Servicing

Sixteen tranches of CSFB mortgage pass-through certificates issued in 2004 have been downgraded by Moody's Investors Service.Moody's also upgraded one tranche of CSFB pass-throughs. The actions were based on an analysis of the credit enhancement levels provided by excess spread, overcollateralization, and subordinate classes relative to expected losses, the rating agency said. The underlying collateral of the affected tranches consists of first-lien, alternative-A, adjustable-rate mortgage loans.

Eighteen classes of mortgage-backed securities from three issuers were downgraded by Fitch Ratings on Dec. 27 as a result of changes to its subprime loss forecasting assumptions.Fitch also placed 15 classes on Rating Watch Negative and affirmed the ratings on classes with outstanding balances of more than $2.6 billion. The securities affected by the latest downgrades were: nine classes of HASCO mortgage pass-through certificates; five classes of Soundview Home Equity Loan Trust asset-backed certificates; and four classes of Ace mortgage pass-throughs. The rating actions were attributed to changes in Fitch's subprime loss forecasting assumptions that "better capture the deteriorating performance of pools from 2006 and late 2005 with regard to continued poor loan performance and home price weakness." Fitch can be found online at http://www.fitchratings.com.

Thirty-one certificates from transactions issued in 2004 and backed by Fremont-originated subprime mortgage and home equity loans have been downgraded by Moody's Investors Service.In addition, Moody's upgraded 17 certificates and confirmed the ratings of five certificates from the numerous transactions. The certificates were downgraded "because the reduction in overcollateralization due to stepdown and higher loss severity at the tail end of the deals' life have made the bottom tranches more vulnerable to further pool deterioration," the rating agency said. Moody's can be found on the Web at http://www.moodys.com.

Fitch Ratings has assigned Imperial Capital Bank an SBSS3 special servicer rating for small-balance commercial products.Fitch said the rating is based on the company's ability to work out, resolve, and dispose of small-balance commercial mortgage loans and real-estate-owned properties. Fitch also affirmed Imperial Capital's primary servicer rating of SBPS3 for small-balance commercial loans. Fitch rates commercial servicers on a scale of 1 to 5, with 1 being the highest rating. Imperial Bank, based in La Jolla, Calif., can be found online at http://www.imperialcapitalbank.com.

Middleburg Financial Corp., Middleburg, Va., has announced that it expects to record a noncash impairment charge of approximately $5 million in the fourth quarter in connection with the carrying value of Middleburg Bank's ownership stake in Southern Trust Mortgage LLC.The bank's 41.8% ownership interest in Southern Trust was valued at $9.7 million as of Sept. 30, the company said. "The impairment of value primarily results from earnings declines associated with the slowdown in loan production volume and the increases to loan loss reserves," Middleburg Financial said. The company can be found on the Web at http://www.middleburgbank.com.

Deutsche Bank, a top-ranked issuer of subprime mortgage-backed securities, will conduct a top-to-bottom review of its entire mortgage business in the first quarter, according to officials at the company.A spokeswoman for the bank confirmed that a review will soon be under way, adding that, "there may be a reallocation of assets." Like many Wall Street firms, Deutsche Bank has both an active trading desk and a warehouse lending group that caters to the nonprime sector, a business that is in the throes of a historic correction. Deutsche Bank's trading desk is overseen by Michael Commaroto, who is listed in Securities and Exchange Commission documents as president of Deutsche Mortgage Securities. In 2006 Deutsche Bank purchased Chapel Funding Corp., Lake Forest, Calif., a privately held nonprime lender. It also acquired the publicly traded MortgageIT Holdings Inc., New York, the nation's 21st-largest lender, for $429 million. Deutsche Bank can be found online at http://www.deutsche-bank.com.

Two classes of Renaissance Home Equity Loan Trust series 2002-2 have been downgraded by Fitch Ratings.Class M2 was downgraded from BBB-plus to BBB and placed on Rating Watch Negative, and class B was downgraded from B to CC/DR3. The negative rating actions were attributed to deterioration in the relationship between credit enhancement and loss expectations. The collateral for the transaction consists of first- and second-lien subprime mortgage loans.

Three classes of Chase Funding subprime mortgage pass-through certificates have been downgraded by Fitch Ratings.The downgrades were as follows: series 2001-4 group 2, class IIM-1, from AA to A-plus, and class IIM-2, from A to BBB-plus; and series 2002-3 group 1, class IB, from A-minus to BBB (and placed on Rating Watch Negative). Fitch also placed class IIB of series 2003-6 group 2 on Rating Watch Negative and affirmed the ratings on 35 other classes from 10 Chase subprime deals. The negative rating actions were attributed to deterioration in the relationship between credit enhancement and loss expectations. The collateral consists of subprime loans secured by first- and second-lien mortgages or deeds of trust.

Five classes from three issues of Long Beach Mortgage Loan Trust residential mortgage-backed securities have been downgraded by Fitch Ratings.The downgrades were as follows: series 2003-1, class M-3, from BB-minus to B-minus/DR1; series 2003-3, class M-3, from BB to B, and class M-4, from B to CC/DR3; and series 2004-5, class M-6, from BBB to BB-plus (and placed on Rating Watch Negative), and class M-7, from BBB-minus to B (and placed on Rating Watch Negative). The negative rating actions were attributed to continued deterioration in the relationship between credit enhancement and loss expectations. The collateral consists of subprime loans secured by first- and second-lien mortgages or deeds of trust.

Eight classes from six collateralized debt obligations insured by MBIA Inc. and consisting partly of mortgage-backed securities have been placed on Rating Watch Negative by Fitch Ratings.The ratings of the CDOs are supported by a financial guaranty provided by MBIA Insurance Corp., a subsidiary of MBIA, whose triple-A insurer financial strength rating was recently placed on Rating Watch Negative by Fitch because of exposure to subprime residential MBS. The affected notes are as follows: Endurance CLO I Ltd, class A; Mulberry Street CDO Ltd., class A-1A; Mulberry Street CDO II Ltd., classes A-1A, A-1B, and A-1W; Oceanview CBO I Ltd., class A-1A; Shyppco Finance Co. LLC, class A-2A; and Z-1 CDO 1996 Ltd. (previously Cigna CBO 1996-1 Ltd.), class A-2.