The FINANCIAL -- New York-22 July 2011: Recent rating actions coupled with stabilizing
U.S. commercial real estate fundamentals have resulted in a greater
percentage of Stable Outlooks for Fitch's investment grade CMBS.
Rating Outlooks for investment grade U.S. CMBS bonds in Fitch's rated portfolio are 88% stable (by count). This follows Fitch's most recent extensive review of its rated CMBS portfolio as well as the continuing stabilization of the commercial property markets.
Through the end of June, Fitch affirmed 1,417, downgraded 1,257 and upgraded only 84 classes. Following these actions, 50% of Fitch's portfolio remains investment grade, with 97% of 'AAA' classes assigned a Stable Rating Outlook. At this time last year 57% of the portfolio was investment grade but only 45% carried a stable outlook, including 91% of 'AAA' rated bonds.
Fitch's latest round of rating actions followed criteria adjustments it made in November of last year. The continuing turnaround of real estate fundamentals also figured into the improved results. Fitch's rating actions consider both current performance and future projections for defaults and losses.
'While delinquencies are still expected to increase and most losses have yet to be realized, Fitch's CMBS ratings are expected to remain largely stable,' said Managing Director Mary MacNeill.
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