XML 41 R30.htm IDEA: XBRL DOCUMENT
v3.8.0.1

Segment Information | 3 Months Ended
--- | ---
Mar. 31, 2018
Segment Reporting [Abstract] |
Segment Information | Segment Information Redwood operates in two segments: Investment Portfolio and Residential Mortgage Banking. Our segments are based on our organizational and management structure, which aligns with how our results are monitored and performance is assessed. For a full description of our segments, see Item 1—Business in our Annual Report on Form 10-K for the year ended December 31, 2017. Segment contribution represents the measure of profit that management uses to assess the performance of our business segments and make resource allocation and operating decisions. Certain corporate expenses not directly assigned or allocated to one of our two segments, as well as activity from certain consolidated Sequoia entities, are included in the Corporate/Other column as reconciling items to our consolidated financial statements. These unallocated corporate expenses primarily include interest expense associated with certain long-term debt, indirect operating expenses, and other expense. The following tables present financial information by segment for the three months ended March 31, 2018 and 2017. Table 21.1 – Business Segment Financial Information
|  | Three Months Ended March 31, 2018
(In Thousands) |  | Investment Portfolio |  | Residential Mortgage Banking |  | Corporate/ Other |  | Total
Interest income |  | $ | 58,757 |  |  | $ | 12,897 |  |  | $ | 4,965 |  |  | $ | 76,619 |
Interest expense |  | (19,863 | ) |  | (6,137 | ) |  | (15,514 | ) |  | (41,514 | )
Net interest income (loss) |  | 38,894 |  |  | 6,760 |  |  | (10,549 | ) |  | 35,105 |
Non-interest income |  |  |  |  |  |  |  |
Mortgage banking activities, net |  | — |  |  | 26,576 |  |  | — |  |  | 26,576 |
MSR income, net |  | 957 |  |  | — |  |  | — |  |  | 957 |
Investment fair value changes, net |  | 1,590 |  |  | — |  |  | 19 |  |  | 1,609 |
Other income |  | 1,161 |  |  | — |  |  | — |  |  | 1,161 |
Realized gains, net |  | 9,363 |  |  | — |  |  | — |  |  | 9,363 |
Total non-interest income, net |  | 13,071 |  |  | 26,576 |  |  | 19 |  |  | 39,666 |
Direct operating expenses |  | (2,007 | ) |  | (8,632 | ) |  | (12,391 | ) |  | (23,030 | )
Provision for income taxes |  | (888 | ) |  | (4,008 | ) |  | — |  |  | (4,896 | )
Segment Contribution |  | $ | 49,070 |  |  | $ | 20,696 |  |  | $ | (22,921 | ) |  |
Net Income |  |  |  |  |  |  |  | $ | 46,845 |
Non-cash amortization income (expense), net |  | $ | 4,617 |  |  | $ | (22 | ) |  | $ | (858 | ) |  | $ | 3,737 |
|  | Three Months Ended March 31, 2017
(In Thousands) |  | Investment Portfolio |  | Residential Mortgage Banking |  | Corporate/ Other |  | Total
Interest income |  | $ | 42,250 |  |  | $ | 7,474 |  |  | $ | 4,904 |  |  | $ | 54,628 |
Interest expense |  | (5,264 | ) |  | (2,924 | ) |  | (12,843 | ) |  | (21,031 | )
Net interest income (loss) |  | 36,986 |  |  | 4,550 |  |  | (7,939 | ) |  | 33,597 |
Non-interest income |  |  |  |  |  |  |  |
Mortgage banking activities, net |  | — |  |  | 17,604 |  |  | — |  |  | 17,604 |
MSR income, net |  | 1,713 |  |  | — |  |  | — |  |  | 1,713 |
Investment fair value changes, net |  | 3,359 |  |  | — |  |  | (1,808 | ) |  | 1,551 |
Other income |  | 1,184 |  |  | — |  |  | — |  |  | 1,184 |
Realized gains, net |  | 5,703 |  |  | — |  |  | — |  |  | 5,703 |
Total non-interest income, net |  | 11,959 |  |  | 17,604 |  |  | (1,808 | ) |  | 27,755 |
Direct operating expenses |  | (1,593 | ) |  | (5,881 | ) |  | (10,752 | ) |  | (18,226 | )
Provision for income taxes |  | (1,737 | ) |  | (4,420 | ) |  | — |  |  | (6,157 | )
Segment Contribution |  | $ | 45,615 |  |  | $ | 11,853 |  |  | $ | (20,499 | ) |  |
Net Income |  |  |  |  |  |  |  | $ | 36,969 |
Non-cash amortization income (expense) |  | $ | 5,847 |  |  | $ | (27 | ) |  | $ | (997 | ) |  | $ | 4,823 |
The following table presents the components of Corporate/Other for the three months ended March 31, 2018 and 2017. Table 21.2 – Components of Corporate/Other
|  | Three Months Ended March 31,
|  | 2018 |  | 2017
(In Thousands) |  | Legacy Consolidated VIEs (1) |  | Other |  | Total |  | Legacy Consolidated VIEs (1) |  | Other |  | Total
Interest income |  | $ | 4,812 |  |  | $ | 153 |  |  | $ | 4,965 |  |  | $ | 4,838 |  |  | $ | 66 |  |  | $ | 4,904 |
Interest expense |  | (3,852 | ) |  | (11,662 | ) |  | (15,514 | ) |  | (3,516 | ) |  | (9,327 | ) |  | (12,843 | )
Net interest income (loss) |  | 960 |  |  | (11,509 | ) |  | (10,549 | ) |  | 1,322 |  |  | (9,261 | ) |  | (7,939 | )
Non-interest income |  |  |  |  |  |  |  |  |  |  |  |
Investment fair value changes, net |  | (8 | ) |  | 27 |  |  | 19 |  |  | (1,810 | ) |  | 2 |  |  | (1,808 | )
Total non-interest income, net |  | (8 | ) |  | 27 |  |  | 19 |  |  | (1,810 | ) |  | 2 |  |  | (1,808 | )
Direct operating expenses |  | — |  |  | (12,391 | ) |  | (12,391 | ) |  | — |  |  | (10,752 | ) |  | (10,752 | )
Total |  | $ | 952 |  |  | $ | (23,873 | ) |  | $ | (22,921 | ) |  | $ | (488 | ) |  | $ | (20,011 | ) |  | $ | (20,499 | )
(1) | Legacy consolidated VIEs represent Legacy Sequoia entities that are consolidated for GAAP financial reporting purposes. See Note 4 for further discussion on VIEs.
The following table presents supplemental information by segment at March 31, 2018 and December 31, 2017. Table 21.3 – Supplemental Segment Information
(In Thousands) |  | Investment Portfolio |  | Residential Mortgage Banking |  | Corporate/ Other |  | Total
March 31, 2018 |  |  |  |  |  |  |  |
Residential loans |  | $ | 3,389,404 |  |  | $ | 1,130,185 |  |  | $ | 626,151 |  |  | $ | 5,145,740 |
Real estate securities |  | 1,357,720 |  |  | — |  |  | — |  |  | 1,357,720 |
Mortgage servicing rights |  | 66,496 |  |  | — |  |  | — |  |  | 66,496 |
Total assets |  | 5,012,235 |  |  | 1,154,413 |  |  | 832,925 |  |  | 6,999,573 |
December 31, 2017 |  |  |  |  |  |  |  |
Residential loans |  | $ | 3,054,448 |  |  | $ | 1,427,945 |  |  | $ | 632,817 |  |  | $ | 5,115,210 |
Real estate securities |  | 1,476,510 |  |  | — |  |  | — |  |  | 1,476,510 |
Mortgage servicing rights |  | 63,598 |  |  | — |  |  | — |  |  | 63,598 |
Total assets |  | 4,743,873 |  |  | 1,453,069 |  |  | 842,880 |  |  | 7,039,822 |

X
- References No definition available. + Details
Name: | us-gaap_SegmentReportingAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- Definition The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 34 -URI http://asc.fasb.org/extlink&oid=68060357&loc=d3e8981-108599 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 41 -URI http://asc.fasb.org/extlink&oid=68060357&loc=d3e9038-108599 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 33 -URI http://asc.fasb.org/extlink&oid=68060357&loc=d3e8971-108599 Reference 4: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 12 -URI http://asc.fasb.org/extlink&oid=68060357&loc=d3e8595-108599 Reference 5: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=68060357&loc=d3e8380-108599 Reference 6: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 32 -URI http://asc.fasb.org/extlink&oid=68060357&loc=d3e8933-108599 Reference 7: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 26 -URI http://asc.fasb.org/extlink&oid=68060357&loc=d3e8844-108599 Reference 8: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 35 -URI http://asc.fasb.org/extlink&oid=68060357&loc=d3e8984-108599 Reference 9: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 40 -URI http://asc.fasb.org/extlink&oid=68060357&loc=d3e9031-108599 Reference 10: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 42 -URI http://asc.fasb.org/extlink&oid=68060357&loc=d3e9054-108599 Reference 11: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 10 -URI http://asc.fasb.org/extlink&oid=68060357&loc=d3e8538-108599 Reference 12: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 29 -URI http://asc.fasb.org/extlink&oid=68060357&loc=d3e8864-108599 Reference 13: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 31 -URI http://asc.fasb.org/extlink&oid=68060357&loc=d3e8924-108599 Reference 14: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 30 -URI http://asc.fasb.org/extlink&oid=68060357&loc=d3e8906-108599 + Details
Name: | us-gaap_SegmentReportingDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration