Redwood pricing RMBS with Fitch rating

[Update 1: includes actual Fitch Ratings] Redwood Trust (RWT) is announcing the pricing of a public offering of prime residential mortgage-backed securities. The jumbo RMBS is the first of its kind this year and will be issued by Sequoia Mortgage Trust 2011-1, the trust sponsored by RWT Holdings, a Redwood subsidiary. The offered securities include approximately $270 million principal amount of Class A-1 Certificates, with an initial interest rate of 4.125% per year. Redwood expects to close by March 1. The lead managing underwriter of the offering is Credit Suisse. JPMorgan and Jefferies & Co. are also acting as underwriters of the offering. Redwood asked Moody’s Investors Service to rate the deal but Redwood disagreed with the rating when the agency said concentration risk linked to a potential catastrophic event. Fitch Ratings assigned the following ratings on Friday: –Class A-1 ‘triple-A’ (Credit Enhancement: 7.5%); –Class A-IO ‘triple-A’ (Credit Enhancement: n/a); –Class B-1 ‘double-A’ (Credit Enhancement: 5%); –Class B-2 ‘single-A’ (Credit Enhancement: 3.25%); –Class B-3 ‘triple-B’ (Credit Enhancement: 2%); –Class B-4 ‘double-B’ (Credit Enhancement: 1.25% Write to Jacob Gaffney. Follow him on Twitter @JacobGaffney. The author holds no relevant investments.

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