit (a “Unit”) consisting of one ten -thousandth of a share of the Company’s Series C Junior Participating Preferred Stock, par value $0.001 per share (the “Series C Preferred Stock”), at a purchase price of $100.00 per Unit (the “Purchase Price”), subject to adjustment.
The Company determines the fair value by utilizing a model that starts with the publicly traded share price but then applies a discount based on a Monte Carlo simulation. The inputs to this model are observable so the Company classifies these securities within level 2 of the valuation hierarchy.
The Company determines the fair value by utilizing a model that starts with the publicly traded share price but then applies a discount based on a Monte Carlo simulation. The inputs to this model are observable so the Company generally classifies these securities within level 2 of the valuation hierarchy.
The amendments also enhance existing disclosure requirements and introduce new requirements related to certain modifications of receivables made to borrowers experiencing financial difficulty. The Company's adoption of the provisions of ASU 2022 - 02, effective January 1, 2023, did not have an effect on the Company’s consolidated financial statements. D.
The amendments also enhance existing disclosure requirements and introduce new requirements related to certain modifications of receivables made to borrowers experiencing financial difficulty. The Company's adoption of the provisions of ASU 2022 - 02, effective January 1, 2023, did not have an effect on the Company’s consolidated financial statements.
On February 26, 2021, the Operating LLC entered into a letter agreement with FTAC Athena Sponsor whereby the Operating LLC would provide personnel to serve as the chief financial officer as well as other accounting and administrative services to FTAC Olympus Sponsor for a period not longer than 24 months.
On February 26, 2021, the Operating LLC entered into a letter agreement with FTAC Athena Sponsor whereby the Operating LLC would provide personnel to serve as the chief financial officer as well as other accounting and administrative services to FTAC Athena Sponsor for a period not longer than 24 months.
Additionally, SFAs generally include a feature whereby if the Company holds the interests it acquired in the SFA Counterparty until maturity or another agreed-upon date, the Company becomes eligible to receive an additional payment from the SFA Counterparty, either in cash or in additional interests in the SFA Counterparty.
Additionally, SFAs generally include a feature whereby if the Company holds the interests in the SFA Counterparty that it acquired until maturity or another agreed-upon date, the Company becomes eligible to receive an additional payment from the SFA Counterparty, either in cash or in additional interests in the SFA Counterparty.
If any of these SFA Counterparty obligations are breached or not satisfied, the Company may have the right to terminate the SFA and accelerate the payment of the Maturity Consideration upon termination.
If any of these SFA Counterparty obligations are breached or not satisfied, the Company may have the right to terminate the SFA early and accelerate the payment of the Maturity Consideration upon termination.
In these cases, the Company will classify such securities as level 3 within the valuation hierarchy until it is able to obtain third -party pricing. F- 29 Table of Contents Residential Mortgage Loans : The Company generally values these loans using a model. The model’s main inputs are current market quotations for pooled mortgage loan securities with similar characteristics.
In these cases, the Company will classify such securities as level 3 within the valuation hierarchy until it is able to obtain third -party pricing. F- 30 Table of Contents Residential Mortgage Loans : The Company generally values these loans using a model. The model’s main inputs are current market quotations for pooled mortgage loan securities with similar characteristics.
At December 31, 2023 , the Company had open TBA and other forward MBS purchase agreements in the notional amount of $592,000 and open TBA and other forward MBS sale agreements in the notional amount of $618,425.
At December 31, 2023 , the Company had open TBA and other forward agency MBS purchase agreements in the notional amount of $592,000 and open TBA and other forward agency MBS sale agreements in the notional amount of $618,425.
Insurance SPAC III Insurance SPAC III is considered a related party because it was an equity method investment of the Company. The Operating LLC was the manager of the Insurance SPAC III Sponsor Entities and the Company consolidated the Insurance SPAC III Sponsor Entities.
Insurance SPAC III Insurance SPAC III was considered a related party because it was an equity method investment of the Company. The Operating LLC was the manager of the Insurance SPAC III Sponsor Entities, and the Company consolidated the Insurance SPAC III Sponsor Entities.
They are all routine and short-term in nature. Deposits are amounts held by landlords or other parties, which will be returned or offset upon satisfaction of a lease or other contractual arrangement. Intangible assets represent the carrying value of the JVB broker-dealer license. F- 41 Table of Contents 16.
They are all routine and short-term in nature. Deposits are amounts held by landlords or other parties, which will be returned or offset upon satisfaction of a lease or other contractual arrangement. Intangible assets represent the carrying value of the JVB broker-dealer license. F- 42 Table of Contents 16.
F- 52 Table of Contents Pursuant to the Rights Agreement, in the event that a person or entity becomes an Acquiring Person, each other holder of a Right will thereafter have the right to receive, upon exercise, Common Stock (or, in certain circumstances, cash, property or other securities of the Company), having a value equal to two times the exercise price of the Right.
F- 53 Table of Contents Pursuant to the Rights Agreement, in the event that a person or entity becomes an Acquiring Person, each other holder of a Right will thereafter have the right to receive, upon exercise, Common Stock (or, in certain circumstances, cash, property or other securities of the Company), having a value equal to two times the exercise price of the Right.
As consideration for these services, the Company received an allocation of 35,000 founder shares of FTAC V stock to the Operating LLC and recorded an equity method investment of $40 for the valuation of these services. The revenue earned on this arrangement is disclosed in principal transactions and other income, other SPAC entities in the tables below.
As consideration for these services, the Company received an allocation of 35,000 founder shares of FTAC V stock to the Operating LLC and recorded an equity method investment of $40 for the valuation of these services. The revenue earned on this arrangement is disclosed in principal transactions and other income, other SPAC entities in the table below.
As consideration for these services, the Company received an allocation of 35,000 founder shares of FTAC VI stock to the Operating LLC and recorded an equity method investment of $40 for the valuation of these services. The revenue earned on this arrangement is disclosed in principal transactions and other income, other SPAC entities in the tables below.
As consideration for these services, the Company received an allocation of 35,000 founder shares of FTAC VI stock to the Operating LLC and recorded an equity method investment of $40 for the valuation of these services. The revenue earned on this arrangement is disclosed in principal transactions and other income, other SPAC entities in the table below.
As consideration for these services, the Company received an allocation of 35,000 founder shares of FTAC Athena stock to the Operating LLC and recorded an equity method investment of $40 for the valuation of these services. The revenue earned on this arrangement is disclosed in principal transactions and other income, other SPAC entities in the tables below.
As consideration for these services, the Company received an allocation of 35,000 founder shares of FTAC Athena stock to the Operating LLC and recorded an equity method investment of $40 for the valuation of these services. The revenue earned on this arrangement is disclosed in principal transactions and other income, other SPAC entities in the table below.
As consideration for these services, the Company received an allocation of 35,000 founder shares of FTAC Hera stock to the Operating LLC and recorded an equity method investment of $40 for the valuation of these services. The revenue earned on this arrangement is disclosed in principal transactions and other income, other SPAC entities in the tables below.
As consideration for these services, the Company received an allocation of 35,000 founder shares of FTAC Hera stock to the Operating LLC and recorded an equity method investment of $40 for the valuation of these services. The revenue earned on this arrangement is disclosed in principal transactions and other income, other SPAC entities in the table below.
As consideration for these services, the Company received an allocation of 35,000 founder shares of FTAC Parnassus stock to the Operating LLC and recorded an equity method investment of $40 for the valuation of these services. The revenue earned on this arrangement is disclosed in principal transactions and other income, other SPAC entities in the tables below.
As consideration for these services, the Company received an allocation of 35,000 founder shares of FTAC Parnassus stock to the Operating LLC and recorded an equity method investment of $40 for the valuation of these services. The revenue earned on this arrangement is disclosed in principal transactions and other income, other SPAC entities in the table below.
As consideration for these services, the Company received an allocation of 35,000 founders shares of FTAC Zeus stock to the Operating LLC and recorded an equity method investment of $40 for the valuation of these services. The revenue earned on this arrangement is disclosed in principal transactions and other income, other SPAC entities in the tables below.
As consideration for these services, the Company received an allocation of 35,000 founders shares of FTAC Zeus stock to the Operating LLC and recorded an equity method investment of $40 for the valuation of these services. The revenue earned on this arrangement is disclosed in principal transactions and other income, other SPAC entities in the table below.
As consideration for these services, the Company received an allocation of 35,000 founders shares of FTAC Emerald stock to the Operating LLC and recorded an equity method investment of $40 for the valuation of these services. The revenue earned on this arrangement is disclosed in principal transactions and other income, other SPAC entities in the tables below.
As consideration for these services, the Company received an allocation of 35,000 founders shares of FTAC Emerald stock to the Operating LLC and recorded an equity method investment of $40 for the valuation of these services. The revenue earned on this arrangement is disclosed in principal transactions and other income, other SPAC entities in the table below.
F-6 Table of Contents COHEN & COMPANY INC. Notes to Consolidated Financial Statements December 31, 2023 (Dollars in thousands, except share and per share information) 1. ORGANIZATION AND NATURE OF OPERATIONS Organizational History Cohen Brothers, LLC (“Cohen Brothers”) was formed on October 7, 2004 by Cohen Bros. Financial, LLC (“CBF”).
F-6 Table of Contents COHEN & COMPANY INC. Notes to Consolidated Financial Statements December 31, 2024 (Dollars in thousands, except share and per share information) 1. ORGANIZATION AND NATURE OF OPERATIONS Organizational History Cohen Brothers, LLC (“Cohen Brothers”) was formed on October 7, 2004 by Cohen Bros. Financial, LLC (“CBF”).
SECURED BORROWINGS (Dollars in Thousands) December 31, 2023 Repurchase Agreements Remaining Contractual Maturity of the Agreements Collateral Type: Overnight and Continuous Up to 30 days 30 - 90 days Greater than 90 days Total MBS (gestation repo) $ - $ 408,203 $ - $ - $ 408,203 Reverse Repurchase Agreements Remaining Contractual Maturity of the Agreements Collateral Type: Overnight and Continuous Up to 30 days 30 - 90 days Greater than 90 days Total MBS (gestation repo) $ - $ 408,408 $ - $ - $ 408,408 The weighted average interest rate of the repurchase agreements outstanding as of December 31, 2023 was 6.10%.
SECURED BORROWINGS (Dollars in Thousands) December 31, 2023 Repurchase Agreements Remaining Contractual Maturity of the Agreements Collateral Type: Overnight and Continuous Up to 30 days 30 - 90 days Greater than 90 days Total MBS (gestation repo) $ - $ 408,203 $ - $ - $ 408,203 Reverse Repurchase Agreements Remaining Contractual Maturity of the Agreements Collateral Type: Overnight and Continuous Up to 30 days 30 - 90 days Greater than 90 days Total MBS (gestation repo) $ - $ 408,408 $ - $ - $ 408,408 The weighted average interest rate of the repurchase agreements outstanding as of December 31, 2023 was 6.1%.
FURNITURE, EQUIPMENT, AND LEASEHOLD IMPROVEMENTS, NET Furniture, equipment, and leasehold improvements, net, which are included as a component of other assets on the consolidated balance sheets, are as follows.
FURNITURE, EQUIPMENT, AND LEASEHOLD IMPROVEMENTS, NET Furniture, equipment, and leasehold improvements, net, which are included as a component of other assets on the consolidated balance sheets, were as follows.
SPAC Sponsor Entities: A series of LLCs set up to pool investor funds and invest in private placements of Company sponsored special purpose acquisition companies ("SPACs"). See note 4. 9. Vellar GP is an LLC in which the Operating LLC owns a one - third interest and consolidates.
SPAC Sponsor Entities: A series of LLCs set up to pool investor funds and invest in private placements of Company sponsored special purpose acquisition companies ("SPACs"). See note 4. 7. Vellar GP is an LLC in which the Operating LLC owns a one - third interest and consolidates.
Second, JVB qualifies for an exemption under Footnote 74 of the SEC Release No. 34 - 70073 because it limits its business activities to certain activities allowed under this exemption and it does not hold customer funds or securities, carry customer accounts, and does not carry PAB accounts. F- 67 Table of Contents 28.
Second, JVB qualifies for an exemption under Footnote 74 of the SEC Release No. 34 - 70073 because it limits its business activities to certain activities allowed under this exemption and it does not hold customer funds or securities, carry customer accounts, and does not carry PAB accounts. F- 69 Table of Contents 28.
For every 10 shares of Series E Preferred Stock, the holders thereof are entitled to one vote on any such matter. Daniel G. Cohen, the Company’s executive chairman, is the sole holder of all 4,983,557 shares of Series E Preferred Stock outstanding as of December 31, 2023 . The Series E Preferred Stock held by Daniel G.
For every 10 shares of Series E Preferred Stock, the holders thereof are entitled to one vote on any such matter. Daniel G. Cohen, the Company’s executive chairman, is the sole holder of all 4,983,557 shares of Series E Preferred Stock outstanding as of December 31, 2024 . The Series E Preferred Stock held by Daniel G.
Financial Group LLC, a wholly owned broker dealer subsidiary of JVB Holdings; "CCFESA" refers to Cohen & Company Financial (Europe) S.A., a majority owned subsidiary regulated by the Autorité de Contrôle Prudentiel et de Résolution ("ACPR") in France; “CCFEL” refers to Cohen & Company Financial (Europe) Limited, a subsidiary formerly regulated by the Central Bank of Ireland.
Financial Group LLC, a wholly owned broker dealer subsidiary of JVB Holdings; "CCFESA" refers to Cohen & Company Financial (Europe) S.A., a consolidated subsidiary regulated by the Autorité de Contrôle Prudentiel et de Résolution ("ACPR") in France; “CCFEL” refers to Cohen & Company Financial (Europe) Limited, a subsidiary formerly regulated by the Central Bank of Ireland.
No cash payments were made to acquire right of use assets. In December 2023, the Company executed a second amendment ("Second Lease Amendment") to its 3 Columbus Circle LLC original lease agreement. The Second Lease Amendment provides for the Company to lease additional space in the building in conjunction with surrendering certain currently occupied premises.
No cash payments were made to acquire right of use assets. In December 2023, the Company executed a second amendment ("Second Lease Amendment") to its 3 Columbus Circle LLC original lease agreement. The Second Lease Amendment provided for the Company to lease additional space in the building in conjunction with surrendering certain currently occupied premises.
Revenue earned by the Company from the administrative services agreement is included as part of principal transactions and other income in the tables below. The Operating LLC loaned to Insurance SPAC III approximately $71 to cover IPO expenses, which was repaid in full at the closing of the IPO.
Revenue earned by the Company from the administrative services agreement is included as part of principal transactions and other income in the table below. The Operating LLC loaned to Insurance SPAC III approximately $71 to cover IPO expenses, which was repaid in full at the closing of the IPO.
These investments differ from investments classified as trading securities sold, not yet purchased as they are either acquired for purposes of earning a return rather than to support the Company’s trading or matched book operations or they are acquired as an economic hedge to investments classified as other investments, at fair value.
These investments differ from investments classified as trading securities sold, not yet purchased as they are either acquired for purposes of earning a return rather than supporting the Company’s trading or matched book operations or they are acquired as an economic hedge to investments classified as other investments, at fair value.
For discussion of margin payable, see note 6. Other trading revenue is primarily comprised of revenue earned on the Company's agency repo business. See note 11. F- 21 Table of Contents 6. RECEIVABLES FROM AND PAYABLES TO BROKERS, DEALERS, AND CLEARING AGENCIES Amounts receivable from brokers, dealers, and clearing agencies consisted of the following.
For discussion of margin payable, see note 6. Other trading revenue is primarily comprised of revenue earned on the Company's agency repo business. See note 11. F- 22 Table of Contents 6. RECEIVABLES FROM AND PAYABLES TO BROKERS, DEALERS, AND CLEARING AGENCIES Amounts receivable from brokers, dealers, and clearing agencies consisted of the following.
F- 60 Table of Contents 23. INCOME TAXES Cohen & Company Inc. is treated as a C corporation for United States federal income tax purposes. The components of income tax expense (benefit) included in the consolidated statements of operations for each year presented herein are shown in the table below.
F- 62 Table of Contents 23. INCOME TAXES Cohen & Company Inc. is treated as a C corporation for United States federal income tax purposes. The components of income tax expense (benefit) included in the consolidated statements of operations for each year presented herein are shown in the table below.
In either case, the entity (or entities) is referred in this section as the sponsor of the applicable SPAC. The Company had the following transactions with various sponsors of SPACs that are related parties, which the Company does not consolidate. Fintech Acquisition Corp. IV ("FTAC IV") was a SPAC.
In either case, the entity (or entities) is referred in this section as the sponsor of the applicable SPAC. The Company had the following transactions with various sponsors of SPACs that are related parties, which the Company does not consolidate. Fintech Acquisition Corp. V ("FTAC V") was a SPAC.
CCFESA is regulated by the ACPR and subject to certain minimum levels of capital. Shares Outstanding of Stockholders’ Equity of the Company The following table summarizes share transactions that occurred in stockholders’ equity during the years ended December 31, 2023 , 2022 , and 2021 . ROLLFORWARD OF SHARES OUTSTANDING OF COHEN & COMPANY INC.
CCFESA is regulated by the ACPR and subject to certain minimum levels of capital. Shares Outstanding of Stockholders’ Equity of the Company The following table summarizes share transactions that occurred in stockholders’ equity during the years ended December 31, 2024 , 2023 , and 2022 . ROLLFORWARD OF SHARES OUTSTANDING OF COHEN & COMPANY INC.
Other than its investment in these entities, the Company did not provide financial support to these VIEs during the years ended December 31, 2023 and 2022 and had no liabilities, contingent liabilities, or guarantees (implicit or explicit) related to these VIEs at December 31, 2023 and 2022 . See table below.
Other than its investment in these entities, the Company did not provide financial support to these VIEs during the years ended December 31, 2024 and 2023 , and had no liabilities, contingent liabilities, or guarantees (implicit or explicit) related to these VIEs at December 31, 2024 and 2023 . See table below.
The Amended and Restated Note accrues interest on the unpaid principal amount from January 31, 2022 until maturity at a rate equal to 10% per year. Interest on the Amended and Restated Note is payable in cash quarterly on each January 1, April 1, July 1, and October 1, which commenced on April 1, 2022.
The Amended and Restated Note accrued interest on the unpaid principal amount from January 31, 2022 until maturity at a rate equal to 10% per year. Interest on the Amended and Restated Note is payable in cash quarterly on each January 1, April 1, July 1, and October 1, which commenced on April 1, 2022.
F- 76 Table of Contents SPAC Sponsor Entities and Other In general, a SPAC is initially funded by a sponsor and that sponsor invests in and receives private placement and founder shares of the SPAC. The sponsor may be organized as a single legal entity or multiple entities under common control.
F- 77 Table of Contents SPAC Sponsor Entities and Other In general, a SPAC is initially funded by a sponsor and that sponsor invests in and receives private placement and founder shares of the SPAC. The sponsor may be organized as a single legal entity or multiple entities under common control.
DUE FROM / DUE TO RELATED PARTIES Amounts due to related parties related to redeemable financial instruments and outstanding debt are included as components of those balances in the consolidated balance sheets. Also, interest or investment return owed on those balances are included as a component of accounts payable and other liabilities in the consolidated balance sheets.
DUE FROM / DUE TO RELATED PARTIES Amounts due to related parties related to redeemable financial instruments and outstanding debt are included as components of those balances in the consolidated balance sheets. In addition, interest or investment return owed on those balances are included as a component of accounts payable and other liabilities in the consolidated balance sheets.
F- 37 Table of Contents The following tables show certain summary financial data of all the Company's equity method investees. These amounts include all equity method investees whether accounted for under the equity method or at fair value. All information is presented on a combined basis.
F- 38 Table of Contents The following tables show certain summary financial data of all the Company's equity method investees. These amounts include all equity method investees whether accounted for under the equity method or at fair value. All information is presented on a combined basis.
Loans (both principal and interest) made by Byline Bank under the amended and restated agreement are scheduled to mature and become immediately due and payable in full on June 18, 2024. The Company is subject to the following financial covenants in the Byline Credit Facility.
Loans (both principal and interest) made by Byline Bank under the amended and restated agreement are scheduled to mature and become immediately due and payable in full on June 18, 2025. The Company is subject to the following financial covenants in the Byline Credit Facility.
Initially, the Rights will be attached to all Common Stock certificates representing shares then outstanding or, in the case of uncertificated shares of Common Stock registered in book entry form (“Book Entry Shares”) by notation in book entry (which certificates for Common Stock and Book Entry Shares shall be deemed also to be certificates for Rights), and no separate Rights certificates will be distributed.
The Rights attached to all Common Stock certificates representing shares then outstanding and in the case of uncertificated shares of Common Stock registered in book entry form (“Book Entry Shares”) by notation in book entry (which certificates for Common Stock and Book Entry Shares shall be deemed also to be certificates for Rights), and no separate Rights certificates will be distributed.
If the Company determines that the collection of the remaining Maturity Consideration owed is not probable, the Company will not record the unpaid portion. F- 33 Table of Contents The following table shows the carrying value of the assets and liabilities of SFA transactions as of the reporting period dates.
If the Company determines that the collection of the remaining Maturity Consideration owed is not probable, the Company will not record the unpaid portion. F- 34 Table of Contents The following table shows the carrying value of the assets and liabilities of SFA transactions as of the reporting period dates.
FAIR VALUE MEASUREMENTS ON A RECURRING BASIS As of December 31, 2023 (Dollars in Thousands) Significant Significant Quoted Prices in Other Observable Unobservable Active Markets Inputs Inputs Assets Fair Value (Level 1) (Level 2) (Level 3) Investments-trading: Corporate bonds and redeemable preferred stock $ 53,657 $ - $ 53,657 $ - Derivatives 7,470 - 7,470 - Equity securities 928 639 289 - Municipal bonds 20,572 - 20,572 - Residential mortgage loans 3,113 - 3,113 - RMBS 9 - 9 - U.S. government agency debt securities 6,567 - 6,567 - U.S. government agency MBS and CMOs 88,000 - 88,000 - U.S.
F- 28 Table of Contents FAIR VALUE MEASUREMENTS ON A RECURRING BASIS As of December 31, 2023 (Dollars in Thousands) Significant Significant Quoted Prices in Other Observable Unobservable Active Markets Inputs Inputs Assets Fair Value (Level 1) (Level 2) (Level 3) Investments-trading: Corporate bonds and redeemable preferred stock $ 53,657 $ - $ 53,657 $ - Derivatives 7,470 - 7,470 - Equity securities 928 639 289 - Municipal bonds 20,572 - 20,572 - Residential mortgage loans 3,113 - 3,113 - RMBS 9 - 9 - U.S. government agency MBS and CMOs 88,000 - 88,000 - U.S. government agency debt securities 6,567 - 6,567 - U.S.
F- 30 Table of Contents Investments in Certain Entities that Calculate Net Asset Value Per Share (or its Equivalent) The following table presents additional information about investments in certain entities that calculate NAV per share (regardless of whether the “practical expedient” provisions of ASC 820 have been applied), which are measured at fair value on a recurring basis as of December 31, 2023 and 2022 .
F- 31 Table of Contents Investments in Certain Entities that Calculate Net Asset Value Per Share (or its Equivalent) The following table presents additional information about investments in certain entities that calculate NAV per share (regardless of whether the “practical expedient” provisions of ASC 820 have been applied), which are measured at fair value on a recurring basis as of December 31, 2024 and 2023 .
Agency repo income receivable represents income receivable on gestation repo trades. See note 11. Miscellaneous other receivables are receivables that are of a short-term nature. F- 23 Table of Contents 8. FINANCIAL INSTRUMENTS Investments—Trading Investments-trading consisted of the following.
Agency repo income receivable represents income receivable on gestation repo trades. See note 11. Miscellaneous other receivables are receivables that are of a short-term nature. F- 24 Table of Contents 8. FINANCIAL INSTRUMENTS Investments—Trading Investments-trading consisted of the following.
Foreign Government Bonds : The fair value of foreign government bonds is estimated using valuations provided by third -party pricing services and classifies the fair value within level 2 of the valuation hierarchy. Interests in SPVs : The Company values these instruments using a model.
Foreign Government Bond : The fair value of foreign government bond is estimated using valuations provided by third -party pricing services and classifies the fair value within level 2 of the valuation hierarchy. Interests in SPVs : The Company values these instruments using a model.
Recent Accounting Developments In August 2020, the FASB issued ASU 2020 - 06, Debt—Debt with Conversion and Other Options (Subtopic 470 - 20 ) and Derivatives and Hedging—Contracts in Entity's Own Equity (Subtopic 815 - 40 ): Accounting for Convertible Instruments and Contracts in an Entity's Own Equity.
In August 2020, the FASB issued ASU 2020 - 06, Debt — Debt with Conversion and Other Options (Subtopic 470 - 20 ) and Derivatives and Hedging — Contracts in Entity's Own Equity (Subtopic 815 - 40 ): Accounting for Convertible Instruments and Contracts in an Entity's Own Equity.
The Company carries the foreign currency forward contracts at fair value and includes them as a component of other investments, at fair value in the Company’s consolidated balance sheets. As of December 31, 2023 and 2022 , the Company had no outstanding foreign currency forward contracts.
The Company carries the foreign currency forward contracts at fair value and includes them as a component of other investments, at fair value in the Company’s consolidated balance sheets. As of December 31, 2024 and 2023 , the Company had no outstanding foreign currency forward contracts.
New issue and advisory New issue and advisory revenue is comprised of (a) origination fees for newly created financial instruments originated by the Company: (b) revenue from advisory services, and (c) revenue associated with arranging and placing the issuance of newly created financial instruments.
New issue and advisory New issue and advisory revenue is comprised of (a) origination fees for newly created financial instruments originated by the Company, (b) revenue from advisory services, (c) revenue from underwriting, and (d) revenue associated with arranging and placing the issuance of newly created financial instruments.
The expected income tax expense /(benefit) using the federal statutory rate differs from income tax expense / (benefit) pertaining to pre-tax income / (loss) as a result of the following for the years ended December 31, 2023 , 2022 , and 2021 .
The expected income tax expense /(benefit) using the federal statutory rate differs from income tax expense / (benefit) pertaining to pre-tax income / (loss) as a result of the following for the years ended December 31, 2024 , 2023 , and 2022 .
Certain prior period amounts have been reclassified to conform to the current period presentation. The Company paid or received cash distributions to / from Cohen & Company, LLC as disclosed above in the statements of cash flow. F-84
Certain prior period amounts have been reclassified to conform to the current period presentation. The Company paid or received cash distributions to / from Cohen & Company, LLC as disclosed above in the statements of cash flow. F-85
See note 5 for realized and unrealized gains recognized on investments-trading and trading securities sold, not yet purchased. F- 24 Table of Contents Other Investments, at Fair Value Other investments, at fair value consisted of the following.
See note 5 for realized and unrealized gains recognized on investments-trading and trading securities sold, not yet purchased. F- 25 Table of Contents Other Investments, at Fair Value Other investments, at fair value consisted of the following.
As of December 31, 2023 , there were 4,983,557 shares of Series E Preferred Stock issued and outstanding. See Non-Controlling Interest — Future Conversion / Redemption of Operating LLC Units below.
As of December 31, 2024 , there were 4,983,557 shares of Series E Preferred Stock issued and outstanding. See Non-Controlling Interest — Future Conversion / Redemption of Operating LLC Units below.
Expense incurred by the Company for services provided by Duane Morris is included within professional fees and operating expense in the consolidated statements of operations and comprehensive income and are disclosed in the table below. E.
Expense incurred by the Company for services provided by Duane Morris is included within professional fees and operating expense in the consolidated statements of operations and comprehensive income and are disclosed in the table below. D.
On January 31, 2022, the Operating LLC and JKD Investor entered into the 2022 Purchase Agreement, pursuant to which, among other things, on such date, (i) JKD Investor paid to the Operating LLC an additional $2,250 and (ii) in consideration for such funds, the Operating LLC issued to JKD Investor the Amended and Restated Note in the aggregate principal amount of $4,500.
On January 31, 2022, the Operating LLC and JKD Investor entered into the 2022 Note Purchase Agreement, pursuant to which, among other things, on such date, (i) JKD Investor paid to the Operating LLC an additional $2,250 and (ii) in consideration for such funds, the Operating LLC issued to JKD Investor the 2020 Note in the aggregate principal amount of $4,500.
See note 12. The Company agreed to pay a consultant fee of $1 per month, which commenced on December 1, 2020 and continued through November 18, 2022, the date Insurance SPAC III announced that it would not consummate an initial business combination within the time period required.
The Company agreed to pay a consultant fee of $1 per month, which commenced on December 1, 2020 and continued through November 18, 2022, the date Insurance SPAC III announced that it would not consummate an initial business combination within the time period required.
F- 53 Table of Contents Net Share Settlement of Restricted Stock The Company may net share settle equity-based awards for the payment of employees’ tax obligations to taxing authorities related to the vesting of such equity-based awards.
F- 54 Table of Contents Net Share Settlement of Restricted Stock The Company may net share settle equity-based awards for the payment of employees’ tax obligations to taxing authorities related to the vesting of such equity-based awards.
FTAC Parnassus liquidated in 2022. F- 77 Table of Contents FTAC Zeus Acquisition Corp. ("FTAC Zeus") was a SPAC. The sponsor of FTAC Zeus ("FTAC Zeus Sponsor") is a related party as it was an equity method investment of the Company.
FTAC Parnassus liquidated in 2022. F- 78 Table of Contents FTAC Zeus Acquisition Corp. ("FTAC Zeus") was a SPAC. The sponsor of FTAC Zeus ("FTAC Zeus Sponsor") is a related party as it was an equity method investment of the Company.
No assurance can be made that the Company will have future taxable income or future capital gains to benefit from its NOL and NCL carryovers. The Company has determined that its NOL and NCL carryovers are not currently limited by Section 382 of the Internal Revenue Code of 1986, as amended (the “Code”).
No assurance can be made that the Company will have future taxable income or future capital gains to benefit from its NOL and NCL carry forwards. The Company has determined that its NOL and NCL carry forwards are not currently limited by Section 382 of the Internal Revenue Code of 1986, as amended (the “Code”).
These models include estimates, and the valuations derived from them could differ materially from amounts realizable in an open market exchange. Dividend income is recognized on the ex-dividend date.
These models include estimates, and the valuations derived from them could differ materially from amounts realizable in an open market exchange. Dividend income is recorded on the ex-dividend date.
F- 28 Table of Contents The following provides a brief description of the types of financial instruments the Company holds, the methodology for estimating fair value, and the level within the valuation hierarchy of the estimate.
F- 29 Table of Contents The following provides a brief description of the types of financial instruments the Company holds, the methodology for estimating fair value, and the level within the valuation hierarchy of the estimate.
The following table presents the Company’s derivative financial instruments and the amount and location of the fair value (unrealized gain / (loss)) presented in the consolidated balance sheets as of December 31, 2023 and 2022 .
The following table presents the Company’s derivative financial instruments and the amount and location of the fair value (unrealized gain / (loss)) presented in the consolidated balance sheets as of December 31, 2024 and 2023 .
The table below shows the Company’s maximum exposure to loss associated with these identified nonconsolidated VIEs in which it holds variable interests at December 31, 2023 and 2022 .
The table below shows the Company’s maximum exposure to loss associated with these identified nonconsolidated VIEs in which it holds variable interests at December 31, 2024 and 2023 .
GOODWILL Goodwill is comprised of the following. GOODWILL (Dollars in Thousands) December 31, 2023 December 31, 2022 AFN $ 109 $ 109 Goodwill $ 109 $ 109 The annual impairment testing date for AFN goodwill is October 1. The first testing date following the AFN Merger was October 1, 2010.
GOODWILL Goodwill is comprised of the following. GOODWILL (Dollars in Thousands) December 31, 2024 December 31, 2023 AFN $ 109 $ 109 Goodwill $ 109 $ 109 The annual impairment testing date for AFN goodwill is October 1. The first testing date following the AFN Merger was October 1, 2010.
Cohen & Company Financial Management, LLC (“CCFM”) is a wholly owned subsidiary of the Operating LLC and acts as asset manager and investment adviser to the Alesco III, Alesco IV, Alesco V, Alesco VI, and Alesco VIII CDOs. Alesco CDOs invest in bank and insurance company TruPS as well as insurance company subordinated debt.
Cohen & Company Financial Management, LLC (“CCFM”) is a wholly owned subsidiary of the Operating LLC and acts as asset manager and investment adviser to the Alesco III, Alesco IV, Alesco V, Alesco VI, and Alesco VIII CDOs. Alesco CDOs invest in bank and insurance company trust preferred securities ("TruPS") as well as insurance company subordinated debt.
Equity Derivatives The Company may enter into equity derivatives which include listed options as well as other derivative transactions with an equity instrument as the underlying. Listed options are traded on a recognized liquid exchange and the Company classifies their fair value within level 1 of the valuation hierarchy.
Equity Derivatives The Company may enter into equity derivatives, which include listed options as well as other derivative transactions with an underlying equity instrument. Listed options are traded on a recognized liquid exchange and the Company classifies the fair value of these securities within level 1 of the valuation hierarchy.
The Series C Preferred Stock has a par value of $0.001 per share and 10,000 shares were authorized as of December 31, 2023 and 2022 .
The Series C Preferred Stock has a par value of $0.001 per share and 10,000 shares were authorized as of December 31, 2024 and 2023 .
COMMITMENTS AND CONTINGENCIES Lease Commitments The Company leases office space in several cities under lease agreements. As of December 31, 2023 , future minimum commitments under these operating leases are as follows.
COMMITMENTS AND CONTINGENCIES Lease Commitments The Company leases office space in several cities under lease agreements. As of December 31, 2024 , future minimum commitments under these operating leases are as follows.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeRisks Related to Our Business and Our Industry : ● Difficult market conditions have adversely affected our business and may continue to do so. ● Economic slowdown, market volatility, a recession and increasing interest rates may impair investments and operating results. ● We may experience write downs of financial instruments and other losses due to the volatile and illiquid market conditions. ● We have incurred losses for certain periods covered by this report and in the recent past and may incur losses in the future. ● Continued difficulties in our Capital Markets segment due to intense competition has resulted in significant strain on our administrative, operational and financial resources and these difficulties may continue in the future. ● The incurrence of additional debt could adversely effect on our financial condition and results of operation. ● Our gestation repo business serves a narrow market and is likely subject to highly volatile demand. ● Our mortgage group’s revenue is highly dependent on the U.S. housing market, generally. ● Our Capital Markets segment depends significantly on a limited group of customers. ● Failure to retain senior management and qualified personnel may result in our not being able to execute our business strategy. ● Payment of severance could strain our cash flow. ● If additional cash is not available, our business and financial performance will be significantly harmed. ● Failure to obtain or maintain adequate capital and funding would adversely affect the growth and results of our operations. ● The lack of liquidity in certain investments may adversely affect our business, financial condition and results of operations. ● If we are unable to manage the risks of international operations effectively, our business could be adversely affected. ● The securities settlement process exposes us to risks that may adversely affect our business. ● We are exposed to the risk that third parties that are indebted to us will not perform their obligations. ● We are exposed to various risks related to margin requirements under repurchase agreements and securities financing arrangements and are highly dependent on our clearing relationships. ● We have market risk exposure from unmatched principal transactions entered into by our brokerage desks. ● Pricing and other competitive pressures may impair the revenues and profitability of our brokerage business. ● Increase in capital commitments in our trading business increases the potential for significant losses. ● Our principal trading and investments expose us to risk of loss. ● Our principal investments are subject to various risks and expose us to a significant risk of capital loss. ● Transition away from LIBOR may adversely affect our business. ● Historical returns of our funds and managed accounts may not be indicative of their future results. ● There is increasing regulatory supervision of alternative asset management companies. ● Asset management clients generally may redeem their investments, which could reduce our asset management fee revenues. ● The investment management business is intensely competitive, which could have a material adverse impact on our business. ● Poor performance of our investment funds’ and separately managed accounts’ investments could result in a decline in our asset management revenue and earnings and investors terminating our management agreements. ● If the investments we have made on behalf of our CDOs perform poorly, we will suffer a decline in our asset management revenue and earnings and the investors in our CDOs may seek to terminate our management agreements. ● Our investments in SPAC Sponsor Entities are speculative, subject to total loss, and illiquid prior to business combination. ● Our investments in post-business combination SPACs are carried at fair value but are subject to sale restrictions which could result in significant losses to our business. ● Our strategic relationship with Cohen Circle, LLC ("Cohen Circle"), formerly Fintech Masala, LLC could result in conflicts of interest and a termination of such relationship could result in losses to our business. ● Our management may allocate some portion of their time to the business of the SPAC, which may create conflicts of interest. ● Any agreement to indemnify a SPAC against certain claims could negatively affect our financial results. ● We may make future loans to SPACs which may not be repaid. ● If our risk management systems for our businesses are ineffective, we may be exposed to material unanticipated losses. ● Failures in our information and communications systems could significantly disrupt our business. ● We may not be able to keep pace with continuing changes in technology. ● Failure to protect client data or prevent breaches of our information systems could expose us to liability/reputational damage. ● We are largely dependent on Pershing LLC to provide clearing services and margin financing. ● Our substantial level of indebtedness could adversely affect our financial health and ability to compete. ● Changes in accounting interpretations or assumptions could adversely impact our financial statements. ● Any change of our investment strategy, hedging strategy, asset allocation and operational policies may result in riskier investments and adversely affect the market value of our Common Stock. ● Maintenance of our Investment Company Act exemption imposes limits on our operations. ● The soundness of other financial institutions and intermediaries affects us. 16 Table of Contents ● We operate in a highly regulated industry and may face increasing restrictions on, and examination of, the conduct of our operations. ● Substantial legal liability or significant regulatory action could materially affect our business. ● Highly competitive markets could have a material effect on our business. ● Employee misconduct or error could harm our business. ● We receive financial instruments instead of cash as consideration for some of our services, which may be illiquid, and the price we ultimately realize may be materially lower than current fair value. ● SFA transactions may obligate us to make payments on certain payments upon or subsequent to maturity which may adversely impact our liquidity.
Biggest changeRisks Related to Our Business and Our Industry : ● Difficult market conditions have adversely affected our business and may continue to do so. ● Economic slowdown, market volatility, a recession and increasing interest rates may impair investments and operating results. ● We may experience write downs of financial instruments and other losses due to the volatile and illiquid market conditions. ● We have incurred losses for certain periods covered by this report and in the recent past and may incur losses in the future. ● Continued difficulties in our Capital Markets segment due to intense competition has resulted in significant strain on our administrative, operational and financial resources and these difficulties may continue in the future. ● Our gestation repo business serves a narrow market and is likely subject to highly volatile demand. ● Our mortgage group’s revenue is highly dependent on the U.S. housing market, generally. ● Our Capital Markets segment depends significantly on a limited group of customers. ● Underwriting activities expose us to risk. ● Failure to retain senior management and qualified personnel may result in our not being able to execute our business strategy. ● Payment of severance could strain our cash flow. ● If additional cash is not available, our business and financial performance will be significantly harmed. ● Failure to obtain or maintain adequate capital and funding would adversely affect the growth and results of our operations. ● The lack of liquidity in certain investments may adversely affect our business, financial condition and results of operations. ● Our investments in the equity interests of SPACs and SPAC Sponsor Entities may expose us to increased risks and liabilities. ● Our investments in SPAC Sponsor Entities are highly speculative, subject to total loss, and completely illiquid prior to business combination. ● Our investments in post-business combination SPACs are carried at fair value but subject to sale restrictions which could result in significant losses to our business. ● Our failure to deal appropriately with actual, potential, or perceived conflicts of interest could damage our reputation and materially adversely affect our business. ● Our strategic relationship with Cohen Circle, LLC ("Cohen Circle"), formerly Fintech Masala, LLC could result in conflicts of interest and termination of such relationship could result in losses to our businesses. ● If we are unable to manage the risks of international operations effectively, our business could be adversely affected. ● The securities settlement process exposes us to risks that may adversely affect our business. ● We are exposed to the risk that third parties that are indebted to us will not perform their obligations. ● We are exposed to various risks related to margin requirements under repurchase agreements and securities financing arrangements and are highly dependent on our clearing relationships. ● We have market risk exposure from unmatched principal transactions entered into by our brokerage desks. ● Pricing and other competitive pressures may impair the revenues and profitability of our brokerage business. ● Increase in capital commitments in our trading business increases the potential for significant losses. ● Our principal trading and investments expose us to risk of loss. ● Our principal investments are subject to various risks and expose us to a significant risk of capital loss. ● Historical returns of our funds and managed accounts may not be indicative of their future results. ● There is increasing regulatory supervision of alternative asset management companies. ● Asset management clients generally may redeem their investments, which could reduce our asset management fee revenues. ● The investment management business is intensely competitive, which could have a material adverse impact on our business. ● Poor performance of our investment funds’ and separately managed accounts’ investments could result in a decline in our asset management revenue and earnings and investors terminating our management agreements. ● Any agreement to indemnify a SPAC against certain claims could negatively affect our financial results. ● We may make future loans to SPACs which may not be repaid. ● Our management may allocate some portion of their time to the business of the SPAC, which may create conflicts of interest. ● If our risk management systems for our businesses are ineffective, we may be exposed to material unanticipated losses. ● Failures in our information and communications systems could significantly disrupt our business. ● We may not be able to keep pace with continuing changes in technology. ● The development and use of artificial intelligence presents risks and challenges that could adversely impact our business, financial condition, and results of operations. ● Failure to protect client data or prevent breaches of our information systems could expose us to liability/reputational damage. ● We are largely dependent on Pershing LLC to provide clearing services and margin financing. ● Our substantial level of indebtedness could adversely affect our financial health and ability to compete. ● Changes in accounting interpretations or assumptions could adversely impact our financial statements. ● Any change of our investment strategy, hedging strategy, asset allocation and operational policies may result in riskier investments and adversely affect the market value of our Common Stock. ● Maintenance of our Investment Company Act exemption imposes limits on our operations. ● The soundness of other financial institutions and intermediaries affects us. 15 Table of Contents ● We operate in a highly regulated industry and may face increasing restrictions on, and examination of, the conduct of our operations. ● Substantial legal liability or significant regulatory action could materially affect our business. ● Highly competitive markets could have a material effect on our business. ● Employee misconduct or error could harm our business. ● We receive financial instruments instead of cash as consideration for some of our services, which may be illiquid, and the price we ultimately realize may be materially lower than current fair value. ● SFA transactions may obligate us to make payments on certain payments upon or subsequent to maturity which may adversely impact our liquidity.
Cohen & Company, Inc. also holds units of membership interests in the Operating LLC and has the majority voting power of the LLC through a proxy granted to it by Mr. Cohen and the DGC Trust.
Cohen & Company, Inc. also holds units of membership interests in the Operating LLC and has the majority voting power of the Operating LLC through a proxy granted to it by Mr. Cohen and the DGC Trust.
Some aspects of the business that are subject to extensive regulation and/or examination by regulatory agencies, include: • sales methods, trading procedures and valuation practices; • investment decision making processes and compensation practices; • use and safekeeping of client funds and securities; • the manner in which we deal with clients; • the safeguarding of personally identifiable information; • capital requirements; • financial and reporting practices; • required record keeping and record retention procedures; • the licensing of employees; • the conduct of directors, officers, employees and affiliates; • systems and control requirements; • conflicts of interest including, but not limited to allocation of investment opportunities and targets for business combinations for SPACs; • restrictions on marketing, gifts and entertainment; and • client identification and anti-money laundering requirements. 29 Table of Contents The SEC, FINRA, ACPR, and various other domestic and international regulatory agencies also have stringent rules and regulations with respect to the maintenance of specific levels of net capital by broker-dealers.
Some aspects of the business that are subject to extensive regulation and/or examination by regulatory agencies, include: • sales methods, trading procedures and valuation practices; • investment decision making processes and compensation practices; • use and safekeeping of client funds and securities; • the manner in which we deal with clients; • the safeguarding of personally identifiable information; • capital requirements; • financial and reporting practices; • required record keeping and record retention procedures; • the licensing of employees; • the conduct of directors, officers, employees and affiliates; • systems and control requirements; • conflicts of interest including, but not limited to allocation of investment opportunities and targets for business combinations for SPACs; • restrictions on marketing, gifts and entertainment; and • client identification and anti-money laundering requirements. 28 Table of Contents The SEC, FINRA, ACPR, and various other domestic and international regulatory agencies also have stringent rules and regulations with respect to the maintenance of specific levels of net capital by broker-dealers.
On September 25, 2020, the Securities Purchase Agreement (the "SPA") dated December 30, 2019, by and among the Company, the Operating LLC, Daniel Cohen, and DGC Trust and the Amended and Restated Limited Liability Company Agreement of the Operating LLC were amended to provide that the voting proxy shall be revoked in the event that Daniel G.
On September 25, 2020, the Securities Purchase Agreement dated December 30, 2019, by and among the Company, the Operating LLC, Daniel Cohen, and DGC Trust and the Amended and Restated Limited Liability Company Agreement of the Operating LLC were amended to provide that the voting proxy shall be revoked in the event that Daniel G.
It may take more than a year for us to determine whether we have successfully integrated new individuals, and lines of business and capabilities into our operations. During that time, we may incur significant expenses and expend significant time and resources toward training, integration and business development.
Generally, it may take more than a year for us to determine whether we have successfully integrated new individuals, and lines of business and capabilities into our operations. During that time, we may incur significant expenses and expend significant time and resources toward training, integration and business development.
We cannot assure you that we will be able to: • Expand our capabilities or systems effectively; • Successfully develop new products or services; • Allocate our human resources optimally; • Identify, hire or retain qualified employees or vendors; • Incorporate effectively the components of any business that we may acquire in our effort to achieve growth; • Sell businesses or assets at their fair market value; or • Effectively manage the costs associated with developing, growing, acquiring or exiting a business. 35 Table of Contents We may need to offer new investment strategies and products in order to continue to generate revenue.
We cannot assure you that we will be able to: • Expand our capabilities or systems effectively; • Successfully develop new products or services; • Allocate our human resources optimally; • Identify, hire or retain qualified employees or vendors; • Incorporate effectively the components of any business that we may acquire in our effort to achieve growth; • Sell businesses or assets at their fair market value; or • Effectively manage the costs associated with developing, growing, acquiring or exiting a business. 34 Table of Contents We may need to offer new investment strategies and products in order to continue to generate revenue.
The disruption in these markets generally, and in the U.S. and European markets in particular, impacted and may continue to impact our business. We have exposure to these markets and products, and if market conditions continue to worsen, the fair value of our investments and our management fees could further deteriorate.
The disruption in these markets generally, and in the U.S. and European markets in particular, impacted and may continue to impact our business. We have exposure to these markets and products, and if market conditions continue to worsen, the fair value of our investments and our management fees could deteriorate.
We may need to incur additional indebtedness to finance these payments to the extent our cash resources are insufficient to meet our obligations under the SFAs as a result of timing discrepancies or otherwise, and these obligations could negatively effect our business, financial condition, and results of operations. 31 Table of Contents Risks Related to Our Organizational Structure and Ownership of Our Common Stock We could repurchase shares of our Common Stock at price levels considered excessive, the amount of our Common Stock we repurchase may decrease from historical levels, or we may not repurchase any additional shares of our Common Stock in the future.
We may need to incur additional indebtedness to finance these payments to the extent our cash resources are insufficient to meet our obligations under the SFAs as a result of timing discrepancies or otherwise, and these obligations could negatively effect our business, financial condition, and results of operations. 30 Table of Contents Risks Related to Our Organizational Structure and Ownership of Our Common Stock We could repurchase shares of our Common Stock at price levels considered excessive, the amount of our Common Stock we repurchase may decrease from historical levels, or we may not repurchase any additional shares of our Common Stock in the future.
If we fail to implement our control our costs effectively, our business could be disrupted, and our financial results could be adversely affected. The Company continues to look for ways to reduce infrastructure costs and reposition itself in the financial services industry.
If we fail to control our costs effectively, our business could be disrupted, and our financial results could be adversely affected. The Company continues to look for ways to reduce infrastructure costs and reposition itself in the financial services industry.
In addition, global macroeconomic conditions and U.S. financial markets remain vulnerable to the potential risks posed by exogenous shocks, which could include, among other things, political and financial uncertainty in the U.S. and the European Union (the “EU”), continued spread of the global novel coronavirus (“COVID-19”) pandemic, renewed concern about China’s economy, cybersecurity incidents and events, climate-related incidents, complications involving terrorism and armed conflicts around the world, or other challenges to global trade or travel.
In addition, global macroeconomic conditions and U.S. financial markets remain vulnerable to the potential risks posed by exogenous shocks, which could include, among other things, political and financial uncertainty in the U.S. and the European Union (the “EU”), continued effects of the global novel coronavirus (“COVID-19”) pandemic, renewed concern about China’s economy, cybersecurity incidents and events, climate-related incidents, complications involving terrorism and armed conflicts around the world, or other challenges to global trade or travel.
We believe that competition for fund investors is based primarily on: • investment performance; • investor liquidity and willingness to invest; • investor perception of investment managers’ drive, focus and alignment of interest; • business reputation; • the quality of services provided to fund investors; • pricing; • fund terms (including fees); and • the relative attractiveness of the types of investments that have been or will be made. 25 Table of Contents We believe that competition for investment opportunities is based primarily on the pricing, terms and structure of a proposed investment and certainty of execution.
We believe that competition for fund investors is based primarily on: • investment performance; • investor liquidity and willingness to invest; • investor perception of investment managers’ drive, focus and alignment of interest; • business reputation; • the quality of services provided to fund investors; • pricing; • fund terms (including fees); and • the relative attractiveness of the types of investments that have been or will be made. 24 Table of Contents We believe that competition for investment opportunities is based primarily on the pricing, terms and structure of a proposed investment and certainty of execution.
In the event that our strategic relationship with Cohen Circle is terminated, the loss of the services of Cohen Circle’s personnel could significantly impair our SPAC franchise's ability to continue to succeed, which could hinder our ability to achieve and sustain profitability. 21 Table of Contents In addition, certain of our employees also provide consulting and other SPAC-related services to Cohen Circle pursuant to contractual arrangements with the SPACs of which Cohen Circle is a sponsor.
In the event that our strategic relationship with Cohen Circle is terminated, the loss of the services of Cohen Circle’s personnel could significantly impair our SPAC franchise's ability to continue to succeed, which could hinder our ability to achieve and sustain profitability. 20 Table of Contents In addition, certain of our employees also provide consulting and other SPAC-related services to Cohen Circle pursuant to contractual arrangements with the SPACs of which Cohen Circle is a sponsor.
If we are unable to meet our funding needs on a timely basis, our business would be adversely affected and there may be a negative impact on the market price of our Common Stock. 20 Table of Contents Our investments in the equity interests of SPACs and SPAC Sponsor Entities may expose us to increased risks and liabilities.
If we are unable to meet our funding needs on a timely basis, our business would be adversely affected and there may be a negative impact on the market price of our Common Stock. 19 Table of Contents Our investments in the equity interests of SPACs and SPAC Sponsor Entities may expose us to increased risks and liabilities.
Daniel G. Cohen, our Executive Chairman, has significant ownership interests in the Operating LLC and competing duties to other entities (including Cohen Circle) that could create potential conflicts of interest and may result in decisions that are not in the best interests of other Cohen & Company Inc. stockholders. As of December 31, 2023, Daniel G.
Daniel G. Cohen, our Executive Chairman, has significant ownership interests in the Operating LLC and competing duties to other entities (including Cohen Circle) that could create potential conflicts of interest and may result in decisions that are not in the best interests of other Cohen & Company Inc. stockholders. As of December 31, 2024, Daniel G.
If we finance acquisitions by issuing equity securities or securities convertible into equity securities, our existing stockholders will also be diluted. 33 Table of Contents The issuance of the shares of Common Stock upon the redemption, if any, of the issued and outstanding LLC Units may cause substantial dilution to our existing stockholders and may cause the price of our Common Stock to decline.
If we finance acquisitions by issuing equity securities or securities convertible into equity securities, our existing stockholders will also be diluted. 32 Table of Contents The issuance of the shares of Common Stock upon the redemption, if any, of the issued and outstanding LLC Units may cause substantial dilution to our existing stockholders and may cause the price of our Common Stock to decline.
If our internal controls over financial reporting and disclosure controls and procedures are not effective, we may not be able to provide reliable financial information. Because we are a smaller reporting company, we are not required to obtain, nor have we voluntarily obtained, an auditor attestation regarding the effectiveness of our controls as of December 31, 2023.
If our internal controls over financial reporting and disclosure controls and procedures are not effective, we may not be able to provide reliable financial information. Because we are a smaller reporting company, we are not required to obtain, nor have we voluntarily obtained, an auditor attestation regarding the effectiveness of our controls as of December 31, 2024.
Changes in accounting interpretations or assumptions could materially impact our financial statements. 28 Table of Contents We may change our investment strategy, hedging strategy, asset allocation and operational policies without our stockholders’ consent, which may result in riskier investments and adversely affect the market value of our Common Stock.
Changes in accounting interpretations or assumptions could materially impact our financial statements. 27 Table of Contents We may change our investment strategy, hedging strategy, asset allocation and operational policies without our stockholders’ consent, which may result in riskier investments and adversely affect the market value of our Common Stock.
Therefore, as of December 31, 2023, we have only performed management’s assessment of the effectiveness of our internal controls and management has determined that our internal controls are effective as of December 31, 2023. Any failure to maintain effective controls in the future could adversely affect our business or cause us to fail to meet our reporting obligations.
Therefore, as of December 31, 2024, we have only performed management’s assessment of the effectiveness of our internal controls and management has determined that our internal controls are effective as of December 31, 2024. Any failure to maintain effective controls in the future could adversely affect our business or cause us to fail to meet our reporting obligations.
Liquidity is essential to our businesses. We depend upon the availability of adequate funding and capital for our operations. In particular, we may need to raise additional capital in order to significantly grow our business. In recent years, we have engaged in a number of capital raising transactions with Daniel G.
Liquidity is essential to our businesses. We depend upon the availability of adequate funding and capital for our operations. In particular, we may need to raise additional capital in order to significantly grow our business. In past years, we have engaged in a number of capital raising transactions with Daniel G.
Such limitations could have a material adverse effect on our business and operations. As of December 31, 2023, we are in compliance with and meet the Section 3(a)(1)(C) exclusion. The soundness of other financial institutions and intermediaries affects us .
Such limitations could have a material adverse effect on our business and operations. As of December 31, 2024, we are in compliance with and meet the Section 3(a)(1)(C) exclusion. The soundness of other financial institutions and intermediaries affects us .
Cohen as a shareholder of the Company could approve or reject actions based on his own interests as a stockholder that may or may not be in the best interests of the other the Company’s stockholders. 32 Table of Contents We are controlled by Daniel G.
Cohen as a shareholder of the Company could approve or reject actions based on his own interests as a stockholder that may or may not be in the best interests of the other the Company’s stockholders. 31 Table of Contents We are controlled by Daniel G.
If we are unable to manage any of these risks effectively, our results of operations and cash flows could be materially and adversely affected. 24 Table of Contents The historical returns of our funds and managed accounts may not be indicative of the future results of our funds and managed accounts.
If we are unable to manage any of these risks effectively, our results of operations and cash flows could be materially and adversely affected. 23 Table of Contents The historical returns of our funds and managed accounts may not be indicative of the future results of our funds and managed accounts.
If we are unable to hire and retain senior management or other qualified personnel, such as salespeople and traders, we will not be able to grow our business and our financial results may be materially and adversely affected.
If we are unable to hire and retain senior management or other qualified personnel, such as salespeople, investment bankers, and traders, we will not be able to grow our business and our financial results may be materially and adversely affected.
Our business will require a significant amount of cash, and if it is not available, our business and financial performance will be significantly harmed. We require a substantial amount of cash to fund our investments, pay our expenses and hold our assets.
Our business will require a significant amount of cash, and if it is not available, our business and financial performance will be significantly harmed. We require a substantial amount of cash to fund our operations, make investments, pay our expenses, and hold our assets.
In addition, any principal gains and losses resulting from these positions could, from time to time, have a disproportionate positive or negative effect on our financial condition and results of operations for a particular reporting period. Pricing and other competitive pressures may impair the revenues and profitability of our brokerage business.
In addition, any principal gains and losses resulting from these positions could, from time to time, have a disproportionate positive or negative effect on our financial condition and results of operations for a particular reporting period. 22 Table of Contents Pricing and other competitive pressures may impair the revenues and profitability of our brokerage business.
In addition, our management contracts may be terminated for various reasons. 26 Table of Contents Any agreement to indemnify a SPAC against certain claims could negatively affect our financial results.
In addition, our management contracts may be terminated for various reasons. 25 Table of Contents Any agreement to indemnify a SPAC against certain claims could negatively affect our financial results.
In addition, we may not be able to obtain insurance to cover all of the types of risks we face and any insurance policies we do obtain may not provide adequate coverage for covered risks. 22 Table of Contents We are exposed to the risk that third parties that are indebted to us will not perform their obligations.
In addition, we may not be able to obtain insurance to cover all of the types of risks we face and any insurance policies we do obtain may not provide adequate coverage for covered risks. We are exposed to the risk that third parties that are indebted to us will not perform their obligations.
As of December 31, 2023, we have a substantial amount of debt with variable interest rates. We may experience material increases in our interest expense as a result of increases in general interest rate levels.
As of December 31, 2024, we have a substantial amount of debt with variable interest rates. We may experience material increases in our interest expense as a result of increases in general interest rate levels.
The Operating LLC will pay distributions to us in amounts necessary to satisfy our tax obligations and regularly scheduled payments of interest in connection with our convertible senior debt and our junior subordinated notes, and we are dependent on these distributions from the Operating LLC in order to generate the funds necessary to meet these obligations and liabilities.
The Operating LLC will pay distributions to us in amounts necessary to satisfy our tax obligations and regularly scheduled payments of interest in connection with our junior subordinated notes, and we are dependent on these distributions from the Operating LLC in order to generate the funds necessary to meet these obligations and liabilities.
In addition, these restrictions could potentially impose notice requirements or limit the Company’s ability to withdraw capital above the required minimum amounts (excess capital) whether through distribution or loan. CCFEL is regulated by the CBI in Ireland and must maintain certain minimum levels of capital. CCFESSA is regulated by the ACPR and must maintain certain minimum levels of capital.
In addition, these restrictions could potentially impose notice requirements or limit the Company’s ability to withdraw capital above the required minimum amounts (excess capital) whether through distribution or loan. CCFESSA is regulated by the ACPR and must maintain certain minimum levels of capital.
Although the length and impact of the ongoing military conflict is highly unpredictable, the conflict in Ukraine has lead to market disruptions, including significant volatility in credit and capital markets.
Although the length and impact of the ongoing military conflict is highly unpredictable, the conflict in Ukraine has led to market disruptions, including significant volatility in credit and capital markets.
In addition, the delisting of our Common Stock could significantly impair our ability to raise capital. 36 Table of Contents ITEM 1B. UNRESOLVED STAFF COMMENTS. None.
In addition, the delisting of our Common Stock could significantly impair our ability to raise capital. 35 Table of Contents ITEM 1B. UNRESOLVED STAFF COMMENTS. None.
Such breaches could lead to shutdowns or disruptions of our systems and potential unauthorized disclosure of confidential information and violations of privacy laws and regulations. 27 Table of Contents In providing services to clients, we manage, utilize and store sensitive and confidential client data, including personal data.
Such breaches could lead to shutdowns or disruptions of our systems and potential unauthorized disclosure of confidential information and violations of privacy laws and regulations. In providing services to clients, we manage, utilize and store sensitive and confidential client data, including personal data.
Our primary sources of working capital and cash are expected to consist of: • revenue from operations, including net trading revenue, asset management revenue, new issue and advisory revenue, interest income and dividends from our investment portfolio and potential monetization of principal investments; • interest income from temporary investments and cash equivalents; • sales of assets; and • proceeds from future borrowings or any offerings of our equity or debt securities.
Our primary sources of working capital and cash are expected to consist of: • revenue from operations, including net trading revenue, asset management revenue, new issue and advisory revenue, interest income and dividends from our investment portfolio and potential monetization of principal investments; • securities financing including repurchase agreements and margin loans; • interest income from temporary investments and cash equivalents; • sales of assets; and • proceeds from future borrowings or any offerings of our equity or debt securities.
These challenges have materially adversely affected our Capital Markets segment’s results of operations and may continue to do so. 18 Table of Contents We intend to focus on improving the performance of our Capital Markets segment, which could place additional demands on our resources and increase our expenses.
These challenges have materially adversely affected our Capital Markets segment’s results of operations and may continue to do so. We continue to focus on improving the performance of our Capital Markets segment, which could place additional demands on our resources and increase our expenses.
In addition, our failure to satisfy the financial covenants in our debt agreements could result in a default and acceleration of repayment of the indebtedness thereunder. Our balance sheet includes approximately $52.6 million par value of recourse indebtedness. Our indebtedness could have important consequences to our stockholders.
In addition, our failure to satisfy the financial covenants in our debt agreements could result in a default and acceleration of repayment of the indebtedness thereunder. Our balance sheet includes approximately $57.8 million par value of recourse indebtedness. Our indebtedness could have important consequences to our stockholders.
Cohen, at any time, could become the owner of the membership interests in the Operating LLC currently held by the DGC Trust and, in turn, an additional 21.3% of the voting power of the Company. As a result of Mr. Cohen’s voting control of the Company, Mr.
Cohen, at any time, could become the owner of the membership interests in the Operating LLC currently held by the DGC Trust and, in turn, an additional 20.7% of the voting power of the Company. As a result of Mr. Cohen’s voting control of the Company, Mr.
As of December 31, 2023, of the Company’s $14.2 million balance of investment in equity method affiliates, $8.4 million represents direct or indirect investments in SPAC sponsor entities. These investments are subject to transfer restrictions (as described in greater detail below), are completely illiquid and could be worthless if the underlying sponsor entities liquidate without completing a business combination.
As of December 31, 2024, of the Company’s $23.4 million balance of investment in equity method affiliates, $17.8 million represents direct or indirect investments in SPAC sponsor entities. These investments are subject to transfer restrictions (as described in greater detail below), are completely illiquid and could be worthless if the underlying sponsor entities liquidate without completing a business combination.
Cohen currently owns approximately 41.8% of the voting power of the Company as a result of his ownership of Common Stock, Series E Preferred Stock and Series F Preferred Stock. Further, the DGC Family Fintech Trust (the “DGC Trust”), a trust formed by Mr. Cohen, owns 9,880,268 shares of our Series F Preferred Stock.
Cohen currently owns approximately 40.1% of the voting power of the Company as a result of his ownership of our outstanding Common Stock, Series E Preferred Stock and Series F Preferred Stock. Further, the DGC Family Fintech Trust (the “DGC Trust”), a trust formed by Mr. Cohen, owns 9,880,268 shares of our Series F Preferred Stock.
Cohen and/or his affiliates cease to beneficially own a majority of the voting securities of the Company. See notes 21 and 31. Additionally, as of December 31, 2023, Daniel G. Cohen owns 5.4% of our Common Stock. Further, as of such date, Mr.
Cohen and/or his affiliates cease to beneficially own a majority of the voting securities of the Company. See notes 21 and 31. Additionally, as of December 31, 2024, Daniel G. Cohen directly owns 4.1% of our Common Stock. Further, as of such date, Mr.
Our broker-dealer relies on Pershing LLC to provide clearing services, as well as other operational and support functions that cannot be provided for internally. In addition, currently all of our margin financing is obtained from Pershing LLC. As of December 31, 2023, our total margin loan payable to Pershing LLC is $111.1 million.
Our broker-dealer relies on Pershing LLC to provide clearing services, as well as other operational and support functions that cannot be provided for internally. In addition, currently all of our margin financing is obtained from Pershing LLC. As of December 31, 2024, our total margin loan payable to Pershing LLC is $66.7 million.
So long as Mr. Cohen continues to own a majority of our voting stock, he will have the ability to control the vote in any election of directors and will have the ability to approve or prevent any transaction that requires stockholder approval regardless of whether others believe the transaction are or are not in our best interests.
Cohen continues to own, directly or indirectly, a majority of our voting stock, he will have the ability to control the vote in any election of directors and will have the ability to approve or prevent any transaction that requires stockholder approval regardless of whether others believe the transaction are or are not in our best interests.
We may not be able to generate sufficient taxable income to fully realize our deferred tax asset, which would also have to be reduced if U.S. federal income tax rates are lowered. As of December 31, 2023, we have recorded a deferred tax asset of $1.6 million.
We may not be able to generate sufficient taxable income to fully realize our deferred tax asset, which would also have to be reduced if U.S. federal income tax rates are lowered. As of December 31, 2024, we have recorded a deferred tax asset of $2.3 million.
As of December 31, 2023, we had $72.2 million in other investments, at fair value. We may use our capital, including on a leveraged basis, for principal investments in both private and public company securities that may be illiquid and volatile.
As of December 31, 2024, we had $35.3 million in other investments, at fair value. We may use our capital, including on a leveraged basis, for principal investments in both private and public company securities that may be illiquid and volatile.
Some of our risk management methods will depend upon the evaluation of information regarding markets, clients or other matters that are publicly available or otherwise accessible by us. That information may not, in all cases, be accurate, complete, up-to-date or properly evaluated.
These policies and procedures, however, may not be fully effective. Some of our risk management methods will depend upon the evaluation of information regarding markets, clients or other matters that are publicly available or otherwise accessible by us. That information may not, in all cases, be accurate, complete, up-to-date or properly evaluated.
Cohen could be deemed to be the beneficial owner of additional shares of our Common Stock representing 4.2%, which is owned by EBC 2013 Family Trust (“EBC”) as the result of Mr. Cohen’s position as trustee of the trust and as a result of the fact that Mr.
Cohen may be deemed to be the beneficial owner of additional shares of our Common Stock representing 3.9%, which is owned by EBC 2013 Family Trust (“EBC”) as the result of Mr. Cohen’s position as trustee of the trust and as a result of the fact that Mr.
In addition, as of December 31, 2023, the DGC Trust owns 20,225,095 or 33.2% units of the membership interests in the Operating LLC. The DGC Trust was formed by Daniel G. Cohen. Although Daniel G.
In addition, as of December 31, 2024 the DGC Trust owns 20,225,095 or 32.9% units of the membership interests in the Operating LLC. The DGC Trust was formed by Daniel G. Cohen. Although Daniel G.
Our business, financial condition and results of operations may be materially adversely affected by any negative impact on the global economy and capital markets resulting from the conflicts in Ukraine, Israel, or any other geopolitical tensions. ● If we fail to maintain effective internal control over financial reporting and disclosure controls and procedures in the future, we may not be able to accurately report our financial results, which could have an adverse effect on our business. ● Future sales of our Common Stock could lower the price of our Common Stock and harm our future securities offerings. ● Our stockholders’ percentage ownership in the Company may be diluted in the future. ● If we fail to control our costs effectively, our business could be disrupted and adversely affected. ● We may need to offer new investment strategies and products in order to continue to generate revenue. ● Our failure to deal appropriately with conflicts of interest could damage our reputation and adversely affect our business. ● Insurance may be inadequate to cover risks facing the Company. ● We depend on third-party software licenses and the loss of key licenses could adversely affect our brokerage services. ● Failure to maintain effective internal control over financial reporting and disclosure controls could harm our business. ● The market price of our Common Stock may be volatile and may be affected by market conditions beyond our control. ● Our Common Stock may be delisted, which may have a material adverse effect on the liquidity and our Common Stock value. 17 Table of Contents Risks Related to Our Business and Our Industry Difficult market conditions have adversely affected our business in many ways and may continue to adversely affect our business in a manner which could materially reduce our revenues.
Our business, financial condition and results of operations may be materially adversely affected by any negative impact on the global economy and capital markets resulting from the conflicts in Ukraine, Israel, or any other geopolitical tensions. ● Climate change concerns and incidents could disrupt our business, adversely affect the profitability of certain of our investments, adversely affect customer activity levels, adversely affect the creditworthiness of our counterparties, and damage our reputation. ● If we fail to control our costs effectively, our business could be disrupted and adversely affected. ● We may need to offer new investment strategies and products in order to continue to generate revenue. ● Our failure to deal appropriately with conflicts of interest could damage our reputation and adversely affect our business. ● Insurance may be inadequate to cover risks facing the Company. ● We depend on third-party software licenses and the loss of key licenses could adversely affect our brokerage services. ● Failure to maintain effective internal control over financial reporting and disclosure controls could harm our business. ● The market price of our Common Stock may be volatile and may be affected by market conditions beyond our control. ● Our Common Stock may be delisted, which may have a material adverse effect on the liquidity and our Common Stock value. 16 Table of Contents Risks Related to Our Business and Our Industry Difficult market conditions have adversely affected our business in many ways and may continue to adversely affect our business in a manner which could materially reduce our revenues.
Cohen, our Executive Chairman, individually and through an entity he wholly owns, Cohen Bros. Financial, LLC (“CBF”), owns 23,207,975 units of membership interests (including both unrestricted and restricted units), or 38.1% of the membership interests in the Operating LLC.
Cohen, our Executive Chairman, individually and through an entity he wholly owns, Cohen Bros. Financial, LLC (“CBF”), owns 22,975,501 units of membership interests (including both unrestricted and restricted units), or 37.4% of the membership interests in the Operating LLC.
We believe that price competition and pricing pressures in these and other areas will continue as institutional investors continue to reduce the amounts they are willing to pay, including reducing the number of brokerage firms they use, and some of our competitors seek to obtain market share by reducing fees, commissions or margins. 23 Table of Contents Increase in capital commitments in our trading business increases the potential for significant losses.
We believe that price competition and pricing pressures in these and other areas will continue as institutional investors continue to reduce the amounts they are willing to pay, including reducing the number of brokerage firms they use, and some of our competitors seek to obtain market share by reducing fees, commissions or margins.
We maintain trading positions in the fixed income markets to facilitate client trading activities. To the extent that we own security positions, in any of those markets, a downturn in the value of those securities or in those markets could result in losses from a decline in value.
To the extent that we own security positions, in any of those markets, a downturn in the value of those securities or in those markets could result in losses from a decline in value.
As of December 31, 2023, of our $72.2 million reported as other investments, at fair value, $12.5 million represented restricted shares of post-business combination SPACs that were subject to transfer restrictions and could not be sold and $23.6 million related to interest in SPVs and other receivables which have no ready market.
As of December 31, 2024, out of the $35.3 million reported as other investments, at fair value, $10.6 million represented restricted shares of post-business combination SPACs that were subject to transfer restrictions and could not be sold and $12.9 million related to interest in SPVs and other receivables, which have no ready market.
Cohen’s significant ownership interests in the Operating LLC and other entities could create conflicts of interest. ● As a “controlled company,” our other stockholders may lose certain corporate governance protections. ● Redemptions of our outstanding LLC Units may cause substantial dilution to our existing stockholders. ● We may not fully realize our deferred tax asset. ● The Maryland General Corporation Law and our charter and bylaws may prevent potentially beneficial takeover attempts.
Cohen’s significant ownership interests in the Operating LLC and other entities could create conflicts of interest. ● As a “controlled company,” our other stockholders may lose certain corporate governance protections. ● Future sales of our Common Stock in the public market could lower the price of our Common Stock and impair our ability to raise funds in future securities offerings. ● Your percentage ownership in the Company may be diluted in the future. ● Redemptions of our outstanding LLC Units may cause substantial dilution to our existing stockholders. ● We may not fully realize our deferred tax asset. ● The Maryland General Corporation Law and our charter and bylaws may prevent potentially beneficial takeover attempts.
These statutory, charter and bylaw provisions include the following: • the MGCL generally requires the affirmative vote of two-thirds of all votes entitled to be cast on the matter to approve a merger, consolidation, or share exchange involving us or the transfer of all or substantially all of our assets; • our board of directors has the power to classify and reclassify authorized and unissued shares of our Common Stock or preferred stock and, subject to certain restrictions in the Operating LLC Agreement, authorize the issuance of a class or series of Common Stock or preferred stock without stockholder approval; • our charter may be amended only if the amendment is declared advisable by our board of directors and approved by the affirmative vote of the holders of our Common Stock entitled to cast at least two-thirds of all of the votes entitled to be cast on the matter; • a director may be removed from office at any time with or without cause by the affirmative vote of the holders of our Common Stock entitled to cast at least two-thirds of the votes of the stock entitled to be cast in the election of directors; • an advance notice procedure for stockholder proposals to be brought before an annual meeting of our stockholders and nominations of persons for election to our board of directors at an annual or special meeting of our stockholders; • no stockholder is entitled to cumulate votes at any election of directors; and • our stockholders may take action in lieu of a meeting with respect to any actions that are required or permitted to be taken by our stockholders at any annual or special meeting of stockholders only by unanimous consent. 34 Table of Contents Risks Related to General and Global Factors The COVID-19 pandemic has caused severe disruptions in the U.S. and global economy and is expected to continue to impact our business, financial condition and results of operations.
These statutory, charter and bylaw provisions include the following: • the MGCL generally requires the affirmative vote of two-thirds of all votes entitled to be cast on the matter to approve a merger, consolidation, or share exchange involving us or the transfer of all or substantially all of our assets; • our board of directors has the power to classify and reclassify authorized and unissued shares of our Common Stock or preferred stock and, subject to certain restrictions in the Operating LLC Agreement, authorize the issuance of a class or series of Common Stock or preferred stock without stockholder approval; • our charter may be amended only if the amendment is declared advisable by our board of directors and approved by the affirmative vote of the holders of our Common Stock entitled to cast at least two-thirds of all of the votes entitled to be cast on the matter; • a director may be removed from office at any time with or without cause by the affirmative vote of the holders of our Common Stock entitled to cast at least two-thirds of the votes of the stock entitled to be cast in the election of directors; • an advance notice procedure for stockholder proposals to be brought before an annual meeting of our stockholders and nominations of persons for election to our board of directors at an annual or special meeting of our stockholders; • no stockholder is entitled to cumulate votes at any election of directors; and • our stockholders may take action in lieu of a meeting with respect to any actions that are required or permitted to be taken by our stockholders at any annual or special meeting of stockholders only by unanimous consent. 33 Table of Contents Risks Related to General and Global Factors We are currently operating in a period of economic uncertainty and capital markets disruption, which has been significantly impacted by geopolitical instability due to the ongoing military conflict between Russia and Ukraine.
We have incurred losses for certain periods covered by this report and in the recent past and may incur losses in the future. Although the Company recorded net income of $10.4 million for the year ended December 31, 2023, it recorded net loss of $58.7 million for the year ended December 31, 2022.
We have incurred losses for certain periods covered by this report and in the recent past and may incur losses in the future. Although the Company recorded net income of $8.2 and $10.4 million for the years ended December 31, 2024 and 2023, respectively we may incur losses in future periods.
The members of our senior management team have extensive experience in the financial services industry. Their reputations and relationships with investors, financing sources and members of the business community in our industry, among others, are critical elements in operating and expanding our business.
Their reputations and relationships with investors, financing sources and members of the business community in our industry, among others, are critical elements in operating and expanding our business.
We are currently operating in a period of economic uncertainty and capital markets disruption, which has been significantly impacted by geopolitical instability due to the ongoing military conflict between Russia and Ukraine.
Risks Related to General and Global Factors : ● We are currently operating in a period of economic uncertainty and capital markets disruption, which has been significantly impacted by geopolitical instability due to the ongoing military conflicts in Ukraine and in Israel and the surrounding areas.
In addition, the failure of a significant number of counterparties or a counterparty that holds a significant amount of derivatives exposure, or that has significant financial exposure to, or reliance on, the mortgage, asset-backed or related markets, could have a material adverse effect on the trading volume and liquidity in a particular market for which we provide brokerage services or on the broader financial markets.
In addition, the failure of a significant number of counterparties or a counterparty that holds a significant amount of derivatives exposure, or that has significant financial exposure to, or reliance on, the mortgage, asset-backed or related markets, could have a material adverse effect on the trading volume and liquidity in a particular market for which we provide brokerage services or on the broader financial markets. 21 Table of Contents We have policies and procedures to identify, monitor and manage these risks, through reporting and control procedures and by monitoring credit standards applicable to our clients.
At December 31, 2023, we had 367,491 shares of restricted stock outstanding to employees and directors of the Company and there were 579,391 shares available for future awards under our equity compensation plans. The Operating LLC also has issued 5,525,330 units that are restricted.
At December 31, 2024, we had 404,791 shares of restricted stock outstanding to employees and directors of the Company and there were 385,400 shares available for future awards under our equity compensation plans. The Operating LLC also has issued 4,465,998 units that are restricted.
We may enter into transactions in which we commit our own capital as part of our trading business. The number and size of these transactions may materially affect our results of operations in a given period. We may also incur significant losses from our trading activities due to market fluctuations and volatility from quarter to quarter.
Increase in capital commitments in our trading business increases the potential for significant losses. We may enter into transactions in which we commit our own capital as part of our trading business. The number and size of these transactions may materially affect our results of operations in a given period.
Risks Related to Our Organizational Structure and Ownership of Our Common Stock : ● We are dependent on distributions from the Operating LLC as a holding company. ● Daniel G.
Risks Related to Our Organizational Structure and Ownership of Our Common Stock : ● We could repurchase shares of our Common Stock at price levels considered excessive, the amount of our Common Stock we repurchase may decrease from historical levels, or we may not repurchase any additional shares of our Common Stock in the future. ● We are dependent on distributions from the Operating LLC as a holding company. ● Daniel G.
Such litigation or investigation, whether resolved in our favor or not or ultimately settled, could cause significant reputational harm, which could seriously harm our business. The competitive pressures we face as a result of operating in highly competitive markets could have a material adverse effect on our business, financial condition, liquidity and results of operations.
Substantial legal liability or significant regulatory or governmental action against us could materially adversely affect our business, financial condition or results of operations and cause significant reputational harm to us, which could seriously harm our business. 29 Table of Contents The competitive pressures we face as a result of operating in highly competitive markets could have a material adverse effect on our business, financial condition, liquidity and results of operations.
A delay or failure to address technological advances and developments or an increase in costs resulting from these changes could have a material and adverse effect on our business, financial condition and results of operations. Failure to protect client data or prevent breaches of our information systems could expose us to liability or reputational damage .
A delay or failure to address technological advances and developments or an increase in costs resulting from these changes could have a material and adverse effect on our business, financial condition and results of operations. The development and use of artificial intelligence presents risks and challenges that could adversely impact our business, financial condition, and results of operations.
Many of our competitors are substantially larger and have more relevant experience, have considerably greater financial, technical and marketing resources, and have more personnel than we have.
Many firms offer similar and/or additional products and services to the same types of clients that we target or may target in the future. Many of our competitors are substantially larger and have more relevant experience, have considerably greater financial, technical and marketing resources, and have more personnel than we have.
The loss of or a significant reduction in demand for our services from any of these customers could have a material adverse effect on our business, financial condition and operating results. 19 Table of Contents If we do not retain our senior management and continue to attract and retain qualified personnel, we may not be able to execute our business strategy.
The loss of or a significant reduction in demand for our services from any of these customers could have a material adverse effect on our business, financial condition and operating results. Underwriting activities expose us to risks.
We compete with public and private funds, SPACs and SPAC sponsors, REITs, commercial and investment banks, savings and loan institutions, mortgage bankers, insurance companies, institutional bankers, governmental bodies, commercial finance companies, traditional asset managers, brokerage firms and other entities. 30 Table of Contents Many firms offer similar and/or additional products and services to the same types of clients that we target or may target in the future.
A number of entities conduct asset management, origination, investment, and broker-dealer activities. We compete with public and private funds, SPACs and SPAC sponsors, REITs, commercial and investment banks, savings and loan institutions, mortgage bankers, insurance companies, institutional bankers, governmental bodies, commercial finance companies, traditional asset managers, brokerage firms and other entities.
We compete with commercial banks, brokerage firms, insurance companies, sponsors of mutual funds, hedge funds and other companies offering financial services in the U.S., globally, and through the internet. We compete on the basis of several factors, including transaction execution, capital or access to capital, products and services, innovation, reputation, risk appetite and price.
We compete on the basis of several factors, including transaction execution, capital or access to capital, products and services, innovation, reputation, risk appetite and price.
We may incur additional losses in future periods. If we are unable to finance future losses, those losses may have a significant effect on our liquidity as well as our ability to operate our business.
If we are unable to finance future losses, those losses may have a significant effect on our liquidity as well as our ability to operate our business. In addition, the Company has incurred and may further incur significant expenses in connection with initiating new business activities or in connection with any expansion or reorganization of our businesses.
We have experienced difficulties in our Capital Markets segment over the past several years due to intense competition in our industry, which has resulted in significant strain on our administrative, operational and financial resources. These difficulties may continue in the future. The financial services industry and all of our businesses are intensely competitive, and we expect them to remain so.
If our revenue does not increase sufficiently, or even if our revenue does increase but we are unable to manage our expenses, we will not achieve and maintain profitability in future periods. 17 Table of Contents We have experienced difficulties in our Capital Markets segment over the past several years due to intense competition in our industry, which has resulted in significant strain on our administrative, operational and financial resources.
These risks include: • additional regulatory requirements; • difficulties in recruiting and retaining personnel and managing the international operations; • potentially adverse tax consequences, tariffs and other trade barriers; • adverse labor laws; and • reduced protection for intellectual property rights. If we are unable to manage any of these risks effectively, our business could be adversely affected.
These risks include: • additional regulatory requirements; • difficulties in recruiting and retaining personnel and managing the international operations; • potentially adverse tax consequences, tariffs and other trade barriers; • adverse labor laws; • reduced protection for intellectual property rights; and • changes as a result of global elections, including changes in the U.S. presidential administrations or Congress, changes to global trade policies, supply chain complications, investment restrictions, or a combination of these and other factors.
Accordingly, we may need to increase our revenue at a rate greater than our expenses in order to achieve and maintain our profitability. If our revenue does not increase sufficiently, or even if our revenue does increase but we are unable to manage our expenses, we will not achieve and maintain profitability in future periods.
We may also engage in strategic acquisitions and investments for which we may incur significant expenses. Accordingly, we may need to increase our revenue at a rate greater than our expenses in order to achieve and maintain our profitability.
In addition, Joseph Pooler, our Chief Financial Officer and Douglas Listman, our Chief Accounting Officer serve as Chief Financial Officer of certain SPACs sponsored by Cohen Circle. If our risk management systems for our businesses are ineffective, we may be exposed to material unanticipated losses.
If our risk management systems for our businesses are ineffective, we may be exposed to material unanticipated losses.
There are 60,930,382 units of membership interests in the Operating LLC issued and outstanding, including 23,207,975 units of membership interests in the Operating LLC beneficially owned by Daniel G. Cohen.
There are 61,443,567 units of membership interests in the Operating LLC issued and outstanding, of which 22,975,501 units of membership interests in the Operating LLC are beneficially owned by Daniel G. Cohen. and 20,225,095 LLC Units are held by the DGC Family Fintech Trust of which Daniel G. Cohen is a beneficial owner.
Removed
Risks Related to General and Global Factors : ● The COVID-19 pandemic has caused severe disruptions in the U.S. and global economy and is expected to continue to impact our business, financial condition and results of operations. ● We may incur losses as a result of unforeseen events, including further spread of the COVID-19 pandemic, cybersecurity incidents and events, terrorist attacks, climate-related incidents, or other natural disasters. ● We are currently operating in a period of economic uncertainty and capital markets disruption, which has been significantly impacted by geopolitical instability due to the ongoing military conflicts in Ukraine and in Israel and the surrounding areas.
Added
Unfavorable market conditions may also lead to a reduction in revenues from our new issue and advisory revenues, including from underwriting and placement activities. Our CCM revenue, in the form of advisory services and underwriting, is directly related to general economic conditions and corresponding financial market activity.
Removed
In addition, the Company has incurred and may continue to incur significant expenses in connection with initiating new business activities or in connection with any expansion or reorganization of our businesses. We may also engage in strategic acquisitions and investments for which we may incur significant expenses.
Added
When the outlook for such economic conditions is uncertain or negative, financial market activity generally tends to decrease, which reduces our CCM revenues. Reduced expectations of U.S. economic growth or a decline in the global economic outlook could cause financial market activity to decrease and negatively affect our investment banking revenues.
Removed
We have policies and procedures to identify, monitor and manage these risks, through reporting and control procedures and by monitoring credit standards applicable to our clients. These policies and procedures, however, may not be fully effective.
Added
These difficulties may continue in the future. The financial services industry and all of our businesses are intensely competitive, and we expect them to remain so. We compete with commercial banks, brokerage firms, insurance companies, sponsors of mutual funds, hedge funds and other companies offering financial services in the U.S., globally, and through the internet.
Removed
A number of entities conduct asset management, origination, investment, and broker-dealer activities.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changePursuant to its charter, T he Cybersecurity Committee must consist at least four (4) members of Company’s executive management team, which shall include the Company’s Director of Technology, Chief Operating Officer, Chief Compliance Officer and Chief Financial Officer, each of whom is required to have working familiarity, knowledge and competencies in relevant areas, including data privacy, public policy, information technology (“IT”) strategy, IT development and deployment, or IT risk assessment and management, including information security management.
Biggest changePursuant to its charter, the Cybersecurity Committee must consist of at least four members of the Company’s executive management team, which shall include the Company’s director of technology, chief operating officer, chief compliance officer, and chief financial officer, each of whom is required to have working familiarity, knowledge, and competencies in relevant areas, including data privacy, public policy, information technology (“IT”) strategy, IT development and deployment, or IT risk assessment and management, including information security management.
The Board has delegated responsibility for oversight of the Company’s cybersecurity and information security framework and risk management to the Company’s Management Cybersecurity Committee (the “Cybersecurity Committee”).
The board has delegated responsibility for oversight of the Company’s cybersecurity, information security framework, and risk management to the Company’s management cybersecurity committee (the “Cybersecurity Committee”).
The principal responsibilities and duties of the Cybersecurity Committee, pursuant to its written charter, are to: ● Review and provide oversight on the effectiveness of the Company’s information security and privacy policies and procedures with respect to its products and services and internal-use information technology systems; ● Review and provide oversight on the policies and procedures of the Company in preparation for responding to any material information security or privacy incidents; ● Review and provide oversight on the Company’s disaster recovery, business continuity, and business resiliency capabilities, including escalation protocols, relating its customer-facing products and services and internal-use information technology systems; ● Review annually the appropriateness and adequacy of the Company’s cyber-insurance coverage; ● Review and provide oversight on the policies and procedures of the Company with respect to data privacy, and oversee the Company’s compliance with applicable data privacy and cybersecurity laws and regulations; ● Evaluate the Cybersecurity Committee’s composition and performance on an annual basis; ● Review and reassess the adequacy of the Cybersecurity Committee’s written charter annually and recommend to the Board any changes the Cybersecurity Committee determines are appropriate; ● Perform any other activities required by applicable law, rules or regulations (including the Securities Exchange Act of 1934 and The NYSE American Stock Exchange regarding reporting and disclosure obligations related to cybersecurity risks, costs, and incidents), and take such other actions and perform and carry out any other responsibilities and duties delegated to it by the Board or as the Cybersecurity Committee deems necessary or appropriate consistent with its purpose.
The principal responsibilities and duties of the Cybersecurity Committee, pursuant to its written charter, are to: ● Review and provide oversight on the effectiveness of the Company’s information security and privacy policies and procedures with respect to its products and services and internal-use information technology systems; ● Review and provide oversight on the policies and procedures of the Company in preparation for responding to any material information security or privacy incidents; ● Review and provide oversight on the Company’s disaster recovery, business continuity, and business resiliency capabilities, including escalation protocols, relating to its customer-facing products and services and internal-use IT systems; ● Review annually the appropriateness and adequacy of the Company’s cyber-insurance coverage; ● Review and provide oversight on the policies and procedures of the Company with respect to data privacy, and oversee the Company’s compliance with applicable data privacy and cybersecurity laws and regulations; ● Evaluate the Cybersecurity Committee’s composition and performance on an annual basis; ● Review and reassess the adequacy of the Cybersecurity Committee’s written charter annually and recommend to the board any changes the Cybersecurity Committee determines are appropriate; and ● Perform any other activities required by applicable law, rules, or regulations (including the Securities Exchange Act of 1934 and the NYSE American Stock Exchange regarding reporting and disclosure obligations related to cybersecurity risks, costs, and incidents), and take such other actions and perform and carry out any other responsibilities and duties delegated to it by the board or as the Cybersecurity Committee deems necessary or appropriate consistent with its purpose.
In addition, the Company’s Director of Technology has formal education in information technology and extensive experience working in and leading the Company’s information systems and technology function.
In addition, the Company’s director of technology has formal education in IT and extensive experience working in and leading the Company’s information systems and technology function.
The Cybersecurity Committee, including the Company’s Director of Technology, receive regular updates from the Company’s management on cybersecurity matters, results of mitigation efforts and cybersecurity incident response and remediation. 37 Table of Contents
The Cybersecurity Committee, including the Company’s director of technology, receives regular updates from the Company’s management on cybersecurity matters, results of mitigation efforts, and cybersecurity incident response and remediation. 36 Table of Contents

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeCity Description Square Feet Expiration Date Status (1) New York, NY 3 Columbus Circle- 24th Floor 21,390 4/30/2035 Partially Occupied / Partially Subleased New York, NY 3 Columbus Circle- 17th Floor 8,409 3/31/2024 Occupied Philadelphia, PA 2929 Arch Street 9,501 11/30/2029 Partially Occupied / Partially Subleased Boca Raton, FL 1825 NW Corporate Blvd 5,208 6/30/2024 Occupied Paris, France 17 avenue de l'Opera 1,830 5/31/2030 Occupied Locust Valley, NY 63 Forest Avenue 288 9/30/2025 Occupied Menlo Park, CA 2727 Sandy Hill Road 2,735 8/31/2025 Occupied Jupiter, FL 601 Heritage Drive 290 9/30/2024 Occupied (1) For purposes of this table, the term “Partially Occupied / Partially Subleased” means we occupy a portion of the space and sublease the remaining portion to a third-party or third parties; and “Occupied” means we fully utilize the space for our operations.
Biggest changeMilitary Trail 3,776 3/31/2032 Occupied Paris, France 17 avenue de l'Opera 1,830 5/31/2030 Occupied Menlo Park, CA 2727 Sand Hill Road 2,735 8/31/2025 Occupied Memphis, TN 6000 Poplar Avenue 330 Month-to-month Occupied (1) For purposes of this table, “Partially Occupied / Partially Subleased” means we occupy a portion of the space and sublease the remaining portion to a third-party or third parties and “Occupied” means we fully utilize the space for our operations.
Removed
ITEM 2. PROPERTIES. The following table lists our current leases as of December 31, 2023.
Added
ITEM 2. PROPERTIES. The following table lists our current leases as of December 31, 2024. City Description Square Feet Expiration Date Status (1) New York, NY 3 Columbus Circle- 24th Floor 31,614 7/31/2035 Partially Occupied / Partially Subleased Philadelphia, PA 2929 Arch Street 9,501 11/30/2029 Partially Occupied / Partially Subleased Boca Raton, FL 1800 N.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeMINE SAFETY DISCLOSURES. Not applicable. 38 Table of Contents PART II
Biggest changeMINE SAFETY DISCLOSURES. Not applicable. 37 Table of Contents PART II

Item 4. Mine Safety Disclosures

Mine Safety Disclosures — required of mining issuers

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Biggest changeItem 4. Mine Safety Disclosures. 38 PART II Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities. 39 Item 6. Selected Financial Data. 39 Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations. 40 Item 7A. Quantitative and Qualitative Disclosures About Market Risk. 80 Item 8.
Biggest changeItem 4. Mine Safety Disclosures. 37 PART II Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities. 38 Item 6. Selected Financial Data. 38 Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations. 39 Item 7A. Quantitative and Qualitative Disclosures About Market Risk. 77 Item 8.
Financial Statements and Supplementary Data. 82 Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure. 82 Item 9A. Controls and Procedures. 82
Financial Statements and Supplementary Data. 79 Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure. 79 Item 9A. Controls and Procedures. 79

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeUnregistered Sales of Equity Securities None Issuer Purchases of Equity Securities Period Total Number of Shares Purchased Average Price Paid Per Share Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs Maximum Dollar Value of Shares that May Yet be Purchased under the Plans or Programs (1) October 1, 2023 - October 31, 2023 - $ - - $ - November 1, 2023 - November 30, 2023 - $ - - $ - December 1, 2023 - December 31, 2023 - $ - - $ - Total - - (1) Dollar amounts in thousands.
Biggest changeUnregistered Sales of Equity Securities None Issuer Purchases of Equity Securities Period Total Number of Shares Purchased Average Price Paid Per Share Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs Maximum Dollar Value of Shares that May Yet be Purchased under the Plans or Programs (1) October 1, 2024 - October 31, 2024 - $ - - $ - November 1, 2024 - November 30, 2024 - $ - - $ - December 1, 2024 - December 31, 2024 - $ - - $ - Total - - Equity Compensation Plans Information on certain of our equity compensation plans, for which shares of our common stock are authorized for issuance, is included in the section of our Proxy Statement to be filed pursuant to Regulation 14A of the Exchange Act in connection with the Company’s 2025 Annual Meeting of Stockholders under the headings “Cash and Equity Plan Compensation” and “Equity Compensation Plan Information” is incorporated herein by reference.
ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES. Market Information for Our Common Stock and Dividends Our Common Stock trades under the symbol "COHN" on the NYSE American Stock Exchange. The closing price of our Common Stock was $6.90 on March 1, 2024.
ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES. Market Information for Our Common Stock and Dividends Our Common Stock trades under the symbol "COHN" on the NYSE American Stock Exchange. The closing price of our Common Stock was $9.30 on March 5, 2025.
We had 1,928,172 shares of Common Stock outstanding held by 39 holders of record as of March 6, 2023.
We had 2,054,674 shares of Common Stock outstanding held by 57 holders of record as of March 5, 2025.
Removed
On August 3, 2007, our board of directors authorized us to repurchase up to $50 million of our Common Stock from time to time in open market purchases or privately negotiated transactions. The repurchase plan was publicly announced on August 7, 2007. See note 21 to our consolidated financial statements in this Annual Report on Form 10-K.
Removed
Equity Compensation Plans Information on certain of our equity compensation plans, for which shares of our common stock are authorized for issuance, is included in the section of our Proxy Statement captioned “Cash and Equity Plan Compensation” and is incorporated herein by reference.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Biggest changeCONSOLIDATED STATEMENTS OF OPERATIONS (Dollars in Thousands) Year Ended December 31, Favorable / (Unfavorable) 2022 2021 $ Change % Change Revenues Net trading $ 40,009 $ 69,385 $ (29,376 ) (42 )% Asset management 9,004 10,923 (1,919 ) (18 )% New issue and advisory 24,721 28,736 (4,015 ) (14 )% Principal transactions and other income (29,347 ) 37,324 (66,671 ) (179 )% Total revenues 44,387 146,368 (101,981 ) (70 )% Operating expenses Compensation and benefits 50,290 85,048 34,758 41 % Business development, occupancy, equipment 5,076 3,365 (1,711 ) (51 )% Subscriptions, clearing, and execution 8,274 10,307 2,033 20 % Professional fee and other operating 8,153 7,684 (469 ) (6 )% Depreciation and amortization 557 371 (186 ) (50 )% Total operating expenses 72,350 106,775 34,425 32 % Operating income / (loss) (27,963 ) 39,593 (67,556 ) (171 )% Non-operating income / (expense) Interest expense, net (4,982 ) (7,233 ) 2,251 31 % Income / (loss) from equity method affiliates (20,931 ) 36,010 (56,941 ) (158 )% Other non-operating income - 2,127 (2,127 ) (100 )% Income / (loss) before income taxes (53,876 ) 70,497 (124,373 ) (176 )% Income tax expense / (benefit) 4,794 (3,541 ) (8,335 ) (235 )% Net income / (loss) (58,670 ) 74,038 (132,708 ) (179 )% Less: Net income (loss) attributable to the non-convertible non-controlling interest (23,203 ) 35,574 58,777 165 % Enterprise net income (loss) (35,467 ) 38,464 (73,931 ) (192 )% Less: Net income (loss) attributable to the convertible non-controlling interest (22,078 ) 26,656 48,734 183 % Net income / (loss) attributable to Cohen & Company Inc. $ (13,389 ) $ 11,808 $ (25,197 ) (213 )% Revenues Revenues decreased by $101,981, or 70%, to $44,387 for the year ended December 31, 2022, as compared to $146,368 for the year ended December 31, 2021.
Biggest changeCONSOLIDATED STATEMENTS OF OPERATIONS (Dollars in Thousands) Year Ended December 31, Favorable / (Unfavorable) 2024 2023 $ Change % Change Revenues Net trading $ 36,409 $ 30,926 $ 5,483 18 % Asset management 9,009 7,337 1,672 23 % New issue and advisory 63,422 28,264 35,158 124 % Principal transactions and other income (29,242 ) 16,454 (45,696 ) (278 )% Total revenues 79,598 82,981 (3,383 ) (4 )% Operating expenses Compensation and benefits 56,388 52,092 (4,296 ) (8 )% Business development, occupancy, equipment 6,617 5,204 (1,413 ) (27 )% Subscriptions, clearing, and execution 9,639 8,965 (674 ) (8 )% Professional fee and other operating 14,421 9,296 (5,125 ) (55 )% Depreciation and amortization 556 563 7 1 % Total operating expenses 87,621 76,120 (11,501 ) (15 )% Operating income / (loss) (8,023 ) 6,861 (14,884 ) (217 )% Non-operating income / (expense) Interest expense, net (5,821 ) (6,526 ) 705 11 % Income / (loss) from equity method affiliates 21,704 15,609 6,095 39 % Income / (loss) before income taxes 7,860 15,944 (8,084 ) (51 )% Income tax expense / (benefit) (329 ) 5,545 5,874 106 % Net income / (loss) 8,189 10,399 (2,210 ) (21 )% Less: Net income (loss) attributable to the non-convertible non-controlling interest 8,675 19,590 10,915 56 % Enterprise net income (loss) (486 ) (9,191 ) 8,705 95 % Less: Net income (loss) attributable to the convertible non-controlling interest (357 ) (4,078 ) (3,721 ) (91 )% Net income / (loss) attributable to Cohen & Company Inc. $ (129 ) $ (5,113 ) $ 4,984 97 % Revenues Revenues decreased by $3,383, or 4%, to $79,598 for the year ended December 31, 2024, as compared to $82,981 for the year ended December 31, 2023.
Our ability to complete securitizations in the future will depend upon, among other things, our asset origination capacity and success, our ability to arrange warehouse financing to originate assets, our willingness and capacity to fund required amounts to obtain warehouse financing and securitized financings, and the demand in the markets for such securitizations.
Our ability to complete securitizations in the future will depend upon, among other things, our asset origination capacity and success, our ability to arrange warehouse financing to originate assets, our willingness and capacity to fund required amounts to obtain warehouse financing and securitized financings, and the demand in the markets for such securitizations.
Our ability to complete securitizations in the future will depend upon, among other things, our asset origination capacity and success, our ability to arrange warehouse financing to originate assets, our willingness and capacity to fund required amounts to obtain warehouse financing and securitized financings, and the demand in the markets for such securitizations.
Our ability to complete securitizations in the future will depend upon, among other things, our asset origination capacity and success, our ability to arrange warehouse financing to originate assets, our willingness and capacity to fund required amounts to obtain warehouse financing and securitized financings, and the demand in the markets for such securitizations.
Asset management fees from CDOs decreased primarily because the one of the securitizations we manage completed a successful auction during 2022. As a result, we received payment of deferred subordinated management fees of $1,600 in 2022.
Asset management fees from CDOs decreased primarily because one of the securitizations we manage completed a successful auction during 2022. As a result, we received payment of deferred subordinated management fees of $1,600 in 2022.
To the extent management's determination changes, an adjustment will be made to the valuation allowance resulting in deferred tax expense or benefit. We recorded deferred tax expense in 2022 and 2023 because expectations of future income decreased and the Company increased the valuation allowance it had applied against carryforward assets.
To the extent management's determination changes, an adjustment will be made to the valuation allowance resulting in deferred tax expense or benefit. We recorded deferred tax expense in 2022 and 2023 because expectations of future income decreased and the Company increased the valuation allowance it had applied against carryforward tax assets.
The following table shows the detail by trading group.
The following table shows the detail by trading group.
This may adversely affect the ultimate value realized from these investments. In addition, our net trading revenue also includes realized gains on certain proprietary trading positions. Our ability to derive trading gains from such trading positions is subject to overall market conditions.
This may adversely affect the ultimate value realized from these investments. In addition, our net trading revenue also includes realized gains on certain proprietary trading positions. Our ability to derive trading gains from such trading positions is subject to overall market conditions.
Level 3 assets are carried at fair value based on estimates derived using internal valuation models and other estimates. See notes 9 and 10 to our consolidated financial statements included in this Annual Report on Form 10-K. The fair value estimates made by us may not be indicative of the final sale price at which these assets may be sold.
Level 3 assets are carried at fair value based on estimates derived using internal valuation models and other estimates. See notes 9 and 10 to our consolidated financial statements included in this Annual Report on Form 10-K. The fair value estimates made by us may not be indicative of the final sale price at which these assets may be sold.
Several of these SPAC Sponsor Entities are invested in SPACs that have completed their business combinations. Those SPAC Sponsor Entities hold restricted and unrestricted equity interests in the public post-merger entities. We account for our investments in SPAC Sponsor Entities under the equity method of accounting.
Several of these SPAC sponsor entities are invested in SPACs that have completed their business combinations. Those SPAC sponsor entities hold restricted and unrestricted equity interests in the public post-merger entities. We account for our investments in SPAC sponsor entities under the equity method of accounting.
If the SPAC Sponsor Entity distributes SPAC shares to us, we account for those SPAC shares as a component of other investments, at fair value. The following table shows the equity method income or loss included in other SPAC Sponsor Entities above broken out by the ultimate public company investee.
If the SPAC sponsor entity distributes SPAC shares to us, we account for those SPAC shares as a component of other investments, at fair value. The following table shows the equity method income or loss included in SPAC sponsor entities above broken out by the ultimate public company investee.
This determination is subjective and subject to many assumptions and factors including: profitability of our business in the future, the timing of that future income as compared to carryforward asset expiration, the character of future income (ordinary or capital), and the jurisdiction in which the income will be generated.
This determination is subjective and subject to many assumptions and factors including: profitability of our business in the future, the timing of that future income as compared to carryforward asset expiration, the character of future income (ordinary or capital), and the jurisdiction in which the income will be generated.
The cash provided investing activities of $38,123 was comprised of (a) $75,906 in proceeds from sales of other investments, at fair value; (b) $53,928 in proceeds from sales of other investments sold, not yet purchased, at fair value; and (c) $2,091 in proceeds from distributions from equity method affiliates; partially offset by (d) $86,021 in cash used to purchase other investments, at fair value; (e) $5,512 in cash used to purchase other investments sold, not yet purchased, at fair value; (f) $1,896 of cash used to invest in equity method affiliates; and (g) $373 in purchases of furniture, equipment, and leasehold improvements.
The cash provided from investing activities of $38,123 was comprised of (a) $75,906 in proceeds from sales of other investments, at fair value; (b) $53,928 in proceeds from sales of other investments sold, not yet purchased, at fair value; and (c) $2,091 in proceeds from distributions from equity method affiliates; partially offset by (d) $86,021 in cash used to purchase other investments, at fair value; (e) $5,512 in cash used to purchase other investments sold, not yet purchased, at fair value; (f) $1,896 in cash used to invest in equity method affiliates; and (g) $373 in purchases of furniture, equipment, and leasehold improvements.
We use a Monte Carlo simulation model to determine the appropriate discount to place on shares that are subject to hurdle prices. In the case of a SPAC business combination where we consolidate the sponsor entity, generally there is also an equity-based compensation entry to be recorded at the date of the business combination. See equity-based compensation section above.
We use a Monte Carlo simulation model to determine the appropriate discount to place on shares that are subject to hurdle prices. In the case of a SPAC business combination where we consolidate the sponsor entity, generally there is also an equity-based compensation entry to be recorded at the date of the business combination. See the equity-based compensation section above.
At that point, we will hold the SPAC shares directly (rather than through a consolidated subsidiary) and will record principal transaction income and loss until the SPAC shares themselves are liquidated. • We will also invest in sponsor entities that we do not consolidate because we are not the managing member of such sponsor entity or otherwise do not have the power to direct the sponsor entity's most important activities.
At that point, we will hold the SPAC shares directly (rather than through a consolidated subsidiary) and will record principal transaction income and loss until the SPAC shares themselves are liquidated. • We also invest in sponsor entities that we do not consolidate because we are not the managing member of such sponsor entity or otherwise do not have the power to direct the sponsor entity's most important activities.
CONSOLIDATED STATEMENTS OF OPERATIONS (Dollars in Thousands) Year Ended December 31, Favorable / (Unfavorable) 2023 2022 $ Change % Change Revenues Net trading $ 30,926 $ 40,009 $ (9,083 ) (23 )% Asset management 7,337 9,004 (1,667 ) (19 )% New issue and advisory 28,264 24,721 3,543 14 % Principal transactions and other income 16,454 (29,347 ) 45,801 (156 )% Total revenues 82,981 44,387 38,594 87 % Operating expenses Compensation and benefits 52,092 50,290 (1,802 ) (4 )% Business development, occupancy, equipment 5,204 5,076 (128 ) (3 )% Subscriptions, clearing, and execution 8,965 8,274 (691 ) (8 )% Professional fee and other operating 9,296 8,153 (1,143 ) (14 )% Depreciation and amortization 563 557 (6 ) (1 )% Total operating expenses 76,120 72,350 (3,770 ) (5 )% Operating income / (loss) 6,861 (27,963 ) 34,824 (125 )% Non-operating income / (expense) Interest expense, net (6,526 ) (4,982 ) (1,544 ) (31 )% Income / (loss) from equity method affiliates 15,609 (20,931 ) 36,540 175 % Other non operating income - - - NM Income / (loss) before income taxes 15,944 (53,876 ) 69,820 130 % Income tax expense / (benefit) 5,545 4,794 (751 ) (16 )% Net income / (loss) 10,399 (58,670 ) 69,069 118 % Less: Net income (loss) attributable to the non-convertible non-controlling interest 19,590 (23,203 ) (42,793 ) (184 )% Enterprise net income (loss) (9,191 ) (35,467 ) 26,276 74 % Less: Net income (loss) attributable to the convertible non-controlling interest (4,078 ) (22,078 ) (18,000 ) (82 )% Net income / (loss) attributable to Cohen & Company Inc. $ (5,113 ) $ (13,389 ) $ 8,276 62 % Revenues Revenues increased by $38,594, or 87%, to $82,981 for the year ended December 31, 2023, as compared to $44,387 for the year ended December 31, 2022.
CONSOLIDATED STATEMENTS OF OPERATIONS (Dollars in Thousands) Year Ended December 31, Favorable / (Unfavorable) 2023 2022 $ Change % Change Revenues Net trading $ 30,926 $ 40,009 $ (9,083 ) (23 )% Asset management 7,337 9,004 (1,667 ) (19 )% New issue and advisory 28,264 24,721 3,543 14 % Principal transactions and other income 16,454 (29,347 ) 45,801 (156 )% Total revenues 82,981 44,387 38,594 87 % Operating expenses Compensation and benefits 52,092 50,290 (1,802 ) (4 )% Business development, occupancy, equipment 5,204 5,076 (128 ) (3 )% Subscriptions, clearing, and execution 8,965 8,274 (691 ) (8 )% Professional fee and other operating 9,296 8,153 (1,143 ) (14 )% Depreciation and amortization 563 557 (6 ) (1 )% Total operating expenses 76,120 72,350 (3,770 ) (5 )% Operating income / (loss) 6,861 (27,963 ) 34,824 (125 )% Non-operating income / (expense) Interest expense, net (6,526 ) (4,982 ) (1,544 ) (31 )% Income / (loss) from equity method affiliates 15,609 (20,931 ) 36,540 175 % Income / (loss) before income taxes 15,944 (53,876 ) 69,820 130 % Income tax expense / (benefit) 5,545 4,794 (751 ) (16 )% Net income / (loss) 10,399 (58,670 ) 69,069 118 % Less: Net income (loss) attributable to the non-convertible non-controlling interest 19,590 (23,203 ) (42,793 ) (184 )% Enterprise net income (loss) (9,191 ) (35,467 ) 26,276 74 % Less: Net income (loss) attributable to the convertible non-controlling interest (4,078 ) (22,078 ) (18,000 ) (82 )% Net income / (loss) attributable to Cohen & Company Inc. $ (5,113 ) $ (13,389 ) $ 8,276 62 % Revenues Revenues increased by $38,594, or 87%, to $82,981 for the year ended December 31, 2023, as compared to $44,387 for the year ended December 31, 2022.
The cash provided investing activities of $13,798 was comprised of (a) $27,091 in proceeds from sales of other investments, at fair value; (b) $3,054 in proceeds from sales of other investments sold, not yet purchased, at fair value; and (c) $77 in proceeds from distributions from equity method affiliates; partially offset by (d) $7,236 in cash used to purchase other investments, at fair value; (e) $6,001 in cash used to purchase other investments sold, not yet purchased, at fair value; (f) $2,614 of cash used to invest in equity method affiliates; and (g) $573 in purchases of furniture, equipment, and leasehold improvements.
The cash provided investing activities of $13,798 was comprised of (a) $27,091 in proceeds from sales of other investments, at fair value; (b) $3,054 in proceeds from sales of other investments sold, not yet purchased, at fair value; and (c) $77 in proceeds from distributions from equity method affiliates; partially offset by (d) $7,236 in cash used to purchase other investments, at fair value; (e) $6,001 in cash used to purchase other investments sold, not yet purchased, at fair value; (f) $2,614 in cash used to invest in equity method affiliates; and (g) $573 in cash used to purchase furniture, equipment, and leasehold improvements.
ASSET MANAGEMENT (Dollars in Thousands) Year Ended December 31, 2023 2022 Change CDOs $ 1,638 $ 3,454 $ (1,816 ) Other 5,699 5,550 149 Total $ 7,337 $ 9,004 $ (1,667 ) A significant portion of our asset management fees are earned from the management of CDOs. We have not completed a new securitization since 2008.
ASSET MANAGEMENT (Dollars in Thousands) For the Year Ended December 31, 2023 2022 Change CDOs $ 1,638 $ 3,454 $ (1,816 ) Other 5,699 5,550 149 Total $ 7,337 $ 9,004 $ (1,667 ) A significant portion of our asset management fees are earned from the management of CDOs. We have not completed a new securitization since 2008.
Due to volatility and uncertainty in the capital markets, the net trading revenue recognized during the year may not be indicative of future results. Furthermore, from time to time, some of the assets included in the Investments-trading line of our consolidated balance sheets represent level 3 valuations within the FASB valuation hierarchy.
Due to the volatility and uncertainty in the capital markets generally, the net trading revenue recognized during the year may not be indicative of future results. Furthermore, from time to time, some of the assets included in the investments-trading line of our consolidated balance sheets represent level 3 valuations within the FASB valuation hierarchy.
CCM is our full-service boutique investment bank that provides innovative strategic and financial advice in M&A, capital markets, and SPAC advisory. In addition, we generate new issue revenue by originating new assets for the U.S. Insurance JV, CREO JV, and for our PriDe funds in Europe.
CCM is our full-service boutique investment bank that provides innovative strategic and financial advice in M&A, capital markets, and SPAC advisory services. In addition, we generate new issue revenue by originating new assets for the U.S. Insurance JV, CREO JV, and our PriDe Funds in Europe.
Each reporting period, management determines the expected amount of taxable income it will generate in each jurisdiction where the Company has NOLs. Management then schedules this income against each carryforward asset and determines what portion of the asset it believes is more likely than not to be realized.
Each reporting period, management determines the expected amount of taxable income it will generate in each jurisdiction where the Company has NOLs. Management then schedules this income against each carryforward tax asset and determines what portion of the asset it believes is more likely than not to be realized.
Year Ended December 31, 2023 2022 Change Insurance SPAC III Sponsor Entities $ - $ (4,808 ) $ 4,808 Vellar GP 14,755 - 14,755 Other SPAC related 4,835 (18,395 ) 23,230 $ 19,590 $ (23,203 ) $ 42,793 Insurance SPAC III Sponsor Entities are the sponsor entities formed by us for our sponsored SPACs.
Year Ended December 31, 2023 2022 Change Insurance SPAC III Sponsor Entities $ - $ (4,808 ) $ 4,808 Vellar GP 14,755 - 14,755 Other SPAC related 4,835 (18,395 ) 23,230 $ 19,590 $ (23,203 ) $ 42,793 Insurance SPAC III sponsor entities are the sponsor entities formed by us for our sponsored SPAC, Insurance SPAC III.
We are organized into three business segments: Capital Markets, Asset Management, and Principal Investing. • Capital Markets : Our Capital Markets business segment consists primarily of fixed income sales, trading, gestation repo financing, new issue placements in corporate and securitized products, and advisory services.
We are organized into three business segments: Capital Markets, Asset Management, and Principal Investing. • Capital Markets : Our Capital Markets business segment consists primarily of fixed income sales, trading, gestation repo financing, new issue placements in corporate and securitized products, underwriting, and advisory services.
The total par amount owed by the Company to the trusts is $49,614. However, the Company owns the common stock of the trusts in a total par amount of $1,489. The Company pays interest (and at maturity, principal) to the trusts on the entire $49,614 junior notes outstanding.
The total par amount owed by the Company to the trusts is $49,614. However, the Company owns the common stock of the trusts in a total par amount of $1,489. The Company pays interest (and at maturity, principal) to the trusts on the entire $49,614 junior subordinated notes outstanding.
Because earnings are recognized unevenly throughout the year and the non-controlling interest percentage may change during the period, the average effective non-controlling interest percentage may not equal the percentage at the end of any period or the simple average of the beginning and ending percentages. 63 Table of Contents Liquidity and Capital Resources Liquidity is a measurement of our ability to meet potential cash requirements including ongoing commitments to repay debt borrowings, make interest payments on outstanding borrowings, fund investments, and support other general business purposes.
Because earnings are recognized unevenly throughout the year and the non-controlling interest percentage may change during the period, the average effective non-controlling interest percentage may not equal the percentage at the end of any period or the simple average of the beginning and ending percentages. 61 Table of Contents Liquidity and Capital Resources Liquidity is a measurement of our ability to meet potential cash requirements including ongoing commitments to repay debt borrowings, make interest payments on outstanding borrowings, fund investments, and support other general business purposes.
As discussed in more detail below, the change was comprised of (i) a decrease of $9,083 in net trading revenue; (ii) a decrease of $1,667 in asset management revenue; (iii) an increase of $3,543 in new issue and advisory revenue; and (iv) an increase of $45,801 in principal transactions and other income. 44 Table of Contents Net Trading Net trading revenue decreased by $9,083, or 23%, to $30,926 for the year ended December 31, 2023, as compared to $40,009 for the year ended December 31, 2022.
As discussed in more detail below, the change was comprised of (i) a decrease of $9,083 in net trading revenue; (ii) a decrease of $1,667 in asset management revenue; (iii) an increase of $3,543 in new issue and advisory revenue; and (iv) an increase of $45,801 in principal transactions and other income. 53 Table of Contents Net Trading Net trading revenue decreased by $9,083, or 23%, to $30,926 for the year ended December 31, 2023, as compared to $40,009 for the year ended December 31, 2022.
Non-Operating Income and Expense Interest Expense, net Interest expense, net increased by $1,544 to $6,526 for the year ended December 31, 2023, as compared to $4,982 for the year ended December 31, 2022.
Non-Operating Income and Expense Interest Expense, net Interest expense, net increased by $1,544, or 31%, to $6,526 for the year ended December 31, 2023, as compared to $4,982 for the year ended December 31, 2022.
The cash used in financing activities of $17,105 was comprised of (a) $15,000 of cash used to repay debt; (b) $175 of cash used to settle equity awards; (c) $1,750 of cash used to pay dividends on Common Stock; (d) $4,344 in cash used for distributions to the convertible non-controlling interest; and (e) $10,041 in cash used for distributions to the non-convertible non-controlling interests; partially offset by (f) $15,000 in proceeds from the issuance of debt ;(g) $39 in cash proceeds from investments in the non-convertible non-controlling interests; and (h) $834 of cash used for the redemption of convertible non-controlling interest units. 66 Table of Contents 2022 Cash Flows As of December 31, 2022, our cash and cash equivalents were $29,101, representing a decrease of $21,466 from December 31, 2021.
The cash used in financing activities of $17,105 was comprised of (a) $15,000 of cash used to repay debt; (b) $175 of cash used to settle equity awards; (c) $1,750 of cash used to pay dividends on Common Stock; (d) $4,344 in cash used for distributions to the convertible non-controlling interest; and (e) $10,041 in cash used for distributions to the non-convertible non-controlling interests; partially offset by (f) $15,000 in proceeds from the issuance of debt; (g) $39 in cash proceeds from investments in the non-convertible non-controlling interests; and (h) $834 of cash used for the redemption of convertible non-controlling interest units. 2022 Cash Flows As of December 31, 2022, our cash and cash equivalents were $29,101, representing a decrease of $21,466 from December 31, 2021.
See note 20 to our consolidated financial statements included in this Annual Report on Form 10-K. 65 Table of Contents If we are unable to raise sufficient capital on economically favorable terms, we may need to reduce the amount of capital invested for the uses described above, which may adversely impact earnings and our ability to pay dividends.
See note 20 to our consolidated financial statements included in this Annual Report on Form 10-K. 63 Table of Contents If we are unable to raise sufficient capital on economically favorable terms, we may need to reduce the amount of capital invested for the uses described above, which may adversely impact earnings and our ability to pay dividends.
Our assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to the asset or liability. 73 Table of Contents Financial instruments carried at contract amounts with short-term maturities (one year or less) are repriced frequently or bear market interest rates.
Our assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to the asset or liability. 70 Table of Contents Financial instruments carried at contract amounts with short-term maturities (one year or less) are repriced frequently or bear market interest rates.
In October 2023, the FASB issued ASU 2023-06 , Disclosure Improvements — Codification Amendments in Response to the Securities and Exchange Commission ( “ SEC ” ) Disclosure Update and Simplification Initiative .
In October 2023, the FASB issued ASU 2023-06 , Disclosure Improvements — Codification Amendments in Response to the Securities and Exchange Commission ( “ SEC ’” ) Disclosure Update and Simplification Initiative .
Furthermore, a termination of any of our clearing arrangements would result in a significant disruption to our business and would have a significant negative impact on our dealings and relationship with our customers. 69 Table of Contents The following table presents our period end balance, average monthly balance, and maximum balance at any month end for receivables under resale agreements and securities sold under agreements to repurchase.
Furthermore, a termination of any of our clearing arrangements would result in a significant disruption to our business and would have a significant negative impact on our dealings and relationship with our customers. 66 Table of Contents The following table presents our period end balance, average monthly balance, and maximum balance at any month end for receivables under resale agreements and securities sold under agreements to repurchase.
However, because future events and their effects cannot be determined with certainty, actual results could differ from our assumptions and estimates, and such differences could be material. 72 Table of Contents We consider the accounting policies discussed below to be the policies that are the most impactful to our financial statements and also subject to significant management judgment.
However, because future events and their effects cannot be determined with certainty, actual results could differ from our assumptions and estimates, and such differences could be material. 69 Table of Contents We consider the accounting policies discussed below to be the policies that are the most impactful to our financial statements and also subject to significant management judgment.
Our policy is to record penalties and interest as a component of provision for income taxes in our consolidated statements of operations. 74 Table of Contents Our voting-controlled subsidiary, the Operating LLC, is treated as a pass-through entity for U.S. federal income tax purposes and in most of the states in which we do business.
Our policy is to record penalties and interest as a component of provision for income taxes in our consolidated statements of operations. 71 Table of Contents Our voting-controlled subsidiary, the Operating LLC, is treated as a pass-through entity for U.S. federal income tax purposes and in most of the states in which we do business.
More recently, a significant component of our principal investment revenue has come from SPAC related equity investments, primarily in entities that have been the result of sponsored SPAC business combinations, share forward arrangements ("SFAs"), or related party sponsored SPAC business combinations. Access to these investments is reliant on a robust SPAC market.
More recently, a significant component of our principal investment revenue has come from SPAC related equity investments, primarily in entities that have been the result of sponsored SPAC business combinations, share forward arrangements ("SFAs"), CCM engagements, or related party sponsored SPAC business combinations. Access to these investments is reliant on a robust SPAC market.
The cash used in operating activities of $39,660 was comprised of (a) net cash outflows of $77,599 related to working capital fluctuations; (b) net cash inflows of $65,282 from trading activities comprised of our investments-trading, trading securities sold, not yet purchased, securities sold under agreement to repurchase, receivables under resale agreements, and receivables and payables from brokers, dealers, and clearing agencies, as well as the changes in unrealized gains and losses on the investments-trading and trading securities sold, not yet purchased; and (c) net cash outflows from other earnings items of $27,343 (which represents net income or loss adjusted for the following non-cash operating items: deferred taxes, other income / (expense), non-cash advisory revenue, realized and unrealized gains and losses on other investments, at fair value, other investments sold, not yet purchased, income / (loss) from equity method affiliates, equity-based compensation, depreciation, and amortization).
The cash used in operating activities of $39,660 was comprised of (a) net cash outflow of $77,599 related to working capital fluctuations; (b) net cash inflow of $65,282 from trading activities comprised of our investments-trading, trading securities sold, not yet purchased, securities sold under agreement to repurchase, receivables under resale agreements, and receivables and payables from brokers, dealers, and clearing agencies, as well as the changes in unrealized gains and losses on the investments-trading and trading securities sold, not yet purchased; and (c) net cash outflow from other earnings items of $27,343 (which represents net income or loss adjusted for the following non-cash operating items: deferred taxes, other income / (expense), non-cash advisory revenue, realized and unrealized gains and losses on other investments, at fair value, other investments sold, not yet purchased, income / (loss) from equity method affiliates, equity-based compensation, depreciation, and amortization).
The recipient is entitled to distributions that are declared and paid during the vesting period but they are paid only if (and to the extent) the unit grant ultimately vests. 76 Table of Contents Third, employees sometimes invest in the membership interests of consolidated SPAC sponsor entities (the Insurance SPAC Sponsor Entities, the Insurance SPAC II Sponsor Entities, and the Insurance SPAC III Sponsor Entities).
The recipient is entitled to distributions that are declared and paid during the vesting period but they are paid only if (and to the extent) the unit grant ultimately vests. 73 Table of Contents Third, employees sometimes invest in the membership interests of consolidated SPAC sponsor entities (the Insurance SPAC Sponsor Entities, the Insurance SPAC II Sponsor Entities, and the Insurance SPAC III Sponsor Entities).
As of December 31, 2023, 42% of our existing AUM were in CDOs. The creation of CDOs has depended upon a vibrant securitization market. Since 2008, volumes within the securitization market have dropped significantly and have not fully recovered since that time. We have not completed a new securitization since 2008.
As of December 31, 2024, 42% of our existing AUM were in CDOs. The creation of CDOs has depended upon a vibrant securitization market. Since 2008, volumes within the securitization market have dropped significantly and have not fully recovered since that time. We have not completed a new securitization since 2008.
If we determine that the collection of the remaining Maturity Consideration owed is not probable, we will not record the unpaid portion. 78 Table of Contents Recent Accounting Pronouncements The following is a list of recent accounting pronouncements that, we believe, will have a continuing impact on our financial statements going forward.
If we determine that the collection of the remaining Maturity Consideration owed is not probable, we will not record the unpaid portion. 75 Table of Contents Recent Accounting Pronouncements The following is a list of recent accounting pronouncements that, we believe, will have a continuing impact on our financial statements going forward.
Net Income/ (Loss) Attributable to the Non-Convertible Non-Controlling Interest Net income / (loss) attributable to the non-convertible non-controlling interest for the years ended December 31, 2023 and 2022 was comprised of the non-controlling interest related to member interests in consolidated subsidiaries of the Operating LLC other than interests held by us for the relevant periods.
Net Income/ (Loss) Attributable to the Non-Convertible Non-Controlling Interest Net income / (loss) attributable to the non-convertible non-controlling interest for the years ended December 31, 2024 and 2023 was comprised of the non-controlling interest related to member interests in consolidated subsidiaries of the Operating LLC other than interests held by us for the relevant periods.
As a result, we recorded significant principal transaction losses and equity method losses during the years ended December 31, 2022 and 2023 in certain SPAC related investments. Continued declines in the equity prices of these companies will result in further losses for us.
As a result, we recorded significant principal transaction losses and equity method losses during the years ended December 31, 2023 and 2024 in certain SPAC related investments. Continued declines in the equity prices of these companies will result in further losses for us.
The period-to-period comparisons of financial results are not necessarily indicative of future results. Year Ended December 31, 2023 Compared to the Year Ended December 31, 2022 The following table sets forth information regarding our consolidated results of operations for the years ended December 31, 2023 and 2022. COHEN & COMPANY INC.
The period-to-period comparisons of financial results are not necessarily indicative of future results. Year Ended December 31, 2024 Compared to the Year Ended December 31, 2023 The following table sets forth information regarding our consolidated results of operations for the years ended December 31, 2024 and 2023. COHEN & COMPANY INC.
Net Income / (Loss) Attributable to the Convertible Non-Controlling Interest Net income / (loss) attributable to the convertible non-controlling interest for the years ended December 31, 2022 and 2021 was comprised of the non-controlling interest related to member interests in the Operating LLC other than interests held by us for the relevant periods.
Net Income / (Loss) Attributable to the Convertible Non-Controlling Interest Net income / (loss) attributable to the convertible non-controlling interest for the years ended December 31, 2023 and 2022 was comprised of the non-controlling interest related to member interests in the Operating LLC other than interests held by us for the relevant periods.
We recognize incentive fee revenue when it is probable and there is not a significant chance of reversal in the future. In the case of Investment Vehicles other than CDOs, generally we earn a base fee and, in some cases, also earns an incentive fee.
We recognize incentive fee revenue when it is probable and there is not a significant chance of reversal in the future. In the case of Investment Vehicles other than CDOs, generally we earn a base fee and, in some cases, an incentive fee.
In the case of consolidated sponsor entities, we will also record an offsetting entry to non-controlling interest. 77 Table of Contents Share Forward Arrangements We have also engaged in several transactions known as “share forward arrangements” (“SFAs”).
In the case of consolidated sponsor entities, we will also record an offsetting entry to non-controlling interest. 74 Table of Contents Share Forward Arrangements We have also engaged in several transactions known as “share forward arrangements” (“SFAs”).
REDEEMABLE FINANCIAL INSTRUMENTS (Dollars in thousands) December 31, 2023 December 31, 2022 JKD Investor $ 7,868 $ 7,868 $ 7,868 $ 7,868 Off-Balance Sheet Arrangements Other than as described in note 10 (derivative financial instruments) and note 18 (variable interest entities) to our consolidated financial statements included in this Annual Report on Form 10-K, there were no material off balance sheet arrangements as of December 31, 2023. 71 Table of Contents Contractual Obligations The table below summarizes our significant contractual obligations as of December 31, 2023 and the future periods in which such obligations are expected to be settled in cash.
REDEEMABLE FINANCIAL INSTRUMENTS (Dollars in thousands) December 31, 2024 December 31, 2023 JKD Investor $ - $ 7,868 $ - $ 7,868 Off-Balance Sheet Arrangements Other than as described in note 10 (derivative financial instruments) and note 18 (variable interest entities) to our consolidated financial statements included in this Annual Report on Form 10-K, there were no material off balance sheet arrangements as of December 31, 2024. 68 Table of Contents Contractual Obligations The table below summarizes our significant contractual obligations as of December 31, 2024 and the future periods in which such obligations are expected to be settled in cash.
We account for SFA transactions as follows: ● The interests in public companies that it owns are carried at fair value. Refer to note 9 for further details on determining the fair value of unrestricted common shares, restricted common shares, equity derivatives, or fair value receivables. ● The derivative obligation arising from the SFA is also carried at fair value.
We account for SFA transactions as follows: ● The interests in public companies that we own are carried at fair value. Refer to note 9 for further details on determining the fair value of unrestricted common shares, restricted common shares, equity derivatives, or fair value receivables. ● The derivative obligation arising from the SFA is also carried at fair value.
The increase was comprised of an increase in subscriptions and dues of $573 and an increase in clearing and execution of $118. Professional Fee and Other Operating Expenses Professional fee and other operating expenses increased by $1,143, or 14%, to $9,296 for the year ended December 31, 2023, as compared to $8,153 for the year ended December 31, 2022.
The increase was comprised of an increase in subscriptions and dues of $573 and an increase in clearing and execution of $118. 58 Table of Contents Professional Fee and Other Operating Expenses Professional fee and other operating expenses increased by $1,143, or 14%, to $9,296 for the year ended December 31, 2023, as compared to $8,153 for the year ended December 31, 2022.
These future adjustments may likewise result in material amounts of deferred tax benefit or expense going forward. 62 Table of Contents Net Income / (Loss) Attributable to the Non-Convertible Non-Controlling Interest Net income / (loss) attributable to the non-convertible non-controlling interest for the years ended December 31, 2022 and 2021 was comprised of the non-controlling interest related to member interests in consolidated subsidiaries of the Operating LLC other than interests held by us for the relevant periods.
These future adjustments may likewise result in material amounts of deferred tax benefit or expense going forward. 60 Table of Contents Net Income / (Loss) Attributable to the Non-Convertible Non-Controlling Interest Net income / (loss) attributable to the non-convertible non-controlling interest for the years ended December 31, 2023 and 2022 was comprised of the non-controlling interest related to member interests in consolidated subsidiaries of the Operating LLC other than interests held by us for the relevant periods.
Other SPAC related is mainly comprised of an entity that we consolidated but do not wholly own that invests in other SPAC sponsor entities. 52 Table of Contents Net Income / (Loss) Attributable to the Convertible Non-controlling Interest Net income / (loss) attributable to the convertible non-controlling interest for the years ended December 31, 2023 and 2022 was comprised of the non-controlling interest related to member interests in the Operating LLC other than interests held by us for the relevant periods.
Other SPAC related is mainly comprised of an entity that we consolidated but do not wholly own that invests in other SPAC sponsor entities. 51 Table of Contents Net Income / (Loss) Attributable to the Convertible Non-Controlling Interest Net income / (loss) attributable to the convertible non-controlling interest for the years ended December 31, 2024 and 2023 was comprised of the non-controlling interest related to member interests in the Operating LLC other than interests held by us for the relevant periods.
Because earnings are recognized unevenly throughout the year and the non-controlling interest percentage may change during the period, the average effective non-controlling interest percentage may not equal the percentage at the end of any period or the simple average of the beginning and ending percentages. 53 Table of Contents Year Ended December 31, 2022 Compared to the Year Ended December 31, 2021 The following table sets forth information regarding our consolidated results of operations for the years ended December 31, 2022 and 2021.
Because earnings are recognized unevenly throughout the year and the non-controlling interest percentage may change during the period, the average effective non-controlling interest percentage may not equal the percentage at the end of any period or the simple average of the beginning and ending percentages. 52 Table of Contents Year Ended December 31, 2023 Compared to the Year Ended December 31, 2022 The following table sets forth information regarding our consolidated results of operations for the years ended December 31, 2023 and 2022.
However, in all cases, we recognize the incentive fees when they are probable and there is not a significant chance of reversal in the future. 75 Table of Contents New issue and advisory New issue and advisory revenue includes: (i) new issue revenue associated with origination fees for newly created financial instruments originated by us; (ii) revenue from advisory services; and (iii) new issue revenue associated with arranging the issuance of and placing newly created financial instruments.
However, in all cases, we recognize the incentive fees when they are probable and there is not a significant chance of reversal in the future. 72 Table of Contents New issue and advisory New issue and advisory revenue includes: (i) new issue revenue associated with origination fees for newly created financial instruments originated by us; (ii) revenue from advisory services; (iii) underwriting; and (iv) new issue revenue associated with arranging the issuance of and placing newly created financial instruments.
SUMMARY CALCULATION OF CONVERTIBLE NON-CONTROLLING INTEREST For the Year Ended December 31, 2022 Wholly Owned Subsidiaries Other Consolidated Subsidiaries Total Operating LLC Consolidated Cohen & Company Inc.
SUMMARY CALCULATION OF CONVERTIBLE NON-CONTROLLING INTEREST For the Year Ended December 31, 2024 Wholly Owned Subsidiaries Other Consolidated Subsidiaries Total Operating LLC Consolidated Cohen & Company Inc.
In addition, our United States and European broker-dealer subsidiaries are subject to certain regulatory requirements to maintain minimum levels of net capital. Historically, our primary sources of funds have been our operating activities and general corporate borrowings. In addition, our trading operations have generally been financed by use of collateralized securities financing arrangements as well as margin loans.
In addition, our U.S. and European broker-dealer subsidiaries are subject to certain regulatory requirements to maintain minimum levels of net capital. Historically, our primary sources of funds have been our operating activities and general corporate borrowings. In addition, our trading operations have generally been financed by use of collateralized securities financing arrangements as well as margin loans.
We specialize in a variety of products, including but not limited to: corporate bonds, ABS, MBS, RMBS, CDOs, CLOs, CBOs, CMOs, municipal securities, TBAs and other forward agency MBS contracts, U.S. government bonds, U.S. government agency securities, brokered deposits and CDs for small banks, and hybrid capital of financial institutions including TruPS, whole loans, and other structured financial instruments.
We specialize in a variety of products, including but not limited to: corporate bonds, ABS, MBS, RMBS, CBOs, CMOs, municipal securities, TBAs and other forward agency MBS contracts, SBA loans, U.S. government bonds, U.S. government agency securities, brokered deposits and CDs for small banks, and hybrid capital of financial institutions including whole loans and other structured financial instruments.
The remaining portion of our AUM is from a diversified mix of other Investment Vehicles that were more recently formed. • Principal Investing : Our Principal Investing business segment is comprised of investments that we hold related to our SPAC franchise and other investments we have made for the purpose of earning an investment return rather than investments to support our Capital Markets business segment activities.
The remaining portion of our AUM is from a diversified mix of other Investment Vehicles that were more recently formed. • Principal Investing : Our Principal Investing business segment is comprised of investments that we hold related to our SPAC franchise and other investments we have made for the purpose of earning an investment return rather than investments to support our trading and CCM activities.
Rising rates create instability in the equity markets, which has reduced equity financing and business combination volumes and negatively impacted CCM. 3. Rising rates reduced the volumes of new issue fixed income instruments, which has negatively impacted our CREO JV. 4. Rising rates significantly reduce mortgage activity.
Rising rates created instability in the equity markets, which has reduced equity financing and business combination volumes and negatively impacted CCM. 3. Rising rates reduced the volumes of new issue fixed income instruments, which has negatively impacted our CREO JV. 4. Rising rates significantly reduced mortgage activity.
Also, investor demand for SPACs would be negatively impacted if the stock of SPACs that successfully complete a business combination underperform the market. If volumes of SPAC activity decline, our results of operations will likely be significantly negatively impacted. 41 Table of Contents Equity prices of SPACs and post business combination SPACs declined significantly during 2022 and 2023.
Also, investor demand for SPACs would be negatively impacted if the stock of SPACs that successfully complete a business combination underperform the market. If volumes of SPAC activity decline, our results of operations will likely be significantly negatively impacted. 40 Table of Contents Equity prices of SPACs and post-business combination SPACs declined significantly during 2023 and 2024.
The deferred tax expense was a U.S. federal, state, and local tax expense, which was the result of the increase in the valuation allowance applied against the Company's NOL and NCL tax assets. The tax expense recognized in 2022 was comprised of a deferred tax expense of $4,579 and current tax expense of $215.
The deferred tax expense was U.S. federal, state, and local tax expense, which was the result of the increase in the valuation allowance applied against the Company's carryforward tax assets. The tax expense recognized in 2022 was comprised of a deferred tax expense of $4,579 and current tax expense of $215.
On October 5, 2023, we entered into an equity distribution agreement (the “2023 Equity Agreement”) with the Sales Agent, relating to the ATM Program, pursuant to which we are permitted to sell an aggregate of up to $4,712 in Shares, which represented one-third of the value of the Common Stock held by non-affiliates.
Issuances of Common Stock On October 5, 2023, we entered into an equity distribution agreement (the “2023 Equity Agreement”) relating to the ATM Program, pursuant to which we are permitted to sell an aggregate of up to $4,712 in Shares, which represented one-third of the value of the Common Stock held by non-affiliates.
These subsidiaries have historically operated in excess of minimum net capital requirements. Our minimum capital requirements at December 31, 2023 were as follows.
These subsidiaries have historically operated in excess of minimum net capital requirements. Our minimum capital requirements at December 31, 2024 were as follows.
To the extent management's determination changes, an adjustment will be made to the valuation allowance resulting in deferred tax expense or benefit. We recorded deferred tax benefit in 2021 because expectations of future income increased and the Company reduced the valuation allowance it had applied against carryforward assets.
To the extent management's determination changes, an adjustment will be made to the valuation allowance resulting in deferred tax expense or benefit. We recorded deferred tax expense in 2023 because expectations of future income decreased and the Company increased the valuation allowance it had applied against carryforward assets.
However, we are subject to significant limitations on our ability to make distributions from JVB. These limitations include limitations imposed by FINRA under rule 15c3-1 (described immediately above) and limitations under our line of credit with Byline Bank (see note 20 to our consolidated financial statements included in this Annual Report on Form 10-K).
However, we are subject to significant limitations on our ability to make distributions from JVB such as the limitations imposed by FINRA under rule 15c3-1 (described immediately above) and limitations under our line of credit with Byline Bank (see note 20 to our consolidated financial statements included in this Annual Report on Form 10-K).
In the event of default, the lenders will have recourse only to the assets securing the loan. Our Asset Management business segment includes our fee-based asset management operations, which include on-going base and incentive management fees. As of December 31, 2023, we had approximately $2.4 billion in assets under management (“AUM”) of which 42% was in CDOs.
In the event of default, the lenders will have recourse only to the assets securing the loan. Our Asset Management business segment includes our fee-based asset management operations, which include on-going base and incentive management fees. As of December 31, 2024, we had approximately $2,325 in assets under management (“AUM”) of which 42% was in CDOs.
Therefore, only $346 of equity exists outside of JVB. During certain periods of time, we have generated losses or negative cash flow outside of JVB.
Therefore, only $12,955 of equity exists outside of JVB. During certain periods of time, we have generated losses or negative cash flow outside of JVB.
Principal Investing: • Gains and losses (unrealized and realized) and income and expense earned on securities classified as other investments, at fair value and other investments sold, not yet purchased; and • Income and loss earned on equity method investments. 40 Table of Contents Business Environment Our business in general and our Capital Markets business segment in particular do not produce predictable earnings.
Principal Investing: • Gains and losses (unrealized and realized) and income and expense earned on securities classified as other investments, at fair value and other investments sold, not yet purchased, which were not acquired as part of our CCM business; and • Income and loss earned on equity method investments. 39 Table of Contents Business Environment Our business in general and our Capital Markets business segment in particular do not produce predictable earnings.
As of December 31, 2023, the Company had a federal net operating loss (“NOL”) of approximately $96,457, which will be available to offset future taxable income, subject to limitations described below. If not used, this NOL will begin to expire in 2028.
As of December 31, 2024, the Company had a federal net operating loss (“NOL”) of approximately $92,543, which will be available to offset future taxable income, subject to limitations described below. If not used, this NOL will begin to expire in 2028.
When factoring in the discount, the yield to maturity of the junior subordinated notes as of December 31, 2023 on a combined basis was 21.66% assuming the variable rate in effect on the last day of the reporting period remains in effect until maturity. (2) Represents the interest rate in effect as of the last day of the reporting period.
When factoring in the discount, the yield to maturity of the junior subordinated notes as of December 31, 2024 on a combined basis was 20.55% assuming the variable rate in effect on the last day of the reporting period remains in effect until maturity. (2) Represents the interest rate in effect as of the last day of the reporting period.
The Company also had net capital losses (“NCLs”) in excess of capital gains of $59,844 as of December 31, 2023, which can be carried forward to offset future capital gains. If not used, this carryforward will begin to expire in 2024.
The Company also had net capital losses (“NCLs”) in excess of capital gains of $57,239 as of December 31, 2024, which can be carried forward to offset future capital gains. If not used, this carryforward will begin to expire in 2025.
See note 25 to our consolidated financial statements included in this Annual Report on Form 10-K. In addition, our licensed broker-dealers are generally subject to capital withdrawal notification requirements and restrictions. Restrictions of Distributions of Capital from JVB As of December 31, 2023, our total equity on a consolidated basis was $91,797. However, the total equity of JVB was $91,451.
See note 25 to our consolidated financial statements included in this Annual Report on Form 10-K. In addition, our licensed broker-dealers are generally subject to capital withdrawal notification requirements and restrictions. Restrictions of Distributions of Capital from JVB As of December 31, 2024, our total equity on a consolidated basis was $90,283. However, the total equity of JVB was $77,328.
We are currently evaluating the new guidance to determine the impact it may have on our consolidated financial statements. In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740 ).
We are currently evaluating the new guidance to determine the impact it may have on our consolidated financial statements, which, is not expected to be material. In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740 ).
The interest rate of 9.65% (based on a 90-day SOFR rate in effect as of December 31, 2023 plus 4.26%) was used to compute the contractual interest payment in each period noted. The interest on the junior subordinated notes related to Sunset Financial Statutory Trust I is variable.
The interest rate of 8.85% (based on a 90-day SOFR rate in effect as of December 31, 2024 plus 4.00%) was used to compute the contractual interest payment in each period noted. The interest on the junior subordinated notes related to Sunset Financial Statutory Trust I is variable.
See note 23 to our consolidated financial statements included in our Annual Report on Form 10-K. The tax expense recognized in 2022 was comprised of a deferred tax expense of $4,579 and current tax expense of $215. The current tax expense incurred was the result of foreign, state, and local income tax.
See note 23 to our consolidated financial statements included in our Annual Report on Form 10-K. The tax benefit recognized in 2024 was comprised of a deferred tax benefit of $677 and current tax expense of $348. The current tax expense incurred was the result of foreign, state, and local income tax.
NET TRADING (Dollars in Thousands) Year Ended December 31, 2023 2022 Change Mortgage $ (1,523 ) $ 1,143 $ (2,666 ) Matched book repo 16,315 30,595 (14,280 ) High yield corporate 4,768 4,694 74 Investment grade corporate (420 ) 1,197 (1,617 ) Wholesale and other 11,786 2,380 9,406 Total $ 30,926 $ 40,009 $ (9,083 ) Our net trading revenue includes unrealized gains on our trading investments, as of the applicable measurement date, which may never be realized due to changes in market or other conditions not in our control.
NET TRADING (Dollars in Thousands) For the Year Ended December 31, 2023 2022 Change Mortgage $ (1,523 ) $ 56 $ (1,579 ) Matched book repo 16,315 30,595 (14,280 ) High yield corporate 4,768 4,694 74 Investment grade corporate (420 ) 1,197 (1,617 ) Wholesale and other 11,787 3,467 8,320 Total $ 30,927 $ 40,009 $ (9,082 ) Our net trading revenue includes unrealized gains on our trading investments, as of the applicable measurement date, which may never be realized due to changes in market or other conditions not in our control.
The current tax expense incurred was the result of foreign, state, and local income tax. The deferred tax expense was a U.S. federal, state, and local tax expense, which was the result of the increase in the valuation allowance applied against the Company's NOL and NCL tax assets.
The current tax expense incurred was the result of foreign, state, and local income tax. The deferred tax expense was U.S. federal, state, and local tax expense, which was the result of the increase in the valuation allowance applied against the Company's carryforward tax assets. We have significant carryforward tax assets.
As of December 31, 2023 and December 31, 2022, we maintained cash and cash equivalents of $10,650 and $29,101, respectively. We generated cash from or used cash for the activities described below.
As of December 31, 2024 and December 31, 2023, we maintained cash and cash equivalents of $19,590 and $10,650, respectively. We generated cash from or used cash for the activities described below.
Otherwise, asset management fees from CDOs declined by $216 during 2023 mainly due to a decline in AUM due to liquidations and principal paydowns of collateral. Asset management fees from other investment vehicles remained relatively flat.
Otherwise, asset management fees from CDOs declined by $216 during 2023 mainly due to a decline in AUM due to liquidations and principal paydowns of collateral. Asset management fees from other investment vehicles remained relatively unchanged. All asset management revenue is included in our asset management segment.
For several of the investments described below, we also had an investment in the same company accounted for at fair value as a component of other investments, at fair value during the periods presented. See discussion of principal transactions above.
For several of the investments described below, we also had an investment in the same company accounted for at fair value as a component of other investments, at fair value during the periods presented. See discussion of principal transactions above. Year Ended December 31, 2023 2022 Change Heliogen, Inc.
MINIMUM NET CAPITAL REQUIREMENTS (Dollars in Thousands) U.S. $ 250 France 685 Total $ 935 We operate with more than the minimum regulatory capital requirement in our licensed broker-dealers and at December 31, 2023 total net capital, or the equivalent as defined by the relevant statutory regulations, in our licensed broker-dealers was $51,639.
MINIMUM NET CAPITAL REQUIREMENTS (Dollars in Thousands) As of December 31, 2024 U.S. $ 250 France 643 Total $ 893 We operate with more than the minimum regulatory capital requirement in our licensed broker-dealers and at December 31, 2024 total net capital, or the equivalent as defined by the relevant statutory regulations, in our licensed broker-dealers was $49,988.
SUMMARY CASH FLOW INFORMATION (Dollars in Thousands) Year Ended December 31, 2023 2022 2021 Cash flow from operating activities $ (39,660 ) $ (23,488 ) $ 18,321 Cash flow from investing activities 38,123 13,798 (22,534 ) Cash flow from financing activities (17,105 ) (11,504 ) 13,161 Effect of exchange rate on cash 191 (272 ) (377 ) Net cash flow (18,451 ) (21,466 ) 8,571 Cash and cash equivalents, beginning 29,101 50,567 41,996 Cash and cash equivalents, ending $ 10,650 $ 29,101 $ 50,567 See the statements of cash flows in our consolidated financial statements.
SUMMARY CASH FLOW INFORMATION (Dollars in Thousands) Year Ended December 31, 2024 2023 2022 Cash flow from operating activities $ 9,475 $ (39,660 ) $ (23,488 ) Cash flow from investing activities 16,506 38,123 13,798 Cash flow from financing activities (16,717 ) (17,105 ) (11,504 ) Effect of exchange rate on cash (324 ) 191 (272 ) Net cash flow 8,940 (18,451 ) (21,466 ) Cash and cash equivalents, beginning 10,650 29,101 50,567 Cash and cash equivalents, ending $ 19,590 $ 10,650 $ 29,101 See the statements of cash flows in our consolidated financial statements.
The revenue share arrangement noted in the table above entitles us to a percentage of revenue earned by IIFC. The IIFC revenue share arrangement expires at the earlier of (i) the dissolution of IIFC or (ii) when we have earned a cumulative $20,000 in revenue share payments. As of December 31, 2022, we had earned $4,513.
The revenue share arrangement noted in the table above entitles us to a percentage of revenue earned by IIFC. The IIFC revenue share arrangement expires at the earlier of (i) the dissolution of IIFC or (ii) when we have earned a cumulative $20,000 in revenue share payments. To date, we have earned $8,175.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Biggest changeA 100-bps adverse change in the market yield to maturity would have resulted in an increase in the fair value of the debt in the amount of $2,261 as of December 31, 2023. 80 Table of Contents Counterparty Risk and Settlement Risk We are subject to counterparty risk primarily in two areas: (1) our collateralized securities transactions described in note 11 to our consolidated financial statements included in this Annual Report on Form 10-K and (2) our TBA and other forward agency MBS activities described in note 10 to our consolidated financial statements included in this Annual Report on Form 10-K.
Biggest changeA 100 bps adverse change in the market yield to maturity would have resulted in an increase in the fair value of the debt in the amount of $2,618 as of December 31, 2024. 77 Table of Contents Counterparty Risk and Settlement Risk We are subject to counterparty risk primarily in two areas: (1) our collateralized securities transactions described in note 11 to our consolidated financial statements included in this Annual Report on Form 10-K and (2) our TBA and other forward agency MBS activities described in note 10 to our consolidated financial statements included in this Annual Report on Form 10-K.
We seek to earn net interest income on these matched transactions. 81 Table of Contents In our gestation repo business, we will generally ensure that the maturity dates of our reverse repurchase agreements match the maturity dates of the matched repurchase agreements.
We seek to earn net interest income on these matched transactions. 78 Table of Contents In our gestation repo business, we will generally ensure that the maturity dates of our reverse repurchase agreements match the maturity dates of the matched repurchase agreements.
As of December 31, 2023, a 100-bps change in the three-month SOFR would have resulted in a change in our annual cash to be paid for interest in the amount of $481.
As of December 31, 2024, a 100 bps change in the three-month SOFR would have resulted in a change in our annual cash to be paid for interest in the amount of $481.
Based on this analysis, as of December 31, 2023, our equity price sensitivity was $1,383 and our foreign exchange currency sensitivity was $0. As of December 31, 2022, our equity price sensitivity was $1,695 and our foreign exchange currency sensitivity was $0. Other Securities: These investments are primarily made up of residual interests in securitization entities.
Based on this analysis, as of December 31, 2024, our equity price sensitivity was $1,189 and our foreign exchange currency sensitivity was $0. As of December 31, 2023, our equity price sensitivity was $1,383 and our foreign exchange currency sensitivity was $0. Other Securities: These investments are primarily made up of residual interests in securitization entities.
As of December 31, 2022, we would have incurred a loss of $1,610 if the yield curve rose 100 bps across all maturities and a gain of $1,605 if the yield curve fell 100 bps across all maturities. Equity Securities : We hold equity interests in both public and private entities. These investments are subject to equity price risk.
As of December 31, 2023, we would have incurred a loss of $1,368 if the yield curve rose 100 bps across all maturities and a gain of $1,364 if the yield curve fell 100 bps across all maturities. Equity Securities : We hold equity interests in both public and private entities. These investments are subject to equity price risk.
Based on this analysis, as of December 31, 2023, we would have incurred a loss of $1,368 if the yield curve rose 100 bps across all maturities and a gain of $1,364 if the yield curve fell 100 bps across all maturities.
Based on this analysis, as of December 31, 2024, we would have incurred a loss of $3,159 if the yield curve rose 100 bps across all maturities and a gain of $3,156 if the yield curve fell 100 bps across all maturities.

Other COHN 10-K year-over-year comparisons