MILL VALLEY, Calif.--(BUSINESS WIRE)--April 29, 2026--
Redwood Trust, Inc. (NYSE:RWT; "Redwood", the "Company"), a leader in expanding access to housing for homebuyers and renters, today reported its financial results for the quarter ended March 31, 2026.
First Quarter 2026 Highlights
-- On a consolidated basis, GAAP net loss was $(0.07) per basic and
diluted common share. Non- GAAP Earnings Available for Distribution
("EAD") was $0.21 per share(1), an increase from the prior quarter and
once again exceeding the Company's dividend
-- Demonstrated sustained momentum in Mortgage Banking despite a more
volatile and uncertain macroeconomic backdrop
-- Mortgage Banking production reached a record $8.5 billion, up
from $7.3 billion in the previous quarter and marking a third
consecutive quarterly record(2)
-- Gross margins remained within targeted ranges despite increased
market volatility late in the quarter from changes in interest
rates and mortgage spreads
-- Distribution remained strong across platforms, supported by
record securitization activity and continued momentum in whole
loan sales, enabling efficient risk transfer and consistent market
access
-- Variability between Consolidated GAAP and EAD results primarily
reflects market-driven changes in portfolio valuations rather than
underlying operating performance
Key Financial First Quarter 2026 Results and Metrics
-- GAAP book value per common share was $7.12 at March 31, 2026, compared
to $7.36 per share at December 31, 2025
-- Economic return on book value of (0.8)% for the first quarter
2026(3)
-- GAAP net loss of $(7.3) million or $(0.07) per basic and diluted common
share
-- Non-GAAP Earnings Available for Distribution ("EAD") of $27.1 million
or $0.21 per basic common share(1)
-- Non-GAAP Core Segments Earnings Available for Distribution ("Core
Segments EAD") of $36.5 million, or $0.28 per basic common share(4)
-- Declared and paid a regular quarterly dividend of $0.18 per common
share
"We delivered a third consecutive quarter of record mortgage banking volume, as Sequoia and Aspire continued to scale while maintaining disciplined margins," said Christopher Abate, Chief Executive Officer of Redwood Trust. "What stands out in this environment is not just the level of production, but how we're processing it using active distribution and technology to drive capital turnover and efficiently manage risk. As we expand our product set and deepen relationships across our ecosystem, we are seeing sustained demand from institutional investors seeking consistent access to the high-quality assets we source."
Three Months Ended
-------------------------------
3/31/2026 12/31/2025
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Financial Performance
-------------------------------------------
Book Value per Common Share $ 7.12 $ 7.36
Economic Return on Book Value (3) (0.8)% 2.6%
Net (Loss) Income per Basic Common Share $ (0.07) $ 0.13
Non-GAAP EAD per Basic Common Share
(non-GAAP) (1) $ 0.21 $ 0.20
Non-GAAP Core Segments EAD per Basic
Common Share (4) $ 0.28 $ 0.33
Dividends per Common Share $ 0.18 $ 0.18
------------------------------------------- --- ------ ------
Q1 2026 Segment Highlights (5)
GAAP Segment Net (Loss) Income Results Summary
($ in millions)
Three Months Ended
3/31/2026 12/31/2025
------------------------------------ ------------- --------------
Core Segments:
Mortgage Banking Platforms:
Sequoia Mortgage Banking $ 37.8 $ 33.3
Aspire Mortgage Banking 2.3 3.3
CoreVest Mortgage Banking (3.4) 6.8
------------------------------------ --- ------- -------
Total Mortgage Banking Platforms $ 36.7 $ 43.5
Redwood Investments (8.0) 15.2
------------------------------------ --- ------- -------
Total Core Segments $ 28.7 $ 58.7
------------------------------------ --- ------- -------
Legacy Investments $ (13.1) $ (22.9)
Corporate/Other $ (22.9) $ (17.5)
------------------------------------ --- ------- -------
Total GAAP Net (Loss) Income $ (7.3) $ 18.3
------------------------------------ --- ------- -------
Mortgage Banking Platforms
-- Total Mortgage Banking Platforms GAAP net income of $36.7 million
-- Generated 38% annualized return on capital ("ROC")(6)
-- Continued expansion across platforms, including Sequoia's new medical
professional loan program and Aspire's inaugural non-QM securitization,
supporting volume growth and expanded distribution capabilities
-- Aspire Mortgage Banking reported as a separate segment beginning in the
first quarter of 2026
Sequoia Mortgage Banking(5)
-- Gain on sale margin of 96 basis points, at the higher end of the
Company's target range, and partially impacted by market volatility late
in the first quarter
-- Locked $6.5 billion of loans, up 22% from the fourth quarter 2025 and
67% from the first quarter 2025(7)
-- Distributed $5.5 billion of loans through a combination of
securitizations ($4.6 billion) and whole loan sales ($915 million), a 35%
increase from the prior quarter
-- Completed a record level of securitization activity, including
the first ever securitization backed by medical professional
loans
-- Cost per loan improved to 18 basis points in the first quarter(8),
compared to 26 basis points in the prior quarter, reflecting continued
operating scale benefits
Aspire Mortgage Banking(5)
-- Gain on sale margins of 73 basis points, compared to 92 basis points in
the fourth quarter 2025
-- Lock volume of $1.6 billion reflects incremental growth from the fourth
quarter and strong underlying demand for Aspire products from a growing
network of loan sellers(7)
-- Distributed $1.0 billion of loans through a combination of
securitizations ($391 million) and whole loan sales ($656 million), a 44%
increase from the prior quarter
-- Expanded distribution capabilities through issuance of Aspire's
inaugural securitization
CoreVest Mortgage Banking(5)
-- Segment GAAP net loss of $(3.4) million included $5.0 million of
expenses related to organizational changes during the quarter, impacting
comparability to the prior quarter. Non-GAAP EAD was $1.8 million
-- Funded $432 million of loans (61% bridge and 39% term), a 6% decrease
from the fourth quarter 2025 and a 10% decrease from the first quarter
2025
-- Distributed $694 million of newly-originated loans through whole loan
sales, securitizations and sales to joint ventures ("JVs"), up 19% from
the fourth quarter 2025
-- Volume reflected a more cautious approach late in the quarter, with
intentional pipeline discipline during March volatility and heightened
month-end activity, as we worked closely with our borrowers to manage
execution in response to evolving investor demand
Redwood Investments
-- Generated a segment GAAP net loss of $(8.0) million
-- Results were primarily driven by unrealized market-related
valuation changes during the quarter, partially offset by net
interest income from portfolio investments
-- Redwood Investments recourse leverage ratio increased to 1.1x at March
31, 2026, from 1.0x at December 31, 2025(10)
Legacy Investments
-- Segment GAAP net loss of $(13.1) million
-- Continued resolution activity within the legacy bridge portfolio
supported capital redeployment and a reduction in portfolio
exposure
-- Segment capital allocation decreased to 15% of total invested capital,
compared to 19% at December 31, 2025
-- Closed a $225 million securitization backed by a mix of
performing/non-performing bridge loans which included $66 million
of loans from the legacy investments portfolio
-- Legacy Investments recourse leverage ratio of 1.6x at March 31,
2026(11)
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April 29, 2026 16:15 ET (20:15 GMT)
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