DBRS found in a commercial mortgage-backed securities investor survey that the majority of respondents expect their holdings to increase over the next 12 months despite
Of those surveyed, 53% held this view. Only 13% said they expect their holdings to decrease during that time period.
Also, 51% of respondents said they are “neutral” when it comes to their risk position. Furthermore, 22% said they would take more risk this year compared to past years, while 27% said they would take less risk.
“Most investors said they are concerned that competition among lenders will force some to loosen standard origination and underwriting practices,” DBRS noted. “Examples include an increase in leverage, more interest-only structures and the waiving of reserve collections and cash flow traps.”
The 45 responses for this survey generally came from large institutions representing asset managers (53%), insurance companies (36%) and bankers (9%), including both commercial banks and central banks, according to DBRS.
Investor roles were identified predominately as credit analysts, portfolio managers and traders. DBRS considers the sample, generally, to be representative of the current U.S. CMBS investor community.
