Equity (Tables)

12 Months Ended

Dec. 31, 2020

Changes to Accumulated Other Comprehensive Income (Loss) by Component

The following table provides a summary of changes to accumulated other comprehensive income by component for the years ended December 31, 2020 and 2019. During the year ended December 31, 2020, we recognized net unrealized losses of $2 million on our Level 3 AFS securities which we owned as of December 31, 2020.

Table 17.1 – Changes in Accumulated Other Comprehensive Income (Loss) by Component


	Years Ended December 31,
	2020				2019
(In Thousands)	Net Unrealized Gains on Available-for-Sale Securities		Net Unrealized Losses on Interest Rate Agreements Accounted for as Cash Flow Hedges		Net Unrealized Gains on Available-for-Sale Securities		Net Unrealized Losses on Interest Rate Agreements Accounted for as Cash Flow Hedges
Balance at beginning of period	$	92,452	$	(50,939)	$	95,342	$	(34,045)
Other comprehensive (loss) income before reclassifications	(3,951)		(32,806)		17,077		(16,894)
Amounts reclassified from other accumulated comprehensive (loss) income	(12,165)		3,188		(19,967)		—
Net current-period other comprehensive loss	(16,116)		(29,618)		(2,890)		(16,894)
Balance at End of Period	$	76,336	$	(80,557)	$	92,452	$	(50,939)

Reclassifications out of Accumulated Other Comprehensive Income (Loss)

The following table provides a summary of reclassifications out of accumulated other comprehensive income for the years ended December 31, 2020 and 2019.

Table 17.2 – Reclassifications Out of Accumulated Other Comprehensive Income (Loss)



		Amount Reclassified From Accumulated Other Comprehensive Income
	Affected Line Item in the	Year Ended December 31,
(In Thousands)	Income Statement	2020		2019
Net Realized (Gain) Loss on AFS Securities
Credit loss expense on AFS securities	Investment fair value changes, net	$	388	$	—
Gain on sale of AFS securities	Realized gains, net	(12,553)		(19,967)

		$	(12,165)	$	(19,967)
Net Realized Loss on Interest Rate Agreements Designated as Cash Flow Hedges
Amortization of deferred loss	Interest expense	$	3,188	$	—
		$	3,188	$	—

Basic and Diluted Earnings (Loss) Per Common Share

The following table provides the basic and diluted earnings per common share computations for the years ended December 31, 2020, 2019, and 2018.

Table 17.3 – Basic and Diluted Earnings per Common Share


	Years Ended December 31,
(In Thousands, except Share Data)	2020		2019		2018
Basic (Loss) Earnings per Common Share:
Net (loss) income attributable to Redwood	$	(581,847)	$	169,183	$	119,600
Less: Dividends and undistributed earnings allocated to participating securities	(1,990)		(4,797)		(3,754)
Net (loss) income allocated to common shareholders	$	(583,837)	$	164,386	$	115,846
Basic weighted average common shares outstanding	113,935,605		101,120,744		78,724,912
Basic (Loss) Earnings per Common Share	$	(5.12)	$	1.63	$	1.47
Diluted (Loss) Earnings per Common Share:
Net (loss) income attributable to Redwood	$	(581,847)	$	169,183	$	119,600
Less: Dividends and undistributed earnings allocated to participating securities	(1,990)		(5,273)		(4,283)
Adjust for interest expense and gain on extinguishment of convertible notes for the period, net of tax	—		36,212		32,653
Net (loss) income allocated to common shareholders	$	(583,837)	$	200,122	$	147,970
Weighted average common shares outstanding	113,935,605		101,147,225		78,724,912
Net effect of dilutive equity awards	—		251,100		189,120
Net effect of assumed convertible notes conversion to common shares	—		35,382,269		31,113,738
Diluted weighted average common shares outstanding	113,935,605		136,780,594		110,027,770
Diluted (Loss) Earnings per Common Share	$	(5.12)	$	1.46	$	1.34