Company: RWT-PA
Filing Date: 2025-08-08
Form Type: 10-Q
Source: 0000930236-25-000029
Chunk: 347

Company: REDWOOD TRUST INC
Filing Date: 2025-08-08
Form: 10-Q
Item: Part I, Item 8
Chunk 347
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30, 2024 is due to the decline in Investment fair value changes, net of $67 million and the decline in HEI income, net of $28 million, driven by similar trends as mentioned above.

Investments Detail and Activity

This section presents additional details on our securities portfolio, home equity investments and unsecuritized residential investor loans held in this segment and their activity during the three and six months ended June 30, 2025. 

Securities Portfolio

The following table sets forth activity in our securities held in our Legacy Investments segment for the three and six months ended June 30, 2025. This table includes our economic interests in securities issued by consolidated re-performing loan securitization entities which we consolidate in accordance with GAAP. For GAAP purposes, we consolidated $1.26 billion of loans and $1.01 billion of ABS issued associated with these investments at June 30, 2025. We consolidated $1.24 billion of loans and $1.01 billion of ABS issued associated with these investments at December 31, 2024. At June 30, 2025, our re-performing loan securities were financed with $131 million of non-recourse securitization debt (ABS issued). 

Table 14 – Activity of Securities Retained from Consolidated Re-Performing SecuritiesThree Months EndedSix Months Ended(In Thousands)June 30, 2025June 30, 2025Beginning fair value$263,768 $241,765 Effect of principal payments (1)(6,928)(13,906)Change in fair value, net(299)28,682 Ending Fair Value$256,541 $256,541 

(1)The effect of principal payments reflects the change in fair value due to principal payments, which is calculated as the cash principal received on a given security during the period multiplied by the prior quarter ending price or acquisition price for that security.

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Home Equity Investments

In the second quarter of 2025, we began reporting our third-party originated HEI portfolio as part of our Legacy Investments segment, as substantial portion of these HEI investments are expected to be sold or disposed of as part of an accelerated strategic repositioning of our business model. At June 30, 2025, $238 million of unsecuritized HEI and $341 million of securitized HEI were included in the Legacy Investments segment, as presented in the table below.