NEW YORK, May 10, 2016 /PRNewswire/ -- Morningstar Credit Ratings, LLC today announced it assigned two new vendor rankings for the recently created roles of Deal Agent and Representation and Warranty Reviewer in the residential mortgage-backed securities (RMBS) market. Morningstar assigned its MOR RV2 residential vendor rankings to Clayton Holdings, LLC, a wholly owned subsidiary of Radian Group Inc., a global provider of mortgage and real estate market risk-management solutions.
Morningstar's Deal Agent and Representation and Warranty Reviewer vendor rankings for Clayton are the first in the industry. Morningstar Credit Ratings is the only ratings agency offering vendor rankings for these types of firms that provide governance and oversight for RMBS.
During the past year, a working group of mortgage industry participants introduced a proposal for a Deal Agent Framework calling for an independent entity to monitor and oversee RMBS securitization contracts. The Deal Agent role should provide investors with an increased level of protection for U.S. mortgage securities without government backing.
"We believe these new vendor ranking functions are significant to the financial services industry and will play an important role in the revitalization of the private-label RMBS market, which has slowed since the financial crisis of 2008," Michael Gutierrez, managing director, operational risk assessments for Morningstar Credit Ratings, said. "Having an independent assessment of a company's capability to perform these functions can serve to reassure investors who are reluctant to reenter the marketplace."
The U.S. Treasury Department and the Structured Finance Industry Group (SFIG) has supported and promoted the development of the Deal Agent role to add transparency to the mortgage securitization industry and protect investors' interests.
For more information about Morningstar's residential vendor rankings for Clayton Holdings, please view Morningstar's Rankings Announcement.
The ranking scale is MOR RV1-RV4, consistent with all Morningstar ranking types. To access Morningstar's operational risk assessments methodology and all published reports, please visit https://ratingagency.morningstar.com.
About Morningstar Credit Ratings, LLC and Morningstar, Inc.
Morningstar Credit Ratings, LLC is a nationally recognized statistical rating organization (NRSRO) offering a wide array of services including new-issue ratings and analysis, operational risk assessments, surveillance services, data, and technology solutions.
Morningstar Credit Ratings, LLC is a subsidiary of Morningstar, Inc. (NASDAQ: MORN), a leading provider of independent investment research in North America, Europe, Australia, and Asia.
Morningstar, Inc. offers an extensive line of products and services for individual investors, financial advisors, asset managers, and retirement plan providers and sponsors. Morningstar provides data on approximately 525,000 investment offerings, including stocks, mutual funds, and similar vehicles, along with real-time global market data on nearly 18 million equities, indexes, futures, options, commodities, and precious metals, in addition to foreign exchange and Treasury markets. Morningstar also offers investment management services through its investment advisory subsidiaries, with more than $180 billion in assets under advisement and management as of March 31, 2016. The company has operations in 27 countries. Morningstar, Inc. is not an NRSRO and does not issue NRSRO credit ratings.
Morningstar rankings, forecasts, and assessments contained in this press release are not assessments of the creditworthiness of an obligor or a security and thus are not credit ratings subject to NRSRO regulations.
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SOURCE Morningstar Credit Ratings, LLC