Metro Asset MBS Classes Downgraded

Three subordinate tranches from two subprime mortgage transactions issued by Metropolitan Asset Funding Inc. in 1999 and 2000 have been downgraded by Moody's Investors Service.The downgrades were as follows: series 1999-B, class B-2, from Ba2 to B2, and class B-3, from B2 to Caa2; and series 2000-A, class M-2, from B3 to Caa2. The downgrades were attributed to the weaker-than-expected performance of the mortgage pools and the resulting erosion of credit support. "Specifically, the overcollateralization in the 1999-B deal is almost completely depleted and the class B-3 certificates are likely to experience losses in the near future," Moody's said. "In addition, the overcollateralization in the 2000-A deal has been fully exhausted, the class B-1 certificates have been fully written down, and the class M-2 certificates have realized losses." The pools are backed by first-lien fixed-rate subprime mortgage loans, and they include "a significant amount" of seller-financed loans and loans with small average balances, the rating agency reported. Moody's can be found online at http://www.moodys.com.