The CMBS market in the UK is well-placed to weather any further downturn in commercial property prices, according to a report by Fitch Ratings. Even if property valuation yields reverted to levels last seen in 1990 – what Fitch terms a “severe” scenario – the subsequent revaluation of assets would lead to losses of only 0.25% on triple-A CMBS and 9% on investment-grade CMBS tranches.
Fitch analysed four stressed scenarios: mild, moderate, severe and worst-case. In the worst-case scenario (which
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