REDWOOD TRUST INC

For the period ended Jun 30, 2024. Filed Aug 7, 2024.

About this filing

A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.

Jun 30, 2024 · Filed Aug 7, 2024

RWT$2.97-4.2%Stored close · as of Nov 10, 2026

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Contents

Consolidated Results of Operations

Net Interest Income

The following table presents the components of net interest income for the three and six months ended June 30, 2024 and 2023.

Table 3 – Net Interest Income

	Three Months Ended June 30,
2024 · 2023
(Dollars in Thousands) · Interest Income/ (Expense) · Average Balance (1) · Yield · Interest Income/ (Expense) · Average Balance (1) · Yield
Interest Income
Residential consumer loans, held-for-sale	$11,523	$668,380	6.9%		$1,263	$75,054	6.7%
Residential consumer loans - HFI at Sequoia (2)	80,879	6,241,861	5.2%		40,215	3,902,660	4.1%
Residential consumer loans - HFI at Freddie Mac SLST (2)	14,308	1,313,492	4.4%		15,273	1,441,776	4.2%
Residential investor loans - HFS	6,881	333,558	8.3%		3,440	252,916	5.4%
Residential investor loans - HFI	27,344	1,242,868	8.8%		40,241	1,634,615	9.8%
Residential investor term loans - HFI at CAFL (2)	39,882	2,800,790	5.7%		42,080	2,856,689	5.9%
Residential investor bridge loans - HFI at CAFL (2)	18,999	741,311	10.3%		12,503	493,907	10.1%
Multifamily loans - HFI at Freddie Mac K-Series (2)	4,559	421,524	4.3%		4,697	424,733	4.4%
Real estate securities	10,749	225,266	19.1%		6,223	207,452	12.0%
Other interest income	10,293	858,349	4.8%		13,046	1,105,138	4.7%
Total interest income	225,417	14,847,399	6.1%		178,981	12,394,940	5.8%
Interest Expense
ABS issued - Sequoia (2)	(74,373)	6,001,059	(5.0)%		(36,653)	3,669,624	(4.0)%
ABS issued - Freddie Mac SLST (2)	(13,610)	1,219,478	(4.5)%		(10,650)	1,130,963	(3.8)%
ABS issued - Freddie Mac K-Series (2)	(4,177)	387,871	(4.3)%		(4,311)	392,474	(4.4)%
ABS issued - CAFL Term (2)	(32,370)	2,458,312	(5.3)%		(33,202)	2,545,639	(5.2)%
ABS issued - CAFL Bridge (2)	(8,899)	688,426	(5.2)%		(5,277)	479,891	(4.4)%
Debt Facilities	(52,433)	2,477,562	(8.5)%		(47,795)	2,424,720	(7.9)%
Corporate Debt	(14,262)	691,720	(8.2)%		(14,997)	805,278	(7.4)%
Total interest expense	(200,124)	13,924,428	(5.7)%		(152,885)	11,448,589	(5.3)%
Net Interest Income	$25,293			$26,096

	Six Months Ended June 30,
2024 · 2023
(Dollars in Thousands) · Interest Income/ (Expense) · Average Balance (1) · Yield · Interest Income/ (Expense) · Average Balance (1) · Yield
Interest Income
Residential consumer loans, held-for-sale	$20,866	$621,532	6.7%		$6,460	$222,123	5.8%
Residential consumer loans - HFI at Sequoia (2)	143,855	5,756,797	5.0%		77,399	3,762,051	4.1%
Residential consumer loans - HFI at Freddie Mac SLST (2)	28,924	1,327,495	4.4%		30,766	1,442,751	4.3%
Residential investor loans - HFS	10,456	276,428	7.6%		7,845	262,035	6.0%
Residential investor loans - HFI	57,810	1,271,955	9.1%		78,695	1,592,536	9.9%
Residential investor term loans - HFI at CAFL (2)	80,635	2,852,959	5.7%		83,889	2,879,585	5.8%
Residential investor bridge loans - HFI at CAFL (2)	39,240	756,303	10.4%		25,131	500,691	10.0%
Multifamily loans - HFI at Freddie Mac K-Series (2)	9,140	422,786	4.3%		9,315	423,933	4.4%
Real estate securities (3)	17,029	189,654	18.0%		12,651	222,489	11.4%
Other interest income	22,202	879,724	5.0%		25,346	1,094,723	4.6%
Total interest income	430,157	14,355,633	6.0%		357,497	12,402,917	5.8%
Interest Expense
ABS issued - Sequoia (2)	(133,195)	5,529,610	(4.8)%		(69,212)	3,531,299	(3.9)%
ABS issued - Freddie Mac SLST (2)	(27,591)	1,234,882	(4.5)%		(21,868)	1,140,899	(3.8)%
ABS issued - Freddie Mac K-Series (2)	(8,376)	389,245	(4.3)%		(8,552)	391,854	(4.4)%
ABS issued - CAFL Term (2)	(65,825)	2,509,053	(5.2)%		(67,362)	2,560,664	(5.3)%
ABS issued - CAFL Bridge (2)	(18,701)	701,361	(5.3)%		(10,564)	479,215	(4.4)%
Debt Facilities	(98,667)	2,355,133	(8.4)%		(97,205)	2,500,073	(7.8)%
Corporate Debt	(28,299)	689,624	(8.2)%		(30,201)	821,244	(7.4)%
Total interest expense	(380,654)	13,408,908	(5.7)%		(304,964)	11,425,248	(5.3)%
Net Interest Income	$49,503			$52,533

(1)Average balances for residential consumer loans held-for-sale and held-for-investment, residential investor loans held-for-sale and held-for-investment, multifamily loans held-for-investment, and trading securities are calculated based upon carrying values, which represent estimated fair values. Average balances for AFS securities, debt facilities, corporate debt and certain ABS issued are calculated based upon amortized historical cost. Average balances for ABS carried at fair value are calculated based upon fair value.

(2)Interest income and interest expense at "Sequoia", "Freddie Mac SLST", "Freddie Mac K-Series", "CAFL Term", and "CAFL Bridge" reflect activity from consolidated variable interest entities. While we consolidate these entities for GAAP reporting purposes, economically, we earn interest income from the securities we own in these entities, which is represented by the net interest income (interest income less interest expense) from these consolidated entities presented in the table above.

(3)At June 30, 2024, real estate securities include trading securities consisting primarily of interest-only securities, which generate a higher cash interest yield. This interest income may be offset by a decline in fair value (recognized through investment fair value changes, net on our consolidated statements of income) related to the receipt of cash flows each period, resulting in a lower overall economic yield for these investments.

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