Walter Investment gets noninvestment grade ratings from Moody's, S&P
Moody's Investors Service (MCO) assigned Walter Investment Management Corp. (WAC) a corporate credit rating of B1 with a stable outlook, attributing the noninvestment grade rating to the company's proposed issuance of $500 million first-lien and $265 million second-lien secured loans associated with the firm's acquisition of Green Tree. In early May, Walter Investment reported a 57% drop in first-quarter earnings as it continued to integrate Green Tree. Last fall, the asset manager and mortgage servicer privately placed $81 million Class B secured notes backed by residential mortgages, building and installment sales contracts and promissory notes. The company expects proceeds of about $84 million from the notes, which were issued by Mid-State Capital Trust 2010-1. The Moody's ratings comes after Standard & Poor's gave Walter Investment a B-plus long-term counterparty credit rating with a stable outlook. "The assignment of these corporate ratings by S&P and Moody's reflect Walter Investment's tremendous opportunity in the high-margin, recurring fee-based mortgage services market, which will continue to drive significant growth for the company subsequent to its acquisition of Green Tree," said Mark O'Brien, Walter Investment's Chairman and CEO. "We are quite pleased with both the corporate and debt ratings we received from these institutions." Write to Kerri Panchuk.