Fitch Ratings has increased the credit enhancement levels required to obtain ratings on commercial mortgage-backed securities as a result of the declining quality of CMBS loans in recent months, according to the rating agency.Fitch said it expects to see subordination levels in CMBS deals increase further this year if current trends continue. "Over the past year, there has been a decline in structural features such as amortization, reserves, and cash management practices, more aggressive underwriting, and a diminishing quality of borrowers with lower levels of equity in their properties," said Dan Chamber, a Fitch managing director. The rating agency's views are outlined in a report titled "U.S. CMBS: Where Have All the Good Loans Gone?" Fitch can be found on the Web at http://www.fitchratings.com.

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