S&P Downgrades, Warns on 6,389 Subprime RMBS Classes

Standard & Poor’s said Wednesday that it had downgraded or placed on negative watch 6,389 classes from subprime RMBS transactions rated between the start of 2006 and June 2007. The rating agency also placed 1,953 ratings from 572 CDOs of ABS and CDOs-squared transactions on negative watch. HW broke the story on revised rating criteria for subprime RMBS on January 15, noting then that a wide swath of downgrades were likely to result. Wednesday’s ratings actions were a direct result of the new criteria. The affected U.S. RMBS classes represent an issuance amount of approximately $270.1 billion, or approximately 46.6 percent of the par amount of U.S. RMBS backed by first-lien subprime mortgage loans rated by Standard & Poor’s during 2006 and the first half of 2007, the agency said in a press statement. Click here to read a complete list of all affected RMBS securities. Click here to read a complete list of all affected CDO ratings. For more information, visit http://www.standardandpoors.com.