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The American Stock Exchange has announced the commencement of trading in common shares of a new closed-end fund issued by ING Clarion Real Estate.The ING Clarion Real Estate Income Fund is the first closed-end fund to be issued by ING Clarion and the first real estate closed-end fund to invest in both equity and fixed-income real estate securities, Amex reported. The fund's primary investment objectives are to seek high current income and capital appreciation. Amex can be found online at http://www.amex.com.

Class B of First Union Home Equity Loan Series 1997-3 has been downgraded from BBB to BB by Fitch Ratings and removed from Rating Watch Negative.The rating action was attributed to the poor performance of the underlying collateral in the deal. Losses have been higher than expected and have resulted in the depletion of overcollateralization, Fitch said.

Standard & Poor's Ratings Services has announced that it will rate structured finance deals that include Nevada loans governed by the state's new predatory lending law.The law, which takes effect Oct. 1, prohibits certain practices in regard to making home loans (as defined by the statute) and sets forth rules that lenders must abide by, S&P said. Violations could result in liability for the originators, purchasers, or assignees of home loans. The liability of purchasers and assignees for a loan that violates the act may exceed the unpaid principal balance of the loan, but the liability is capped, S&P said. The rating agency said it will require certain representations and warranties for deals containing Nevada loans. S&P can be found online at http://www.standardandpoors.com.

Standard & Poor's has lowered the Federal Home Loan Bank of New York's coveted AAA credit rating to AA-plus due to a $183 million loss on a sale of $1 billion in downgraded manufactured housing securities."While the bank has disposed of these [MH] securities, which helps to reduce its credit risk profile, the FHLB-NY's retained earnings were cut in half, and a significant quarterly loss will be recognized," said S&P's credit analyst Jonathan Ukeiley. The New York FHLBank has suspended its third-quarter dividend to prevent further drain on its retained earnings, which totaled $240 million at the end of the second quarter. While the bank rebuilds it retained earnings, "it is expected that profitability will remain depressed given the low interest rate environment," the S&P analyst said. Meanwhile, Fitch Ratings took no action on its AAA rating of the bank.

Delta Financial Corp., Woodbury, N.Y., has priced a $434 million securitization of closed-end home equity loans through its subsidiary Renaissance Mortgage Acceptance Corp.The Renaissance Home Equity Loan Trust 2003-3 uses a senior/subordinate structure and has fully funded overcollateralization at closing, Delta said. The company said it expects to use a pre-funding feature and deliver approximately $350 million of mortgage loans to the trust by Sept. 30, with the remainder to be delivered in October. Delta can be found on the Web at http://www.deltafinancial.com.

Two classes of the GE Home Equity 1997-HE 3 transaction have been downgraded by Fitch Ratings.The downgrades were as follows: class B-1, from BBB-minus to BB-minus; and class B-2, from CC to C. In addition, the ratings on two classes in the deal were affirmed, and another remains on Rating Watch Negative. Fitch said credit support for class B-2 has been depleted due to losses, and the bond took a principal writedown on Aug. 25. "Although the transaction's structure allows for the writedown amount to be repaid from future recoveries, the structure does not allow for interest on the written-down amount to be repaid," the rating agency said. The downgrade of class B-1 was attributed to loss levels and high delinquencies in relation to applicable credit support. Fitch can be found online at http://www.fitchratings.com.

The ratings on nine classes from two manufactured housing transactions linked to Conseco Finance Corp. have been lowered by Standard & Poor's Ratings Services and removed from CreditWatch with negative implications.The downgrades in Manufactured Housing Contract Senior/Sub Pass-Through Certificates, series 2002-1, are as follows: class A, from AAA to A-plus; classes M-1-A and M-1-F, from AA-minus to BBB; class M-2, from A-minus to BB; and class B-1, from BBB to B-plus. The downgrades in Manufactured Housing Contract Senior/Sub Pass-Through Certificates, series 2002-2, are as follows: class A-2, from AAA to A-plus; class M-1, from AA to A-minus; class M-2, from A to BBB-minus; and class B-1, from BBB to BB-minus. S&P attributed the downgrades to the poor performance of the underlying pools of manufactured housing contracts and the resulting decline in credit enhancement. The rating agency said recovery rates on liquidated collateral have "plummeted" for both deals since Conseco has become more reliant on a wholesale liquidation strategy after suspending its MH financing business and filing for bankruptcy in December 2002. S&P can be found online at http://www.standardandpoors.com.

Credit Suisse First Boston was the buyer of most of the manufactured housing-backed bonds that blew a hole in the Federal Home Loan Bank of New York's balance sheet this quarter, a source familiar with the matter has told MortgageWire.As of MW's deadline, CSFB had yet to comment on the matter. The bonds had a face value of about $1 billion, and the FHLBank said recently that it lost $183 million on the sale. Conseco and Oakwood Homes were the issuers of the bonds, a source noted. Conseco went bankrupt and is no longer in business, and Oakwood recently filed for bankruptcy protection. Fannie Mae also invested in some of Conseco's asset-backed bonds.

Meanwhile, Federal Housing Finance Board Chairman John Korsmo has told a House panel that the deterioration in the credit quality of the New York FHLBank's manufactured housing assets is "a concern."Mr. Korsmo told the House Financial Services Committee that the agency is monitoring the situation and that the New York FHLBank stopped paying dividends "to protect retained earnings." He added that the Finance Board has issued guidance to all FHLBanks to review the adequacy of their retained earnings.

The Federal Home Loan Bank of New York will not pay a dividend to its shareholders in the third quarter due to a $183 million loss on the sale of its troubled investments in manufactured housing securities.The FHLBank sold $1.033 billion of MH securities that were not insured and had been downgraded from their original triple-A ratings. "To ensure that there would be no further deterioration, the Bank has now sold this portfolio and has no uninsured exposure to the manufactured housing sector," FHLBank president Alfred DelliBovi says in a letter to shareholders. In August, Standard & Poor's warned that the bank's triple-A credit rating might be downgraded due to problems with its MH investments. Mr. DelliBovi also announced that the bank would postpone its conversion to a risk-based capital system that was scheduled to go into effect Oct. 1. The FHLBank's capital ratio of 4.68% is "well above" the minimum capital-to-assets ratio of 4.0%, the Sept. 24 letter says. "The Bank also expects its retained earnings will continue to be positive at September 30, 2003." (The FHLBank had $240 million in retained earnings at the end of the second quarter.)