HML also gained an A3.EDF score for financial stability.
The Moody’s SQ rating analyses the quality of a servicer with specific regard to the securitisation of loan portfolios.
HML’s head of business development, Paul Fenn explains:
“With the growing trend for UK lenders to securitise their mortgage portfolios (as is common in the US), they do need the technical expertise to service their mortgage pools in such a way that they achieve a high credit quality to facilitate a successful securitisation. It is expensive and time consuming for companies to build such expertise in-house, whereas a professional servicer like HML has the capability to handle the growing volume of securitised mortgage portfolios.”
Moody’s highlights the strength of HML’s management team, specifically mentioning the depth of their industry experience at an average of 26 years. Moody’s also rated staff motivation, training and experience at HML as ‘very good’, while loan administration, arrears management, loss mitigation, general quality and IT systems were all ‘above average’.
The Moody’s rating comes on top of the confirmation of servicer ratings by international rating agency Fitch earlier this year. Following an in-depth review, Fitch affirmed their RPS2+UK(Prime) and RPS2+UK(SubPrime) residential mortgage primary servicer ratings awarded to HML – the highest rating awarded to any such company in Europe.
Steve Haggerty, HML’s managing director commented:
“It’s great to see our strengths highlighted by these excellent ratings from both Moody’s and Fitch. In just 16 months, we’ve grown assets under management by more than 40% to reach the current level of £32 billion.”
“To cope with this impressive growth,” he continues, “we have significantly expanded our operations in Padiham and opened a completely new business unit in Londonderry, to handle all our call centre operations. In fact, both agencies specifically highlight the success of our Derry business unit, opened in early 2004.”
Moody’s also discussed HML’s commitment to creating a good working environment, highlighting the well thought out design of the Padiham facility. Moody’s believe that the achievement of a strong corporate culture has helped HML to minimize staff turnover, which at 19% is below the industry average of 22%.
In conclusion, Steve Haggerty says: “In an ever more competitive market, securitisation of residential mortgages is certain to become more and more important to lenders. HML has the vital expertise to enable them to achieve this – and we have the independent rating from Moody’s to prove it.”
“We operate not only in the UK but also in Ireland, where we expect to see a growing trend towards securitisation of mortgage loans.”
