Nov 13 - Standard & Poor's Ratings Services has reviewed commercial servicer
data from its Servicer Evaluation Analytical Methodology (SEAM) questionnaires
since December 2007 to determine trends in the industry over the past five
years, and published its findings in a recent report.
The past five years of SEAM data show considerable shifts in portfolio sizes,
personnel counts, and delinquency levels over time. "The property market's
boom and crash spurred a flurry of loan originations and securitizations
between 2006 and 2008, followed by precipitous declines in primary servicing,
rapid increases in special servicing, and falling property performance and
values--not to mention regulatory changes, increases in reporting and
transparency requirements, and the introduction of additional reviews and
parties into servicers' best practices," said Standard & Poor's servicer
analyst Mark Goldberg.
The report noted that between 2007 and June 2012, primary and master
servicers' portfolios shrank overall as loan originations dropped, while
special servicers' portfolios grew in step with the rise in troubled loans.
Accordingly, staffing levels dropped for primary and master servicers, while
special servicing staffs generally kept pace with the rise in assets.
Servicers and system vendors have updated their technology to incorporate
greater loan-level capabilities and other enhancements to meet stricter
investor reporting requirements.
Mr. Goldberg said, "All told, commercial mortgage servicers have typically
responded by scaling down or reorganizing staff, enhancing and expanding their
servicing systems, modifying internal procedures, and strengthening their
quality controls and compliance monitoring."
The full report, "Focus On Servicing: The Past Five Years Bring Big Changes
For Commercial Servicers," was published Nov. 13, 2012, on RatingsDirect on
the Global Credit Portal.
The report is available to subscribers of RatingsDirect on the Global Credit
Portal at www.globalcreditportal.com. If you are not a RatingsDirect
subscriber, you may purchase a copy of the report by calling (1) 212-438-7280
or sending an e-mail to email@example.com. Ratings
information can also be found on Standard & Poor's public Web site by using
the Ratings search box located in the left column at www.standardandpoors.com.