Commercial mortgage-backed securities performed well in the first quarter, with 142 confirmations of rating actions, 68 upgrades, and 40 downgrades, Moody's Investors Service has reported.Floating-rate bonds accounted for more than half of the investment-grade downgrades. Conduits accounted for half the upgrades, "largely due to credit support build up, and also to declines in overall loan leverage," according to Tad Philipp, managing director/CMBS at Moody's. Leverage for conduits and conduit portions of fusion deals continued to rise, reaching 93.2% on a loan-to-value basis, Moody's said. This is the highest level the rating agency has seen in seven years of tracking the measure. Hotel collateral is making its way back into CMBS loans, which Moody's said it believes to be an indicator that the sector has bottomed out and is poised for a rebound. Moody's can be found online at http://www.moodys.com.

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