Categories

A sample text widget

Etiam pulvinar consectetur dolor sed malesuada. Ut convallis euismod dolor nec pretium. Nunc ut tristique massa.

Nam sodales mi vitae dolor ullamcorper et vulputate enim accumsan. Morbi orci magna, tincidunt vitae molestie nec, molestie at mi. Nulla nulla lorem, suscipit in posuere in, interdum non magna.

Fitch: Modifications' Impact on US Student Loan ABS Limited

NEW YORK–(BUSINESS WIRE)–

Plans by private student lenders to help struggling borrowers by modifying their student loans will likely have only a limited impact on private student lenders and none on student loan ABS, Fitch Ratings says. However, portfolio yields and cash flows may be pressured if programs are expanded and modifications are offered to a broader subset of borrowers.

Last week the Wall Street Journal reported that Wells Fargo & Co. plans to lower interest rates and extend loans for approximately 600-1,000 student loan borrowers by the end of 2015. Discover Financial Services Inc. also plans to lower interest rates and may waive a portion of some borrowers’ balances.

In the near term, Fitch expects private student loan ABS pools to be unaffected as Wells and Discover have not securitized their student loans. Private student lenders’ profits will be only marginally impacted by these plans as the number of borrowers who may be eligible for modifications under the programs is small. At least initially, we believe the pool of eligible loans will be limited to delinquent accounts at an increased risk of default. Furthermore, we believe any downward pressure generated by a change in loan terms may be at least partly offset by incremental cash flows as some of the modified loans might otherwise have defaulted.

Longer term, private student lenders may elect to expand these programs to more borrowers, reflecting in part increased scrutiny from regulators, pressure from consumer advocacy groups and increased media exposure calling attention to mounting student loan debt. If loan modifications are extended to many more borrowers, ABS pools may need to address interest shortfalls while the profitability of bank student loan portfolios may come under pressure.

Additional information is available on www.fitchratings.com.

The above article originally appeared as a post on the Fitch Wire credit market commentary page. The original article, which may include hyperlinks to companies and current ratings, can be accessed at www.fitchratings.com. All opinions expressed are those of Fitch Ratings.

ALL FITCH CREDIT RATINGS ARE SUBJECT TO CERTAIN LIMITATIONS AND DISCLAIMERS. PLEASE READ THESE LIMITATIONS AND DISCLAIMERS BY FOLLOWING THIS LINK: HTTP://FITCHRATINGS.COM/UNDERSTANDINGCREDITRATINGS. IN ADDITION, RATING DEFINITIONS AND THE TERMS OF USE OF SUCH RATINGS ARE AVAILABLE ON THE AGENCY’S PUBLIC WEBSITE ‘WWW.FITCHRATINGS.COM‘. PUBLISHED RATINGS, CRITERIA AND METHODOLOGIES ARE AVAILABLE FROM THIS SITE AT ALL TIMES. FITCH’S CODE OF CONDUCT, CONFIDENTIALITY, CONFLICTS OF INTEREST, AFFILIATE FIREWALL, COMPLIANCE AND OTHER RELEVANT POLICIES AND PROCEDURES ARE ALSO AVAILABLE FROM THE ‘CODE OF CONDUCT’ SECTION OF THIS SITE. FITCH MAY HAVE PROVIDED ANOTHER PERMISSIBLE SERVICE TO THE RATED ENTITY OR ITS RELATED THIRD PARTIES. DETAILS OF THIS SERVICE FOR RATINGS FOR WHICH THE LEAD ANALYST IS BASED IN AN EU-REGISTERED ENTITY CAN BE FOUND ON THE ENTITY SUMMARY PAGE FOR THIS ISSUER ON THE FITCH WEBSITE.

FinanceFinancial AidFitch Ratingsstudent loans Contact:

Fitch Ratings

Tracy Wan

Senior Director

US Structured Finance, Asset Backed Securities

+1 212-908-9171

33 Whitehall Street

New York, NY

or

Brendan Sheehy

Director

US Banks

+ 1 212-908-9138

or

Rob Rowan

Senior Director

Fitch Wire

+1 212-908-9159

or

Media Relations

Sandro Scenga, +1 212-908-0278

sandro.scenga@fitchratings.com […]

Fitch Upgrades Transportadora de Gas Internacional S.A. E.S.P.'s IDR to 'BBB'; Outlook Stable

NEW YORK–(BUSINESS WIRE)–

Fitch Ratings has upgraded Transportadora de Gas Internacional S.A. E.S.P.’s (TGI) ratings as follows:

–Foreign and local currency Issuer Default Ratings (IDRs) to ‘BBB’ from ‘BBB-‘;

–International senior unsecured debt ratings to ‘BBB’ from ‘BBB-‘.

The Rating Outlook is Stable.

KEY RATING DRIVERS

TGI’s ratings reflect the company’s stable and predictable cash flow generation, business strength, as well as its solid liquidity position. Historically, TGI has benefited from its linkage to its primary shareholder, Empresa de Energia de Bogota S.A. E.S.P. (EEB), which supports the company through an intercompany loan. TGI’s exposure to regulatory risk is considered moderate further supporting its ratings.

STABLE CASH FLOW

TGI’s ratings reflect the company’s low business risk profile, which stems from its stable and predictable cash flow generation, as well as its strong competitive position. TGI has favorable long-term take-or-pay contracts with approximately 82% of revenues coming from regulated fixed tariffs. These fixed payments from a diversified portfolio of off-takers add to cash flow stability. The company has low exposure to volume risk as only 16% of revenues are linked to volume throughput. TGI’s pipeline location and the importance of its service area, where 70% of the Colombian population resides, represent substantial growth potential and help support the company’s credit profile and credit rating.

CONSTRUCTIVE REGULATORY RISK

TGI’s ratings also incorporate its exposure to regulatory risk, as the bulk of its revenue comes from contract tariffs, which are set by the regulator. The tariff structure for natural gas transportation companies is based on each company’s asset value, expected capital expenditures for expansion and remuneration for costs and operating expenses. Fitch considers the Colombian utilities’ regulatory framework to be balanced and fair to market participants and independent from the central government.

STRONG LIQUIDITY

The company’s adequate liquidity position is supported by its cash on hand, strong internal cash flow generation and favorable amortization schedule. TGI does not have significant amounts of debt coming due before 2022. On June 30, 2014, TGI’s cash and marketable securities totaled USD64 million, though this was due to the disbursement of a USD350 million intercompany loan made to parent company, EEB. This loan was used as a bridge by the parent for financing the purchase of the equity stake in TGI. The loan is in the process of being repaid by EEB, so TGI’s pro forma liquidity is a strong USD414 million versus short-term debt of USD15 million.

TGI’s regulated revenues are partially indexed to the U.S. dollar (approximately 63% of revenue are indexed to USD), which mitigates the risk from currency fluctuations as USD denominated revenues satisfactorily cover interest expenses. Going forward, the company’s liquidity position will be supported by its internal cash flow generation and easing capital investments needs as the company completed a significant portion of its expansion plan during 2012. Capital expenditures for 2014 to 2018 are estimated to be approximately USD350 million, a significant reduction from 2011 capital expenditures of USD733 million.

PARENT SUPPORT

TGI benefits from its parent company’s explicit and implicit support. EEB (Fitch IDR: ‘BBB’) owns 99.97% of TGI, and, in turn, the District Capital of Bogota (Bogota DC; foreign currency IDR ‘BBB’) owns 76.3% of EEB.

INCREASING LEVERAGE

TGI’s leverage level is moderate with debt to EBITDA of approximately 2.3 times (x) in dollar terms as of June 30, 2014. Including a USD370 million deeply subordinated intercompany loan from EEB, leverage would be approximately 3.4x in dollar terms. Going forward, TGI’s leverage will increase given EEB’s transaction to buy the 31.92% stake of TGI it did not previously own. The USD645 million in debt raised by EEB will be absorbed by TGI in 2015 when the transaction is finalized, and at that point Fitch expects leverage to rise to 4x. Given the company’s strong cash flow generation, leverage is expected to decline to the sub-3x level over time. As of the LTM ended June 30, 2014, the company reported an EBITDA of approximately USD338 million and total debt (including an equity credit for the subordinated intercompany loan) of approximately USD775 million.

DIVIDEND PAYMENTS BEGIN

In March 2014, TGI’s shareholders approved the first dividend distribution in the history of the company. The approved dividends amounted to 100% of 2013 net income (USD68 million). In addition, it is expected the company will payout an additional USD190 million in dividends from the company’s reserves by the end of 2014, with regular dividend payments forecast to average USD110 million/year starting in 2015. Given declining capex expectations and the company’s solid cash flow generation prospects, Fitch expects for the company to keep comfortable liquidity despite the payment of substantial dividends going forward.

RATING SENSITIVITIES

A negative rating action or outlook would be considered if the company’s standalone or underlying operating assets’ financial profile significantly deteriorates to a sustained leverage level above 4.0x.

A positive rating action is unlikely in the near to medium term given the company’s expected rise in leverage in 2015. A significant reduction of the company’s leverage after 2015 would be viewed positively.

Additional information is available at ‘www.fitchratings.com‘.

Applicable Criteria and Related Research:

–‘Corporate Rating Methodology’ (May 28, 2014).

Applicable Criteria and Related Research:

Corporate Rating Methodology – Including Short-Term Ratings and Parent and Subsidiary Linkage
http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=749393

Additional Disclosure

Solicitation Status
http://www.fitchratings.com/gws/en/disclosure/solicitation?pr_id=909635

ALL FITCH CREDIT RATINGS ARE SUBJECT TO CERTAIN LIMITATIONS AND DISCLAIMERS. PLEASE READ THESE LIMITATIONS AND DISCLAIMERS BY FOLLOWING THIS LINK: HTTP://FITCHRATINGS.COM/UNDERSTANDINGCREDITRATINGS. IN ADDITION, RATING DEFINITIONS AND THE TERMS OF USE OF SUCH RATINGS ARE AVAILABLE ON THE AGENCY’S PUBLIC WEBSITE ‘WWW.FITCHRATINGS.COM‘. PUBLISHED RATINGS, CRITERIA AND METHODOLOGIES ARE AVAILABLE FROM THIS SITE AT ALL TIMES. FITCH’S CODE OF CONDUCT, CONFIDENTIALITY, CONFLICTS OF INTEREST, AFFILIATE FIREWALL, COMPLIANCE AND OTHER RELEVANT POLICIES AND PROCEDURES ARE ALSO AVAILABLE FROM THE ‘CODE OF CONDUCT’ SECTION OF THIS SITE. FITCH MAY HAVE PROVIDED ANOTHER PERMISSIBLE SERVICE TO THE RATED ENTITY OR ITS RELATED THIRD PARTIES. DETAILS OF THIS SERVICE FOR RATINGS FOR WHICH THE LEAD ANALYST IS BASED IN AN EU-REGISTERED ENTITY CAN BE FOUND ON THE ENTITY SUMMARY PAGE FOR THIS ISSUER ON THE FITCH WEBSITE.

Security Upgrades & DowngradesFinanceFitch Ratings Contact:

Fitch Ratings

Primary Analyst

Xavier Olave, +1-212-612-7895

Associate Director

Fitch Ratings, Inc.

33 Whitehall Street

New York, NY 60602

or

Secondary Analyst

Natalia O’Byrne, +57-1-326-9999

Director

or

Committee Chairperson

Dan Kastholm, +1-312-368-2070

Managing Director

or

Media Relations, New York

Elizabeth Fogerty, +1-212-908-0526

elizabeth.fogerty@fitchratings.com […]

Fitch Affirms California Infra and Econ Devel Bank's $56MM SRF Rev Bonds at 'AAA'; Outlook Stable

CHICAGO–(BUSINESS WIRE)–

Fitch Ratings affirms its ‘AAA’ rating on the following California Infrastructure and Economic Development Bank (CIEDB) state revolving funds (SRF) revenue bonds issued under the 2012 master trust indenture (MTI) for the benefit of the California State Water Resources Control Board (SWRCB):

–Approximately $56 million in outstanding clean water SRF refunding revenue bonds, series 2012.

The Rating Outlook is Stable.

SECURITY

The series 2012 bonds are secured by pledged borrower loan repayments.

KEY RATING DRIVERS

STRONG FINANCIAL STRUCTURE: Fitch’s cash flow modeling demonstrates that SWRCB’s clean water SRF program (the program) would perform even with portfolio loan defaults in excess of Fitch’s ‘AAA’ liability default hurdle, as produced using Fitch’s Portfolio Stress Calculator (PSC).

SOLID LOAN SECURITY: All loans are secured by the obligors’ utility system revenue pledges.

HIGH BORROWER CONCENTRATION: The loan portfolio has single-borrower concentration. However, this risk is mitigated by the strong credit quality of the pool’s largest borrower, which is rated ‘AAA’ by Fitch, as well as by the expected diversification over time.

RATING SENSITIVITIES

REDUCTION OF STRUCTURAL ENHANCEMENT: A measurable decline in loan quality could pressure the rating. The Stable Outlook reflects Fitch’s view that structural enhancement and program credit quality will be sufficiently maintained.

CREDIT PROFILE

The 2012 MTI is an open indenture with bonds issued under separate supplemental series indentures. The program bonds are structured using a traditional cash flow model with pledged loan repayments securing the bonds. Bond proceeds are used to fund loans to local governments and other public entities throughout the state for clean water SRF projects.

FINANCIAL STRUCTURE EXHIBITS STRONG DEFAULT TOLERANCE

The SRF program’s scheduled pledged loan repayments are projected to provide significant minimum debt service coverage of 1.8x. Overall, Fitch calculates the program’s asset strength ratio (PASR) to be a strong 2.1x, which is notably higher than Fitch’s’ AAA’ median of 1.6x. The PASR includes total scheduled loan repayments divided by total scheduled bond debt service.

Given significant pledged resources, Fitch’s cash flow modeling demonstrates that the program can continue to pay bond debt service even with hypothetical loan defaults of 100% over the final four-year period of the bonds life (ending in 2018). This is in excess of Fitch’s ‘AAA’ liability stress hurdle of 25.8% as produced by the PSC. The liability stress hurdle is calculated based on overall pool credit quality as measured by the rating of underlying borrowers, size, and loan term.

While additional leverage is expected, Fitch believes that management will continue to keep coverage at levels that protect the program’s high credit quality given historical performance in other SWRCB revolving fund programs as well as existing management policies. In addition, SWRCB’s clean water SRF program benefit’s from a substantial pool of non-pledged loans totaling approximately $3.6 billion, which could be pledged at any time to the series 2012 and future program bonds.

SMALL POOL; HIGH BORROWER CONCENTRATION

The clean water loan pool has only 16 borrowers which results in high portfolio concentration risk. Orange County Water District, the largest borrower, represents approximately 28% of the total portfolio, with the second largest borrower (the city of Hayward) accounting for 11% of the pool. Fitch anticipates that the pool will begin to diversify slightly in the next two years as additional borrowers are expected to be added to support future clean water leverage under the MTI.

UNDERLYING BORROWER QUALITY REMAINS FAVORABLE

The 2012 MTI pool’s loan credit quality is strong. Fitch estimates that at least 55% of all loan principal is of ‘A+’ credit quality or higher. Furthermore, underlying loan security is solid, with loan repayments primarily secured by each borrower’s water or wastewater utility system revenues, a pledge which Fitch believes is very strong.

Additional information is available at ‘www.fitchratings.com‘.

Applicable Criteria and Related Research:

–‘Revenue-Supported Rating Criteria’, dated June 16, 2014;

–‘State Revolving Fund and Leveraged Municipal Loan Pool Criteria’, dated April 28, 2014.

Applicable Criteria and Related Research:

State Revolving Fund and Leveraged Municipal Loan Pool Criteria

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=746076

Revenue-Supported Rating Criteria

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=750012

Additional Disclosure

Solicitation Status

http://www.fitchratings.com/gws/en/disclosure/solicitation?pr_id=892994

ALL FITCH CREDIT RATINGS ARE SUBJECT TO CERTAIN LIMITATIONS AND DISCLAIMERS. PLEASE READ THESE LIMITATIONS AND DISCLAIMERS BY FOLLOWING THIS LINK: HTTP://FITCHRATINGS.COM/UNDERSTANDINGCREDITRATINGS. IN ADDITION, RATING DEFINITIONS AND THE TERMS OF USE OF SUCH RATINGS ARE AVAILABLE ON THE AGENCY’S PUBLIC WEBSITE ‘WWW.FITCHRATINGS.COM‘. PUBLISHED RATINGS, CRITERIA AND METHODOLOGIES ARE AVAILABLE FROM THIS SITE AT ALL TIMES. FITCH’S CODE OF CONDUCT, CONFIDENTIALITY, CONFLICTS OF INTEREST, AFFILIATE FIREWALL, COMPLIANCE AND OTHER RELEVANT POLICIES AND PROCEDURES ARE ALSO AVAILABLE FROM THE ‘CODE OF CONDUCT’ SECTION OF THIS SITE. FITCH MAY HAVE PROVIDED ANOTHER PERMISSIBLE SERVICE TO THE RATED ENTITY OR ITS RELATED THIRD PARTIES. DETAILS OF THIS SERVICE FOR RATINGS FOR WHICH THE LEAD ANALYST IS BASED IN AN EU-REGISTERED ENTITY CAN BE FOUND ON THE ENTITY SUMMARY PAGE FOR THIS ISSUER ON THE FITCH WEBSITE.

BondsSecurity Upgrades & DowngradesFitch Ratings Contact:

Fitch Ratings

Primary Analyst

Adrienne M. Booker, +1 312-368-5471

Senior Director

Fitch Ratings, Inc.

70 W. Madison Street

Chicago, IL 60602

or

Secondary Analyst

Major Parkhurst, +1 512-215-3724

Director

or

Committee Chairperson

Karen Ribble, +1 415-732-5611

Senior Director

or

Media Relations:

Elizabeth Fogerty, +1 212-908-0526

elizabeth.fogerty@fitchratings.com […]

Fitch Rates Level 3 Financing Secured Credit Facility 'BB+/RR1'; Outlook Remains Positive

CHICAGO–(BUSINESS WIRE)–

Fitch Ratings has assigned a ‘BB+/RR1’ rating to Level 3 Financing, Inc.’s proposed senior secured term loan (Tranche B 2022 Term Loan) under its existing senior secured credit facility. Level 3 Financing is a wholly owned subsidiary of Level 3 Communications, Inc. (LVLT). The Issuer Default Rating (IDR) for both LVLT and Level 3 Financing is ‘B+’ with a Positive Rating Outlook. LVLT had approximately $8.4 billion of consolidated debt outstanding on June 30, 2014.

Proceeds generated from the Tranche B 2022 are expected to be used to fund the cash utilized to fund, in part, the cash consideration of LVLT’s previously announced acquisition of TW Telecom, Inc. (TWTC). The terms of the Tranche B 2022, including the security and guaranty structure are expected to be substantially similar to the existing Tranche B-III 2019 term loan and the Tranche B 2020 term loan.

Overall, LVLT expects to issue $3 billion of debt, including Level 3 Escrow II, Inc.’s $1 billion issuance of 5.375% senior notes due 2022, which will be used to pay the cash consideration of the TWTC acquisition and repay outstanding TWTC indebtedness. Pro forma for the TWTC acquisition, Fitch estimates LVLT will have approximately $11.5 billion of debt. The transaction is subject to shareholder approval (vote scheduled for Oct. 28, 2014) and customary regulatory approvals including the FCC and other U.S. and state regulatory agencies. The U.S. Department of Justice previously approved LVLT’s pending acquisition of TWTC on Sept. 8, 2014. LVLT anticipates the transaction will close by year-end 2014.

KEY RATING DRIVERS

–The TW Telecom, Inc. (TWTC) acquisition increases LVLT’s scale and focus on high-margin enterprise account revenues while increasing the company’s overall competitive position and ability to capture incremental market share.

–The acquisition is clearly in line with LVLT’s strategy to shift its revenue and customer focus to become a predominantly enterprise-focused entity.

–LVLT remains committed to operate within its 3x to 5x net leverage target. The enhanced scale and ability to generate meaningful free cash flow (FCF) resulting from the transaction reinforces Fitch’s expectation for further strengthening of LVLT’s credit profile.

–The company is poised to generate sustainable levels of free cash flow (FCF; defined as cash flow from operations less capital expenditures and dividends). Fitch anticipates LVLT FCF generation during 2014 will range between 4% and 4.5% of consolidated revenues on a stand-alone basis, growing to nearly 10% of revenues by year-end 2016 on a pro forma basis.

–The operating leverage inherent within LVLT’s business model positions the company to expand both gross and EBITDA margins.

LVLT leverage strengthened to 4.7x as of the LTM ended June 30, 2014, reflecting a decrease from 5.2x as of year-end 2013 and 5.4x as of the LTM ended June 30, 2013. Fitch expects LVLT leverage on a stand-alone basis will approach 4.5x by the end of 2014. Fitch continues to expect LVLT’s credit profile will strengthen as the company benefits from anticipated EBITDA growth, FCF generation and cost synergies related to the TWTC acquisition. Consolidated leverage on a pro forma basis is 5.1x before consideration of any operating cost synergies and declines to 4.7x after factoring in $200 million of anticipated operating cost synergies.

The TWTC acquisition improves LVLT’s ability to generate consistent levels of FCF. Fitch anticipates LVLT FCF generation during 2014 will range between 4% and 4.5% of consolidated revenues on a stand-alone basis before growing to nearly 10% by year-end 2016 on a pro forma basis. The company has generated approximately $147 million of FCF through the LTM ended June 30, 2014. Fitch believes the company’s ability to grow high-margin core network services (CNS) revenues coupled with the strong operating leverage inherent in its operating profile position the company to generate consistent levels of FCF.

The TWTC acquisition is in line with LVLT’s strategy to shift its revenue and customer focus to become a predominately enterprise-focused entity. TWTC’s strong metropolitan network supports LVLT’s overall strategy. Pro forma for the transaction, LVLT’s revenue from enterprise customers increases to 70% of total CNS revenue from 66%. From a regional perspective North America CNS revenue would increase to 78% of total CNS revenue, up from approximately 71%.

LVLT’s network capabilities, in particular its strong metropolitan network, along with a broad product and service portfolio emphasizing IP-based infrastructure and managed services provide the company a solid base to grow its enterprise segment revenues. Fitch believes that revenue growth prospects within LVLT’s CNS segment stand to benefit from the transition among enterprise customers from legacy time division multiplexing (TDM) communications infrastructure to Ethernet or IP VPN infrastructure based on Internet protocol.

Fitch believes that LVLT’s liquidity position is adequate given the rating, and that overall financial flexibility is enhanced with positive FCF generation. The company’s liquidity position is primarily supported by cash carried on its balance sheet which as of June 30, 2014 totaled approximately $637 million, and expected FCF generation. LVLT does not maintain a revolver, which limits its financial flexibility in Fitch’s opinion. LVLT has no significant maturities scheduled during the remainder of 2014. LVLT’s next scheduled maturity is not until 2015 when approximately $475 million of debt is scheduled to mature or convert into equity.

RATING SENSITIVITIES

What Could Lead to a Positive Rating Action:

–Consolidated leverage maintained at 4x or lower;

–Consistent generation of positive FCF, with FCF-to-adjusted debt of 5% or greater;

–Positive operating momentum characterized by consistent core network service revenue growth and gross margin expansion.

What Could Lead to a Negative Rating Action:

–Weakening of LVLT’s operating profile, as signaled by deteriorating margins and revenue erosion brought on by difficult economic conditions or competitive pressure;

–Discretionary management decisions including but not limited to execution of merger and acquisition activity that increases leverage beyond 5.5x in the absence of a credible de-leveraging plan.

Additional information is available at ‘www.fitchratings.com‘.

Applicable Criteria and Related Research:

–‘Corporate Rating Methodology’ (May 28, 2014).

Applicable Criteria and Related Research:

Corporate Rating Methodology: Including Short-Term Ratings and Parent and Subsidiary Linkage

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=715139

Additional Disclosure

Solicitation Status

http://www.fitchratings.com/gws/en/disclosure/solicitation?pr_id=891054

ALL FITCH CREDIT RATINGS ARE SUBJECT TO CERTAIN LIMITATIONS AND DISCLAIMERS. PLEASE READ THESE LIMITATIONS AND DISCLAIMERS BY FOLLOWING THIS LINK: HTTP://FITCHRATINGS.COM/UNDERSTANDINGCREDITRATINGS. IN ADDITION, RATING DEFINITIONS AND THE TERMS OF USE OF SUCH RATINGS ARE AVAILABLE ON THE AGENCY’S PUBLIC WEBSITE ‘WWW.FITCHRATINGS.COM‘. PUBLISHED RATINGS, CRITERIA AND METHODOLOGIES ARE AVAILABLE FROM THIS SITE AT ALL TIMES. FITCH’S CODE OF CONDUCT, CONFIDENTIALITY, CONFLICTS OF INTEREST, AFFILIATE FIREWALL, COMPLIANCE AND OTHER RELEVANT POLICIES AND PROCEDURES ARE ALSO AVAILABLE FROM THE ‘CODE OF CONDUCT’ SECTION OF THIS SITE. FITCH MAY HAVE PROVIDED ANOTHER PERMISSIBLE SERVICE TO THE RATED ENTITY OR ITS RELATED THIRD PARTIES. DETAILS OF THIS SERVICE FOR RATINGS FOR WHICH THE LEAD ANALYST IS BASED IN AN EU-REGISTERED ENTITY CAN BE FOUND ON THE ENTITY SUMMARY PAGE FOR THIS ISSUER ON THE FITCH WEBSITE.

Security Upgrades & DowngradesFinance Contact:

Fitch Ratings

Primary Analyst

David Peterson, +1-312-368-3177

Senior Director

Fitch Ratings, Inc.

70 W. Madison Street

Chicago, IL 60602

or

Secondary Analyst

Bill Densmore, +1-312-368-3125

Senior Director

or

Committee Chairperson

Michael Weaver, +1-312-368-3156

Managing Director

or

Media Relations

Brian Bertsch, New York, +1-212-908-0549

brian.bertsch@fitchratings.com […]

Fitch Affirms ARMSS 2004-1

NEW YORK–(BUSINESS WIRE)–

Fitch Ratings has affirmed all rated classes of Arbor Realty Mortgage Securities Series 2004-1, Ltd. / LLC (ARMSS 2004-1) reflecting Fitch’s base case loss expectation of 66%. Fitch’s performance expectation incorporates prospective views regarding commercial real estate market value and cash flow declines. A detailed list of rating actions follows at the end of this release.

KEY RATING DRIVERS

Since the last rating action, total pay down to class A-1 from payoffs and loan amortization has been $36 million. No realized losses were reported over the period. The CDO exited its reinvestment period in April 2009; however, the loan documents allow for some continued substitution of credit improved collateral. Since last rating action, four new loan interests were added totaling $7.5 million.

The CDO remains under collateralized by approximately $23 million. As of the July 2014 trustee report, all par value and interest coverage tests were in compliance.

ARMSS 2004-1 is a CRE collateralized debt obligation (CDO) managed by Arbor Realty Collateral Management, LLC (Arbor). As of the July 2014 trustee report and per Fitch categorizations, the CDO was substantially invested as follows: B-notes (56.7%), whole loans/A-notes (8.8%), preferred equity (22.5%), mezzanine debt (10.1%), and cash (1.9%). Approximately 82% of the pool consists of assets that are either defaulted or Loans of Concern. Fitch expects significant losses on many of the assets as they are highly leveraged subordinate positions.

Under Fitch’s methodology, approximately 96.9% of the portfolio is modeled to default in the base case stress scenario, defined as the ‘B’ stress. In this scenario, the modeled average cash flow decline is 6.8% from, generally, year-end 2013 or trailing 12 months 1Q 2014. Recoveries are below average at 31.9% due to the high percentage of subordinate debt.

The largest component of Fitch’s base case loss expectation is a preferred equity position (14.8% of the pool) on an over 150 property multifamily portfolio located across multiple states. As of June 2014, occupancy was 90%. In early 2013, the senior debt was modified into an A/B note structure and transferred out of special servicing. Fitch modeled a full loss in its base case scenario on this overleveraged position.

The next largest component of Fitch’s base case loss expectation is related to an A-note and B-note (12.4%) secured by a portfolio of five full and limited service hotels located in Daytona Beach, FL. The portfolio was previously in bankruptcy, and an Arbor affiliate took title to the properties in February 2011. While new management has been installed at the properties, it is expected to take time for performance at all five properties to stabilize. A sixth poorly performing hotel was sold in December 2012 with proceeds applied to the senior debt. Fitch modeled a term default and a substantial loss on these loan interests in its base case scenario.

The transaction was analyzed according to the ‘Surveillance Criteria for U.S. CREL CDOs and CMBS Large Loan Floating-Rate Transactions’, which applies stresses to property cash flows and debt service coverage ratio tests to project future default levels for the underlying portfolio. Recoveries are based on stressed cash flows and Fitch’s long-term capitalization rates. The default levels were then compared to the breakeven levels generated by Fitch’s cash flow model of the CDO under the various defaults timing and interest rate stress scenarios as described in the report ‘Global Rating Criteria for Structured Finance CDOs’. The breakeven rates for classes A and B are generally consistent with the ratings listed below.

The Stable Outlook on class A generally reflects the class’s seniority in the capital stack and expectation of continued further pay down over the near term. The Negative Outlook to class B reflects the potential for further negative credit migration of the underlying collateral.

The ratings for classes C and D are based on a deterministic analysis that considers Fitch’s base case loss expectation for the pool and the current percentage of defaulted assets and Fitch Loans of Concern factoring in anticipated recoveries relative to each classes credit enhancement.

RATING SENSITIVITIES

If the collateral continues to repay at or near par, classes may be upgraded. The junior classes are subject to further downgrade should realized losses begin to increase.

Fitch affirms the following classes:

–$29.1 million class A at ‘BBBsf’; Outlook Stable;

–$51.6 million class B at ‘Bsf’; Outlook Negative;

–$27.6 million class C at ‘CCCsf’; RE 10%;

–$11.2 million class D at ‘CCCsf’; RE 0%.

Additional information is available at ‘www.fitchratings.com‘.

Applicable Criteria and Related Research:

–‘Global Structured Finance Rating Criteria’ (Aug. 4, 2014);

–‘Surveillance Criteria for U.S. CREL CDOs and CMBS Large Loan Floating-Rate Transactions’ (Nov. 25, 2013);

–‘Global Rating Criteria for Structured Finance CDOs’ (July 16, 2014).

Applicable Criteria and Related Research:

Global Structured Finance Rating Criteria

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=754389

Surveillance Criteria for U.S. CREL CDOs and CMBS Large Loan Floating-Rate Transactions

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=723059

Global Rating Criteria for Structured Finance CDOs

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=751136

Additional Disclosure

Solicitation Status

http://www.fitchratings.com/gws/en/disclosure/solicitation?pr_id=866074

ALL FITCH CREDIT RATINGS ARE SUBJECT TO CERTAIN LIMITATIONS AND DISCLAIMERS. PLEASE READ THESE LIMITATIONS AND DISCLAIMERS BY FOLLOWING THIS LINK: HTTP://FITCHRATINGS.COM/UNDERSTANDINGCREDITRATINGS. IN ADDITION, RATING DEFINITIONS AND THE TERMS OF USE OF SUCH RATINGS ARE AVAILABLE ON THE AGENCY’S PUBLIC WEBSITE ‘WWW.FITCHRATINGS.COM‘. PUBLISHED RATINGS, CRITERIA AND METHODOLOGIES ARE AVAILABLE FROM THIS SITE AT ALL TIMES. FITCH’S CODE OF CONDUCT, CONFIDENTIALITY, CONFLICTS OF INTEREST, AFFILIATE FIREWALL, COMPLIANCE AND OTHER RELEVANT POLICIES AND PROCEDURES ARE ALSO AVAILABLE FROM THE ‘CODE OF CONDUCT’ SECTION OF THIS SITE. FITCH MAY HAVE PROVIDED ANOTHER PERMISSIBLE SERVICE TO THE RATED ENTITY OR ITS RELATED THIRD PARTIES. DETAILS OF THIS SERVICE FOR RATINGS FOR WHICH THE LEAD ANALYST IS BASED IN AN EU-REGISTERED ENTITY CAN BE FOUND ON THE ENTITY SUMMARY PAGE FOR THIS ISSUER ON THE FITCH WEBSITE.

Security Upgrades & DowngradesFinanceFitch RatingsCDO Contact:

Fitch Ratings

Primary Surveillance Analyst

Stacey McGovern

Director

+1-212-908-0722

Fitch Ratings, Inc.

33 Whitehall Street, New York 10004

or

Committee Chairperson

Mary MacNeill

Managing Director

+1-212-908-0785

or

Media Relations

Sandro Scenga, New York, +1-212-908-0278

sandro.scenga@fitchratings.com […]

Fitch Affirms GT Loan Financing I, Ltd.'s Ratings

NEW YORK–(BUSINESS WIRE)–

Fitch Ratings has affirmed the class A notes issued by GT Loan Financing I, Ltd. (GT Loan I) at ‘AAAsf’. The Rating Outlook remains Stable.

KEY RATING DRIVERS

The affirmation is based on the stable performance of the underlying portfolio since Fitch’s last review and the stable credit enhancement available to the notes. As of the July 14, 2014 trustee report, the transaction continues to pass all of its coverage tests and collateral quality tests, and there are currently no defaults in the underlying portfolio.

The loan portfolio par amount plus principal cash is approximately $191 million, compared to the effective date target balance of $190 million. The minimum required weighted average spread (WAS) trigger is 4.0%, versus a current WAS of 4.4%, as reported by the trustee. Additionally, the weighted average rating factor is at ‘B/B-‘, in line with the level at closing. Fitch considers 2.6% of the collateral assets to be rated in the ‘CCC’ category versus 6.2% at closing, based on Fitch’s Issuer Default Rating (IDR) Equivalency Map. Currently, 94.3% of the portfolio has strong recovery prospects or a Fitch-assigned Recovery Rating of ‘RR2’ or higher.

The Stable Outlook reflects the expectation that the class A notes have a sufficient level of credit protection to withstand potential deterioration in the credit quality of the portfolio, based on the results of the Fitch sensitivity analysis described below.

RATING SENSITIVITIES

The ratings of the notes may be sensitive to the following: asset defaults, portfolio migration, including assets being downgraded to ‘CCC’, portions of the portfolio being placed on Rating Watch Negative, overcollateralization (OC) or interest coverage (IC) test breaches, or breach of concentration limitations or portfolio quality covenants. Fitch conducted rating sensitivity analysis on the closing date of GT Loan I, incorporating increased levels of defaults and reduced levels of recovery rates, among other sensitivities.

GT Loan Financing I, Ltd. (the issuer) is an arbitrage cash flow collateralized loan obligation (CLO) that is managed by GoldenTree Asset Management, LP (GoldenTree). Net proceeds from the issuance of the secured and subordinated notes were used to purchase a portfolio of approximately $190 million of primarily senior secured leveraged loans. The CLO has a four-year reinvestment period, ending in October 2017.

This review was conducted under the framework described in the report ‘Global Rating Criteria for Corporate CDOs’ using the Portfolio Credit Model (PCM) for projecting future default and recovery levels for the underlying portfolio. Given the stable performance of the deal since closing in September 2013, no updated cash flow modeling was completed. The WAS, WAL, and PCM outputs are similar to the levels at closing. The current portfolio’s ‘AAAsf’ Rating Default Rate (RDR) and Rating Recovery Rate (RRR) outputs from PCM are 53.6% and 39.4%, respectively, versus an RDR of 63.9% and RRR of 35.2% for the Fitch stressed portfolio at closing.

Initial Key Rating Drivers and Rating Sensitivity are further described in the New Issue Report published on Oct. 22, 2013. A comparison of the transaction’s Representations, Warranties, and Enforcement Mechanisms (RW&Es) to those of typical RW&Es for that asset class is also available by accessing the reports and links indicated below.

Fitch has affirmed the following ratings:

–$110,000,000 class A notes ‘AAAsf’; Outlook Stable;

Fitch does not rate the class B, C, or the Subordinated Notes.

Additional information is available at ‘www.fitchratings.com‘.

Applicable Criteria & Related Research:

–‘Global Structured Finance Rating Criteria’ (August 4, 2014);

–‘Global Rating Criteria for Corporate CDOs’ (July 25, 2014);

–‘Counterparty Criteria for Structured Finance and Covered Bonds’ (May 14, 2014);

–‘GT Loan Financing I, Ltd. New Issue Report’ (Oct. 22, 2013);

–‘GT Loan Financing I, Ltd. – Appendix’ (Oct. 22, 2013).

Applicable Criteria and Related Research:

GT Loan Financing I, Ltd.

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=719236

GT Loan Financing I, Ltd. – Appendix

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=716722

Counterparty Criteria for Structured Finance and Covered Bonds

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=744158

Global Rating Criteria for Corporate CDOs

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=753057

Global Structured Finance Rating Criteria

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=754389

Additional Disclosure

Solicitation Status

http://www.fitchratings.com/gws/en/disclosure/solicitation?pr_id=861594

ALL FITCH CREDIT RATINGS ARE SUBJECT TO CERTAIN LIMITATIONS AND DISCLAIMERS. PLEASE READ THESE LIMITATIONS AND DISCLAIMERS BY FOLLOWING THIS LINK: HTTP://FITCHRATINGS.COM/UNDERSTANDINGCREDITRATINGS. IN ADDITION, RATING DEFINITIONS AND THE TERMS OF USE OF SUCH RATINGS ARE AVAILABLE ON THE AGENCY’S PUBLIC WEBSITE ‘WWW.FITCHRATINGS.COM‘. PUBLISHED RATINGS, CRITERIA AND METHODOLOGIES ARE AVAILABLE FROM THIS SITE AT ALL TIMES. FITCH’S CODE OF CONDUCT, CONFIDENTIALITY, CONFLICTS OF INTEREST, AFFILIATE FIREWALL, COMPLIANCE AND OTHER RELEVANT POLICIES AND PROCEDURES ARE ALSO AVAILABLE FROM THE ‘CODE OF CONDUCT’ SECTION OF THIS SITE. FITCH MAY HAVE PROVIDED ANOTHER PERMISSIBLE SERVICE TO THE RATED ENTITY OR ITS RELATED THIRD PARTIES. DETAILS OF THIS SERVICE FOR RATINGS FOR WHICH THE LEAD ANALYST IS BASED IN AN EU-REGISTERED ENTITY CAN BE FOUND ON THE ENTITY SUMMARY PAGE FOR THIS ISSUER ON THE FITCH WEBSITE.

Security Upgrades & DowngradesFinanceFitch Ratings Contact:

Fitch Ratings

Primary Surveillance Analyst

Shashi Srikantan

Director

+1-212-908-0393

Fitch Ratings, Inc.

33 Whitehall Street

New York, NY 10004

or

Committee Chairperson

Derek Miller

Senior Director

+1-312-368-2076

or

Media Relations

Sandro Scenga, New York, +1-212-908-0278

sandro.scenga@fitchratings.com […]

Fitch Rates AP WIP Holdings, LLC Notes Maturing 2019 'BBBsf'

NEW YORK–(BUSINESS WIRE)–

Fitch Ratings has assigned the following rating and Rating Outlook to AP WIP Holdings, LLC notes maturing 2019:

–$115,000,000 notes maturing 2019 ‘BBBsf’; Outlook Stable.

The ratings are based on information provided by the issuer as of Aug. 12, 2014.

The $115 million AP WIP Holdings, LLC loan maturing 2019 is backed by 630 wireless sites with 860 wireless tenant leases. Of the $115 million, $90 million is advanced at closing with an additional $25 million available to purchase eligible additional assets. The transaction is an issuance of notes backed by mortgages representing approximately 96% of the annualized net cash flow, a first priority perfected security interest in the personal property associated with the mortgaged sites, and a perfected security interest in the personal property and fixtures of the asset entities of the non-mortgaged sites. The transaction is structured as interest-only through the anticipated repayment date in 2019.

The ownership interest in the wireless sites consists of lease purchase sites, easements and fee interests in land, rooftops or other structures on which site space is allocated for placement of tower and wireless communication equipment.

KEY RATING DRIVERS

Cash flow and leverage: Fitch’s net cash flow (NCF) on the pool is approximately $14.9 million (including prefunding), which is approximately 4.4% below the issuer’s NCF, implying a Fitch stressed debt service coverage ratio (DSCR) of 1.37x including all potential future prefunding. Gross potential rents were determined on a tenant-by-tenant basis per Fitch’s ‘Criteria for Analyzing U.S. Wireless Tower Transactions’. The debt multiple relative to Fitch’s NCF for the loan is 7.69x, which equates to a debt yield of 13%.

Leases to Strong Tower Tenants: There are 860 wireless tenant leases. Telephony tenants represent 99.5% of the leases on the cellular sites. AT&T (rated ‘A’, Outlook Negative by Fitch) and Verizon (rated ‘A-‘) are the largest tenants, representing approximately 21% each of the total issuer cash flow. The tenant leases have average annual escalators of approximately 3.07%.

Reasonable Diversification: There are 630 sites spanning 50 states. The largest state (California) represents approximately 21.6% of issuer cash flow.

Loan secured by mortgages and first-priority security interests: The loan is secured by: perfected first mortgage liens on the interests of the asset entities in fee assets, ground leased assets, and other sites representing approximately 96.9% of the NCF from all such assets; and the equity interests of the issuers and each asset entity, as well as various transaction accounts and agreements. The security interests in the equity of the issuers and the asset entities provide noteholders with the ability to foreclose on the ownership of the issuers and the asset entities in addition to their assets pledged as collateral in the event of default.

Importance of Towers to Wireless Service Providers: Increased smartphone penetration and data usage have increased the need for cell towers. With wireless service providers (WSPs) moving to 4G networks, there is a need for additional towers, since 4G has a smaller range per WSP. The emergence of tablets and other devices adds additional demands for higher speeds and network build-outs.

Risk of Technological Obsolescence: The notes have a rated final payment date 25 years after closing, and the long-term tenor of the notes increases the risk that an alternative technology – rendering obsolete the current transmission of wireless signals through cellular sites – will be developed. Currently, WSPs depend on towers to transmit their signals and continue to invest in this technology.

Additional Notes: It is expected that the transaction will allow for the issuance of additional notes. Such additional notes may rank pari passu with or subordinate to the 2014 notes. The additional notes will be pari passu with and be rated the same as any class of notes bearing the same alphabetical class designation. Additional notes may be issued without the benefit of additional collateral, provided the post-issuance DSCR is not less than 2.0x. As Fitch monitors the transaction, the possibility of upgrades may be limited due to the provision that allows additional notes and cash flow deterioration.

Prefunding: It is expected that on the closing date, approximately 22% of the total rated proceeds can be used by AP to acquire additional cellular sites during the 12-month acquisition period via further advances as allowed under the loan agreement. Prefunding introduces uncertainty as to final collateral characteristics. Fitch accounted for prefunding by stressing the NCF of the prefunding component to reflect the most conservative prefunding pool composition tests. Fitch also performed an originator review including a site inspection to gain comfort with AP’s origination practices. Additionally, the calculation agent, Deutsche Bank Trust Company Americas, will be performing certain recalculation of prefunding requirements outlined in the documents.

Structural Features: The transaction features an upfront reserve account with an initial balance of approximately $2.6 million. The reserve account thereafter has a minimum balance of $2.6 million, or six months interest payments, and is replenished. The transaction also features mandatory prepayments if the advances are greater than 7.75x the eligible free cash flow. This allows for the prepayment of the loan if sites become ineligible due to condemnation, concentration or missed payments (among other criteria). Site eligibility is outlined in the transaction documents. The calculation agent monitors the structural triggers on a monthly basis.

RATING SENSITIVITIES

Fitch performed several stress scenarios in which Fitch’s NCF was stressed. Fitch determined that a 26.9% reduction in Fitch’s NCF would cause the notes to break even at 1.0x DSCR on an interest-only basis.

Fitch evaluated the sensitivity of the ratings and an 11.9% decline in NCF would result in a one-category downgrade to ‘BBsf’, while a 30.6% decline would result in a downgrade below ‘CCCsf’.

Additional information is available at ‘www.fitchratings.com‘.

Applicable Criteria and Related Research:

–‘Global Structured Finance Rating Criteria'(May 24, 2013);

–‘Criteria for Analyzing U.S. Wireless Tower Transactions’ (Dec. 3, 2013).

Applicable Criteria and Related Research: AP WIP Holdings, LLC maturing 2019

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=754056

Global Structured Finance Rating Criteria – Effective from 20 May 2014 to 4 August 2014

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=748821

Criteria for Analyzing U.S. Wireless Tower Transactions

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=724675

Additional Disclosure

Solicitation Status

http://www.fitchratings.com/gws/en/disclosure/solicitation?pr_id=849794

ALL FITCH CREDIT RATINGS ARE SUBJECT TO CERTAIN LIMITATIONS AND DISCLAIMERS. PLEASE READ THESE LIMITATIONS AND DISCLAIMERS BY FOLLOWING THIS LINK: HTTP://FITCHRATINGS.COM/UNDERSTANDINGCREDITRATINGS. IN ADDITION, RATING DEFINITIONS AND THE TERMS OF USE OF SUCH RATINGS ARE AVAILABLE ON THE AGENCY’S PUBLIC WEBSITE ‘WWW.FITCHRATINGS.COM‘. PUBLISHED RATINGS, CRITERIA AND METHODOLOGIES ARE AVAILABLE FROM THIS SITE AT ALL TIMES. FITCH’S CODE OF CONDUCT, CONFIDENTIALITY, CONFLICTS OF INTEREST, AFFILIATE FIREWALL, COMPLIANCE AND OTHER RELEVANT POLICIES AND PROCEDURES ARE ALSO AVAILABLE FROM THE ‘CODE OF CONDUCT’ SECTION OF THIS SITE. FITCH MAY HAVE PROVIDED ANOTHER PERMISSIBLE SERVICE TO THE RATED ENTITY OR ITS RELATED THIRD PARTIES. DETAILS OF THIS SERVICE FOR RATINGS FOR WHICH THE LEAD ANALYST IS BASED IN AN EU-REGISTERED ENTITY CAN BE FOUND ON THE ENTITY SUMMARY PAGE FOR THIS ISSUER ON THE FITCH WEBSITE.

Security Upgrades & DowngradesFinanceFitch Ratings Contact:

Fitch Ratings

Primary Analyst

Tara Sweeney

Senior Director

+1-212-908-0347

Fitch Ratings, Inc.

33 Whitehall Street

New York, NY 10004

or

Secondary Analyst

Jeffrey Diliberto

+1-212-908-9173

or

Committee Chairperson

Robert Vrchota

Managing Director

+1-312-606-3337

or

Media Relations

Sandro Scenga, New York, +1-212-908-0278

sandro.scenga@fitchratings.com […]

Fitch Affirms All Classes of Concord 2006-1

NEW YORK–(BUSINESS WIRE)–

Fitch Ratings has upgraded one class and affirmed six classes of Concord Real Estate CDO 2006-1, Ltd/LLC. (Concord 2006-1) reflecting Fitch’s base case loss expectation of 43.6%. Fitch’s performance expectation incorporates prospective views regarding commercial real estate market value and cash flow declines. A detailed list of rating actions follows at the end of this release.

KEY RATING DRIVERS

Since last rating action, class A-1 has received pay down totaling approximately $113 million primarily from the full and partial payoff of eight assets as well as scheduled amortization. Realized losses since last review were $4.2 million. The CDO is overcollateralized by approximately $48 million, as of the May 2014 trustee report. Per the asset manager, a $20 million loan was recently paid off in full. The principal proceeds are expected to be applied to pay down class A-1 at the next payment date.

As of the May 2014 trustee report, and per Fitch categorization, the CDO is substantially invested as follows: whole loans/A-notes (15%), B-notes (43%), mezzanine debt (15%), CMBS (14%), CDOs (5%), and cash (8%). There are interests in approximately 19 different assets contributed to the CDO. The current percentage of defaulted assets and assets of concern is 14.9% and 41.7%, respectively. The CDO is currently passing all of its par value and interest coverage tests.

Under Fitch’s methodology, approximately 60.3% of the portfolio is modeled to default in the base case stress scenario, defined as the ‘B’ stress. Modeled recoveries are below average at 27.7% reflecting the significant subordinate debt in the transaction.

The largest contributor to Fitch’s base case loss expectation is a B-note (13% of the total collateral) secured by two office towers located in Farmers Branch, TX. While the property is currently 100% leased to an investment grade tenant, the property is considered overleveraged, and Fitch modeled a substantial loss on this loan in its base case scenario.

The next largest contributor to Fitch’s base case loss expectation is a defaulted B-note (11.7% of the total collateral) secured by a 575-room full-service resort located in Tucson, AZ. Since August 2010, the loan has been in maturity default and the special servicer is pursuing foreclosure. Fitch modeled a substantial loss on this loan in its base case scenario.

This transaction was analyzed according to the ‘Surveillance Criteria for U.S. CREL CDOs and CMBS Large Loan Floating-Rate Transactions’, which applies stresses to property cash flows and debt service coverage ratio tests to project future default levels for the underlying portfolio. Recoveries are based on stressed cash flows and Fitch’s long-term capitalization rates. The default levels were then compared to the breakeven levels generated by Fitch’s cash flow model of the CDO under the various defaults timing and interest rate stress scenarios as described in the report ‘Global Criteria for Cash Flow Analysis in CDOs’. The breakeven rates for classes A through C pass the cash flow model at the ratings listed below.

The Positive and Stable Outlooks on classes A through C generally reflect the senior positions in the capital structure and/or cushion in the modeling.

The ‘CCC’ ratings for classes D through F are based on a deterministic analysis that considers Fitch’s base case loss expectation for the pool and the current percentage of defaulted assets and Fitch Assets of Concern, factoring in anticipated recoveries relative to each class’ credit enhancement.

RATING SENSITIVITIES

If the collateral continues to repay at or near par, classes may be upgraded. The junior classes are subject to further downgrade should realized losses begin to increase.

WRP Management, LLC is the collateral asset manager for the transaction. The CDO’s reinvestment period ended in December 2011.

Fitch upgrades the following:

–$20.3 million class A-1 to ‘A’ from ‘BBBsf’; Outlook Stable;

Fitch affirms the following classes and revises Outlooks as indicated:

–$23.3 million class A-2 at ‘BBsf’; Outlook to Positive from Stable;

–$46.5 million class B at ‘BBsf’; Outlook Stable;

–$10 million class C at ‘Bsf’; Outlook Stable;

–$6 million class D at ‘CCCsf’ RE 100%;

–$8.1 million class E at ‘CCCsf’; RE 100%;

–$22.4 million class F at ‘CCCsf’; RE 70%.

Additional information is available at ‘www.fitchratings.com‘.

Applicable Criteria and Related Research:

–‘Global Structured Finance Rating Criteria’ (May 20, 2014);

–‘Surveillance Criteria for U.S. CREL CDOs and CMBS Large Loan Floating-Rate Transactions’ (Nov. 25, 2013);

–‘Global Rating Criteria for Structured Finance CDOs’ (Sept. 12, 2013).

Applicable Criteria and Related Research:

Global Structured Finance Rating Criteria

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=748821

Surveillance Criteria for U.S. CREL CDOs and CMBS Large Loan Floating-Rate Transactions

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=723059

Global Rating Criteria for Structured Finance CDOs

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=718027

Additional Disclosure

Solicitation Status

http://www.fitchratings.com/gws/en/disclosure/solicitation?pr_id=835078

ALL FITCH CREDIT RATINGS ARE SUBJECT TO CERTAIN LIMITATIONS AND DISCLAIMERS. PLEASE READ THESE LIMITATIONS AND DISCLAIMERS BY FOLLOWING THIS LINK: HTTP://FITCHRATINGS.COM/UNDERSTANDINGCREDITRATINGS. IN ADDITION, RATING DEFINITIONS AND THE TERMS OF USE OF SUCH RATINGS ARE AVAILABLE ON THE AGENCY’S PUBLIC WEBSITE ‘WWW.FITCHRATINGS.COM‘. PUBLISHED RATINGS, CRITERIA AND METHODOLOGIES ARE AVAILABLE FROM THIS SITE AT ALL TIMES. FITCH’S CODE OF CONDUCT, CONFIDENTIALITY, CONFLICTS OF INTEREST, AFFILIATE FIREWALL, COMPLIANCE AND OTHER RELEVANT POLICIES AND PROCEDURES ARE ALSO AVAILABLE FROM THE ‘CODE OF CONDUCT’ SECTION OF THIS SITE. FITCH MAY HAVE PROVIDED ANOTHER PERMISSIBLE SERVICE TO THE RATED ENTITY OR ITS RELATED THIRD PARTIES. DETAILS OF THIS SERVICE FOR RATINGS FOR WHICH THE LEAD ANALYST IS BASED IN AN EU-REGISTERED ENTITY CAN BE FOUND ON THE ENTITY SUMMARY PAGE FOR THIS ISSUER ON THE FITCH WEBSITE.

Security Upgrades & DowngradesFinanceFitch Ratings Contact:

Fitch Ratings

Primary Surveillance Analyst

Stacey McGovern

Director

+1 212-908-0722

Fitch Ratings, Inc.

33 Whitehall Street

New York, NY 10004

or

Committee Chairperson

Mary MacNeill

Managing Director

+1 212-908-0785

or

Media Relations, New York

Sandro Scenga, +1 212-908-0278

sandro.scenga@fitchratings.com […]

Fitch: Navient's Expected Future Cash Flows Offer Degree of Downside Protection

CHICAGO–(BUSINESS WIRE)–

Link to Fitch Ratings’ Report: Cash Flow Analysis of Navient Corporation (Updated Cash Flow Projections Post Separation)
http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=748756

Navient Corporation’s (Navient) expected cash flows from the runoff portfolio and fee-based businesses would be sufficient to repay $18 billion in existing senior unsecured debt under a single factor stress scenario, according to Fitch Ratings.

This according to Fitch’s analysis of Navient’s (rated ‘BB’ with a Stable Outlook) $130 billion legacy FFELP and private student loan portfolio. That said, Navient’s ability to repay debt in full would come under pressure in a scenario where multiple stress factors are simultaneously applied.

Following the strategic separation of Navient from SLM Corporation (SLM) in April, Fitch assigned a new ‘BB’ IDR to Navient and transferred SLM’s senior unsecured debt ratings to Navient at ‘BB’. Per the terms of the separation, SLM’s existing public unsecured debt was assumed by Navient.

Ratings assigned to Navient’s outstanding debt reflect continued uncertainty regarding the long-term strategic direction of the company. However, Fitch believes the run-off cash flow analysis provides a degree of downside protection to debt holders.

The full report ‘Cash Flow Analysis of Navient Corporation’ is available at ‘www.fitchratings.com‘ or by clicking on the above link. This report updates Fitch’s earlier analysis of SLM Corporation published in July 2013.

Additional information is available on www.fitchratings.com.

ALL FITCH CREDIT RATINGS ARE SUBJECT TO CERTAIN LIMITATIONS AND DISCLAIMERS. PLEASE READ THESE LIMITATIONS AND DISCLAIMERS BY FOLLOWING THIS LINK: HTTP://FITCHRATINGS.COM/UNDERSTANDINGCREDITRATINGS. IN ADDITION, RATING DEFINITIONS AND THE TERMS OF USE OF SUCH RATINGS ARE AVAILABLE ON THE AGENCY’S PUBLIC WEBSITE ‘WWW.FITCHRATINGS.COM‘. PUBLISHED RATINGS, CRITERIA AND METHODOLOGIES ARE AVAILABLE FROM THIS SITE AT ALL TIMES. FITCH’S CODE OF CONDUCT, CONFIDENTIALITY, CONFLICTS OF INTEREST, AFFILIATE FIREWALL, COMPLIANCE AND OTHER RELEVANT POLICIES AND PROCEDURES ARE ALSO AVAILABLE FROM THE ‘CODE OF CONDUCT’ SECTION OF THIS SITE. FITCH MAY HAVE PROVIDED ANOTHER PERMISSIBLE SERVICE TO THE RATED ENTITY OR ITS RELATED THIRD PARTIES. DETAILS OF THIS SERVICE FOR RATINGS FOR WHICH THE LEAD ANALYST IS BASED IN AN EU-REGISTERED ENTITY CAN BE FOUND ON THE ENTITY SUMMARY PAGE FOR THIS ISSUER ON THE FITCH WEBSITE.

FinanceInvestment & Company InformationFitch RatingsSLM Corporation Contact:

Fitch Ratings

Brendan Sheehy

Director

+1 212-908-9138

Fitch Ratings, Inc.

33 Whitehall Street

NY, NY 10004

or

Media Relations, New York

Alyssa Castelli, +1 212-908-0540

alyssa.castelli@fitchratings.com […]

Fitch Rates GoldenTree Loan Opportunities VIII, Limited/LLC

NEW YORK–(BUSINESS WIRE)–

Fitch Ratings assigns the following ratings to GoldenTree Loan Opportunities VIII Limited/LLC:

— $364,800,000 class A notes ‘AAAsf’; Outlook Stable.

TRANSACTION SUMMARY

GoldenTree Loan Opportunities VIII, Limited (the issuer) and GoldenTree Loan Opportunities VIII, LLC (the co-issuer) together comprise an arbitrage cash flow collateralized loan obligation (CLO) that will be managed by GoldenTree Asset Management LP (GoldenTree). Net proceeds from the issuance of the secured and subordinated notes will be used to purchase a portfolio of approximately $600 million of primarily senior secured leveraged loans. The CLO will have a four-year reinvestment period and a two-year non-call period.

KEY RATING DRIVERS

Sufficient Credit Enhancement: Credit enhancement (CE) of 39.2% for class A notes, in addition to excess spread, is sufficient to protect against portfolio default and recovery rate projections in an ‘AAAsf’ stress scenario. The degree of CE available to class A notes is in line with, though slightly higher than, the average CE of recent CLO issuances.

‘B/B-‘ Asset Quality: The average credit quality of the indicative portfolio is ‘B/B-‘, which is comparable to recent CLOs. Issuers rated in the ‘B’ rating category denote a highly speculative credit quality; however, in Fitch’s opinion, class A notes are unlikely to be affected by the foreseeable level of defaults. Class A notes are projected to be able to withstand default rates of up to 67.9%.

Strong Recovery Expectations: The indicative portfolio consists of 94.7% first lien senior secured loans. Approximately 91% of the indicative portfolio has either strong recovery prospects or a Fitch-assigned Recovery Rating of ‘RR2’ or higher.

Portfolio Parameters: Most of the concentration limitations and collateral quality test levels are within the range of limits set in the majority of recent CLOs. Fitch addressed the impact of the most prominent risk-presenting concentration allowances in the Fitch stressed portfolio analysis.

RATING SENSITIVITIES

Fitch evaluated the structure’s sensitivity to the potential variability of key model assumptions including decreases in weighted average spread or recovery rates and increases in default rates or correlation. Fitch expects the class A notes to remain investment grade even under the most extreme sensitivity scenarios. Results under these sensitivity scenarios ranged between ‘A+sf’ and ‘AAAsf’ for the class A notes.

Key Rating Drivers and Rating Sensitivities are further described in the accompanying new issue report, which will be available shortly to investors on Fitch’s website at ‘www.fitchratings.com‘.

For more information about Fitch’s comprehensive subscription service FitchResearch, which includes all presale reports, surveillance and credit reports on more than 20 asset classes, contact product sales at +1-212-908-0800 or at ‘webmaster@fitchratings.com‘.

Additional information is available at ‘www.fitchratings.com‘.

The sources of information used to assess these ratings were the transaction documents provided by the arranger, J.P. Morgan Securities LLC, and the public domain.

Applicable Criteria and Related Research:

— ‘Global Structured Finance Rating Criteria’ (May 24, 2013);

— ‘Global Rating Criteria for Corporate CDOs’ (Aug. 8, 2013);

— ‘Criteria for Interest Rate Stresses in Structured Finance Transactions and Covered Bonds’ (Jan. 23, 2014);

— ‘Counterparty Criteria for Structured Finance and Covered Bonds’ (May 13, 2013).

Applicable Criteria and Related Research:

Counterparty Criteria for Structured Finance and Covered Bonds
http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=707155

Criteria for Interest Rate Stresses in Structured Finance Transactions and Covered Bonds
http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=725537

Global Rating Criteria for Corporate CDOs
http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=715492

Global Structured Finance Rating Criteria – Effective 4 August 2011 to 6 June 2012
http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=646569

Additional Disclosure

Solicitation Status
http://www.fitchratings.com/gws/en/disclosure/solicitation?pr_id=827125

ALL FITCH CREDIT RATINGS ARE SUBJECT TO CERTAIN LIMITATIONS AND DISCLAIMERS. PLEASE READ THESE LIMITATIONS AND DISCLAIMERS BY FOLLOWING THIS LINK: HTTP://FITCHRATINGS.COM/UNDERSTANDINGCREDITRATINGS. IN ADDITION, RATING DEFINITIONS AND THE TERMS OF USE OF SUCH RATINGS ARE AVAILABLE ON THE AGENCY’S PUBLIC WEBSITE ‘WWW.FITCHRATINGS.COM‘. PUBLISHED RATINGS, CRITERIA AND METHODOLOGIES ARE AVAILABLE FROM THIS SITE AT ALL TIMES. FITCH’S CODE OF CONDUCT, CONFIDENTIALITY, CONFLICTS OF INTEREST, AFFILIATE FIREWALL, COMPLIANCE AND OTHER RELEVANT POLICIES AND PROCEDURES ARE ALSO AVAILABLE FROM THE ‘CODE OF CONDUCT’ SECTION OF THIS SITE. FITCH MAY HAVE PROVIDED ANOTHER PERMISSIBLE SERVICE TO THE RATED ENTITY OR ITS RELATED THIRD PARTIES. DETAILS OF THIS SERVICE FOR RATINGS FOR WHICH THE LEAD ANALYST IS BASED IN AN EU-REGISTERED ENTITY CAN BE FOUND ON THE ENTITY SUMMARY PAGE FOR THIS ISSUER ON THE FITCH WEBSITE.

Security Upgrades & DowngradesFinanceFitch Ratings Contact:

Fitch Ratings, Inc.

Primary Analyst

Robert Rhein, +1-312-606-2314

Director

70 West Madison Street

Chicago, IL 60602

or

Secondary Analyst

Christine Choo, +1-212-908-0603

Director

or

Committee Chairperson

Derek Miller, +1-312-368-2076

Senior Director

or

Media Relations, New York

Alyssa Castelli, +1-212-908-0540

alyssa.castelli@fitchratings.com […]