Fitch Affirms National City Home Loan Services' 'RPS2-' & 'RSS3+' Servicer Ratings.Business Editors NEW YORK--(BUSINESS WIRE)--May 19, 2004 Fitch Ratings Fitch Ratings An international rating agency for financial institutions, insurance companies, and corporate, sovereign, and municipal debt. Fitch Ratings has headquarters in New York and London and is wholly owned by FIMALAC of Paris. affirms National City Home Loan Services, Inc.'s (HLS (Hue Lightness Saturation) A color space that is closely related to HSB, except that Brightness is called Lightness and is measured from 0 to 1 rather than from 0 to 100%. See HSB. ) residential primary servicer ratings for Alt-A and subprime products at 'RPS2-' and affirms the special servicer rating at 'RSS3+' for residential mortgages. The affirmation of the ratings for subprime and Alt-A products reflect HLS' continued effective loan administration and default management practices, established policies and procedures Policies and Procedures are a set of documents that describe an organization's policies for operation and the procedures necessary to fulfill the policies. They are often initiated because of some external requirement, such as environmental compliance or other governmental , competent training programs, utilization of technology, and multiple levels of internal controls. Fitch's affirmation of the special servicer rating reflects the company's effective collection practices, competent loss mitigation processes, focused default training programs, reliable default management methods, and capable real estate owned Real Estate Owned Property owned by a lender - usually a bank - after an unsuccessful sale at a foreclosure auction. This is common because most of the properties up for sale at these auctions are worth less than the total amount owed to the bank: the minimum bid in most management procedures. The ratings also reflect the financial strength of HLS' parent, National City Corporation (NCC NCC See National Clearing Corporation (NCC). ; rated 'AA-' by Fitch). National City Corporation (NCC), the parent company of HLS, recently announced its plans to acquire Cincinnati-based Provident Financial Group Provident Financial Group was a bank located in Cincinnati, Ohio. It was purchased in 2004 by National City Corporation for $2.1 billion. , Inc. (PFGI PFGI Provident Financial Group, Incorporated (Cincinnati, OH) ). The transaction is expected to close this year pending regulatory and PFGI's shareholders approval. On Feb. 17, 2004, Fitch affirmed the 'AA-' long-term debt Long-Term Debt Loans and financial obligations lasting over one year. Notes: For example debts obligations such as bonds and notes which have maturities greater than one year would be considered long-term debt. ratings for National City Corporation (NCC), and at the same time placed PFGI's ratings on Rating Watch Positive. Fitch will monitor the progress of the merger process as more details become available. The HLS servicing platform is headquartered in Pittsburgh, PA, with a call center located nearby in Washington, PA. HLS has expanded its subprime and Alt-A loan servicing portfolio from nearly 119,000 loans totaling $12.9 billion in December 2002 to over 153,000 loans totaling $18.6 billion as of December 2003. HLS' owned portfolio comprises over 77% of the servicing portfolio and the balance of the portfolio consists of third party interim servicing for a mixture of outside investors and NCC affiliate companies. Over 21% of the portfolio is composed of interim servicing of Alt-A product with 77% of the portfolio consisting of subprime mortgages. In addition, HLS is a purchaser and servicer of a significant portion of the annual loan production of NCC affiliate First Franklin Financial Corporation (FFFC FFFC Force Flow Fusion Center ). The senior executive manager of the servicing platform recently announced his imminent transfer to another management opportunity within the NCC organization. HLS' Chief Financial Officer is currently running the daily servicing operation during NCC's focused search for a replacement. Fitch will continue to monitor the firm's progress in this important executive search and will continue to monitor the servicing operation's effectiveness in managing the firm's portfolio growth initiatives and any impact on loan performance. Fitch rates residential mortgage primary, master, and special servicers on a scale of 1 to 5, with 1 being the highest rating. Within some of these rating levels, Fitch further differentiates ratings by plus (+) and minus (-) as well as the flat rating. For more information on the review and rating process for servicers, see Fitch Research on 'Residential Mortgage Servicer Ratings', dated Feb. 21, 2003 and available on the Fitch Ratings web site at 'www.fitchratings.com'. |
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