OREANDA-NEWS. Fitch Ratings has affirmed Acenden's Primary and Special Servicer Ratings and removed them from Rating Watch Evolving (RWE), as follows:

UK Residential Primary (Prime) Servicer Rating affirmed at 'RPS2+', removed from RWE
UK Residential Primary (Sub-prime) Servicer Rating affirmed at 'RPS2+', removed from RWE
UK Residential Special Servicer Rating affirmed at 'RSS2', removed from RWE

The removal of RWE follows the completion of Fitch's review of the servicer in the wake of the acquisition of Acenden by funds managed by Blackstone Tactical Opportunities Advisors L.L.C. (Blackstone) and TPG Special Situations Partners (TSSP).

The ratings actions reflect the viability of Acenden, its clear corporate objectives and continuity of activities post acquisition. Most notably, the senior management team at Acenden remains unchanged, which Fitch considers to be important to the servicer's stability.

Fitch considers the change of ownership to have been positive for the servicer. Blackstone and TSSP are active in the European financial market and also completed the acquisition of Kensington Mortgage Company (KMC) at end-January 2015. Both Acenden and KMC are active in the UK residential mortgage market. The companies will relocate to a new building and leverage key support functions at group level - while remaining separate legal entities. As these changes had not completed at the time of the review, Fitch cannot fully assess the impact these may have on Acenden.

Acenden has recently boarded - and will act as servicer on - a large portfolio of loans purchased by KMC and will service all KMC's newly originated loans from end-1Q16. Fitch views the new income stream positively, as it supports the servicer's ongoing profitability and underlines support of the new shareholders.

As neither Acenden nor its direct parents have a Fitch credit rating, the agency assesses the servicer's finances as a stand-alone entity. Fitch considers the servicer's financial condition to be stable, following the last five years of positive net results.

The ratings also reflect that over the past two years Acenden has driven its primary servicing activity through improving customer relations, with a focus on the root-cause of complaints and monthly end-to-end quality review of files. Acenden joined the Institute of Customer Services (ICS) in August 2014 to obtain ServiceMark Accreditation. A customer service survey was completed in May 2015, scoring above the ICS's threshold for excellence. Fitch views these achievements positively, as it provides a benchmark of the service quality against other financial services competitors.

In line with customer service activity, in 2013 Acenden restructured its special servicing teams to move away from the traditional arrears-based structure to an activity-based structure. Acenden has enhanced its servicing systems and standardised processes to provide greater automation and clear directions to its special servicing team. Fitch notes that other rated UK peers have implemented similar changes - driven by a stronger focus on customer experience and on borrowers at risk of falling into arrears.

Acenden has adapted its training framework in line with operational changes over the past two years. A new 10-week induction Collections Academy Programme has been introduced for special servicing staff, which was accredited by ICS in 2014. In addition, training for primary servicing staff has been formalised by way of certification, driven by a workflow categorised into tasks. Fitch believes that training at Acenden is well focused and comprehensive, which is reflected in today's affirmation.