Company: RWT-PA
Filing Date: 2025-08-08
Form Type: 10-Q
Source: 0000930236-25-000029
Chunk: 113

Company: REDWOOD TRUST INC
Filing Date: 2025-08-08
Form: 10-Q
Item: Part I, Item 1
Chunk 113
---
.

See Note 8 for further information on residential bridge loans sold to these joint ventures.

38

REDWOOD TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS June 30, 2025(Unaudited) 

Note 13. Derivative Financial Instruments

To manage, to varying degrees, risks associated with certain assets and liabilities on our consolidated balance sheets, we may enter into derivative contracts. We account for our derivative contracts, including loan purchase commitments ("LPCs") and interest rate lock commitments ("IRLCs") qualifying as derivatives under GAAP, at fair value. As discussed in our Annual Report on Form 10-K for the year ended December 31, 2024, we consider counterparty risk as part of our fair value assessments of all derivative financial instruments at each quarter-end. At June 30, 2025, we assessed this risk as remote and did not record an associated specific valuation adjustment. At June 30, 2025, we were in compliance with our derivative counterparty ISDA agreements. The following table presents the fair value and notional amount of our derivatives at June 30, 2025 and December 31, 2024.Table 13.1 – Fair Value and Notional Amount of DerivativesJune 30, 2025December 31, 2024FairValueNotionalAmountFairValueNotionalAmount(In Thousands)Assets - Risk Management DerivativesTBAs$61,249 $5,960,000 $— $— Interest rate futures19,876 2,006,800 16,446 712,500 Swaptions124,518 6,550,000 23,738 8,245,000 Assets - Other DerivativesLPCs and IRLCs14,154 2,008,104 5,819 919,888 Total Assets (1)$219,797 $16,524,904 $46,003 $9,877,388 Liabilities - Risk Management DerivativesInterest rate swaps$(10,519)$1,000,000 $— $— TBAs(27,082)2,760,000 (16,249)1,350,000 Interest rate futures(30,379)1,739,500 (6,915)830,500 Liabilities - Other DerivativesLPCs (2)(846