Company: TWO-PC
Filing Date: 2025-02-18
Form Type: 10-K
Source: 0001465740-25-000083
Chunk: 83

Company: TWO HARBORS INVESTMENT CORP.
Filing Date: 2025-02-18
Form: 10-K
Item: Item 7
Chunk 83
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8 million and $450.2 million for the same periods in 2024 due to a decrease in Agency RMBS portfolio size and lower average cash balances held throughout the periods.

Interest Expense

Interest expense decreased from $168.1 million and $643.2 million for the three and twelve months ended December 31, 2023 to $138.7 million and $607.8 million for the same periods in 2024 due to lower borrowing balances on both AFS securities and MSR, partially offset by increases in interest rates throughout the first half of 2024.

Net Interest Income

The following tables present the components of interest income and average net asset yield earned by asset type, the components of interest expense and average cost of funds on borrowings incurred by collateral type, and net interest income and average net interest spread for the three and twelve months ended December 31, 2024 and 2023: 

Three Months Ended December 31, 2024Year Ended December 31, 2024(dollars in thousands)Average Balance (1)Interest Income/ExpenseNet Yield/Cost of FundsAverage Balance (1)Interest Income/ExpenseNet Yield/Cost of FundsInterest-earning assets:Available-for-sale securities$7,818,127 $92,644 4.7 %$8,266,949 $393,527 4.8 %Mortgage loans held-for-sale2,885 49 6.8 %1,234 78 6.3 %Reverse repurchase agreements356,668 4,308 4.8 %351,714 18,447 5.2 %Other6,773 38,100 Total interest income/net asset yield$8,177,680 $103,774 5.1 %$8,619,897 $450,152 5.2 %Interest-bearing liabilities:Borrowings collateralized by:Available-for-sale securities$7,468,264 $95,892 5.1 %$7,785,923 $425,321 5.5 %Agency Derivatives (2)5,033 69 5.5 %6,199 372 6.0 %Mortgage servicing rights and advances (3)1,830,453 38,143 8.3 %1,837,788 163,826 8.9 %Mortgage loans held