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Segment Information
 9 Months Ended
Sep. 30, 2022
Segment Reporting [Abstract]  
Segment Information Segment Information
Redwood operates in three segments: Residential Mortgage Banking, Business Purpose Mortgage Banking and Investment Portfolio. The accounting policies of the reportable segments are the same as those described in Note 3 — Summary of Significant Accounting Policies. For a full description of our segments, see Part I, Item 1—Business in our Annual Report on Form 10-K for the year ended December 31, 2021.
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 three 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 from our convertible notes and trust preferred securities, indirect general and administrative expenses and other expense.
The following tables present financial information by segment for the three and nine months ended September 30, 2022 and 2021.
Table 24.1 – Business Segment Financial Information
Three Months Ended September 30, 2022
(In Thousands)Residential Mortgage BankingBusiness Purpose Mortgage BankingInvestment PortfolioCorporate/
Other		Total
Interest income$9,882 $9,082 $156,882 $1,816 $177,662 
Interest expense(8,083)(5,971)(111,876)(16,797)(142,727)
Net interest income1,799 3,111 45,006 (14,981)34,935 
Non-interest (loss) income
Mortgage banking activities, net2,158 14,377 — — 16,535 
Investment fair value changes, net— — (61,780)4,083 (57,697)
Other income, net— 399 3,906 (278)4,027 
Realized gains, net— — — — — 
Total non-interest income (loss), net2,158 14,776 (57,874)3,805 (37,135)
General and administrative expenses(5,735)(18,535)(3,502)(12,335)(40,107)
Loan acquisition costs(550)(1,876)— — (2,426)
Other expenses— (3,891)(370)— (4,261)
Benefit from (provision for) income taxes1,688 2,559 (5,664)— (1,417)
Segment Contribution$(640)$(3,856)$(22,404)$(23,511)
Net (Loss)$(50,411)
Non-cash amortization (expense) income, net$(185)$(3,609)$(3,658)$(2,843)$(10,295)
Nine Months Ended September 30, 2022
(In Thousands)Residential Mortgage BankingBusiness Purpose Mortgage BankingInvestment PortfolioCorporate/
Other		Total
Interest income$36,048 $22,509 $471,932 $4,028 $534,517 
Interest expense(23,316)(12,797)(331,047)(38,832)(405,992)
Net interest income12,732 9,712 140,885 (34,804)128,525 
Non-interest (loss) income
Mortgage banking activities, net(7,694)10,527 — — 2,833 
Investment fair value changes, net— — (165,297)13,508 (151,789)
Other income, net— 2,028 15,423 (435)17,016 
Realized gains, net— — 2,581 — 2,581 
Total non-interest (loss) income, net(7,694)12,555 (147,293)13,073 (129,359)
General and administrative expenses(17,918)(40,076)(9,676)(39,257)(106,927)
Loan acquisition costs(2,848)(7,523)— — (10,371)
Other expenses74 (10,731)(1,157)— (11,814)
Benefit from (provision for) income taxes8,283 9,009 (6,808)— 10,484 
Segment Contribution$(7,371)$(27,054)$(24,049)$(60,988)
Net (Loss)$(119,462)
Non-cash amortization (expense) income, net$(699)$(11,563)$4,385 $(6,428)$(14,305)
Three Months Ended September 30, 2021
(In Thousands)Residential Mortgage BankingBusiness Purpose Mortgage BankingInvestment PortfolioCorporate/
Other		Total
Interest income$14,712 $3,967 $125,994 $1,049 $145,722 
Interest expense(7,537)(2,013)(84,049)(10,155)(103,754)
Net interest income7,175 1,954 41,945 (9,106)41,968 
Non-interest income
Mortgage banking activities, net32,946 30,217 — — 63,163 
Investment fair value changes, net— — 26,324 (247)26,077 
Other income, net— 216 1,842 330 2,388 
Realized gains, net— — 6,703 — 6,703 
Total non-interest income, net32,946 30,433 34,869 83 98,331 
General and administrative expenses(7,891)(12,017)(4,483)(23,301)(47,692)
Loan acquisition costs(2,395)(2,175)(51)— (4,621)
Other expenses— (3,873)(150)— (4,023)
(Provision for) benefit from income taxes(10,429)(3,485)(1,045)19,282 4,323 
Segment Contribution$19,406 $10,837 $71,085 $(13,042)
Net Income$88,286 
Non-cash amortization (expense) income, net$(33)$(4,224)$5,682 $(1,995)$(570)

Nine Months Ended September 30, 2021
(In Thousands)Residential Mortgage BankingBusiness Purpose Mortgage BankingInvestment PortfolioCorporate/
Other		Total
Interest income$35,536 $9,849 $363,751 $3,586 $412,722 
Interest expense(19,903)(5,134)(258,685)(30,649)(314,371)
Net interest income15,633 4,715 105,066 (27,063)98,351 
Non-interest income
Mortgage banking activities, net115,646 84,543 — — 200,189 
Investment fair value changes, net— — 121,812 (1,168)120,644 
Other income, net— 494 7,121 742 8,357 
Realized gains, net— — 17,803 — 17,803 
Total non-interest income (loss), net115,646 85,037 146,736 (426)346,993 
General and administrative expenses(27,478)(34,567)(10,804)(58,988)(131,837)
Loan acquisition costs(5,686)(5,528)(710)(4)(11,928)
Other expenses(6)(11,523)(592)17 (12,104)
Provision for income taxes(23,640)(6,988)(2,561)19,282 (13,907)
Segment Contribution$74,469 $31,146 $237,135 $(67,182)
Net Income$275,568 
Non-cash amortization income (expense), net$8,867 $(16,154)$317 $(5,845)$(12,815)
The following table presents the components of Corporate/Other for the three and nine months ended September 30, 2022 and 2021.

Table 24.2 – Components of Corporate/Other
Three Months Ended September 30,
20222021
(In Thousands)
Legacy Consolidated VIEs (1)
OtherTotal
Legacy Consolidated VIEs (1)
Other Total
Interest income$1,473 $343 $1,816 $1,042 $7 $1,049 
Interest expense(1,486)(15,311)(16,797)(641)(9,514)(10,155)
Net interest income(13)(14,968)(14,981)401 (9,507)(9,106)
Non-interest income
Investment fair value changes, net(329)4,412 4,083 (247)— (247)
Other income— (278)(278)— 330 330 
Total non-interest income, net(329)4,134 3,805 (247)330 83 
General and administrative expenses— (12,335)(12,335)— (23,301)(23,301)
Loan acquisition costs— — — — — — 
Other expenses— — — — — — 
Provision for income taxes— — — — 19,282 19,282 
Total$(342)$(23,169)$(23,511)$154 $(13,196)$(13,042)
Nine Months Ended September 30,
20222021
(In Thousands)
Legacy Consolidated VIEs(1)
OtherTotal
Legacy Consolidated VIEs(1)
Other Total
Interest income$3,593 $435 $4,028 $3,559 $27 $3,586 
Interest expense(3,154)(35,678)(38,832)(2,271)(28,378)(30,649)
Net interest income439 (35,243)(34,804)1,288 (28,351)(27,063)
Non-interest income
Investment fair value changes, net(1,379)14,887 13,508 (1,162)(6)(1,168)
Other income— (435)(435)— 742 742 
Total non-interest income, net(1,379)14,452 13,073 (1,162)736 (426)
General and administrative expenses— (39,257)(39,257)— (58,988)(58,988)
Loan acquisition costs— — — — (4)(4)
Other expenses— — — — 17 17 
Provision for income taxes— — — — 19,282 19,282 
Total$(940)$(60,048)$(60,988)$126 $(67,308)$(67,182)

(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 September 30, 2022 and December 31, 2021.
Table 24.3 – Supplemental Segment Information
(In Thousands)Residential Mortgage BankingBusiness Purpose Mortgage BankingInvestment Portfolio Corporate/
Other		Total
September 30, 2022
Residential loans$676,458 $— $4,877,938 $198,160 $5,752,556 
Business purpose loans— 337,238 4,919,980 — 5,257,218 
Consolidated Agency multifamily loans— — 427,458 — 427,458 
Real estate securities— — 259,212 — 259,212 
Home equity investments— — 340,437 — 340,437 
Other investments— — 341,155 71,607 412,762 
Goodwill— 23,373 — — 23,373 
Intangible assets— 44,130 — — 44,130 
Total assets738,301 473,748 11,301,836 632,062 13,145,947 
December 31, 2021
Residential loans$1,673,235 $— $5,688,742 $230,455 $7,592,432 
Business purpose loans— 347,860 4,443,129 — 4,790,989 
Consolidated Agency multifamily loans— — 473,514 — 473,514 
Real estate securities4,927 — 372,484 — 377,411 
Home equity investments— — 192,740 — 192,740 
Other investments— — 413,527 35,702 449,229 
Intangible assets— 41,561 — — 41,561 
Total assets1,716,285 464,967 11,770,486 755,206 14,706,944