Moody's Downgrades 2nd-Lien Classes

Moody's Investors Service issued a flurry of news releases Feb. 26 involving downgrades and placements on review for possible downgrade of more than 100 classes of securities in transactions from eight issuers that are backed by second-lien loans. Among the affected securities were the following: Merrill Lynch Mortgage Investors Trust, 22 downgrades and one review placement; CSFB Home Equity Mortgage Trust, 19 downgrades and three review placements; SACO I Trust, 13 downgrades and two review placements; and Nomura Alternative Loan Trust, 10 downgrades and three review placements. "Substantial pool losses over the last few months have continued to erode credit enhancement available to the mezzanine and senior certificates," the rating agency said. "Despite the large amount of write-offs due to losses, delinquency pipelines have remained high as borrowers continue to default."