” one of our core profitably measurements is our portfolio related net interest margin , which measures the difference between interest income earned on our loan portfolio and interest expense paid on our portfolio-related debt , relative to the amount of loans outstanding over the period . our portfolio-related debt consists of our warehouse repurchase facilities and securitizations and excludes our corporate debt . for the year ended december 31 , 2019 , our portfolio related net interest margin was 4.13 % . we generate profits to the extent that our portfolio related net interest income exceeds our interest expense on corporate debt , provision for loan losses and operating expenses . for the year ended december 31 , 2019 , we generated income before income taxes and net income of $ 25.4 million and $ 17.3 million , respectively , and earned a pre-tax return on equity and return on equity of 17.4 % and 11.8 % , respectively . 40 items affecting comparability of results due to a number of factors , our historical financial results may not be comparable , either from period to period , or to our financial results in future periods . we have summarized the key factors affecting the comparability of our financial results below . income taxes prior to our initial public offering , the company operated as velocity financial , llc , which was formed as a delaware limited liability company , or llc , in 2012. until january 1 , 2018 , as an llc , we had elected to be treated as a partnership for u.s. federal and state income tax purposes , and as such , had generally not been subject to federal and state income taxes prior to january 1 , 2018. accordingly , the results of operations presented for the years prior to january 1 , 2018 do not include any provision for federal or state income taxes . as part of our initial public offering , we converted velocity financial , llc into a delaware corporation and changed our name to velocity financial , inc. , a transaction that we refer to as the “ conversion ” in this annual report form 10-k. the conversion is accounted for in accordance with asc 805-50 –business combinations , as a transaction between entities under common control . the conversion is not expected to impact our provision for income taxes or our deferred tax assets and liabilities . effective january 1 , 2018 , we elected to be treated as a corporation for u.s. federal and state income tax purposes . accordingly , the results of operations for the year ended december 31 , 2018 include the impacts of income taxes . as a result , the historical net income reported for any period prior to january 1 , 2018 , is not comparable to the net income reported for the year ended december 31 , 2018 or the net income anticipated in future periods . furthermore , in connection with the new tax treatment , we began recognizing , and will continue to recognize , deferred tax assets and liabilities for future tax consequences attributable to differences between the financial statement carrying amounts of our existing assets and liabilities and their respective tax bases . deferred tax assets and liabilities are measured using the tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled . the effect on deferred tax assets and liabilities of a change in tax rates is recognized in the statements of operations in the period that included the enactment date , as applicable . interest expense on corporate debt in 2014 , we entered into a five-year , $ 100.0 million corporate debt agreement with the owners of our class c preferred units , pursuant to which we issued at par senior secured notes , the 2014 senior secured notes , that mature on december 16 , 2019. the 2014 senior secured notes bear interest , at our election , at either 10 % annually paid in cash or 11 % annually paid in kind . in august 2019 , we entered into a five-year $ 153.0 million corporate debt agreement with owl rock capital corporation ( “ 2019 term loans ” ) . the 2019 term loans under this agreement bear interest at a rate equal to one-month libor plus 7.50 % and mature in august 2024. a portion of the net proceeds from the 2019 term loans was used to redeem all of the outstanding 2014 senior secured notes in august 2019. another portion of the net proceeds from the 2019 term loans , together with cash on hand , was used to repurchase our outstanding class c preferred units . as of december 31 , 2018 , including paid-in-kind interest , the 2014 senior secured notes balance was $ 127.6 million , and is presented as secured financing , net of debt issuance costs , on the consolidated statement of financial condition . the 2019 term loans balance was $ 153.0 million as of december 31 , 2019. during the year ended december 31 , 2019 , we incurred $ 14.6 million of interest expense related to the 2014 senior secured notes and the 2019 term loans . we used $ 75.7 million of the net proceeds from our ipo to lower our interest expense through the repayment of the $ 75.0 million outstanding principal amount on the 2019 term loans . 41 recent developments january 2020 ipo on january 16 , 2020 , velocity financial , llc converted from a delaware limited liability company to a delaware corporation and changed its name to velocity financial , inc. the conversion was accounted for in accordance with asc 805-50 – business combinations , as a transaction between entities under common control . all assets and liabilities of velocity financial , llc were contributed to velocity financial , inc. story_separator_special_tag operating efficiency we generate positive operating leverage to the extent that our revenue grows at a faster rate than our expenses . we believe our platform is highly scalable and that we can generate positive operating leverage in future periods , primarily due to the technology and other investments we have made in our platform to date and our focus on a scalable , cost-effective mortgage broker network to generate new loan originations . portfolio and asset quality key portfolio statistics replace_table_token_3_th total loans . total loans reflects the aggregate upb at the end of the period . it excludes deferred origination costs , acquisition discounts , fair value adjustments and allowance for loan losses . loan count . loan count reflects the number of loans at the end of the period . it includes all loans with an outstanding principal balance . average loan balance . average loan balance reflects the average upb at the end of the period ( i.e . , total loans divided by loan count ) . weighted average loan-to-value . loan-to-value , or ltv , reflects the ratio of the original loan amount to the appraised value of the underlying property at the time of origination . in instances where the ltv at origination is not available for an acquired loan , the ltv reflects our best estimate of value at the time of acquisition . weighted average ltv is calculated for the population of loans outstanding at the end of each specified period using the original loan amounts and appraised ltvs at the time of origination of each loan . ltv is a key statistic because requiring the borrower to invest more equity in the collateral minimizes our exposure for future credit losses . nonperforming loans . loans that are 90 or more days past due , in bankruptcy , or in foreclosure are not accruing interest and are considered nonperforming loans . the dollar amount of nonperforming loans presented in the table above reflects the upb of all loans that meet this definition . 46 originations and acquisitions the following table presents new loan originations and acquisitions and includes average loan size , weighted average coupon and weighted average loan-to-value for the periods indicated : replace_table_token_4_th over the periods shown , we have increased our origination volume by executing our strategy of continuing to serve and build loyalty within our network of mortgage brokers , while also expanding our network with new mortgage brokers through improved brand recognition . for the year ended december 31 , 2019 , we originated $ 1.0 billion of loans , which was an increase of $ 275.4 million , or 37.4 % from $ 737.3 million for the year ended december 31 , 2018. for the year ended december 31 , 2018 , we originated $ 737.3 million of loans , which was an increase of $ 182.6 million , or 32.9 % , from $ 554.7 million for the year ended december 31 , 2017. loans held for investment our total portfolio of loans held for investment consists of both loans held for investment at cost , which are presented in the consolidated financial statements as loans held for investment , net , and loans held for investment at fair value , which are presented in the financial statements as loans held for investment at fair value . the following tables show the various components of loans held for investment as of the dates indicated : replace_table_token_5_th 47 the following table illustrates the contractual maturities for our loans held for investment in aggregate upb and as a percentage of our total held for investment loan portfolio as of december 31 , 2019 : replace_table_token_6_th allowance for loan losses our allowance for loan losses increased to $ 2.2 million as of december 31 , 2019 , compared to $ 1.7 million as of december 31 , 2018. the increase in allowance is primarily due to the increase in our loan portfolio from december 31 , 2018 to december 31 , 2019. our allowance decreased to $ 1.7 million as of december 31 , 2018 , compared to $ 1.9 million as of december 31 , 2017. the decrease in the allowance for loan losses is based on an analysis of historical loan loss data from january 1 , 2012 through december 31 , 2019. we strive to minimize actual credit losses through our rigorous screening and underwriting process , life of loan portfolio management and special servicing practices . additionally , we believe borrower equity of 25 % to 40 % provides significant protection against credit losses should a loan become impaired . to estimate the allowance for loan losses in our loans held for investment portfolio , we follow a detailed internal process , considering a number of different factors including , but not limited to , our ongoing analyses of loans , historical loss rates , relevant environmental factors , relevant market research , trends in delinquencies , effects and changes in credit concentrations , and ongoing evaluation of fair values . the following table illustrates the activity in our allowance for loan losses over the periods indicated : replace_table_token_7_th credit quality – loans held for investment the following table provides delinquency information on our held for investment loan portfolio as of the dates indicated : replace_table_token_8_th 48 loans that are 90+ days past due , in bankruptcy , or in foreclosure are not accruing interest and are considered nonperforming loans . nonperforming loans were $ 112.2 million , or 6.1 % of our held for investment loan portfolio as of december 31 , 2019 , compared to $ 91.1 million , or 5.9 % as of december 31 , 2018 , and $ 73.3 million , or 5.7 % of the loan portfolio as of december 31 , 2017. we believe the significant equity cushion at origination and the active management of loans will continue to minimize credit losses on the resolution of

cash provided by ( used in ) operating activities , investing activities and financing activities as of the periods indicated : replace_table_token_30_th operating activities cash flows from operating activities primarily includes net income adjusted for ( 1 ) cash used for origination of held for sale loans and the related cash proceeds from the sales of such loans , ( 2 ) non-cash items including depreciation , provision for loan loss , discount accretion , and valuation changes , and ( 3 ) changes in the balances of operating assets and liabilities . for the year ended december 31 , 2019 , our net cash used in operating activities of $ 105.3 million consisted mainly of $ 336.9 million cash used to originate held for sale loans , offset by $ 179.6 million proceeds from sale of loans held for sale , $ 25.1 million in repayments on loans held for sale , and net income of $ 17.3 million . for the year ended december 31 , 2018 , our net cash used in operating activities of $ 72.5 million consisted mainly of net income of $ 7.6 million , offset by $ 148.8 million in cash used to originate held for sale loans , less proceeds from the sale and repayments of loans held for sale of $ 72.9 million and $ 3.5 million , respectively . changes in operating assets and liabilities resulted in cash used of $ 18.9 million , mainly as a result of a $ 16.2 million increase in interest receivable due to portfolio growth . for the year ended december 31 , 2017 , our net cash provided by operating activities of $ 37.6 million consisted mainly of net income of $ 14.0 million , offset by $ 42.9 million in cash used to originate held for sale loans , less proceeds from the sale of such loans of $ 46.3 million . changes in operating assets and liabilities resulted in cash provided of $ 4.8


 Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.
     ```cash provided by ( used in ) operating activities , investing activities and financing activities as of the periods indicated : replace_table_token_30_th operating activities cash flows from operating activities primarily includes net income adjusted for ( 1 ) cash used for origination of held for sale loans and the related cash proceeds from the sales of such loans , ( 2 ) non-cash items including depreciation , provision for loan loss , discount accretion , and valuation changes , and ( 3 ) changes in the balances of operating assets and liabilities . for the year ended december 31 , 2019 , our net cash used in operating activities of $ 105.3 million consisted mainly of $ 336.9 million cash used to originate held for sale loans , offset by $ 179.6 million proceeds from sale of loans held for sale , $ 25.1 million in repayments on loans held for sale , and net income of $ 17.3 million . for the year ended december 31 , 2018 , our net cash used in operating activities of $ 72.5 million consisted mainly of net income of $ 7.6 million , offset by $ 148.8 million in cash used to originate held for sale loans , less proceeds from the sale and repayments of loans held for sale of $ 72.9 million and $ 3.5 million , respectively . changes in operating assets and liabilities resulted in cash used of $ 18.9 million , mainly as a result of a $ 16.2 million increase in interest receivable due to portfolio growth . for the year ended december 31 , 2017 , our net cash provided by operating activities of $ 37.6 million consisted mainly of net income of $ 14.0 million , offset by $ 42.9 million in cash used to originate held for sale loans , less proceeds from the sale of such loans of $ 46.3 million . changes in operating assets and liabilities resulted in cash provided of $ 4.8
```    
 Suspicious Activity Report : ” one of our core profitably measurements is our portfolio related net interest margin , which measures the difference between interest income earned on our loan portfolio and interest expense paid on our portfolio-related debt , relative to the amount of loans outstanding over the period . our portfolio-related debt consists of our warehouse repurchase facilities and securitizations and excludes our corporate debt . for the year ended december 31 , 2019 , our portfolio related net interest margin was 4.13 % . we generate profits to the extent that our portfolio related net interest income exceeds our interest expense on corporate debt , provision for loan losses and operating expenses . for the year ended december 31 , 2019 , we generated income before income taxes and net income of $ 25.4 million and $ 17.3 million , respectively , and earned a pre-tax return on equity and return on equity of 17.4 % and 11.8 % , respectively . 40 items affecting comparability of results due to a number of factors , our historical financial results may not be comparable , either from period to period , or to our financial results in future periods . we have summarized the key factors affecting the comparability of our financial results below . income taxes prior to our initial public offering , the company operated as velocity financial , llc , which was formed as a delaware limited liability company , or llc , in 2012. until january 1 , 2018 , as an llc , we had elected to be treated as a partnership for u.s. federal and state income tax purposes , and as such , had generally not been subject to federal and state income taxes prior to january 1 , 2018. accordingly , the results of operations presented for the years prior to january 1 , 2018 do not include any provision for federal or state income taxes . as part of our initial public offering , we converted velocity financial , llc into a delaware corporation and changed our name to velocity financial , inc. , a transaction that we refer to as the “ conversion ” in this annual report form 10-k. the conversion is accounted for in accordance with asc 805-50 –business combinations , as a transaction between entities under common control . the conversion is not expected to impact our provision for income taxes or our deferred tax assets and liabilities . effective january 1 , 2018 , we elected to be treated as a corporation for u.s. federal and state income tax purposes . accordingly , the results of operations for the year ended december 31 , 2018 include the impacts of income taxes . as a result , the historical net income reported for any period prior to january 1 , 2018 , is not comparable to the net income reported for the year ended december 31 , 2018 or the net income anticipated in future periods . furthermore , in connection with the new tax treatment , we began recognizing , and will continue to recognize , deferred tax assets and liabilities for future tax consequences attributable to differences between the financial statement carrying amounts of our existing assets and liabilities and their respective tax bases . deferred tax assets and liabilities are measured using the tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled . the effect on deferred tax assets and liabilities of a change in tax rates is recognized in the statements of operations in the period that included the enactment date , as applicable . interest expense on corporate debt in 2014 , we entered into a five-year , $ 100.0 million corporate debt agreement with the owners of our class c preferred units , pursuant to which we issued at par senior secured notes , the 2014 senior secured notes , that mature on december 16 , 2019. the 2014 senior secured notes bear interest , at our election , at either 10 % annually paid in cash or 11 % annually paid in kind . in august 2019 , we entered into a five-year $ 153.0 million corporate debt agreement with owl rock capital corporation ( “ 2019 term loans ” ) . the 2019 term loans under this agreement bear interest at a rate equal to one-month libor plus 7.50 % and mature in august 2024. a portion of the net proceeds from the 2019 term loans was used to redeem all of the outstanding 2014 senior secured notes in august 2019. another portion of the net proceeds from the 2019 term loans , together with cash on hand , was used to repurchase our outstanding class c preferred units . as of december 31 , 2018 , including paid-in-kind interest , the 2014 senior secured notes balance was $ 127.6 million , and is presented as secured financing , net of debt issuance costs , on the consolidated statement of financial condition . the 2019 term loans balance was $ 153.0 million as of december 31 , 2019. during the year ended december 31 , 2019 , we incurred $ 14.6 million of interest expense related to the 2014 senior secured notes and the 2019 term loans . we used $ 75.7 million of the net proceeds from our ipo to lower our interest expense through the repayment of the $ 75.0 million outstanding principal amount on the 2019 term loans . 41 recent developments january 2020 ipo on january 16 , 2020 , velocity financial , llc converted from a delaware limited liability company to a delaware corporation and changed its name to velocity financial , inc. the conversion was accounted for in accordance with asc 805-50 – business combinations , as a transaction between entities under common control . all assets and liabilities of velocity financial , llc were contributed to velocity financial , inc. story_separator_special_tag operating efficiency we generate positive operating leverage to the extent that our revenue grows at a faster rate than our expenses . we believe our platform is highly scalable and that we can generate positive operating leverage in future periods , primarily due to the technology and other investments we have made in our platform to date and our focus on a scalable , cost-effective mortgage broker network to generate new loan originations . portfolio and asset quality key portfolio statistics replace_table_token_3_th total loans . total loans reflects the aggregate upb at the end of the period . it excludes deferred origination costs , acquisition discounts , fair value adjustments and allowance for loan losses . loan count . loan count reflects the number of loans at the end of the period . it includes all loans with an outstanding principal balance . average loan balance . average loan balance reflects the average upb at the end of the period ( i.e . , total loans divided by loan count ) . weighted average loan-to-value . loan-to-value , or ltv , reflects the ratio of the original loan amount to the appraised value of the underlying property at the time of origination . in instances where the ltv at origination is not available for an acquired loan , the ltv reflects our best estimate of value at the time of acquisition . weighted average ltv is calculated for the population of loans outstanding at the end of each specified period using the original loan amounts and appraised ltvs at the time of origination of each loan . ltv is a key statistic because requiring the borrower to invest more equity in the collateral minimizes our exposure for future credit losses . nonperforming loans . loans that are 90 or more days past due , in bankruptcy , or in foreclosure are not accruing interest and are considered nonperforming loans . the dollar amount of nonperforming loans presented in the table above reflects the upb of all loans that meet this definition . 46 originations and acquisitions the following table presents new loan originations and acquisitions and includes average loan size , weighted average coupon and weighted average loan-to-value for the periods indicated : replace_table_token_4_th over the periods shown , we have increased our origination volume by executing our strategy of continuing to serve and build loyalty within our network of mortgage brokers , while also expanding our network with new mortgage brokers through improved brand recognition . for the year ended december 31 , 2019 , we originated $ 1.0 billion of loans , which was an increase of $ 275.4 million , or 37.4 % from $ 737.3 million for the year ended december 31 , 2018. for the year ended december 31 , 2018 , we originated $ 737.3 million of loans , which was an increase of $ 182.6 million , or 32.9 % , from $ 554.7 million for the year ended december 31 , 2017. loans held for investment our total portfolio of loans held for investment consists of both loans held for investment at cost , which are presented in the consolidated financial statements as loans held for investment , net , and loans held for investment at fair value , which are presented in the financial statements as loans held for investment at fair value . the following tables show the various components of loans held for investment as of the dates indicated : replace_table_token_5_th 47 the following table illustrates the contractual maturities for our loans held for investment in aggregate upb and as a percentage of our total held for investment loan portfolio as of december 31 , 2019 : replace_table_token_6_th allowance for loan losses our allowance for loan losses increased to $ 2.2 million as of december 31 , 2019 , compared to $ 1.7 million as of december 31 , 2018. the increase in allowance is primarily due to the increase in our loan portfolio from december 31 , 2018 to december 31 , 2019. our allowance decreased to $ 1.7 million as of december 31 , 2018 , compared to $ 1.9 million as of december 31 , 2017. the decrease in the allowance for loan losses is based on an analysis of historical loan loss data from january 1 , 2012 through december 31 , 2019. we strive to minimize actual credit losses through our rigorous screening and underwriting process , life of loan portfolio management and special servicing practices . additionally , we believe borrower equity of 25 % to 40 % provides significant protection against credit losses should a loan become impaired . to estimate the allowance for loan losses in our loans held for investment portfolio , we follow a detailed internal process , considering a number of different factors including , but not limited to , our ongoing analyses of loans , historical loss rates , relevant environmental factors , relevant market research , trends in delinquencies , effects and changes in credit concentrations , and ongoing evaluation of fair values . the following table illustrates the activity in our allowance for loan losses over the periods indicated : replace_table_token_7_th credit quality – loans held for investment the following table provides delinquency information on our held for investment loan portfolio as of the dates indicated : replace_table_token_8_th 48 loans that are 90+ days past due , in bankruptcy , or in foreclosure are not accruing interest and are considered nonperforming loans . nonperforming loans were $ 112.2 million , or 6.1 % of our held for investment loan portfolio as of december 31 , 2019 , compared to $ 91.1 million , or 5.9 % as of december 31 , 2018 , and $ 73.3 million , or 5.7 % of the loan portfolio as of december 31 , 2017. we believe the significant equity cushion at origination and the active management of loans will continue to minimize credit losses on the resolution of

