Company: RWT-PA
Filing Date: 2025-08-08
Form Type: 10-Q
Source: 0000930236-25-000029
Chunk: 328

Company: REDWOOD TRUST INC
Filing Date: 2025-08-08
Form: 10-Q
Item: Part I, Item 8
Chunk 328
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256,387)$6,351,277 $3,727,620 $2,623,657 

Operating expenses presented in the table above include general and administrative expenses and loan acquisition costs for this segment.

Activity at this segment is performed within our taxable REIT subsidiary and subject to federal and state income taxes. The provision for income taxes for the periods presented above resulted from GAAP income from these operations at our TRS during that period.

The following table provides the activity of residential consumer loans held in inventory for sale at our Sequoia Mortgage Banking business during the three and six months ended June 30, 2025. 

Table 6 – Loan Inventory for Sequoia Mortgage Banking OperationsThree Months EndedSix Months Ended(In Thousands)June 30, 2025June 30, 2025Balance at beginning of period $1,294,290 $1,013,547 Acquisitions2,859,167 5,242,364 Sales (788,729)(1,212,701)Transfers between segments (1)(2,000,800)(3,665,115)Principal repayments(25,969)(45,465)Changes in fair value, net12,823 18,152 Balance at End of Period$1,350,782 $1,350,782 

(1)Represents the fair value of the net transfers of loans from held-for-sale to held-for-investment within our Redwood Investments Portfolio, associated with securitizations we sponsored that we consolidate under GAAP.

Three Months Ended June 30, 2025 Compared to Three Months Ended March 31, 2025 

The decrease in segment contribution in the three months ended June 30, 2025, as compared to the three months ended March 31, 2025, is primarily due to lower lock volumes, partially offset by an increase in gain on sale margins and hedge outperformance. Total lock volume for the second quarter of 2025 was $3.6 billion and reflects a 10% decrease from the prior quarter but a 35% increase compared to the $2.7 billion reported in the second quarter of 2024 (see discussion in the section following for the six-month periods). Note that the quarter over quarter difference was primarily driven by a $1.0 billion seasoned bulk pool that we committed to purchase in the first quarter of 2025. Total lock volume in the second quarter of 2025 included