Oct 5 - Fitch Ratings has placed three classes of Morgan Stanley Capital I Trust series 2007-XLF (MSCI 2007-XLF) on Rating Watch Negative. A detailed list of rating actions follows at the end of this release.
The Rating Watch Negative placements are due to expected interest shortfalls. The projected interest shortfalls are the result of a liquidation fee charged by the loan's special servicer, CT Investment Management Co., LLC, in connection to the full payoff of New World Tower. Non-investment grade interest is not sufficient to cover the fee and classes B through J are expected to be impacted. Class A-2 is not expected to be subject to interest shortfalls per the master servicer, Midland Loan Services, Inc.
Fitch expects to resolve the Rating Watch status within the next several months as these classes should receive full interest returned within that period. Should classes B through D not recoup their full interest proceeds in a timely manner, these classes are expected to be downgraded one to two rating categories.
Fitch has placed the following classes on Rating Watch Negative as indicated:
--$41.2 million class B at 'AAAsf'; --$41.2 million class C at 'AAsf'; --$25.2 million class D at 'AAsf';
Additional information is available at '
'. The ratings above were solicited by, or on behalf of, the issuer, and therefore, Fitch has been compensated for the provision of the ratings.
Applicable Criteria and Related Research: --'Global Structured Finance Rating Criteria' (June 6, 2012); --'Surveillance Criteria for U.S. CREL CDOs and CMBS Large Loan Floating-Rate Transactions' (Dec. 1, 2011).
Applicable Criteria and Related Research: Global Structured Finance Rating Criteria Surveillance Criteria for U.S. CREL CDOs and CMBS Large Loan Floating-Rate Transactions (New York Ratings Team)