DBRS Publishes Updated Methodology for Rating U.S. Property Assessed Clean Energy (PACE) Securitizations

DBRS has today published an updated version of its “Rating U.S. Property Assessed Clean Energy (PACE) Securitizations” methodology (the Methodology).

The Methodology is effective as of the date of this press release and supersedes any previously available criteria.

The updated Methodology contains conforming changes that reflect updates made to the U.S. residential mortgage-backed securities methodology published as “RMBS Insight 1.3: U.S. Residential Mortgage-Backed Securities Model and Rating Methodology” (the U.S. RMBS Methodology). The updated Methodology references the U.S. RMBS Methodology as an alternative method to estimate defaults for PACE portfolios based on historical mortgage performance data.

DBRS does not deem the updates to be material. In addition, a preliminary impact analysis performed on the nine outstanding ratings that reference the Methodology does not indicate any resulting rating differences.

It is worth noting that the above impact analysis merely considers model-to-model, as opposed to model-to-actual, rating changes. The DBRS surveillance review does apply certain qualitative factors that may not have been accounted for in a typical loss or cash flow analysis. In conjunction with the updates, DBRS will review all affected securities and take timely and appropriate rating actions under the updated methodology if warranted.

Notes:
The Methodology is available by clicking on Rating U.S. Property Assessed Clean Energy (PACE) Securitizations under Related Research or by contacting us at info@dbrs.com. The U.S. RMBS Methodology is available by clicking on RMBS Insight 1.3: U.S. Residential Mortgage-Backed Securities Model and Rating Methodology under Related Research or by contacting us at info@dbrs.com.

DBRS criteria and methodologies are publicly available on its website www.dbrs.com under Methodologies.

For more information on this credit or on this industry, visit www.dbrs.com or contact us at info@dbrs.com.