Fitch: State bond rating stays at AA+
Posted on November 17, 2009 at 8:34 amOn the day budget hearings started on Capitol Hill, Fitch Ratings lauded state officials’ “proactive approach to addressing the fiscal impact of the current downturn” and rated an upcoming $212 million bond sale at AA+, the state’s current rating.
permalink | Comment on this post
Another wave of CRE handwringing
Posted on at 8:00 amIf you’re looking for even the slightest bit of optimism on the commercial real estate sector, you’re very much in the wrong spot. Fitch Ratings says the delinquency rate on office-building loans rose by a fifth in October.
“Though longer leases on office properties have historically mitigated sharp changes in performance, continued job losses are expected to increase pressure on the office sector,” said Managing Director and U.S. CMBS group head, Susan Merrick. “With the looming possibility of leases expiring on space under-utilized by companies that have downsized, office performance may not reach a trough for a few years.”
A page from First Horizon’s recently updated investor presentation provides a microcosmic view of how the property market is getting sicker. (Go to page 19.)
Worryingly, regional banks as a whole have a lot more CRE loans on their books as a percentage of their capital — although many bankers contend that this statistic is skewed by the inclusion of owner-occupied property loans, which they treat as more conventional C&I holdings.
SEE ALSO: Clusterstock’s concise, but detailed account of how we got here. For all the doom and gloom, it ends on a hopeful note (that I think isn’t meant to be ironic.)
Fortunately, this time around we have an advantage. We know how a contained credit problem can morph into a monster that destroys financial institutions and cripples the economy. Living through the housing bust may make us better able to cope with the commercial real estate bust. At least, it’s pretty to think so.
permalink | Comment on this post
One in six commercial mortgage securities worrisome
Posted on September 4, 2009 at 6:35 am
Fitch Ratings says the number of commercial real estate “loans of concern” grew by 7 percent during July. CRE portfolios are widely expected to provide the next big test for the financial sector.
permalink | Comment on this post
When it comes to HCA, Fitch still looking at 2012
Posted on July 29, 2009 at 11:33 amIn rating a planned bond offering, the credit ratings agency says HCA is doing a nice job on the operations front, but says the more than $10 billion of debt that begins to come due in two years looms as large as ever.
SEE ALSO: HCA doubles bottom line
permalink | Comment on this post
Fitch: Healthcare Realty solid, but refis will have impact
Posted on July 28, 2009 at 1:38 pmCredit ratings group Fitch has affirmed its ratings of Healthcare Realty and affiliates and says there’s a lot to like about the company’s portfolio. But, it warns, the company will have to pay more when it refinances its unsecured credit line. For details on the company’s credit situation, click here and search for ‘January 2006.’
permalink | Comment on this post
Fitch: First Tennessee not out of the woods
Posted on June 30, 2009 at 12:59 pmCredit ratings group Fitch says First Tennessee, which in many ways got a headstart on dealing with last year’s banking crisis, still has a credit mess on its hands.
permalink | Comment on this post
Healthcare Realty outlook downgraded
Posted on June 11, 2009 at 11:47 amWhile it has affirmed its credit ratings and says the medical office market remains stable, Fitch says the potential for Healthcare Realty to use secured debt to pay down its unsecured credit line may lead to a downgrade. Shares of Healthcare Realty (Ticker: HR) are off about 1 percent today.
permalink | Comment on this post
Tennessee commercial mortgages struggling
Posted on May 18, 2009 at 1:29 pmFile this under ‘States we don’t want to be compared to right now:’ Updating its commercial mortgage-backed securities numbers, Fitch Ratings says only Michigan has a higher default rate than Tennessee. Fitch analysts also say it doesn’t appear the market is digesting the sour stuff.
While the loans secured by properties located in the worst performing states account for less than 6% of the Fitch-rated universe by balance, they make up nearly one-fourth of all real estate owned (REO) loans tracked in the index — an indication that special servicers are finding limited opportunities to work out or to quickly dispose of assets in these locations. Each of the preceding states has an unemployment rate significantly higher than the 8.9% national rate.
permalink | Comment on this post
Fitch: LifePoint could line up another Province deal
Posted on May 12, 2009 at 3:10 pmIn affirming the hospital company’s debt ratings, Fitch analysts say they are looking for the company to “increase leverage for a more sizable opportunity, as it has done in the past.” But such a deal would come with plenty of headaches.
Given the company’s focus on improving operations, significant acquisition activity could present meaningful integration risk to the credit. Over the past few years, LifePoint has contended with several operating challenges related to physician recruitment, integrating acquisitions and increasing operating expenses. As a result, the company has reported the worst organic volume growth in the industry since Jan. 1, 2007 as well as a more than 400 basis point decline in EBITDA margins over the past four years.
permalink | Comment on this post
Regions ratings cut
Posted on March 26, 2009 at 12:53 pmFitch Ratings has lowered its opinion of Regions Financial’s main debt rating, saying its work on bad loans will take a while longer.
permalink | Comment on this post
As promised, Vandy back to bond market
Posted on March 10, 2009 at 7:21 amThe university will today sell another $330 million in revenue bonds that will pay off a series of 2005 bonds, refinance some of its commercial paper and help fund some capital projects going forward.
permalink | Comment on this post
Vanderbilt goes to bond market with $250M deal
Posted on February 23, 2009 at 11:17 pm
Fitch Ratings says another $330 million sale is on its way relatively soon and, in a lovely financial boilerplate kind of way, makes the late-summer days of scrambling to make payroll seems oh so far away.
The university also has substantial balance sheet resources. Fiscal 2008 available funds, defined by Fitch as unrestricted and temporarily restricted cash and investments, were $3.6 billion, and covered operating expenses of $2.8 billion and pro forma debt of $1.5 billion by 128.2% and 238.9%, respectively. While the university’s endowment has declined in value since fiscal year end 2008, due to the current financial market turbulence, its liquidity position remains strong and is consistent with the current rating category.
permalink | Comment on this post
Fitch slashes Sumner hospital debt to junk
Posted on January 21, 2009 at 6:21 pmThings aren’t lookin’ too good for Sumner Regional Health Systems: Credit rating agency Fitch has downgraded $150 million of the hospital’s debt to BB+, which is in junk territory and a full grade below its previous BBB+ rating.
Fitch analysts also use some forceful adjectives to describe Sumner Regional’s situation. Don’t think you ever want the words “tremendous financial stress” in a row…
The rationale for the downgrade is based on Sumner Regional Health Systems’ (Sumner) rapidly deteriorating financial profile, its current precarious negotiations with a third party lessor regarding a technical default, and its poor communication and disclosure practices to date. Fitch placed the 2007A bonds on Rating Watch Negative effective Jan. 7, 2009 due to a lack of disclosure, as Sumner had failed to post its fiscal 2008 audit by Oct. 31, 2008, as required under its bond documents.
On Jan. 16, 2009, Sumner posted interim fiscal 2008 results along with first- and second-quarter interim fiscal 2009 results. These interim statements indicate that the organization is experiencing tremendous financial stress resulting in a profound weakening of its credit profile. Sumner has informed Fitch that an error in recording contractual allowances was discovered in the summer of 2008 and resulted in an overstatement of revenues, which were subsequently written down and are the major driver behind the flagging performance recorded in fiscal (FY) 2008 and through the six-month interim FY 1009 period.
permalink | Comment on this post
Fitch places Sumner hospital on negative watch
Posted on January 7, 2009 at 3:04 pmThe credit rating agency says a missed deadline for filing its last year-end financials “may indicate financial distress and/or poor management practices” at Sumner Regional Health System. The hospital cut almost 100 jobs two months ago.
permalink | Comment on this post
Fitch affirms Vandy rating
Posted on December 15, 2008 at 10:08 pmCredit ratings service Fitch has kept its rating of Vanderbilt’s commercial paper at F1+, the highest it can be. Vanderbilt is tweaking the tax-exempt/taxable mix of the $675 million program.
Recent Comments
In our good state a select few run the place, 20 yrs ago and today....
Southernindie…Unfortunat ely you have suffered a dibilitating...
And…Karl (Marx) Dean is spending one billion dollars...
Someone explain the difference between short stay and observation...
Watching the Chairman of Starwood Hotels yesterday on CNBC...
Funny how the Union’s feel about taxes. They complained about their...
Where is it?
An absolutely ugly structure, which I have always thought did not take...
Too bad that ATT changed the look of the building so that it no longer...
Yeah, well, look at the TN Legislature of good ol’ boys and the...
As long as the red rules, we will be far behind other states. The GOP does...
Nissan CEO Carlos Ghosn: I don’t know what...