Fitch Affirms First National Financial LP's Commercial Servicer Ratings

NEW YORK--()--Fitch Ratings has affirmed First National Financial LP's (First National) commercial mortgage servicer ratings as follows:

--Commercial primary servicer rating at 'CPS3+';

--Commercial master servicer rating at 'CMS3';

--Commercial loan level special servicer rating at 'CLLSS3'.

The primary and master servicer ratings reflect the experience of First National's commercial mortgage management team, recent elevated turnover among servicing staff, the manual nature of certain core internal controls, and disaster recovery capabilities. The ratings also reflect the financial condition of First National's parent, First National Financial Corporation (FNFC), as well as Fitch's assessment of the company's experience primary and master servicing CMBS loans. First National has been primary servicing and master servicing CMBS transactions since 1998 and 2005, respectively.

The master servicer rating also reflects Fitch's financial assessment of FNFC relative to potential advancing obligations for CMBS transactions under stressed scenarios. Advancing concerns are partially mitigated by the company's available liquidity and the presence of highly rated back-up advancing agents in Canadian CMBS transactions.

Fitch's loan level special servicer rating reflects First National's experienced asset management team, limited special servicing capacity with three asset managers, and lack of a centralized asset management system. First National employs four supporting staff and asset managers have access to the broader First National platform.

First National is a wholly owned subsidiary of FNFC, a publicly traded company founded in 1988 and headquartered in Toronto. First National is predominately an originator and servicer of prime single family residential mortgages, with an increasing focus on commercial mortgage origination and servicing, a business model consistent with other Fitch rated Canadian commercial mortgage servicers.

As of Sept. 30, 2015, First National's total servicing portfolio consisted of 5,357 loans totaling $20 billion, of which 463 loans totaling $2.7 billion were in CMBS transactions. First National was the named master servicer for 401 CMBS loans totaling $2.3 billion (while also primary servicing 253 loans totaling $1.2 billion), and was the named primary servicer (reporting to an external master) for 108 CMBS loans totaling $399.2 million. Also as of Sept. 30, 2015, First National was named special servicer for 445 loans totaling $2.0 billion for nine CMBS transactions and 4,894 non-CMBS loans totaling $17.2 billion.

The servicer rating is based on Fitch's methodology, as described in the reports highlighted at the end of the press release.

Additional information is available at 'www.fitchratings.com'.

Applicable Criteria

Rating Criteria for Structured Finance Servicers (pub. 23 Apr 2015)

https://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=864375

Rating Criteria for U.S. Commercial Mortgage Servicers (pub. 14 Feb 2014)

https://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=735382

Additional Disclosures

Solicitation Status

https://www.fitchratings.com/gws/en/disclosure/solicitation?pr_id=999547

Endorsement Policy

https://www.fitchratings.com/jsp/creditdesk/PolicyRegulation.faces?context=2&detail=31

ALL FITCH CREDIT RATINGS ARE SUBJECT TO CERTAIN LIMITATIONS AND DISCLAIMERS. PLEASE READ THESE LIMITATIONS AND DISCLAIMERS BY FOLLOWING THIS LINK: HTTP://FITCHRATINGS.COM/UNDERSTANDINGCREDITRATINGS. IN ADDITION, RATING DEFINITIONS AND THE TERMS OF USE OF SUCH RATINGS ARE AVAILABLE ON THE AGENCY'S PUBLIC WEBSITE 'WWW.FITCHRATINGS.COM'. PUBLISHED RATINGS, CRITERIA AND METHODOLOGIES ARE AVAILABLE FROM THIS SITE AT ALL TIMES. FITCH'S CODE OF CONDUCT, CONFIDENTIALITY, CONFLICTS OF INTEREST, AFFILIATE FIREWALL, COMPLIANCE AND OTHER RELEVANT POLICIES AND PROCEDURES ARE ALSO AVAILABLE FROM THE 'CODE OF CONDUCT' SECTION OF THIS SITE. FITCH MAY HAVE PROVIDED ANOTHER PERMISSIBLE SERVICE TO THE RATED ENTITY OR ITS RELATED THIRD PARTIES. DETAILS OF THIS SERVICE FOR RATINGS FOR WHICH THE LEAD ANALYST IS BASED IN AN EU-REGISTERED ENTITY CAN BE FOUND ON THE ENTITY SUMMARY PAGE FOR THIS ISSUER ON THE FITCH WEBSITE.

Contacts

Fitch Ratings
Primary Analyst
James Bauer, +1-212-908-0343
Director
Fitch Ratings, Inc.
33 Whitehall Street
New York, NY 10004
or
Secondary Analyst
Adam Fox, +1-212-908-0869
Senior Director
or
Committee Chairperson
Christopher Bushart, +1-212-908-06069
Senior Director
or
Media Relations
Hannah James, New York, +1-646-582-4947
hannah.james@fitchratings.com

Contacts

Fitch Ratings
Primary Analyst
James Bauer, +1-212-908-0343
Director
Fitch Ratings, Inc.
33 Whitehall Street
New York, NY 10004
or
Secondary Analyst
Adam Fox, +1-212-908-0869
Senior Director
or
Committee Chairperson
Christopher Bushart, +1-212-908-06069
Senior Director
or
Media Relations
Hannah James, New York, +1-646-582-4947
hannah.james@fitchratings.com