Sunday, July 29, 2012

Cumulative Defaults slightly lower than expectations (Fitch)

Fitch reports,

Cumulative default rate for fixed-rate CMBS increased 25 basis points to 13.2% as of the second quarter of 2012 (2Q'12). The steady increase in the default rate has so far in 2012 has been slightly better than Fitch's expectations.

Earlier this year, Fitch predicted that cumulative defaults would reach 14.5% by year end 2012. Newly defaulted loans for 2Q'12 total $2.1 billion (143 loans). Following the trend from first quarter 2012, office continues to lead new defaults at 44% with retail following at 34% by balance, respectively.

The total universe represents fixed-rate deals issued between 1993 and 2012, totaling $569 billion (excluding the Freddie Mac securitizations). Loans are considered defaulted if they have been reported 60 plus days delinquent at least once.


crabsofsteel said...

Fitch excels at getting things wrong. Sure, the servicer is marking 0%-rate B-notes as current, but the trust is still not getting its expected cash so non-cashflowing B-notes should be counted as delinquent. See what Roger sent out today.

crabsofsteel said...

Fitch said 80% of 2007 issuance is stressed and probably unrefinancable. Yet their AAA ratings stand.