Fitch Touts NIMS Performance

Net-interest-margin securitizations have performed better than expected in the U.S. subprime residential mortgage-backed securities market, and they are likely to continue to do so, according to a report by Fitch Ratings.The report said the decline in short-term interest rates is the primary reason for the NIMS performance, while a trend toward using more conservative assumptions in structuring the securities is an additional factor. "If the economy continues its slow growth and remains in its sluggish state, Fitch expects NIMS to sustain their current outperformance of stressed projections," said Tom Albertson, a Fitch senior director. "A worsening economic scenario would only cause NIMS to underperform if the negative effects of rising delinquencies exceed the benefits of falling interest rates." The report is titled "Net Interest Margin Securitizations Performance Update and Outlook." The rating agency can be found on the Web at http://www.fitchratings.com.