Two Harbors Investment Corp. (TWO) reported its financial results for the fourth quarter (Q4) of 2025. The company announced it has entered a definitive merger agreement with UWM Holdings Corporation (UWMC), under which UWMC will acquire TWO in an all-stock transaction. Under the terms of the agreement, TWO stockholders will receive a fixed exchange ratio of 2.3328 shares of UWMC Class A Common Stock for each share of TWO common stock. For the fourth quarter of 2025, TWO reported operating expenses of USD 43.70 million. Operating expenses, excluding non-cash long-term incentive plan amortization and certain operating expenses, represented 9.7 percent of average equity for the period. The company funded USD 221.10 million in unpaid principal balance (UPB) in loans and brokered an additional USD 198.70 million UPB in second lien loans during the quarter. Additionally, USD 28.70 billion of mortgage servicing rights (MSR) UPB was maintained on a subservicing-retained basis. Post quarter-end, convertible senior notes of USD 261.90 million in UPB were repaid in full on their January 15, 2026 maturity date. The company noted that spreads and volatility have returned to pre-pandemic levels, highlighting the benefits of a hedged MSR portfolio which is less sensitive to spread movements.

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