Fitch Ratings: U.S. CMBS Delinquencies on the Mend.Business Editors NEW YORK--(BUSINESS WIRE)--May 13, 2004 When compared to year-end 2003, U.S. commercial mortgage-backed securities Commercial mortgage-backed securities (CMBS) are a type of bond commonly issued in American security markets. They are a type of Mortgage-backed security which are backed by mortgages on commercial rather than residential real estate. (CMBS CMBS See: Commercial Mortgage Backed Securities ) delinquencies in first-quarter 2004 (1Q'04) experienced a sixteen basis point (bp) overall decline. According to according to prep. 1. As stated or indicated by; on the authority of: according to historians. 2. In keeping with: according to instructions. 3. the latest 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. Loan Delinquency Index (the Index) for 1Q'04, the delinquency rate is currently at 1.53%. Mary O'Rourke Mary O'Rourke (Irish: Máire Uí Ruairc) (born May 31, 1937), is a senior Irish politician. She was widowed in January 2001 following the death of her husband, Enda. She has two sons. , Senior Director, Fitch Ratings, said that the Index, when calculated excluding loans that have been securitized securitized Of, related to, or being debt securities that are secured with assets. For example, mortgage purchase bonds are secured by mortgages that have been purchased with the bond issue's proceeds. for less than a year, adjusts upwards to 1.84%, a 22 bp decline over the same calculation last quarter. The adjustment excludes $37.9 billion in newly issued CMBS. "The dollar balance of CMBS delinquents declined by $182 million, and Fitch views this decline in delinquencies as an encouraging sign that the U.S. real estate market is climbing out of its' recent slump," said O'Rourke. Fitch reported the largest delinquency declines occurred in the retail and hotel sectors. The balance of hotel loan delinquencies is slightly lower than it was a year ago, reflecting the slow comeback this sector has experienced over the past four quarters. Retail loan delinquencies declined by $73 million. "Retail loans have been the steadiest performers over the past year," said O'Rourke, "but Fitch has taken notice of an increase in store closings among the smaller chain retailers and is watching to see whether the trend continues." The multifamily sector is not faring as well as others. "An additional $76 million in multifamily loans Multifamily loans Loans usually represented by conventional mortgages on multi-family rental apartments. were reported as delinquent in the first quarter," said O'Rourke, "bringing multifamily loan delinquencies to almost double the level they were twelve months ago." Fitch noted that the multifamily sector has been hit by both the flight to purchase single family homes generated by low interest rates during the past year, as well as by excessive construction in many markets. Fitch's CMBS loan delinquency index is available on the Fitch Ratings web site at 'www.fitchratings.com'. |
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