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J.P. Morgan Announces Sale of Securities Backed by NPLs

""J.P. Morgan"":http://www.jpmorgan.com/pages/jpmorgan recently announced the issuance of $132 million in commercial mortgage-backed securities (CMBS) backed by non-performing commercial real estate loans.



According to the ""Wall Street Journal"":http://blogs.wsj.com/developments/2012/03/29/j-p-morgan-revives-sales-of-distressed-commercial-mortgage-bonds/?mod=dist_smartbrief, the issuance is first time since the late 1990s.

Prior to the securitization, the assets were owned by ""Rialto Capital Management"":http://rialtocapital.com/, a real estate investment management company focused on distressed asset investment, management, and workouts.

The collection includes 271 performing and nonperforming loans securing 266 properties, 11 unsecured loans, and 38 properties acquired at acquisition or through foreclosure, according to Fitch Ratings.

All non-performing assets are assumed to have a 0 percent coupon, according to ""Trepp"":http://www.trepp.com/, whose bond finance team has been working with J.P. Morgan for the last few weeks to design a way for investors to easily analyze the deal.

The deal name is Rialto Capital, series 2012-LT1.

About Author: Esther Cho


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