OREANDA-NEWS.  Fitch Ratings has downgraded the commercial mortgage special servicer rating of CWCapital Asset Management LLC (CWCAM) to 'CSS2+' from 'CSS1-'.

The primary driver of the rating change is the second consecutive year of material noncompliance with servicing criterion noted in the company's annual Reg AB audit. In its action, Fitch also considered recent changes to the compliance infrastructure including the formation of a compliance committee to regularly review exception reporting, the depth and scope of the internal audit function, and the strength of its proprietary asset management technology, CAMS.

Fitch's rating also reflects the company's strong asset management capabilities for defaulted/non-performing commercial real estate assets and extensive workout experience, having resolved more than 400 commercial mortgage loans in 2014, its highly experienced management team, and CAMS.

CWCAM is among the three largest CMBS special servicers by unpaid balance and acts as special servicer on behalf of third-party and affiliated controlling class holders and CDO transactions. CWCAM's active special serviced portfolio has declined 51% by loan count and 39% by unpaid principal balance (UPB) over the past two years. CWCAM currently does not invest in CMBS B-pieces and new assignments are dependent on third-party appointments.

As of Dec. 31, 2014, CWCAM was the named special servicer on 7,601 loans in 147 CMBS transactions with a UPB of \$109.8 billion. As of the same date, the company was actively working out 239 CMBS loans totaling \$5.7 billion and 268 REO assets totaling \$7.9 billion. Additionally, the company is named special servicer on 687 non-CMBS loans with a UPB of \$3.1 billion and is actively servicing 26 non-CMBS loans with a UPB of \$262.7 million and seven REO with a UPB of \$113.6 million. At Dec. 31, 2014, approximately 97% of the company's special servicing portfolio was CMBS.