Commercial real estate CDO delinquencies rose slightly last month following four straight months of decline, according to the latest index results from Fitch Ratings.
CREL CDO late-pays rose to 12% from 11.6% in August. "Given the instability in the broader economy, CREL CDOs delinquencies are expected to continue to seesaw going forward," said director Stacey McGovern.
In September, asset managers reported 11 new delinquent assets. Among the newly delinquent assets were three matured balloon loans, six new credit impaired securities, and two term defaults.
Ratings on the most junior classes remain subject to volatility as losses continue to accumulate. In September, CREL CDO asset managers reported approximately $60 million in realized losses.