NEW YORK, NY--Amid mounting concern that U.S. CMBS underwriting standards are on the decline, Fitch Ratings believes that there is quite a way to go before standards approach levels seen in 2007, viewed by many as the most volatile vintage for CMBS.Some market participants fear that we will shortly see loans comparable to
the worst of the loans made between 2006 and 2008. While Fitch agrees that
underwriting standards have declined in recent months, it should be noted
that that deterioration thus far has been off of its very high standards.
‘It was only a matter of time before CMBS underwriting standards began to
decline from such an unusually high level,’ said Huxley Somerville (top right photo), Group
Managing Director and head of U.S. CMBS for Fitch.
Fitch anticipated a drop in underwriting standards in its ratings, already
raising credit enhancement levels for new CMBS to ensure ample credit risk
protection.
‘If CMBS credit metrics begin to drop more precipitously, Fitch will raise credit enhancement levels accordingly,’ said Somerville.
Fitch discusses this trend in greater detail in its latest U.S. Structured Finance Snapshot, which is available at www.fitchratings.com under
‘Latest Research’.
Contact:
Huxley Somerville, Head of U.S. CMBS
Group Managing Director
+1-212-908-0381
Fitch, Inc., One State Street Plaza, New York, NY 10004,
Media Relations: Sandro Scenga +1-212-908-0278, New York;
Additional information is available at www.fitchratings.com
No comments:
Post a Comment