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Fitch: Mortgage REITs' Reliance on Repo Funding Could Increase U.S. MBS Volatility

Jun 27, 2013
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 Fitch Ratings-New York-27 June 2013: Given their reliance on repo funding, U.S. agency mortgage REITs (mREITs) and other leveraged investors could face pressures to liquidate some of their MBS holdings if repo lenders were to tighten the terms and availability of funding, according to Fitch Ratings in a new report. Such a deleveraging scenario could in turn create a ripple effect that extends to the broader mortgage markets as a whole.

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Fitch Ratings

Dual-headquartered in New York and London, Fitch Ratings is a global rating agency dedicated to providing value beyond the rating through independent and prospective credit opinions, research, and data. Offering a world of knowledge and experience behind every opinion, we transform information to deliver meaning and utility to investors, issuers, and other market participants. Fitch Ratings’ global expertise draws on local market knowledge and spans the fixed-income universe. The additional context, perspective and insights we provide help investors make important credit judgments with confidence.

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