-- We affirmed our overall STRONG ranking on BofA Merrill Lynch Global
Markets Commercial Real Estate Servicing as a commercial loan primary and
master servicer. The outlook is stable.
-- We affirmed our overall ABOVE AVERAGE ranking on BofA Merrill Lynch
Global Markets Commercial Real Estate Servicing as a commercial loan special
servicer. The outlook is stable.
-- We based our opinion on the company's well defined, efficient
operations and procedures, highly effective leverage of loan servicing systems
and strong audit, compliance and quality control environment.
NEW YORK (Standard & Poor's) Dec. 17, 2012--Standard & Poor's Ratings Services
today affirmed its STRONG ranking on BofA Merrill Lynch Global Markets
Commercial Real Estate Servicing (CRES) as a commercial loan primary and
master servicer. We also affirmed our ABOVE AVERAGE ranking as commercial loan
special servicer. The outlook is stable for all three rankings. The financial
position is Sufficient.
BofA Merrill Lynch is one of the world's largest financial services companies
with clients in more than 150 countries and provides services ranging from
investment and corporate banking to investing and equity execution services.
The bank is a major originator and servicer of commercial and multifamily
mortgages, including large-loan, single-borrower, and CMBS transactions, which
include fixed-rate conduit lending. As of June 30, 2012, CRES had total assets
under management of approximately $110 billion and employed approximately 90
professionals. Its primary, master and special servicing operations are
headquartered in Charlotte, N.C.
The affirmed rankings reflect, in our opinion, the company's ongoing
commitment to operational enhancements, proactive portfolio surveillance,
experienced management team, and effective systems and technology. The company
continues to improve processes and procedures in all areas of the
organization, which, in our view, resulted in greater operating efficiencies.
KEY RANKING FACTORS
-- Well defined, efficient operations and procedures;
-- Highly effective leverage of loan servicing systems; and
-- Strong audit, compliance, and quality control environment;
-- No formal vendor performance review process for appraiser, property
managers and brokers.
As of June 30, 2012, the company primary serviced a portfolio of approximately
9,497 loans and 13,084 collateral properties constituting a total unpaid
principal balance of approximately $99.7 billion. The portfolio is
geographically dispersed and contains all major collateral property types.
CRES services loans for a diverse mix of investor types including CMBS,
investment funds, life insurance company mortgages, financial institutions and
Fannie Mae. Loan volume has decreased modestly over the past four and a half
years mainly as due to lower CMBS issuance.
As of the same date, CRES was the master servicer for more than18 third-party
subservicers and the portfolio totaled $10.5 billion with 1,436 loans. New
master servicing volume has decreased in recent years; however, CRES maintains
the resources and procedures to accommodate new transactions.
Also as of June 30, 2012, the company managed a special servicing portfolio of
416 properties totaling $4 billion as well as three real estate owned (REO)
assets totaling $4.5 million. CRES is the named special servicer on 13 CMBS
transactions with 64 loans totaling $13.7 billion. Overall the special
servicing portfolio is predominately comprised of CMBS assets with a smaller
portion of loans managed for banks and other third-party investors. The
portfolio includes complex loan structures and most collateral property types
located throughout the country. Since 2003, the group has resolved
approximately $28 billion in problem loans.
Our outlook on all three servicer rankings is stable. CRES has a successful
track record servicing commercial and multifamily mortgage loans. The company
has demonstrated its commitment to invest in technology resources and
continuous process improvement.