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Segment Information
 12 Months Ended
Dec. 31, 2021
Segment Reporting [Abstract]  
Segment Information Segment Information
Redwood operates in three segments: Residential Mortgage Banking, Business Purpose Mortgage Banking and Investment Portfolio. During the fourth quarter of 2021 we re-organized our segments to conform with changes in how we manage and evaluate our operations, moving all retained investments previously held in our Residential Lending and Business Purpose Lending segments to a newly-created Investment Portfolio Segment, where they are now combined with our third-party portfolio investments. Our mortgage banking activities are now reflected in standalone Residential Mortgage Banking and Business Purpose Mortgage Banking segments. We conformed the presentation of prior periods. 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 Item 1—Business in this Annual Report on Form 10-K.
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 for our convertible notes and trust preferred securities (and in 2020, realized gains from the repurchase of convertible notes), indirect general and administrative expenses and other expense.
The following tables present financial information by segment for the years ended December 31, 2021, 2020, and 2019.
Table 23.1 – Business Segment Financial Information
Year Ended December 31, 2021
(In Thousands)Residential Mortgage BankingBusiness Purpose Mortgage BankingInvestment Portfolio Corporate/
Other 		 Total
Interest income$48,953 $14,054 $507,173 $4,746 $574,926 
Interest expense(26,963)(7,230)(351,635)(40,921)(426,749)
Net interest income21,990 6,824 155,538 (36,175)148,177 
Non-interest income
Mortgage banking activities, net127,151 108,593 — — 235,744 
Investment fair value changes, net— — 129,614 (1,565)128,049 
Other income, net— 1,046 10,021 951 12,018 
Realized gains, net— — 17,993 — 17,993 
Total non-interest income, net127,151 109,639 157,628 (614)393,804 
General and administrative expenses (33,574)(46,586)(13,633)(77,066)(170,859)
Loan acquisition costs(7,480)(8,100)(752)(4)(16,336)
Other expenses104 (15,127)(1,689)17 (16,695)
(Provision for) benefit from income taxes(25,777)(8,122)(3,862)19,283 (18,478)
Segment Contribution$82,414 $38,528 $293,230 $(94,559)
Net Income$319,613 
Non-cash amortization (expense) income, net$(82)$(16,452)$(20,781)$(7,878)$(45,193)
Year Ended December 31, 2020
(In Thousands)Residential Mortgage BankingBusiness Purpose Mortgage BankingInvestment PortfolioCorporate/
Other		 Total
Interest income$17,839 $19,200 $525,741 $9,136 $571,916 
Interest expense(11,978)(13,145)(375,262)(47,620)(448,005)
Net interest income 5,861 6,055 150,479 (38,484)123,911 
Non-interest income
Mortgage banking activities, net3,721 74,622 129 — 78,472 
Investment fair value changes, net— (101)(586,333)(2,004)(588,438)
Other income, net— 3,228 (1,725)2,685 4,188 
Realized gains, net— — 5,242 25,182 30,424 
Total non-interest income (loss), net3,721 77,749 (582,687)25,863 (475,354)
General and administrative expenses (16,297)(37,460)(8,547)(52,900)(115,204)
Loan acquisition costs(2,727)(5,860)(2,426)(10)(11,023)
Other expenses(4,114)(104,147)194 (718)(108,785)
Benefit from (provision for) income taxes4,567 (4,063)4,104 — 4,608 
Segment Contribution$(8,989)$(67,726)$(438,883)$(66,249)
Net Loss$(581,847)
Non-cash amortization income (expense), net$(662)$(18,426)$(1,282)$(4,954)$(25,324)
Other significant non-cash expense: goodwill impairment$— $(88,675)$— $— $(88,675)
Year Ended December 31, 2019
(In Thousands)Residential Mortgage BankingBusiness Purpose Mortgage BankingInvestment PortfolioCorporate/
Other		 Total
Interest income$40,901 $8,212 $555,519 $17,649 $622,281 
Interest expense(21,503)(4,972)(390,188)(63,145)(479,808)
Net interest income 19,398 3,240 165,331 (45,496)142,473 
Non-interest income
Mortgage banking activities, net47,743 39,523 — — 87,266 
Investment fair value changes, net(1)(175)37,293 (1,617)35,500 
Other income, net— 5,139 11,407 2,711 19,257 
Realized gains, net— — 23,821 — 23,821 
Total non-interest income, net47,742 44,487 72,521 1,094 165,844 
General and administrative expenses(21,724)(24,832)(9,313)(52,868)(108,737)
Loan acquisition costs(3,954)(4,226)(1,618)(137)(9,935)
Other expense— (8,521)(1,106)(3,395)(13,022)
Provision for income taxes(4,074)(947)(2,419)— (7,440)
Segment Contribution$37,388 $9,201 $223,396 $(100,802)
Net Income$169,183 
Non-cash amortization income (expense), net$(97)$(8,896)$10,445 $(4,813)$(3,361)
The following table presents the components of Corporate/Other for the years ended December 31, 2021, 2020, and 2019.
Table 23.2 – Components of Corporate/Other
Years Ended December 31,
202120202019
(In Thousands)
Legacy Consolidated VIEs (1)
OtherTotal
Legacy Consolidated VIEs (1)
Other Total
Legacy Consolidated VIEs (1)
Other Total
Interest income$4,709 $37 $4,746 $9,060 $76 $9,136 $17,649 $— $17,649 
Interest expense(3,040)(37,881)(40,921)(5,945)(41,675)(47,620)(14,418)(48,727)(63,145)
Net interest income (loss)1,669 (37,844)(36,175)3,115 (41,599)(38,484)3,231 (48,727)(45,496)
Non-interest income
Investment fair value changes, net(1,558)(7)(1,565)(1,512)(492)(2,004)(1,545)(72)(1,617)
Other income, net— 951 951 — 2,685 2,685 — 2,711 2,711 
Realized gains, net— — — — 25,182 25,182 — — — 
Total non-interest (loss) income, net(1,558)944 (614)(1,512)27,375 25,863 (1,545)2,639 1,094 
General and administrative expenses— (77,066)(77,066)— (52,900)(52,900)— (52,868)(52,868)
Loan acquisition costs— (4)(4)— (10)(10)— (137)(137)
Other expenses— 17 17 — (718)(718)— (3,395)(3,395)
Benefit from income taxes— 19,283 19,283 — — — — — — 
Total$111 $(94,670)$(94,559)$1,603 $(67,852)$(66,249)$1,686 $(102,488)$(100,802)
(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 December 31, 2021 and 2020.
Table 23.3 – Supplemental Segment Information
(In Thousands)Residential Mortgage BankingBusiness Purpose Mortgage BankingInvestment Portfolio Corporate/
Other		Total
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 
Multifamily loans— — 473,514 — 473,514 
Real estate securities4,927 — 372,484 — 377,411 
Other investments— — 606,267 35,702 641,969 
Intangible assets— 41,561 — — 41,561 
Total assets1,716,285 464,967 11,770,486 755,206 14,706,944 
December 31, 2020
Residential loans$176,641 $— $3,786,475 $285,935 $4,249,051 
Business purpose loans— 245,394 3,890,959 — 4,136,353 
Multifamily loans— — 492,221 — 492,221 
Real estate securities5,279 — 338,846 — 344,125 
Other investments— — 343,724 4,451 348,175 
Intangible assets— 56,865 — — 56,865 
Total assets242,060 328,564 8,970,633 813,809 10,355,066