Financial Data and Key Metrics Changes - For Q4 2025, the company reported GAAP net income of $18.3 million, or $0.13 per share, compared to a GAAP loss of $9.5 million, or $0.08 per share in Q3 2025 [22] - Book value per common share was $7.36 at December 31, 2025, slightly up from $7.35 at September 30, 2025 [22] - Economic return on book value was 2.6% for the quarter, including $0.04 from share repurchases and $0.18 per share common dividend [22] - Non-GAAP earnings available for distribution (EAD) increased from $0.01 in Q3 to $0.20 in Q4, exceeding the common dividend [22][23] Business Line Data and Key Metrics Changes - The Sequoia platform locked $5.3 billion of loans in Q4 2025, a 5% increase from Q3 and up 130% from Q4 2024 [12] - Aspire locked a record $1.5 billion of loans during Q4 2025, a 20% sequential increase, with total 2025 lock volume exceeding $3 billion [16] - CoreVest closed out 2025 with full-year volumes up 13% versus 2024, with nearly 40% of Q4 production coming from residential transition loans [17] Market Data and Key Metrics Changes - The company estimates that between $200 billion and $300 billion of jumbo mortgages could become refinanceable as mortgage rates hover just above 6% [8] - The company’s full-year 2025 jumbo market share was approximately 7%, significantly up from prior years [13] - Institutional participation in housing has drawn renewed focus, with proposals to limit ownership of single-family homes by large institutional investors [9] Company Strategy and Development Direction - The company is shifting towards increasing capital to mortgage banking platforms, with over 80% of capital now invested in core operating activities, up from 57% in 2024 [6] - The company plans to leverage AI to enhance risk management, accelerate capital deployment, and improve operating leverage [10] - The focus is on maintaining a capital-efficient, originate-to-distribute model, where earnings power is driven by margin and capital velocity rather than balance sheet size [25] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the potential for a broader refinance wave, which could significantly expand volume expectations for the Sequoia business [8] - The company expects core operating performance to drive consolidated earnings above the common dividend in 2026, enabling earnings retention and reinvestment for organic growth [11] - Management highlighted the importance of affordability initiatives in Washington and their potential impact on housing activity [7] Other Important Information - The company reduced its legacy bridge portfolio's principal balance by nearly 40% during Q4 2025, leading to a significant decline in 90-day plus delinquencies [18] - The company is focused on technology enablement through RWT Horizons, which has resulted in a reduction of operating costs per loan by 44% year-over-year [20] Q&A Session Summary Question: Impact of recent mortgage rate movements on business volume - Management reported January volume at $3.6 billion, indicating continued acceleration from Q4 [30] Question: Opportunities in the Aspire non-QM platform and potential GSE reform impacts - Management noted strong momentum in Aspire, with expectations for continued growth and limited impact from GSE reforms [32][36] Question: Thoughts on third-party capital providers - Management indicated strong demand for production and ongoing discussions with capital partners to support growth [40][41] Question: Current margins in the non-QM channel compared to jumbo - Management targets gain on sale margins in non-QM similar to Sequoia, with expectations for improved execution through securitization [44][46] Question: Competitive landscape in the non-QM market - Management acknowledged increased competition but expressed confidence in their ability to grow market share [48][49] Question: CoreVest originations and first-quarter volume expectations - Management projected higher volumes in Q1 with consistent margins, focusing on smaller balance products [75][76]