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Commercial First gets bond upgrade

Commercial First has had two of its securitised mortgage backed bonds upgraded as part of a performance review of its transactions by ratings agency Fitch Ratings.

Mario Schmidt, associate director in Fitchs European structured finance department, says the upgrades “reflect the seasoning and the higher than originally modelled excess spread levels.

Commercial Firsts Business Mortgage Finance 1 Class M note has been upgraded to AA from A and its BMF1 Class B note has been upgraded to A- from BBB.

Its BMF2 Class M bond has also been upgraded to A+ from A.

The credit ratings on all other classes of notes in the first four instalments of the BMF programme have been affirmed.

Philip George, managing director of Commercial First, says: This is really good news for our securitisation programme, and reflects the excellent work of both our finance and servicing teams. It is good news for the bond holders who can now enjoy an even stronger covenant whilst retaining the premium margin.

Considering some of the issues other securitising lenders have faced in 2006 this is a very positive result, and following on from the investment made by Lloyds Development Capital in the autumn of last year, is a really strong message about the strength of our business model.

Commercial First has completed five securitisations, totalling 1.1bn of commercial mortgage assets, since it started trading in 2003.


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