Redwood Trust Announces Pricing of Common Stock Offering

MILL VALLEY, Calif., Jan. 21 /PRNewswire-FirstCall/ - Redwood Trust, Inc. (NYSE: RWT) today announced the pricing of a public offering of 23 million shares of its common stock at a public offering price per share of $11.25. Redwood Trust has granted the underwriters a 30-day overallotment option to purchase up to 3.45 million additional shares of common stock. The offering is expected to close on January 27, 2009

Net proceeds from the offering will be used to acquire residential and commercial real estate loans and mortgage-backed securities and for other general corporate purposes. The offering is being conducted as a public offering registered under the Securities Act of 1933.

The sole bookrunning manager for the offering is J.P. Morgan Securities Inc.

The public offering is being made by means of a prospectus. Redwood Trust has filed a registration statement (including a prospectus) with the SEC for the offering to which this communication relates. You may get these documents for free by visiting EDGAR on the SEC Web site at www.sec.gov. Alternatively, the issuer, any underwriter, or any dealer participating in the offering will arrange to send you the relevant prospectus if you request it by contacting J.P. Morgan Securities Inc., Chase Distribution & Support Service, Attn: Charles Buckheit/Bob Foley, 4 Chase Metrotech Center, CS Level, Brooklyn, NY 11245 or by calling 1-866-430-0686.

This press release does not constitute an offer to sell or a solicitation of an offer to buy any securities, nor shall there be any sale of these securities in any state or jurisdiction in which such an offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction.

Source: Redwood Trust, Inc.

Contact: Martin S. Hughes, +1-415-389-7373, or Mike McMahon, +1-415-384-3805, both of Redwood Trust, Inc.

Company Release - 01/21/2009 23:38