- E-mail: Adam.Tempkin@thomsonreuters.com
Fitch shook up the US securitisation market last week when, on the eve of a long-awaited US SEC public roundtable on credit rating industry reform in Washington DC, it issued an unsolicited comment lambasting the Triple A ratings given by two of its rivals to a new single-asset CMBS linked to a trophy Manhattan office building.
Three years since Dodd-Frank, and the US Securities and Exchange Commission (SEC) is still struggling to devise a viable alternative to the “issuer pays” rating agency compensation model that contributed to the flawed ratings model that fuelled the financial crisis.
Fitch said in a report this week that a new large-loan CMBS linked to the “prestigious” 375 Park Avenue Seagram Building is based on so-called pro-forma income and does not have enough credit enhancement to warrant a AAA rating.
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