Q3 2024 Redwood Trust Inc Earnings Call Transcript
Key Points
- Redwood Trust Inc (RWT) increased its common dividend for the first time since 2021, reflecting continued growth in operating activities.
- The company's mortgage banking returns were the highest in over three years, driven by strong margins and expanded distribution channels.
- Redwood Trust Inc (RWT) maintained a flat book value despite rate volatility, showcasing effective hedging and distribution strategies.
- The company reported a significant increase in earnings available for distribution, reaching $25 million, up from $19 million in the prior quarter.
- Redwood Trust Inc (RWT) has a diversified loan sourcing strategy, locking loans with over 160 discrete originators, ensuring no single seller represents more than 7% of total flow volume.
- The company's GAAP earnings slightly decreased to $13 million from $14 million in the prior quarter.
- Lock volumes decreased from $2.7 billion in the second quarter to $2.2 billion in the third quarter, reflecting market conditions.
- Interest rate volatility remains a concern, with rates nearly 70 basis points higher than their September lows.
- Delinquencies in the bridge loan portfolio increased by approximately 1% from the second quarter.
- The company's net interest income was negatively impacted by a reduction in the weighted average accrual rate of the bridge loan portfolio.
Ladies and gentlemen, greetings and welcome to the Redwood Trust third quarter, 2024 earnings conference call at this time. All participants are in a listen-only mode. (Operator Instructions) As a reminder, this conference is being recorded.
It is now my pleasure to introduce your host, Kaitlyn Mauritz, head of Investor relations. Please go ahead.
Thank you operator. Hello everyone and thank you for joining us today for Redwood's third quarter, 2024 earnings conference call with me on today's call are Chris Abate, Chief Executive Officer Dash Robinson, President and Brooke Carillo, Chief Financial Officer. Before we begin, I want to remind you that certain statements made during management's presentation today with respect to future financial and business performance may constitute forward-looking statements. Forward-looking statements are based on current expectations forecasts and assumptions and include risks and uncertainties that cause actual results to differ. Materially, we
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