Company: RWT-PA
Filing Date: 2025-04-01
Form Type: DEF 14A
Source: 0000930236-25-000012
Chunk: 31

Company: REDWOOD TRUST INC
Filing Date: 2025-04-01
Form: DEF 14A
Chunk 31
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| Annual Financial Performance – 2024                                                                                                                                                                                                                                                                                        |
| Positive Performance, but Below Internal Targets for Financial Performance:Overall, 2024 presented a challenging market and operating environment for Redwood and its closest industry peers. Key financial performance metrics for full-year 2024 for Redwood were:                                                       
 ▪Return on Common Equity (ROE):4.1%                                                                                                                                                                                                                                                                                        
 ▪Non-GAAP EAD ROE(4):6.4%                                                                                                                                                                                                                                                                                                  
 ▪Book Value TSR(5):5.7%                                                                                                                                                                                                                                                                                                    
 ▪Quarterly Dividend:Increased to $0.18 per share in the fourth quarter of 2024, a 12.5% increase from fourth quarter of 2023                                                                                                                                                                                               
 Significant volatility in key benchmark interest rates over the course of the year resulted in below-target performance on an absolute basis compared to Committee-established targets. On a relative basis, 2024 bvTSR and 2024 ROE were above certain peers and below others, as illustrated in the accompanying graphs. |
| Below Target Annual Bonus Compensation:As further detailed on the following page, Redwood’s annual financial performance for 2024 was below the targets established by the Committee, which drove below-target annual bonus realization for Redwood’s CEO.                                                                 |

Endnotes are set forth on page 44, following the conclusion of this Executive Summary.

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| REDWOOD’S 2024 OPERATIONAL/STRATEGIC PERFORMANCE |

2024 Operational Performance and Strategic Milestones As noted above, a component of Redwood’s executive compensation program is focused on individual performance as measured by various operational metrics, as well as by the achievement of articulated strategic and risk management-related goals and other enterprise-wide priorities. Below is a summary of various accomplishments during 2024, including certain that were taken into account by the Committee in determining the CEO’s (and the other executive officers’) individual component of annual bonus for 2024, with an additional review set forth in the full body of CD&A that follows.

| 2024 Strategic and Operational Achievements |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |
|                                             |     | Leading into 2024, the Company began implementing a number of strategies meant to support performance in 2024 and beyond, including: enhancing capital and operational efficiency; expanding our product sets; diversifying distribution channels; and expanding relationships with bank counterparties. Accordingly, a key goal for management in 2024 was to execute on the objectives