Fitch Ratings Upgrades J.P. Morgan's $268.3MM 1996-C3 Ctfs.

Business Editors

NEW YORK--(BUSINESS WIRE)--April 26, 2002

J.P. Morgan Commercial Mortgage Finance Corp.'s commercial mortgage pass-through certificates, series 1996-C3 $24.1 million class B is upgraded to 'AAA' from 'AA+' by Fitch Ratings. In addition, Fitch upgrades $26.1 million class C to 'AA-' from 'A+', $14 million class D to 'A-' from 'BBB+' and $8 million class E to 'BBB' from 'BBB-'. The $27.3 million A1 class, the $112.6 million class A2 and interest only classes A1X and A2X are affirmed at 'AAA', interest only class BCX at 'AA', $26.1 million class F at 'BB' and $18 million class G at 'B-'. Fitch does not rate the $12 million class NR certificates. The rating actions follow Fitch's annual review of the transaction, which closed in June 1996.

The upgrades are primarily attributable to an increase in subordination levels due to loan payoffs and amortization. As of the February 2002 distribution date, the pool's aggregate balance has been reduced by 33% to $268.3 million from $400.9 million at closing. Twenty three of the original 103 loans plus the crown participation note have paid off since closing. There is currently no delinquent or specially serviced loans. Fitch views this as a strength of the overall pool.

ORIX, the master servicer, collected recent trailing 12-month (TTM) operating statements for loans representing 97% of the outstanding pool balance as follows: 2.1% as of Dec. 31, 2001, 82.6% as of Sept. 30, 2001 (9/30/01), 10.3% as of June 30, 2001 and 2% as of March 31, 2001. The most current weighted average debt service coverage ratio (WADSCR) for these loans is 1.88 times (x) compared to 1.80x as of the prior year's review, and 1.59x at closing.

Of concern to Fitch is five loans (7.4% by principal balance) with declines in performance. Four of these loans (4%) have DSCRs below 1.0x. The largest loan (1.3%) with a DSCR below 1.0x is secured by three multifamily properties, outside of Dallas TX and has a TTM 9/30/01 DSCR of 0.91x. The discontinuation of a low-income housing project has led to lower reimbursements and occupancy at these properties in recent years. The loan is current. Occupancy at the property as of 9/30/01 was 80%. The remaining three loans with DSCRs below 1.0x are current and consist of one retail and two hotel loans. Fitch defaulted these loans of concern and assigned a higher loss severity to them.

Fitch is also concerned with the high retail concentration in the deal. The retail concentration currently is 36% versus 28% at closing. The mitigants to this concern are that the overall retail portion of the pool is performing well (current TTM WADSCR of 1.70x) and that none of the anchors have announced store closings.