NEW YORK--(BUSINESS WIRE)--Fitch Ratings has affirmed Wells Fargo Bank's (WFB) U.S. residential master servicer rating at 'RMS1', Stable Outlook.
The rating affirmation and Stable Outlook are based on Wells Fargo Bank Master Servicer's (WFBMS) experienced management team, enhanced servicer management and technology systems, and the financial strength of its ultimate parent, Wells Fargo & Company (WFC), affirmed at 'AA-', Outlook Stable by Fitch on July 28, 2016.
In addition, the master servicer continues to demonstrate leadership in the master servicing sector and evidenced strong abilities throughout the review period. WFBMS has furthered its involvement as a master servicer in new RMBS transactions, and continues to enhance its master servicing oversight and reporting functions.
During this review period, WFBMS added 40 new full time equivalents (FTE) and increased its dedicated offshore FTE support by eight. The master servicer worked further to centralize operations and bring similar functions together. This helped to facilitate WFBMS efforts in leveraging the tools, policies and procedures across the various groups and platforms to take advantage of economies of scale and best business practices.
WFB has been providing master servicing since 1988, which forms part of the Corporate Trust Services (CTS) under the wholesale banking division of WFC. CTS has approximately 2,300 FTEs globally and is supported by corporate trust operations, CTS control group, risk management, technology, finance, human resources, and other groups across WFC as is applicable. The master servicing operation has 263 dedicated FTEs and utilizes some shared services through CTS.
WFB is a diversified financial services company providing banking, insurance, investments, mortgage, and consumer and commercial finance through more than 9,000 locations, 12,000 ATMs, and the Internet across North America and internationally, and acts as certificate administrator and trustee for CMBS, GNMA, ABS and MBS securitizations, as well as municipal single-family and multifamily housing transactions.
During this review period, the U.S. Senate began an investigation into WFB's cross selling techniques among its employees in the retail banking operations. Fitch does not expect that this investigation or related matters will impact WFBMS' master servicing capabilities or performance.
WFB's master servicing operations are headquartered in Columbia, MD, with additional sites in Houston, TX and Minneapolis, MN. The master servicer also maintains offshore facilities in Bangalore and Hyderabad, India.
As of June 30, 2016, WFB master serviced approximately 1.3 million loans totaling $246 billion, which is further broken down into 883,399 non-agency RMBS loans totaling $201 billion and 414,094 other master serviced loans totaling $45 billion.
Fitch rates residential mortgage primary, master, and special servicers on a scale of 1 to 5, with 1 being the highest rating. Within some of these rating levels, Fitch further differentiates ratings by plus (+) and minus (-) as well as the flat rating. For more information on Fitch's residential servicer rating program, please see Fitch's report 'Rating U.S. Residential and Small Balance Commercial Mortgage Servicer Rating Criteria', dated April 23, 2015 which is available on the Fitch Ratings web site at 'www.fitchratings.com'.
Additional information is available at 'www.fitchratings.com'.
Applicable Criteria
Rating Criteria for Structured Finance Servicers (pub. 01 Jul 2016)
https://www.fitchratings.com/site/re/884140
Rating Criteria for U.S. Residential and Small Balance Commercial Mortgage Servicers (pub. 23 Apr 2015)
https://www.fitchratings.com/site/re/864368
Additional Disclosures
Solicitation Status
https://www.fitchratings.com/gws/en/disclosure/solicitation?pr_id=1012463
Endorsement Policy
https://www.fitchratings.com/jsp/creditdesk/PolicyRegulation.faces?context=2&detail=31
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