Moody’s has downgraded the ratings of nine non-conforming tranches within one of Kensington Mortgages’ residential mortgage-backed securities due to their loss levels and “relatively high delinquency rates”.
As of March, the KMS 2007-1 securitisation had lost 3.8 per cent of the original portfolio balance compared with a loss of 0.8 per cent in September 2008.
The percentage of loans more than 90 days in arrears stands at 29 per cent, up from 13.1 per cent in September 2008.
The percentage of the portfolio that is more than 360 days in arrears has reached 11.4 per cent compared with 2.2 per cent in September 2008.
Kensington refused to comment on the issue.
Moody’s also downgraded three tranches of non-conforming RMBS issued by Money Partners, the Goldman Sachs-owned lender which stopped new lending in February 2009.
In February, losses in the MPS 2 securitisation stood at 4.1 per cent, compared to losses of 1.5 per cent as of May 2008. Loans more than 90 days in arrears stand at 34.3 per cent, up from 17.9 per cent in May 2008. The percentage of the portfolio over 360 days in arrears has reached 12.7 per cent compared with 1.4 per cent in September 2008.
Coreco director Andrew Montlake says: “Lending to people with either medium or heavy adverse was never a particularly good idea, so therefore it is no surprise that these people are having trouble a few years later.”