Company: TWO-PC
Filing Date: 2025-10-28
Form Type: 10-Q
Source: 0001465740-25-000152
Chunk: 137

Company: TWO HARBORS INVESTMENT CORP.
Filing Date: 2025-10-28
Form: 10-Q
Item: Item 2
Chunk 137
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4, was consistent.

57

The following table presents the components of the yield earned on our AFS securities portfolio as a percentage of our average amortized cost of securities for the three and nine months ended September 30, 2025 and 2024:

Three Months EndedNine Months EndedSeptember 30,September 30,2025202420252024Gross yield/stated coupon5.2 %5.0 %5.2 %4.9 %Net (premium amortization) discount accretion(0.2)%(0.2)%(0.3)%(0.1)%Net yield5.0 %4.8 %4.9 %4.8 %

Net Servicing Income

The following table presents the components of net servicing income for the three and nine months ended September 30, 2025 and 2024:

Three Months EndedNine Months EndedSeptember 30,September 30,(in thousands)2025202420252024Servicing fee income$127,349 $126,597 $377,929 $400,278 Ancillary and other fee income5,277 3,928 15,572 12,220 Float income33,822 41,207 88,160 101,582 Total servicing income166,448 171,732 481,661 514,080 Total servicing costs3,762 3,900 9,345 15,494 Net servicing income$162,686 $167,832 $472,316 $498,586 

The decrease in total servicing income for the three and nine months ended September 30, 2025, as compared to the same periods in 2024, was primarily due to lower float income due to the lower interest rate environment, partially offset by higher ancillary and other fee income from subservicing. The decrease for the nine months ended September 30, 2025 was also driven by lower servicing fee income on a smaller MSR portfolio as a result of run-off and sales.

As previously discussed, RoundPoint handles substantially all servicing functions for the mortgage loans underlying our MSR, as well as our originated or purchased mortgage loans held-for-sale. For the remaining portion of our serviced mortgage assets, we contract with appropriately licensed third-party subservicers to handle the servicing functions in the name of the subservicer. All third-party subservicing costs and other servicing expenses directly related to