Press Release

Morningstar DBRS Finalizes Provisional Credit Ratings on BANK 2025-BNK50

CMBS
June 18, 2025

DBRS, Inc. (Morningstar DBRS) finalized its provisional credit ratings on the following classes of Commercial Mortgage Pass-Through Certificates, Series 2025-BNK50 issued by BANK 2025-BNK50:

-- Class A-SB at AAA (sf)
-- Class A-1 at AAA (sf)
-- Class A-4 at AAA (sf)
-- Class A-4-1 at AAA (sf)
-- Class A-4-2 at AAA (sf)
-- Class A-4-X1 at AAA (sf)
-- Class A-4-X2 at AAA (sf)
-- Class A-5 at AAA (sf)
-- Class A-5-1 at AAA (sf)
-- Class A-5-2 at AAA (sf)
-- Class A-5-X1 at AAA (sf)
-- Class A-5-X2 at AAA (sf)
-- Class A-S at AAA (sf)
-- Class A-S-1 at AAA (sf)
-- Class A-S-2 at AAA (sf)
-- Class A-S-X1 at AAA (sf)
-- Class A-S-X2 at AAA (sf)
-- Class B at AA (high) (sf)
-- Class B-1 at AA (high) (sf)
-- Class B-2 at AA (high) (sf)
-- Class B-X1 at AA (high) (sf)
-- Class B-X2 at AA (high) (sf)
-- Class C at AA (low) (sf)
-- Class C-1 at AA (low) (sf)
-- Class C-2 at AA (low) (sf)
-- Class C-X1 at AA (low) (sf)
-- Class C-X2 at AA (low) (sf)
-- Class D at A (high) (sf)
-- Class D-1 at A (high) (sf)
-- Class D-2 at A (high) (sf)
-- Class D-X1 at A (high) (sf)
-- Class D-X2 at A (high) (sf)
-- Class E at A (low) (sf)
-- Class E-1 at A (low) (sf)
-- Class E-2 at A (low) (sf)
-- Class E-X1 at A (low) (sf)
-- Class E-X2 at A (low) (sf)
-- Class F-RR at BBB (sf)
-- Class G-RR at BBB (low) (sf)
-- Class H-RR at BB (low (sf)
-- Class J-RR at B (sf)
-- Class X-A at AAA (sf)

All trends are Stable.

The collateral for the BANK 2025-BNK50 transaction consists of 34 fixed-rate loans secured by 71 commercial and multifamily properties with an aggregate cut-off date balance of $490.94 million. Seven loans, representing 57.8% of the pool, are shadow-rated investment grade by Morningstar DBRS. There are 21 loans secured by cooperative properties in this transaction, representing 22.8% of the pool, including 17 NCB (National Cooperative Bank) loans, representing 12.4% of the pool. Although these loans were not shadow-rated for modeling purposes, they exhibit characteristics of a AAA shadow credit rating. In aggregate, 70.2% of the loans in the pool display attributes of shadow-rated loans¿a significantly higher percentage than previous Morningstar DBRS-rated conduits.

Morningstar DBRS analyzed the conduit pool to determine the provisional credit ratings, reflecting the long-term probability of loan default within the term and its liquidity at maturity. When the cut-off balances were measured against the Morningstar DBRS Net Cash Flow (NCF) and their respective constants, the initial Morningstar DBRS WA Debt Service Coverage Ratio (DSCR) of the pool was 2.88 times (x). The WA Morningstar DBRS Issuance Loan-to-Value Ratio (LTV) of the pool was 42.8% and the loan is scheduled to amortize to a weighted-average (WA) Morningstar DBRS Balloon LTV of 40.8% at maturity based on the A note balances. Excluding the shadow-rated and cooperative loans, the deal still exhibits a reasonable WA Morningstar DBRS Issuance LTV of 60.6% and a WA Morningstar DBRS Balloon LTV of 60.1%. Only two loans, representing 11.8% of the pool, exhibit a Morningstar DBRS Issuance LTV of higher than 67.6%, a threshold generally indicative of above-average default frequency, Additionally, three loans, representing 4.8% of the pool, exhibit a Morningstar DBRS DSCR of lower than 1.25x, a threshold indicative of a higher likelihood of midterm default. The transaction has a sequential-pay pass-through structure.

Seven loans, representing 57.8% of the pool, exhibit credit characteristics consistent with investment-grade shadow credit ratings. These loans' credit characteristics were as follows: 10 West 66th Street Co-Op was consistent with a AAA shadow credit rating; Adini Portfolio was consistent with a AA (high) shadow credit rating; Visa Global HQ was consistent with a AA (low) shadow credit rating; Washington Square was consistent with an A (low) shadow credit rating; Discovery Business Center and Foothills Park Place Shopping Center Galt House were consistent with a BBB (high) shadow credit rating; and Marriott World Headquarters was consistent with a BBB shadow credit rating.

This transaction features 17 NCB loans, representing 12.4% of the pool, which consist of co-operative multifamily properties. These loans have an exceptionally low WA Morningstar DBRS Issuance LTV of 14.3% and a significantly high Morningstar DBRS DSCR of 6.49x. Because of these strong credit characteristics, Morningstar DBRS considers these loans consistent with a AAA shadow credit rating. Additionally, there are four other loans, representing 10.4% of the pool, secured by cooperative properties that have an exceptionally low WA DBRS Issuance LTV of 12.1% and a significantly high Morningstar DBRS WA DSCR of 7.30x.

Twelve loans, representing 40.3% of the pool, are in areas with a Morningstar DBRS Market Rank of 7, which indicate dense urban areas that benefit from increased liquidity driven by consistently strong investor demand, even during times of economic stress. Additionally, 12 loans, representing 27.7% of the pool, are in areas with Morningstar DBRS Market Ranks of 5 or 6, which benefit from lower default frequencies than less-dense suburban, tertiary, and rural markets. New York is the predominant urban market represented in the transaction. Lastly, 28 loans, representing 72.5% of the pool, are in the Morningstar DBRS MSA Group 3, which represents the best-performing group among the top 25 metropolitan statistical areas (MSAs) in terms of historical commercial mortgage-backed securities (CMBS) default rates.

Thirty-one loans, representing 86.8% of the pool, have Morningstar DBRS Issuance LTVs lower than 60.9%, a threshold historically indicative of relatively low-leverage financing and generally associated with below-average default frequency. When excluding the shadow-rated and cooperative loans, which represent 73.5% of the pool, the transaction exhibits a WA Morningstar DBRS Issuance LTV of 60.6%. There is only one loan in the pool, Coastal Equities Portfolio, with a Morningstar DBRS LTV equal to or higher than 70.0%.

The initial Morningstar DBRS WA DSCR of 2.88x, or 1.46x when excluding shadow-rated and loans secured by cooperative properties, is healthy in today's challenging interest rate environment where debt service payments have nearly doubled since mid-2022, severely constraining DSCRs.

Four loans, representing 33.8% of the pool, received a property quality assessment of Average + or Above Average while only two loans, representing 3.0% of the pool, received a property quality assessment of Average - or Below Average. Higher-quality properties are more likely to retain existing tenants/guests and more easily attract new tenants/guests, resulting in a more stable performance.

The pool contains 34 loans and is concentrated with a lower Herfindahl score of 13.6, with the top 10 loans representing 80.2% the pool. These metrics are lower than the Morningstar DBRS-rated BBCMS Mortgage Trust 2025-5C34 transaction, which had a Herfindahl score of 22.5, and the BANK5 2024- 5YR10 transaction, which had a Herfindahl score of 30.7.

Morningstar DBRS' credit ratings on the Certificates address the credit risk associated with the identified financial obligations in accordance with the relevant transaction documents. The associated financial obligations are the related Principal Distribution Amounts and/or Interest Distribution Amounts for the rated classes.

Morningstar DBRS' credit rating does not address non-payment risk associated with contractual payment obligations contemplated in the applicable transaction document(s) that are not financial obligations. For example, Yield Maintenance Charges and Prepayment Premiums.

Morningstar DBRS' long-term credit ratings provide opinions on risk of default. Morningstar DBRS considers risk of default to be the risk that an issuer will fail to satisfy the financial obligations in accordance with the terms under which a long-term obligation has been issued.

ENVIRONMENTAL, SOCIAL, AND GOVERNANCE CONSIDERATIONS

There were no Environmental/Social/Governance factor(s) that had a significant or relevant effect on the credit analysis.

A description of how Morningstar DBRS considers ESG factors within the Morningstar DBRS analytical framework can be found in the Morningstar DBRS Criteria: Approach to Environmental, Social, and Governance Factors in Credit Ratings (May 16, 2025): https://dbrs.morningstar.com/research/454196

Class X-A is an interest-only (IO) certificate that references a single rated tranche or multiple rated tranches. The IO rating mirrors the lowest-rated applicable reference obligation tranche adjusted upward by one notch if senior in the waterfall.

All credit ratings are subject to surveillance, which could result in credit ratings being upgraded, downgraded, placed under review, confirmed, or discontinued by Morningstar DBRS.

Notes:
All figures are in U.S. dollars unless otherwise noted.

The principal methodology is North American CMBS Multi-Borrower Rating Methodology (April 9, 2025):
https://dbrs.morningstar.com/research/451739

Other methodologies referenced in this transaction are listed at the end of this press release.

With regard to due diligence services, Morningstar DBRS was provided with the Form ABS Due Diligence-15E (Form-15E), which contains a description of the information that a third party reviewed in conducting the due diligence services and a summary of the findings and conclusions. While due diligence services outlined in Form-15E do not constitute part of Morningstar DBRS' methodology, Morningstar DBRS used the data file outlined in the independent accountant's report in its analysis to determine the credit ratings referenced herein.

The credit rating was initiated at the request of the rated entity.

The rated entity or its related entities did participate in the credit rating process for this credit rating action.

Morningstar DBRS had access to the accounts, management and other relevant internal documents of the rated entity or its related entities in connection with this credit rating action.

This is a solicited credit rating.

For more information on Morningstar DBRS' policy regarding the solicitation status of credit ratings, please refer to the Credit Ratings Global Policy, which can be found in the Morningstar DBRS Understanding Ratings section of the website: https://dbrs.morningstar.com/understanding-ratings

Please see the related appendix for additional information regarding the sensitivity of assumptions used in the credit rating process.

DBRS, Inc.
22 West Washington Street
Chicago, IL 60602 USA
Tel. +1 312 332-3429

The credit rating methodologies used in the analysis of this transaction can be found at: https://dbrs.morningstar.com/about/methodologies.

North American Commercial Mortgage Servicer Rankings (August 23, 2024):
https://dbrs.morningstar.com/research/438283

Morningstar DBRS North American Commercial Real Estate Property Analysis Criteria (September 19, 2024):
https://dbrs.morningstar.com/research/439702

Legal Criteria for U.S. Structured Finance (December 03, 2024):
https://dbrs.morningstar.com/research/444064

North American Single-Asset/Single-Borrower Ratings Methodology (February 28, 2025):
https://dbrs.morningstar.com/research/448962

North American CMBS Insight Model v 1.3.0.0:

https://dbrs.morningstar.com/research/451739

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

Ratings

BANK 2025-BNK50
  • Date Issued:Jun 18, 2025
  • Rating Action:Provis.-Final
  • Ratings:AAA (sf)
  • Trend:Stb
  • Rating Recovery:
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  • Ratings:AAA (sf)
  • Trend:Stb
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  • Ratings:AAA (sf)
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  • Ratings:AA (high) (sf)
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  • Ratings:AA (low) (sf)
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  • Date Issued:Jun 18, 2025
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  • Ratings:B (sf)
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  • US = Lead Analyst based in USA
  • CA = Lead Analyst based in Canada
  • EU = Lead Analyst based in EU
  • UK = Lead Analyst based in UK
  • E = EU endorsed
  • U = UK endorsed
  • Unsolicited Participating With Access
  • Unsolicited Participating Without Access
  • Unsolicited Non-participating

ALL MORNINGSTAR DBRS RATINGS ARE SUBJECT TO DISCLAIMERS AND CERTAIN LIMITATIONS. PLEASE READ THESE DISCLAIMERS AND LIMITATIONS AND ADDITIONAL INFORMATION REGARDING MORNINGSTAR DBRS RATINGS, INCLUDING DEFINITIONS, POLICIES, RATING SCALES AND METHODOLOGIES.