(The following statement was released by the rating agency)
Dec 10 - Fitch Ratings receives occasional requests to provide rating confirmations regarding proposed changes to transactions. The purpose of this comment is to specify the application of Fitch's general policy regarding rating confirmations to special servicer replacement requests in EMEA CMBS. This comment supplements the one published on 13 January 2009 ("Fitch Clarifies Policy for Structured Finance Rating Confirmations" at www.fitchratings.com).
In EMEA CMBS, Fitch is periodically asked to confirm that the appointment of a special servicer would not, in itself, cause the downgrade of any notes. As outlined more fully below, Fitch will not provide such rating confirmations in EMEA CMBS. This stance formalises concerns previously expressed by Fitch regarding proposals originating from individual creditor classes whose interests may not be aligned with those of other affected noteholders.
Replacing a special servicer is one source of influence over rating-sensitive outcomes that may or may not be in the wider interests of holders of all rated notes. In general terms, there is potential for conflicts of interest to arise from, inter alia:
- a connection between the controlling class (or its representative) and the prospective special servicer;
- conflicting preferences between the controlling class (or its representative) and other (in particular senior) noteholders.
If the trustee is in doubt about a request to appoint a special servicer, noteholders can be consulted about what special servicer arrangements best serve their interests. Fitch expects to continue to receive notification of all changes in transaction parties, including those governed by the servicing agreement. If warranted by such a change, Fitch will take rating action as appropriate.