A Preview of Risk Retention Effects

How will the new risk retention regulations impact the CMBS market? Fitch’s Lauren Cerda weighs in.
Lauren Cerda, Senior Director at Fitch RatingsLauren Cerda, Senior Director at Fitch Ratings
Chicago—With less than two months to go before CMBS issuers will have to keep a portion of the loans they provide on their own balance sheets, market preparations are in full swing. The new federal rules on risk retention will be in effect starting Dec. 24, and while some issuers are testing strategies to adapt, others fear these rules could be the end of their businesses. Commercial Property Executive discussed the effects of the new regulations with Lauren Cerda, senior director at Fitch Ratings.

CPE: What are some of the short-term ramifications of the new risk retention rules on CMBS lenders?

Cerda: Given that the industry is uncertain as to how the regulators will respond to the proposed risk-retention structures being utilized by issuers, it is likely that there will be some volatility during the first quarter related to loan pricing and transaction pricing while all the parties determine the best approach…

A Preview of Risk Retention Effects

Categories : Uncategorized

Leave a Reply

You must be logged in to post a comment.