Company: TWO-PC
Filing Date: 2025-10-28
Form Type: 10-Q
Source: 0001465740-25-000152
Chunk: 105

Company: TWO HARBORS INVESTMENT CORP.
Filing Date: 2025-10-28
Form: 10-Q
Item: Item 1
Chunk 105
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8.0:1.0. As of September 30, 2025, our total indebtedness to tangible net worth, as defined, was 5.1:1.0.

•Cash liquidity must be greater than $200.0 million. As of September 30, 2025, our liquidity, as defined, was $770.5 million.

•Net worth must be greater than the higher of $1.5 billion or 50% of the highest net worth during the 24 calendar months prior. As of September 30, 2025, 50% of the highest net worth during the 24 calendar months prior, as defined, was $1.1 billion and our net worth, as defined, was $1.8 billion.

We are also subject to additional financial covenants in connection with various other agreements we enter into in the normal course of our business. We intend to continue to operate in a manner which complies with all of our financial covenants.

The following table summarizes assets at carrying values that were pledged or restricted as collateral for the future payment obligations of repurchase agreements, revolving credit facilities and warehouse lines of credit at September 30, 2025 and December 31, 2024:

(in thousands)September 30,2025December 31,2024Available-for-sale securities, at fair value$6,193,675 $7,097,561 Mortgage servicing rights, at fair value2,619,586 2,989,106 Mortgage loans held-for-sale, at fair value12,354 2,059 Restricted cash18,414 218,715 Due from counterparties293,663 25,231 Derivative assets, at fair value128,942 5,031 Other assets82,814 118,686 Total$9,349,448 $10,456,389 

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Although we generally intend to hold our target assets as long-term investments, we may sell certain of our assets in order to manage our interest rate risk and liquidity needs, to meet other operating objectives and to adapt to market conditions. Our Agency RMBS are generally actively traded and thus, in most circumstances, readily liquid. However, certain of our assets, including MSR and mortgage loans held-for-sale, are subject to longer trade timelines, and, as a result, market conditions could significantly and adversely affect the liquidity of our assets. Any illiquidity of our assets may make