Rating agencies are talking tough about residential mortgage backed securities (RMBS) again. This time the fuss isn’t about selling defective loans back to the originators. Instead, raters disagree about the risk of deals with a large number of mortgages on homes in the same state, or even the same city.

At issue is a $440-million residential mortgage backed security (RMBS) by Nomura Corporate Funding. Closed in mid July, the deal is Nomura’s first RMBS since the financial crisis. Its collateral consists entirely of 30-year, fixed-rate loans originated by First Republic Bank, a jumbo lender that is a recurring originator for Redwood Trust’s RMBS and boasts a strong performance history.

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