Commercial mortagage-backed products faring better?

August 4, 2008 | By Jim Kim

As the residential mortgage-backed market fiasco continues to unwind, there has been a lot of fear that the commercial market would come under similar pressure soon. For now, commercial mortgage-backed securities and the collateralized debt obligations that invest in them seem to be holding up. The AP reports that in the first half of 2008, upgrades and affirmations are far outpacing downgrades; the agency affirmed 1,452 CMBS and commercial real estate CDO tranches, upgraded 234 tranches and downgraded 123 tranches. The obvious issue is how long this will hold. The weakening economy might take its toll on commercial deals very soon. There's still reason to be nervous.

For more:
- here's the AP article