DBRS and Morningstar Credit Ratings Confirm Operational Risk Assessment Rankings Coverage for North American Commercial Mortgage Servicers

On July 11, 2019, Morningstar Credit Ratings, LLC (MCR) and DBRS, Inc. (DBRS; together, DBRS Morningstar) published their first announcement regarding the integration of the analytical teams focused on the U.S. Structured Finance market. Today’s press release is the forty-first in a series to keep the market updated on analytical integration decisions and is focused on Operational Risk Assessments (ORAs) for North American (NA) commercial mortgage servicer rankings.

<a href="https://www.dbrs.com/research/347875/" target="_blank">"DBRS and Morningstar Credit Ratings Announce Analytical Integration Process and Ratings Overlap"</a>

REQUEST FOR COMMENT
Today, DBRS Morningstar published a Request for Comment (RFC) on the new DBRS Morningstar “North American Commercial Mortgage Servicer Rankings” methodology. The proposed methodology provides the ability for commercial mortgage servicers to request that DBRS Morningstar issue a public ranking on their company. The ranking process is voluntary and is not a prerequisite to having a commercial mortgage-backed security (CMBS) rated by DBRS Morningstar. The RFC period closes on October 13, 2020.

<a href="https://www.dbrsmorningstar.com/research/366398/" target="_blank">"DBRS Morningstar Requests Comments on Proposed North American Commercial Mortgage Servicer Rankings Methodology"</a>

DBRS Morningstar will withdraw and replace its current commercial mortgage servicer evaluations on the following entities with rankings upon the finalization of the proposed methodology:
-- A10 Capital, LLC (Commercial Primary and Special Servicer)
-- CMLS Financial Ltd. (Commercial Primary, Master, and Special Servicer)

MCR U.S. COMMERCIAL MORTGAGE SERVICER RANKINGS PLACED UNDER REVIEW
In conjunction with the publication of the RFC, MCR has placed the following outstanding commercial mortgage servicer rankings Under Review—Analytical Integration Review:

-- Aegon USA Realty Advisors, LLC (Commercial Mortgage Special Servicer)
-- The Bank of New York Mellon Corporation (Commercial Mortgage Primary Servicer)
-- Berkadia Commercial Mortgage LLC (Commercial Mortgage Primary, Master, and Special Servicer)
-- Freddie Mac Multifamily Asset Management and Operations (Commercial Mortgage Special Servicer)
-- Greystone Servicing Company LLC (Commercial Mortgage Primary and Special Servicer)
-- KeyBank N.A. (Commercial Mortgage Primary, Master, and Special Servicer)
-- Midland Loan Services, Inc., a division of PNC Bank, N.A. (Commercial Mortgage Primary, Master, and Special Servicer)
-- Mount Street US (Georgia) LLP (Commercial Mortgage Primary and Special Servicer)
-- Rialto Capital Advisors, LLC (Commercial Mortgage Special Servicer)
-- Sabal Capital Partners, LLC (Commercial Mortgage Primary and Special Servicer)
-- Torchlight Loan Services, LLC (Commercial Mortgage Special Servicer)
-- Wells Fargo Commercial Mortgage Servicing (Commercial Mortgage Primary, Master, and Special Servicer)

Upon finalization of the RFC period described above, DBRS Morningstar expects to review the companies listed above and assign new DBRS Morningstar rankings to each of these companies, as appropriate, using the new DBRS Morningstar NA Commercial Mortgage Servicer Ranking Methodology, published today as an RFC. In any event, the MCR commercial mortgage servicer rankings will be removed from Under Review—Analytical Integration Review and withdrawn on or about October 16, 2020.

For more information related to the actions taken on outstanding MCR commercial mortgage servicer rankings, please see the following press release:

<a href="https://ratingagency.morningstar.com/PDD.aspx?i=oXUFrFwJt8k%3d" target="_blank">"Morningstar Credit Ratings Places Commercial Mortgage Servicer Rankings Under Review”</a>

In addition, MCR has placed the following commercial mortgage ORA rankings Under Review—Analytical Integration Review:

-- Oxane Partners Limited (Commercial Mortgage Primary Servicer) (United Kingdom)
-- Freddie Mac Multifamily Asset Management and Operations (Commercial Mortgage Trust Advisor)
-- Finch Investment Group, LLC (Tax-Lien Servicer)

The proposed DBRS Morningstar “North American Commercial Mortgage Servicer Rankings” methodology does not cover servicer rankings outside North America. Additionally, the proposed methodology does not contemplate trust advisor or tax-lien servicer rankings. DBRS Morningstar will not assign new DBRS Morningstar rankings in the three instances mentioned above. The above-referenced MCR rankings will also be removed from Under Review—Analytical Integration Review and withdrawn on or about October 16, 2020.

MCR rankings, forecasts, and assessments contained in this press release are not assessments of the creditworthiness of an obligor or a security and thus are not credit ratings subject to NRSRO regulations.

Notes:
All data provided in this press release is as of September 10, 2020, and is preliminary and subject to change.

For analytical inquiries regarding this press release, please contact Richard Carlson, Senior Vice President, Head of NA CMBS Surveillance and Operational Risk.

DBRS
Richard Carlson
[email protected]
+1 312 332-9451

For rating engagement inquiries regarding NA Commercial Mortgage Servicer Rankings, please contact Sean O’Connor, Managing Director, Head of Global Business Development.

DBRS
Sean O’Connor
[email protected]
+1 212 806-3252

For more information on the transactions rated by DBRS Morningstar, please visit www.dbrsmorningstar.com or contact DBRS at [email protected]. For transactions rated by MCR, please visit www.morningstarcreditratings.com or contact [email protected].

DBRS
Stephen Bernard
[email protected]
+1 212 806-3240