Fitch Affirms Stater's Dutch Residential Primary Servicer Rating
The rating reflects the senior management team's breadth of experience. The senior management team's continued high tenure in conjunction with their high levels of industry experience has meant that Stater has been able to have clear direction in its continuing improvement and growth as a business. Fitch views this continuity favourably.
Fitch believes that Stater has continued to strengthen its risk culture through the evolution of its risk management (RM) framework. The three lines of defence risk model is now fully embedded within the company and has delivered a more stringent RM framework. Improvements to the framework include the implementation of a RM dashboard that acts as a steering tool for management. Fitch would like to see the continued maturation of the framework.
Stater continues to employ good technology systems to assist its servicing operation. Stater's primary systems are continually enhanced and updated on a bi-monthly basis to ensure that they remain efficient and of a high quality.
In the 12 months ending 30th June 2014 Stater's staff attrition rate rose sharply to 35.87% which is significantly higher than in previous years and Fitch rated peers. The increased turnover figure is the direct consequence of a transformation and deployment process undertaken by the company. In addition to this a number of employees decided to leave the company under the terms of a collective labour agreement between Stater and ABN AMRO bank. Fitch would like to see this attrition rate return to previously seen levels of around 10%.
The rating also takes into consideration Stater's continued commitment to staff development. In the 12 months ending 30th June 2014 Stater evidenced this commitment by making 29 internal promotions, increasing the training budget and keeping training hours per staff member at a healthy level. Fitch views this commitment positively.
Furthermore, the rating benefits from Stater's diversified client base and ongoing support from its parent company, ABN AMRO (A+/Negative/F1).
Fitch used its global servicer rating criteria to analyse the servicer's operations and financial condition, including a comparison against similar Dutch servicers as part of the review process. The analysis is based on information provided to Fitch by Stater.
As of 30 June 2014, Stater's primary residential servicing portfolio totalled EUR229bn (versus EUR177bn at end of December 2012), consisting of 1,311,532 loans (versus 977,401 loans at end of December 2012).
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