Redwood Trust, Inc. · NYSE:RWT
Redwood Trust — Q4 2025 Earnings Presentation
44 slides from Redwood Trust's earnings presentation, Feb 11, 2026
Slide 1: Q4 2025 Redwood Review
Q4 2025 Redwood Review February 11, 2026 RE D W OOD TR UST .COM
Slide 2: Cautionary Statement/Forward-Looking Statements
Cautionary Statement/ Forward-Looking Statements This presentation contains forward-looking statements, including statements Other risks, uncertainties, and factors that could cause actual results to differ regarding our 2026 forward outlook and strategic priorities, key drivers to increase material
Slide 3: Redwood Trust is the Leading Non-Agency Real Estate Platform
INTRODUCTION Redwood Trust is the Leading Non-Agency Real Estate Platform Through our operating businesses and related investments, we provide liquidity to parts of the housing market not well- served by government programs Correspondent Correspondent Jumbo Platform Non-QM Platform Housing Investmen
Slide 4: Redwood Has a 30+ Year Track Record of Delivering Value
Redwood Has a 30+ Year Track Record of Delivering Value ~370% $2.6bn 4 million+ #1 $142 billion Total Cumulative Borrowers and Non-Bank Loans Funded / Shareholder Dividends homeowners Distributor of Locked(3) Return Since Since Inception served(1) Jumbo & Non- Inception QM Loans(2) 4 Detailed Endnot
Slide 5: Fourth Quarter 2025 Financial Performance
Fourth Quarter 2025 Financial Performance EARNINGS AND RETURNS BOOK VALUE AND COMMON DIVIDEND $0.13 7.7% • $7.36 Book Value Per Share GAAP EPS ROE • 2.6% Total Economic Return (1) • $0.18 Dividend Per Share • 13.0% Indicative Dividend Yield $0.33 23.8% (2) Non-GAAP Core Non-GAAP Core Segments EAD EP
Slide 6: Fourth Quarter 2025 Financial Performance (Continued)
Fourth Quarter 2025 Financial Performance (Continued) SEGMENT RETURNS SEGMENT CAPITAL COMPOSITION Q4’25 Q4’25 Non- Segment ROC*) GAAP EAD ROC* Legacy Redwood Investments Investments 31% 19% Redwood Investments 17% 14% Core Segments Core Segments represent $1.6 Mortgage Banking 29% 30% 81% of total c
Slide 7: FY'25 Operating Achievements
FY’25 Operating Achievements 2025 was a record operating year for Redwood’s Mortgage Banking platforms 26% ~2x $23bn 50 #1 FY’25 Mortgage Market Share Mortgage Banking New Loan Sellers Jumbo Securitization Banking ROC* Growth(1) Volume (111% Added Volume in 2025(3) YoY Increase)(2) Note: Mortgage Ba
Slide 8: Growing Volumes Supported by Ongoing Profitability
Growing Volumes Supported by Ongoing Profitability MORTGAGE BANKING ROCs* MORTGAGE BANKING VOLUMES(1) 28% 29% Sequoia (Locks) $22.7 24% CoreVest (Funded) 21% 26% Aspire (Locks) FY’26 ROC* $10.7 111% YoY Increase Q1'25 Q2'25 Q3'25 Q4'25 FY'24 FY'25 Note: Mortgage Banking refers to the combined perfor
Slide 9: Core Segments Drive Earnings Growth as Legacy Portfolio Runs Off
Core Segments Drive Earnings Growth as Legacy Portfolio Runs Off As our Legacy Investment Portfolio has declined… …there is a clear line of sight to higher earnings for our Core Segments LEGACY INVESTMENTS CAPITAL SINCE Q2’25 ($MM) NON-GAAP CORE SEGMENTS EAD SINCE Q2’25 ($MM)* 72% $523 $43 $459 Incr
Slide 10: Mortgage Banking Strategy Drives Higher Earnings
Mortgage Banking Strategy Drives Higher Earnings • Originate-to-distribute mortgage banking model complements—and differs from—a buy-to-hold investment portfolio, creating two distinct earnings engines • Mortgage banking delivers repeatable, higher-quality returns through capital velocity, not stati
Slide 11: Strategic Shift to Mortgage Banking is Reshaping Earnings Profile
Strategic Shift to Mortgage Banking is Reshaping Earnings Profile CORE SEGMENTS CAPITAL ALLOCATION CORE SEGMENTS REVENUE MIX(1) 26% 62% 74% 38% 53% 49% of Core Segment of Core Segment Capital Allocation is in Revenue was Driven Mortgage Banking by Mortgage (excludes Legacy Banking Investments) 74% 6
Slide 12: Efficiency Measured Relative to Production
Efficiency Measured Relative to Production • We assess efficiency based on the capital and expense required to support production at scale • As capital velocity increases, returns improve without proportional balance sheet growth MORTGAGE BANKING TOTAL VOLUME TOTAL OpEx CAPITAL EFFICIENCY(1) AND EXP
Slide 13: Leverage Aligned with Fast-Turning Capital
Leverage Aligned with Fast-Turning Capital Debt growth has been primarily driven by Mortgage Banking growth • Rapid capital turnover across distribution channels accelerates deleveraging through cash generation • Average days of loans on balance sheet of 36 days(1) 85%+ of increase in recourse debt
Slide 14: There's a Growing Jumbo Refinance Opportunity in Today's Market
There's a Growing Jumbo Refinance Opportunity in Today’s Market We participate in the upside from refinance-driven volume growth without the MSR-related risks— such as accelerated amortization and faster prepayments—that pressure traditional originators % OF CURRENT OUTSTANDING JUMBO MORTGAGES BY CO
Slide 15: Refinance Activity Is a Tailwind to Redwood's Growing Market Share
Refinance Activity Is a Tailwind to Redwood’s Growing Market Share Since the last refinance wave in 2021, we have: PURCHASE VS REFINANCE VOLUME RELATIVE TO LAST REFINANCE WAVE (2021) • Grown our loan seller network by 110+ OVERALL JUMBO MARKET(2) SEQUOIA ACTIVITY new or re-engaged bank sellers Purch
Slide 16: Utilizing AI to Drive Scale
TECHNOLOGY AND AI Utilizing AI INTERNAL AI PROCESSES / TECHNOLOGY- to Drive Scale Established Applications | Expanding Capabilities • Data Quality Control Automation • Credit Risk & Portfolio RWT Horizons, Redwood’s strategic AI platform, Intelligence converts automation into durable operating • Bor
Slide 17: RWT Horizons: Partnering with AI Across the Ecosystem
RWT Horizons: Customer Data Normalization Partnering with AI Reduces data reconciliation effort Across the Ecosystem Our RWT Horizons portfolio includes 38 AI and technology- Risk management enabled companies driving innovation across the & Compliance mortgage finance ecosystem. Shown here are selec
Slide 18: Fourth Quarter 2025 Earnings & Segment Results
Fourth Quarter 2025 Earnings & Segment Results
Slide 19: Sequoia Q4'25 Performance Summary
Sequoia Q4’25 Performance Summary REDWOOD’S PRIME RESIDENTIAL YEAR OVER YEAR LOCK VOLUME(1) COST PER LOAN(2) CORRESPONDENT PLATFORM • Q4’25 ROC of 29%* $17.6 0.29% • FY’25 lock volume of $17.6 billion; record quarter in Q4’25 ($5.3 billion)(1) 95% 0.23% • Cost per loan improved 21% YoY(2) YoY Increa
Slide 20: Sequoia Q4'25 Performance Summary (Continued)
Sequoia Q4’25 Performance Summary (Continued) As capital has flowed into this segment, we have maintained strong returns and attractive margins QUARTERLY ROCs* & AVERAGE CAPITAL 26% GAIN ON SALE MARGINS(1) Average Capital ($mm) Average 28% 29% 29% 1.19% 1.31% Average Quarterly ROCs * 1.23% 1.27% 19%
Slide 21: Sequoia's Growing Market Share
Sequoia’s Growing Market Share Growing market share is supported by: SEQUOIA’S MARKET SHARE(2) • Expanded seller network: Active seller base grew to 7.0% 210+ sellers, with banks representing 56% • Increased seasoned loan activity: Seasoned loans 3x accounted for 10% of FY’25 lock volume(1) 4.3% • N
Slide 22: Aspire Q4'25 Performance Summary
Aspire Q4’25 Performance Summary REDWOOD’S NON-QM QUARTERLY LOCK VOLUMES CORRESPONDENT PLATFORM • FY’25 lock volume of $3.2 billion; $1.5 billion in $1,487 Q4’25(1) $1,245 • Loan seller network of 120+ (65% overlap with Sequoia loan seller network) 20% $330 QoQ Increase $111 $ millions Q1'25 Q2'25 Q
Slide 23: Aspire's Growing Market Opportunity
Aspire’s Growing Market Opportunity Non-QM market is a large and rapidly expanding market GROWING NON-QM TAM(1) $150bn TAM • Non-QM origination issuance was up 30% in 2025, and is estimated to grow another 15% in 2026(1) $150 • A combination of a growing Gig Economy, an increase in self- employed bo
Slide 24: CoreVest Q4'25 Performance Summary
CoreVest Q4’25 Performance Summary REDWOOD’S INVESTOR YEAR OVER YEAR FUNDED VOLUMES NET COST TO ORIGINATE(1) LOAN PLATFORM • ROC of 30% and non-GAAP EAD ROC of 36%* $2.0 1.18% • FY’25 funding volume of $2.0 billion; $460 million in Q4’25 0.92% • 50% of FY’25 funded volume was focused on small balanc
Slide 25: CoreVest Volume Drivers
CoreVest Volume Drivers CoreVest is: The small balance addressable market is estimated to grow 15% over the next two years(1) • Expanding footprint and increasing market share in small balance lending (RTL and DSCR) SMALL-BALANCE LOAN MARKET • Growing RTL volumes fueled by record real estate investo
Slide 26: Administration's SFR Proposal Targets Different Market Segment than CoreVest Serves
Administration’s SFR Proposal Targets Different Market Segment than CoreVest Serves In early 2026, the Administration announced initiatives aimed at COREVEST FUNDED LOANS BY BORROWER TYPE limiting large-scale institutional ownership of existing single-family (FY’24 & FY’25) rental homes. 500-1000 10
Slide 27: Redwood Investments Q4'25 Performance Summary
Redwood Investments Q4’25 Performance Summary Lower Rates Could Unlock HOUSING INVESTMENTS SOURCED FROM OUR OPERATING PLATFORMS Efficient Refinancing on • Generated 17% ROC* 47% of Debt in the Next 12 Months • Cost of funds continues to improve, enhancing portfolio economic contribution CAPITAL ALLO
Slide 28: Legacy Investments Q4'25 Performance Summary
Legacy Investments CAPITAL ALLOCATION Q4’25 Performance Legacy HEI Summary 34% $306 million HOUSING INVESTMENTS NO LONGER STRATEGIC TO OUR PLATFORM Legacy Bridge Portfolio 66% • Ongoing focus on reducing legacy portfolio through successful dispositions QOQ 90 DAY+ LEGACY BRIDGE DELINQUENCIES • Reduc
Slide 29: Financial Results
Financial Results
Slide 30: Income Statement
Income Statement ($ in millions, except per share data) 30
Slide 31: Balance Sheet
Balance Sheet ($ in millions) 31
Slide 32: Capital Allocation Summary
Capital Allocation Summary ($ in millions) 32
Slide 33: Mortgage Banking Key Results
Mortgage Banking Key Results ($ in millions) *Return on Capital (“ROC”) is non-GAAP measure. See “Non-GAAP Disclosures” slides for additional information. 33
Slide 34: Redwood Investments Key Results
Redwood Investments Key Results ($ in millions) *Return on Capital (“ROC”) is non-GAAP measure. See “Non-GAAP Disclosures” slides for additional information. 34
Slide 35: Recourse Debt Balances
Recourse Debt Balances ($ in millions) Recourse $3,000 $2,875 Warehouse Debt/Repo (Marginable) Debt Warehouse Debt/Repo $2,000 Secured Term Scheduled $799 Corporate Debt Maturities(1)(5) $1,000 $263 $329 $143 $ billions $0 2026 2027 2028 2029 Beyond 2029 35
Slide 36: Non-GAAP Disclosures
Non-GAAP Disclosures
Slide 37: Non-GAAP Disclosures
Non-GAAP Disclosures To supplement consolidated and segment financial information prepared and presented in ROC is a non-GAAP measure for a segment that is calculated as GAAP segment net income (loss) accordance with U.S. generally accepted accounting principles ("GAAP"), the Company also annualized
Slide 38: Non-GAAP Disclosures (Continued)
Non-GAAP Disclosures (Continued) Reconciliation of GAAP to non-GAAP EAD – Fourth Quarter 2025 (1) 38
Slide 39: Non-GAAP Disclosures (Continued)
Non-GAAP Disclosures (Continued) Reconciliation of GAAP to non-GAAP EAD – Third Quarter 2025 (1) 39
Slide 40: Non-GAAP Disclosures (Continued)
Non-GAAP Disclosures (Continued) Footnotes: 1. Certain totals may not foot due to rounding. 4. Investment fair value changes, net includes all amounts within that same line item in our 2. Earnings Available for Distribution (“EAD”) is a non-GAAP measure that the Company has consolidated statements o
Slide 41: Endnotes
Endnotes
Slide 42: ENDNOTES
ENDNOTES Slide 4 (Redwood Has a 30+ Year Track Record of Delivering Value) Slide 8 (Growing Volumes Supported by Ongoing Profitability) Slide 13 (Leverage Aligned With Fast-Turning Capital) Source: Company financial data as of December 31, 2025 unless otherwise noted. Source: Company financial data
Slide 43: ENDNOTES (Continued)
ENDNOTES (Continued) Slide 21 (Sequoia’s Growing Market Share) Slide 27 (Redwood Investments Q4’25 Performance Summary) Slide 34 (Appendix: Redwood Investments Key Results) Source: Company financial data as of December 31, 2025 unless otherwise noted. Source: Company financial data as of December 31
Slide 44: Glossary of Terms
Glossary of Terms Term Definition Term Definition ARM Adjustable-Rate Mortgage Mortgage banking (refers to Sequoia Mortgage MB Banking and CoreVest Mortgage Banking segments) BFR Build for rent MSR Mortgage servicing rights bps Basis points Non-QM Non-qualified mortgage CAFL® CoreVest securitization