Company: RWT-PA
Filing Date: 2025-11-07
Form Type: 10-Q
Source: 0000930236-25-000037
Chunk: 31

Company: REDWOOD TRUST INC
Filing Date: 2025-11-07
Form: 10-Q
Item: Part I, Item 2
Chunk 31
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 continue to be driven by relatively healthy employment data, embedded equity protection associated with loan seasoning and home price appreciation, and borrowers motivated to stay current on their low-coupon mortgages. Notably, 90 day+ delinquencies on our CAFL Bridge Securities improved to 2.9% in the third quarter of 2025, compared to 3.6% in the second quarter of 2025. Our 90 day + delinquency balances for Sequoia Securities and CAFL Term Securities were stable in the third quarter of 2025 at 0.3% and 7.7% of our total unpaid principal balances, respectively, compared to 0.3% and 7.1% in the second quarter of 2025.

As we continue to expand our focus on our operating platforms, we intend to allocate capital accordingly. In line with this strategy, during the third quarter we deployed approximately $30 million of capital into assets sourced from our operating businesses and completed our fourth non-recourse financing transaction of retained investments, reducing total security repo balances to $28 million.

Nine Months Ended September 30, 2025 Compared to Nine Months Ended September 30, 2024

The $54 million decrease in segment contribution in the nine months ended September 30, 2025, as compared to the nine months ended September 30, 2024 is primarily due to the decline in Investment fair value changes, net of $39 million driven by rate declines and spread tightening in the nine month period.

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Redwood Investments Detail

The following table presents a balance sheet summary for our Redwood Investments segment as of September 30, 2025 and June 30, 2025. 

Table 10 – Redwood Investments Balance Sheet Summary(In Thousands)September 30, 2025June 30, 2025ChangeRetained Operating InvestmentsResidential consumer Sequoia securities$129,613 $137,134 $(7,521)Residential consumer securities at consolidated Sequoia entities (1)556,688 513,180 43,508 Residential investor securities at consolidated Securitization Term entities (2)333,457 330,340 3,117 Securitized and unsecuritized residential investor bridge loans, restricted cash and REO1,037,615 1,053,228 (15,613)HEI (3)11,687 8,216 3,471 Other Investments