Credit rating agency Moody's Investors Service today took action on $10.5bn of Wells Fargo (WFC) jumbo first-lien, adjustable-rate residential mortgage-backed securities (RMBS) originated between 2005 and 2008, with the vast majority of the transactions being downgraded. The action is a result of continuing poor performance in the mortgage pools based directly on "macroeconomic conditions that remain under duress," Moody's report on the matter said. In all, Moody's downgraded the ratings of 98 tranches of the Wells Fargo Mortgage Backed Securities AR Trust series, while upgrading only 17 of those transactions. The credit rating agency said risk is increased by the relatively small size of mortgages in the pools. In this case each pool contains less than 100 mortgages. "Even if a few loans in a small pool become delinquent, there could be a large increase in the overall pool delinquency level due to the concentration risk," the report states. Write to Jacob Gaffney. Disclosure: the author holds no relevant investments.