NEW YORK--(BUSINESS WIRE)--Fitch Ratings has taken the following actions on National Cooperative Bank, N.A.'s (NCB, the bank, or company) commercial servicer ratings:
--Special servicer rating upgraded to 'CSS2-' from 'CSS3+';
--Primary servicer rating affirmed at 'CPS1-';
--Master servicer rating affirmed at 'CMS2-'.
The upgrade to the special servicer rating reflects NCB's experienced asset managers, particular expertise in working out cooperative housing loans, as well as experience working out loans secured by more traditional commercial real estate properties. Additionally, NCB has begun using a third party application for limited asset management functions such as financial statement spreading as well as assisting in generating asset status reports, and continues to develop the system for asset management capabilities. The rating also considers potential capacity concerns with a limited staff size; however, Fitch believes NCB maintains appropriate staffing levels for its current portfolio.
The primary and master servicer ratings reflect the company's highly experienced and tenured management team and staff, technology platform which supports a strong internal control environment, as well as timely and accurate reporting to investors and servicers. Fitch believes that the company's transition to the newest version of Strategy represents some degree of operational risk. Following a successful conversion, the improvement in technology provides for potential greater operational efficiencies and streamlined processes. Fitch views positively NCB's commitment to technology and experience in developing servicing systems. The primary and master servicer ratings also reflect the improved, albeit non-investment grade, financial condition of NCB.
NCB is a subsidiary of National Consumer Cooperative Bank (NCCB), chartered in 1980 to provide financial products and services primarily to eligible cooperative enterprises. NCB provides cooperative lending and loan servicing, serving mostly the northeast corridor. As of March 31, 2015, the servicing portfolio totaled $5.7 billion and by balance, 87% of the servicing portfolio was housing cooperatives and 13% was commercial real estate.
Since the beginning of 2015, the bank contributed $169 million of multifamily co-op loans and $26 million of CRE loans to three new issue CMBS transactions, retaining master, primary, and special servicing responsibilities. On Dec. 31, 2014, NCB changed from a thrift charter to a commercial banking charter, providing the ability to grow commercial loans beyond the 20% thrift limitation. Participation in the CMBS market remains a strategic focus of the bank as it concentrates on growing commercial loan originations.
As of March 31, 2015, NCB was named master servicer for its loans in 30 securitized transactions consisting of 626 loans totaling $1.6 billion; generally, NCB maintains master servicing rights for all loans it contributes to a transaction and therefore is named master servicer for a portion of each CMBS transaction.
Also as of March 31, 2015, NCB was named special servicer for 3,848 CMBS and non-CMBS loans totaling $5.5 billion, of which 43 loan totaling $105.9 were actively specially serviced. NCB was actively special servicing 14 CMBS loans totaling $65.7 million (including one REO property), and the company was also actively special servicing 29 non-CMBS loans totaling $40.2 million.
Additional information is available at 'www.fitchratings.com'.
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