Email Research
Thank you for your interest in sharing Moody's Research. You have reached the daily limit of Research email sharings.
Thank you!
You have successfully sent the research.
Please note: some research requires a paid subscription in order to access.
Already a customer?
LOG IN
Don't want to see this again?
REGISTER
Accept our to continue to Moodys.com:
PLEASE READ
AND SCROLL DOWN!
By clicking “I AGREE” [at the end of this document],
you indicate that you understand and intend these terms and conditions to be
the legal equivalent of a signed, written contract and equally binding, and
that you accept such terms and conditions as a condition of viewing any and all
Moody’s information that becomes accessible to you [after clicking “I AGREE”] (the
“Information”). References herein to “Moody’s” include Moody’s
Corporation, Inc. and each of its subsidiaries and affiliates.
Terms of One-Time Website Use
1. Unless
you have entered into an express written contract with Moody’s to the contrary,
you agree that you have no right to use the Information in a commercial or
public setting and no right to copy it, save it, print it, sell it, or publish
or distribute any portion of it in any form.
2. You
acknowledge and agree that Moody’s credit ratings: (i) are current opinions of
the future relative creditworthiness of securities and address no other risk; and
(ii) are not statements of current
or historical fact or recommendations to purchase, hold or sell particular
securities. Moody’s credit ratings and
publications are not intended for retail investors, and it would be reckless
and inappropriate for retail investors to use Moody’s credit ratings and
publications when making an investment decision. No
warranty, express or implied, as the accuracy, timeliness, completeness,
merchantability or fitness for any particular purpose of any Moody’s credit
rating is given or made by Moody’s in any form whatsoever.
3. To the extent permitted by law, Moody’s and its directors,
officers, employees, representatives, licensors and suppliers disclaim
liability for: (i) any indirect, special, consequential, or incidental losses
or damages whatsoever arising from or in connection with use of the
Information; and (ii) any direct or compensatory damages caused to any person
or entity, including but not limited to by any negligence (but excluding fraud
or any other type of liability that by law cannot be excluded) on the part of
Moody’s or any of its directors, officers, employees, agents, representatives,
licensors or suppliers, arising from or in connection with use of the
Information.
4. You agree to read [and
be bound by] the more detailed disclosures regarding Moody’s ratings and the
limitations of Moody’s liability included in the Information.
5. You agree that any disputes relating to this agreement or your use of
the Information, whether sounding in contract, tort, statute or otherwise,
shall be governed by the laws of the State of New York and shall be subject to
the exclusive jurisdiction of the courts of the State of New York located in
the City and County of New York, Borough of Manhattan.
I AGREE
17 May 2010
Special Servicer for seven Residential Mortgage Securities transactions, three Money Partner Securities plc transactions and Kensington Mortgage Securities plc
London, 17 May 2010 -- Moody's Investors Service said today that Kensington Mortgage Company
's (Kensington, not rated) servicer infrastructure has been
maintained since Moody's previous visit in 2008, despite a
higher dynamic delinquency rate compared to its peers.
As part of Moody's surveillance process of residential mortgage-backed
securities (RMBS) transactions, it regularly meets with servicers
to monitor their quality and discuss any changes to the servicing infrastructure
since Moody's previous visit. On 22 March, Moody's
met with Kensington Mortgage Company Ltd., which is the special
servicer for 11 Moody's-rated outstanding RMBS transactions:
- Seven Residential Mortgage Securities (RMS) transactions (RMS
16 plc through RMS 22 plc)
- Three Money Partners Securities (MPS) transactions (MPS 2,
3 and 4 plc)
- Kensington Mortgage Securities plc Series 2007-1 (KMS).
As of February 2010, the total outstanding balance of these 11 transactions
was GBP2.4 billion.
As special servicer for these transactions, Kensington's responsibilities
include: (i) overseeing the day-to-day operations
of Homeloan Management Ltd (HML, SQ2+), which is acting
as the loan administrator for these transactions; (ii) determining
the servicer's strategy; (iii) making decisions on cases that are
outside HML's mandates; and (iv) managing the repossession
and sale process of the real estate property, which includes overseeing
the third parties involved in these processes (e.g. solicitors,
asset management).
MOODY'S UPDATED OPINION ON KENSINGTON'S SERVICING OPERATION
Since Moody's prior review, Kensington has continued to invest
in its servicing operations to strengthen its infrastructure and controls.
Moody's continues to view positively Kensington's behavioural
score and data mining infrastructure, which drives its call collection
campaigns. In Moody's opinion, this further assists
the servicer in developing collection strategies, which ultimately
aim at maximising recovery.
From Moody's review, it appears that the opening hours of
Kensington's call centre (operated by HML) are slightly longer than
its peers and that it starts calling its borrowers (i.e.
after a failed direct debit) in some circumstances slightly later than
some of its peers (within 4 days vs. 48 hours). Moody's
views positively the use of extended opening hours as it increases the
likelihood of reaching a borrower.
Kensington currently does not use updated credit bureau information when
assessing a borrower's financial condition in order to offer an
arrangement-to-pay (ATP) or a loan modification.
Moody's would welcome the use of credit bureau data as it validates
a borrower's indebtedness and provides additional comfort that the
proposed repayment plan (e.g. ATP or loan modification)
may be sustainable.
Moody's observes that the number of months that a borrower is delinquent
at repossession has continuously increased between November 2008 and the
beginning of 2010 (2009 average: 14 months). Moody's
considers that this increase is mainly attributable to the forbearance
tools introduced by Kensington in response to the changing economic climate
and regulatory environment and the various initiatives implemented by
the government since the start of the financial crisis to ensure that
all the solutions have been considered before beginning the foreclosure
process.
Although Kensington seems to take longer to sell a repossessed property
than some of its peers (Moody's calculated UK non-conforming
2009 average: 170 days), it seems to achieve a slightly higher
sale price as a percentage of the asking price in comparison to Moody's
calculated UK non-conforming 2009 market average of 92%.
Moody's views positively the standardisation and automation of management
information from Kensington's third parties, as it ensures
that information is comparable and has also enhanced the overall monitoring
and control framework. The work has been completed for its asset
managers and is under way for its solicitors.
Moody's also views positively the very low turnover rate and the
experience of the staff (which we have estimated to be on average more
than five years). Moody's further notes that the ratio of
loans per collector in the direct special servicing team is slightly higher
than some of its peers. However, Kensington plans to increase
the number of staff within this department.
Finally, Moody's considers that the fine imposed by the Financial
Services Authority (FSA) on 12 April 2010 has no impact on its analysis
as it appears that most of the FSA's concerns have now been addressed.
SECURITISED PORTFOLIO PERFORMANCE
As of February 2010, the 90+ delinquency rate as a percentage
of the current balance was 31.15%, 32.69%
and 29.27% for RMS, MPS and KMS, respectively,
which is 62%, 70% and 52% higher than the UK
non-conforming index (19.22%). Cumulative
losses as a percentage of the original pool balance were 1.86%
(RMS), 3.31% (MPS) and 2.95% (KMS),
which is 22%, 118% and 94% higher than the
UK non-conforming index (1.52%).
KENSINGTON SERVICING INFRASTRUCTURE - UPDATE
Kensington's special servicing infrastructure has changed significantly
since Moody's prior review in February 2008. During this
period, the department has grown from nine to 43 staff, mainly
as a result of the establishment of the direct special servicing team.
A new head of department and two direct reports were externally recruited
to support the growth. The vast majority of the staff have prior
work experience in financial services gained as a collector, underwriter,
mortgage sale or field agent.
The department currently comprises two sub-departments: the
special servicing team and the possessions and asset managers team.
The special servicing activities include all the activities which are
linked to the loan administrator (e.g. defining servicing
and collection strategy, monitoring servicer level agreement and
taking decision on cases which fell outside their mandate) and the direct
special servicing activities (i.e. Kensington takes over
the special servicing of cases of key segments of its portfolio where
more intense customer focus is required, including cases prior to
the commencement of possession proceedings, customers with more
than one facility, sensitive cases and complaints).
In addition to handling the repossession and sale processes, the
possessions and asset managers team has a customer liaison team performing
face-to-face visits at the borrower's home.
In common with most UK servicers, the litigations, repossession
and sale activities are outsourced to third parties, with the servicer
making the key decisions (e.g. setting the asking price).
Since Moody's prior review, Kensington has strengthened its
control infrastructure in regards to its third-party panels.
Moody's publishes a weekly summary of structured finance credit,
ratings and methodologies, available to all registered users of
our website, at www.moodys.com/SFQuickCheck.
For further information, please visit our website directly or contact
Moody's Client Service Desk (+44 20) 7772 5454. Additional
information on the referenced Moody's rated RMBS transactions,
including the latest Performance Overview, is available at www.moodys.com
Paris
Annick Poulain
Managing Director
Structured Finance Group
Moody's France S.A.
JOURNALISTS: 44 20 7772 5456
SUBSCRIBERS: 44 20 7772 5454
London
Carine Kumps-Feniou
Asst Vice President - Analyst
Structured Finance Group
Moody's Investors Service Ltd.
JOURNALISTS: 44 20 7772 5456
SUBSCRIBERS: 44 20 7772 5454
Moody's updates on Kensington Mortgage Company Ltd as special servicer of 11 UK Non-Conforming RMBS deals rated by Moody's
No Related Data.
© 2019 Moody’s Corporation, Moody’s Investors Service, Inc., Moody’s Analytics, Inc. and/or their licensors and affiliates (collectively, “MOODY’S”). All rights reserved.
CREDIT RATINGS ISSUED BY MOODY'S INVESTORS SERVICE, INC. AND ITS RATINGS AFFILIATES (“MIS”) ARE MOODY’S CURRENT OPINIONS OF THE RELATIVE FUTURE CREDIT RISK OF ENTITIES, CREDIT COMMITMENTS, OR DEBT OR DEBT-LIKE SECURITIES, AND MOODY’S PUBLICATIONS MAY INCLUDE MOODY’S CURRENT OPINIONS OF THE RELATIVE FUTURE CREDIT RISK OF ENTITIES, CREDIT COMMITMENTS, OR DEBT OR DEBT-LIKE SECURITIES. MOODY’S DEFINES CREDIT RISK AS THE RISK THAT AN ENTITY MAY NOT MEET ITS CONTRACTUAL FINANCIAL OBLIGATIONS AS THEY COME DUE AND ANY ESTIMATED FINANCIAL LOSS IN THE EVENT OF DEFAULT OR IMPAIRMENT. SEE MOODY’S RATING SYMBOLS AND DEFINITIONS PUBLICATION FOR INFORMATION ON THE TYPES OF CONTRACTUAL FINANCIAL OBLIGATIONS ADDRESSED BY MOODY’S RATINGS. CREDIT RATINGS DO NOT ADDRESS ANY OTHER RISK, INCLUDING BUT NOT LIMITED TO: LIQUIDITY RISK, MARKET VALUE RISK, OR PRICE VOLATILITY. CREDIT RATINGS AND MOODY’S OPINIONS INCLUDED IN MOODY’S PUBLICATIONS ARE NOT STATEMENTS OF CURRENT OR HISTORICAL FACT. MOODY’S PUBLICATIONS MAY ALSO INCLUDE QUANTITATIVE MODEL-BASED ESTIMATES OF CREDIT RISK AND RELATED OPINIONS OR COMMENTARY PUBLISHED BY MOODY’S ANALYTICS, INC. CREDIT RATINGS AND MOODY’S PUBLICATIONS DO NOT CONSTITUTE OR PROVIDE INVESTMENT OR FINANCIAL ADVICE, AND CREDIT RATINGS AND MOODY’S PUBLICATIONS ARE NOT AND DO NOT PROVIDE RECOMMENDATIONS TO PURCHASE, SELL, OR HOLD PARTICULAR SECURITIES. NEITHER CREDIT RATINGS NOR MOODY’S PUBLICATIONS COMMENT ON THE SUITABILITY OF AN INVESTMENT FOR ANY PARTICULAR INVESTOR. MOODY’S ISSUES ITS CREDIT RATINGS AND PUBLISHES MOODY’S PUBLICATIONS WITH THE EXPECTATION AND UNDERSTANDING THAT EACH INVESTOR WILL, WITH DUE CARE, MAKE ITS OWN STUDY AND EVALUATION OF EACH SECURITY THAT IS UNDER CONSIDERATION FOR PURCHASE, HOLDING, OR SALE.
MOODY’S CREDIT RATINGS AND MOODY’S PUBLICATIONS ARE NOT INTENDED FOR USE BY RETAIL INVESTORS AND IT WOULD BE RECKLESS AND INAPPROPRIATE FOR RETAIL INVESTORS TO USE MOODY’S CREDIT RATINGS OR MOODY’S PUBLICATIONS WHEN MAKING AN INVESTMENT DECISION. IF IN DOUBT YOU SHOULD CONTACT YOUR FINANCIAL OR OTHER PROFESSIONAL ADVISER.
ALL INFORMATION CONTAINED HEREIN IS PROTECTED BY LAW, INCLUDING BUT NOT LIMITED TO, COPYRIGHT LAW, AND NONE OF SUCH INFORMATION MAY BE COPIED OR OTHERWISE REPRODUCED, REPACKAGED, FURTHER TRANSMITTED, TRANSFERRED, DISSEMINATED, REDISTRIBUTED OR RESOLD, OR STORED FOR SUBSEQUENT USE FOR ANY SUCH PURPOSE, IN WHOLE OR IN PART, IN ANY FORM OR MANNER OR BY ANY MEANS WHATSOEVER, BY ANY PERSON WITHOUT MOODY’S PRIOR WRITTEN CONSENT.
CREDIT RATINGS AND MOODY’S PUBLICATIONS ARE NOT INTENDED FOR USE BY ANY PERSON AS A BENCHMARK AS THAT TERM IS DEFINED FOR REGULATORY PURPOSES AND MUST NOT BE USED IN ANY WAY THAT COULD RESULT IN THEM BEING CONSIDERED A BENCHMARK.
All information contained herein is obtained by MOODY’S from sources believed by it to be accurate and reliable. Because of the possibility of human or mechanical error as well as other factors, however, all information contained herein is provided “AS IS” without warranty of any kind. MOODY'S adopts all necessary measures so that the information it uses in assigning a credit rating is of sufficient quality and from sources MOODY'S considers to be reliable including, when appropriate, independent third-party sources. However, MOODY’S is not an auditor and cannot in every instance independently verify or validate information received in the rating process or in preparing the Moody’s publications.
To the extent permitted by law, MOODY’S and its directors, officers, employees, agents, representatives, licensors and suppliers disclaim liability to any person or entity for any indirect, special, consequential, or incidental losses or damages whatsoever arising from or in connection with the information contained herein or the use of or inability to use any such information, even if MOODY’S or any of its directors, officers, employees, agents, representatives, licensors or suppliers is advised in advance of the possibility of such losses or damages, including but not limited to: (a) any loss of present or prospective profits or (b) any loss or damage arising where the relevant financial instrument is not the subject of a particular credit rating assigned by MOODY’S.
To the extent permitted by law, MOODY’S and its directors, officers, employees, agents, representatives, licensors and suppliers disclaim liability for any direct or compensatory losses or damages caused to any person or entity, including but not limited to by any negligence (but excluding fraud, willful misconduct or any other type of liability that, for the avoidance of doubt, by law cannot be excluded) on the part of, or any contingency within or beyond the control of, MOODY’S or any of its directors, officers, employees, agents, representatives, licensors or suppliers, arising from or in connection with the information contained herein or the use of or inability to use any such information.
NO WARRANTY, EXPRESS OR IMPLIED, AS TO THE ACCURACY, TIMELINESS, COMPLETENESS, MERCHANTABILITY OR FITNESS FOR ANY PARTICULAR PURPOSE OF ANY CREDIT RATING OR OTHER OPINION OR INFORMATION IS GIVEN OR MADE BY MOODY’S IN ANY FORM OR MANNER WHATSOEVER.
Moody’s Investors Service, Inc., a wholly-owned credit rating agency subsidiary of Moody’s Corporation (“MCO”), hereby discloses that most issuers of debt securities (including corporate and municipal bonds, debentures, notes and commercial paper) and preferred stock rated by Moody’s Investors Service, Inc. have, prior to assignment of any rating, agreed to pay to Moody’s Investors Service, Inc. for ratings opinions and services rendered by it fees ranging from $1,000 to approximately $2,700,000. MCO and MIS also maintain policies and procedures to address the independence of MIS’s ratings and rating processes. Information regarding certain affiliations that may exist between directors of MCO and rated entities, and between entities who hold ratings from MIS and have also publicly reported to the SEC an ownership interest in MCO of more than 5%, is posted annually at www.moodys.com under the heading “Investor Relations — Corporate Governance — Director and Shareholder Affiliation Policy.”
Additional terms for Australia only: Any publication into Australia of this document is pursuant to the Australian Financial Services License of MOODY’S affiliate, Moody’s Investors Service Pty Limited ABN 61 003 399 657AFSL 336969 and/or Moody’s Analytics Australia Pty Ltd ABN 94 105 136 972 AFSL 383569 (as applicable). This document is intended to be provided only to “wholesale clients” within the meaning of section 761G of the Corporations Act 2001. By continuing to access this document from within Australia, you represent to MOODY’S that you are, or are accessing the document as a representative of, a “wholesale client” and that neither you nor the entity you represent will directly or indirectly disseminate this document or its contents to “retail clients” within the meaning of section 761G of the Corporations Act 2001. MOODY’S credit rating is an opinion as to the creditworthiness of a debt obligation of the issuer, not on the equity securities of the issuer or any form of security that is available to retail investors.
Additional terms for Japan only: Moody's Japan K.K. (“MJKK”) is a wholly-owned credit rating agency subsidiary of Moody's Group Japan G.K., which is wholly-owned by Moody’s Overseas Holdings Inc., a wholly-owned subsidiary of MCO. Moody’s SF Japan K.K. (“MSFJ”) is a wholly-owned credit rating agency subsidiary of MJKK. MSFJ is not a Nationally Recognized Statistical Rating Organization (“NRSRO”). Therefore, credit ratings assigned by MSFJ are Non-NRSRO Credit Ratings. Non-NRSRO Credit Ratings are assigned by an entity that is not a NRSRO and, consequently, the rated obligation will not qualify for certain types of treatment under U.S. laws. MJKK and MSFJ are credit rating agencies registered with the Japan Financial Services Agency and their registration numbers are FSA Commissioner (Ratings) No. 2 and 3 respectively.
MJKK or MSFJ (as applicable) hereby disclose that most issuers of debt securities (including corporate and municipal bonds, debentures, notes and commercial paper) and preferred stock rated by MJKK or MSFJ (as applicable) have, prior to assignment of any rating, agreed to pay to MJKK or MSFJ (as applicable) for ratings opinions and services rendered by it fees ranging from JPY125,000 to approximately JPY250,000,000.
MJKK and MSFJ also maintain policies and procedures to address Japanese regulatory requirements.
|
|
