Redwood Trust, Inc. reported a net income of $54.0 million for the year ended December 31, 2024, a significant improvement from a net loss of $2.3 million in 2023. This increase was driven primarily by a $10 million rise in net interest income, reaching $102.6 million, and a substantial $82 million increase in net non-interest income, totaling $154.3 million. The company's operating expenses increased by $18 million to $184.1 million, largely due to higher compensation expenses reflecting improved performance.
Significant changes compared to the previous fiscal year include a $42.5 million increase in net interest income from Sequoia Mortgage Banking, offset by a $17.5 million decrease in net interest income from Redwood Investments. Non-interest income saw a dramatic increase of $81.6 million, primarily due to a $29.8 million rise in Sequoia Mortgage Banking activities and a $29.6 million improvement in investment fair value changes. The company also reported a $7 million increase in net HEI income.
During 2024, Redwood updated the names of its business segments, renaming Residential Consumer Mortgage Banking to Sequoia Mortgage Banking, Residential Investor Mortgage Banking to CoreVest Mortgage Banking, and Investments Portfolio to Redwood Investments. No changes were made to the composition of the segments. The company also actively engaged in loan purchase activity, locking $8.95 billion in loans and purchasing $7.12 billion. Twelve Sequoia securitizations totaling $5.2 billion were completed, along with whole loan sales of $1.4 billion in the fourth quarter. CoreVest Mortgage Banking saw $1.7 billion in fundings, with $1.56 billion distributed through various channels, including joint ventures.
Redwood employed 283 full-time employees as of December 31, 2024, with 147 (52%) engaged in CoreVest operations. The company reported a voluntary employee turnover rate of 7.5% for 2024. Redwood's strategic developments included expanding its product offerings, launching new guidelines for hybrid ARMs and closed-end second lien mortgage loans, and establishing joint ventures to support growth in its CoreVest platform. The company also highlighted its focus on optimizing its capital position and strategically reallocating capital to support growth initiatives.
Redwood's outlook anticipates continued assessment of the impact of the Los Angeles wildfires and monitoring of mortgage loans in affected areas. While acknowledging the uncertainty surrounding Federal housing and mortgage lending policy changes under the new presidential administration, the company expressed optimism about strategic opportunities to drive market share gains and increased financial returns in 2025.
About REDWOOD TRUST INC
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