Articles from Kroll Bond Rating Agency, LLC

KBRA issues a no downgrade confirmation in relation to the proposed merger of Tortoise Energy Infrastructure Corporation ("TYG") and Tortoise Sustainable & Social Impact Term Fund ("TEAF"), with TYG being the remaining entity. The request for Rating Agency Confirmation ("RAC") was initially received on June 26, 2025. The analysis indicates that the proposed merger in and of itself will not result in a downgrade, qualification or withdrawal of KBRA’s current ratings issued in connection with the outstanding Senior Notes and Mandatory Redeemable Preferred Stock (“MRPS”).

As part of the European Union’s (EU) broader REPowerEU strategy to reduce dependence on Russian energy and under the terms of the recently announced U.S.-EU trade agreement, the EU has committed to purchasing $750 billion worth of U.S. energy over the next three years to meet demand. Abundant low-cost natural gas across the Permian, Eagle Ford, and Haynesville basins—combined with modest liquefaction fees and close proximity to liquefied natural gas (LNG) export facilities on the U.S. Gulf Coast (USGC)—continue to make U.S. LNG incredibly competitive. While there is currently no impact to KBRA’s portfolio of LNG export facilities due to their contracted nature, future projects could be affected if they seek to monetize merchant cash flows.

KBRA releases research discussing the potential impact of Texas' new Educational Savings Account (ESA) program (i.e., private school vouchers) on public school district credit quality.

KBRA releases its Q2 2025 Middle Market Borrower Surveillance Compendium. Private credit may well be in a “Waiting for Godot” moment—marked by growing anticipation of some unknown reckoning that continues to be deferred. As the industry continues to adapt to various market uncertainties, KBRA notes signs of improving credit quality for some borrowers, while still observing a subset of borrowers that face maturities over the next two years without the growth their sponsors and borrowers had expected.

KBRA assigns a long-term rating of AA to the Department of Water and Power of the City of Los Angeles (LADWP or the Department) Water System Revenue Bonds, 2025 Series A and 2025 Series B. Concurrently, KBRA affirms the AA rating on the Department's Water System Revenue Bonds, approximately $5.79 billion of which were outstanding as of August 1, 2025. The rating Outlook on all Water System debt is Stable.

KBRA releases its latest 12 Things in Credit report, highlighting timely credit market themes drawn from our weekly podcast, 3 Things in Credit, hosted by KBRA’s Chief Strategist, Van Hesser. Among the wide-ranging topics Van discusses in this issue are growth catalysts, the implications of the tariff baseline bumping to 15%, and the market reaction to Delta Airlines earnings.

KBRA releases a new conduit CMBS default and loss study that updates our previous observations on the credit behavior of conduit loans.

KBRA assigns a AAA long-term rating with a Stable Outlook to Austin Independent School District’s (the "District") Unlimited Tax School Building Bonds, Series 2025 (PSF), and concurrently affirms the AAA long-term rating with a Stable Outlook for the District’s Unlimited Tax School Bonds (PSF) and Unlimited Tax School Bonds (Non-PSF) outstanding.

KBRA announces the assignment of preliminary ratings to six classes of WFCM 2025-B33RP, a CMBS single-borrower securitization. The collateral for the transaction is a $460.0 million floating rate, interest-only mortgage loan. The loan is expected to have an initial two-year term with three, one-year extension options and require monthly interest-only payments. The loan will be secured by the borrowers’ fee simple interests in 12 retail assets encompassing 4.1 million sf located across nine states, the five largest of which are Illinois (24.6% of allocated loan amount), Colorado (15.4%), South Carolina (15.0%), Michigan (11.0%), and Georgia (10.7%). As of May 2025, the portfolio was 91.4% leased to over 260 unique tenants.

KBRA assigns preliminary ratings to 11 classes of mortgage-backed notes from OBX 2025-NQM14 Trust, a $701.0 million non-prime RMBS transaction. The underlying collateral, comprising 1,187 residential mortgages, is characterized by fixed-rate mortgages (FRMs) and hybrid adjustable-rate mortgages (ARMs) making up 91.0% and 9.0% of the pool, respectively. A majority of the loans are either classified as non-qualified mortgages (Non-QM; 50.2%) or exempt (39.2%) from the Ability-to-Repay/Qualified Mortgage (ATR/QM) rule due to being originated for non-consumer loan purposes. There were no originators comprising over 10% of the pool.

KBRA announces the assignment of preliminary ratings to six classes of BX 2025-BCAT, a CMBS single-borrower securitization. The collateral for the transaction is a $1.4 billion floating rate, interest-only mortgage loan. The loan is expected to have an initial two-year term with three, one-year extension options and require monthly interest-only payments. The loan will be secured by the borrowers’ fee simple and leasehold interests in 63 industrial assets, one outdoor storage facility, one office asset, and two excess land parcels. In total, the portfolio contains 9.7 million sf and the properties are located across 10 states, the five largest of which are California (54.6%), Georgia (15.8%), Texas (8.9%), Florida (7.2%), and New York (4.5%). As of July 2025, the portfolio was 91.6% leased to over 500 unique tenants.

KBRA assigns preliminary ratings to 6 classes of Mortgage Participation Pass-Through Certificates from J.P. Morgan Mortgage Trust 2025-HE2 (JPMMT 2025-HE2), a $362.7 million RMBS transaction sponsored by JPMorgan Chase Bank, National Association and FOCUS III Advisory, LLC consisting entirely of first and second lien home equity line of credit (HELOC) loans. The underlying pool is seasoned approximately five months and comprised of 4,004 loans, with United Wholesale Mortgage, LLC (68.6%) and Better Mortgage Corporation (16.8%) representing the largest contributing originators. The HELOCs are interest-only (IO) adjustable-rate mortgages (ARMs), with IO terms of mostly ten years (95.9%). Most of the loans feature 20-year Amortization Terms, and HELOC initial draw windows of two (0.9%), three (87.0%), five (10.1%) or ten (2.0%) years. As of the June 30, 2025 cut-off date, the borrowers in the pool have drawn $494.4 million from a combined credit limit of $594.0 million for an aggregate utilization rate of 83.2%. The $362.7 unpaid principal balance represents the participation percentage allocated to JPMMT 2025-HE2 from the $494.4 million total drawn amount as of the cut-off date; participation rate equals 73.4%.

KBRA announces the assignment of preliminary ratings to eight classes of AOA 2025-1301, a CMBS single-borrower securitization.

KBRA assigns issuer and senior unsecured debt ratings of BBB- to New York, NY based Clear Street Holdings LLC ("CSH"). The Outlook for the ratings is Positive.

KBRA announces the assignment of preliminary ratings to eight classes of AHPT 2025-ATRM, a CMBS single-borrower securitization.

KBRA assigns preliminary ratings to Series 2025-2 (Metronet 2025-2, or the Series 2025-2 Notes) from Metronet Infrastructure Issuer, LLC (the Issuer), a communications infrastructure securitization (CIS) that is primarily collateralized by fiber-to-the-premises (FTTP) networks and related contracts.

KBRA assigns a preliminary rating to one class of notes issued by BHG Securitization Trust 2025-2CON (“BHG 2025-2”), an asset-backed securitization collateralized by a pool of unsecured consumer loans (“Consumer Loans”).

KBRA releases research on the current trends in CMBS conduit credit metrics and subordination levels.

On July 23, 2025, Fitzgerald, GA-based Colony Bankcorp, Inc. (NYSE: CBAN) ("Colony"), parent company of Colony Bank, and Thomasville, GA-based TC Bancshares (OTCQX: TCBC) (“TC Bancshares”), parent company of TC Federal Bank, jointly announced that they had entered into a definitive agreement pursuant to which TC Bancshares, Inc. would merge with and into Colony Bankcorp, Inc., and TC Federal Bank would merge with and into Colony Bank. The transaction, valued at $86.1 million (P/TBV: 1.1x), is 80% stock and 20% cash consideration and is expected to close in 4Q25 pending regulatory approval. Under the agreement, Greg Eiford, TC Bancshares' President and CEO, would be joining CBAN as an Executive VP and Chief Community Banking Officer.

KBRA releases research examining last month's bounce in retail sales amid signs that the Trump Administration is willing to negotiate trade deals.

KBRA assigns its BBB- ratings to JFK NTO LLC’s aggregate $1.367 billion special facilities revenue bonds (series 2025 bonds), and affirms the existing ratings associated with JFK NTO LLC’s senior secured facilities for Phase A of the Terminal One redevelopment project, also called New Terminal One (NTO), at New York’s John F. Kennedy International Airport (JFK). A portion of the series 2025 bonds ($600 million) benefit from a financial guaranty policy issued by Assured Guaranty Municipal Corp., which has a KBRA rating of AA+. The Outlook is Stable. The financing plan originally consisted of a single five-year term loan with two tranches totaling $6.33 billion, along with a $200 million liquidity facility, a $50 million working capital facility, and a $50 million security deposit facility to be borrowed by the New York Transportation Development Corporation, a local development corporation, as conduit issuer, and subsequently on-lent to JFK NTO LLC (the borrower). Funding also includes $2.33 billion of sponsor equity (backed by letters of credit). Together with other available sources, the series 2025 bond proceeds will be used for Phase A project costs. As of this financing, there will be $5.917 billion in bonds outstanding, and the term loan will be fully refinanced.

KBRA assigns preliminary ratings to ten classes of mortgage-backed notes from BRAVO Residential Funding Trust 2025-NQM7 (BRAVO 2025-NQM7). The $503.7 million RMBS transaction is collateralized by a pool of 985 residential mortgages, with fixed-rate mortgages (FRMs) and hybrid adjustable-rate mortgages (ARMs) making up 98.3% and 1.7% of the pool, respectively. Most loans are either classified as non-qualified mortgages (Non-QM) (43.9%) or exempt (47.2%) from the Ability-to-Repay/Qualified Mortgage (ATR/QM) rule due to being originated for non-consumer loan purposes.

KBRA assigns preliminary ratings to seven classes of mortgage pass-through certificates from EFMT 2025-NQM3, a $369.1 million non-prime RMBS transaction. The underlying collateral, comprising 836 residential mortgages, is characterized by a notable concentration of alternative income documentation, with 81.4% of the loans underwritten using DSCR, bank statements, and asset underwriting documentation types. The majority of loans are either classified as non-qualified mortgages (54.9%) or exempt (45.1%) from the Ability-to-Repay/Qualified Mortgage rule due to being originated for non-consumer loan purposes. LendSure Mortgage Corp. (LendSure), an affiliated originator of Ellington Management Group (“Ellington”) originated 32.1% of the pool.

KBRA assigns preliminary ratings to the Series 2025-1, Class A-2 Notes (Series 2025-1 Notes) that will be issued by Lyra Music Assets (Delaware) L.P., a music royalty ABS securitization.

KBRA assigns a long-term rating of AA to the Triborough Bridge and Tunnel Authority (TBTA) General Revenue Bonds, Series 2025A, consisting of General Revenue Bonds, Subseries 2025A-1 and General Revenue Refunding Bonds, Subseries 2025A-2.

KBRA assigns preliminary ratings to 6 classes of mortgage-backed notes from GS Mortgage-Backed Securities Trust 2025-HE1 (GSMBS 2025-HE1), a $282.0 million RMBS transaction sponsored by Goldman Sachs Mortgage Company. GSMBS 2025-HE1 consists of first lien (7.1%) and second lien (92.9%) home equity line of credit (HELOC) loans. The underlying pool is seasoned approximately seven months and comprises 2,904 loans, with United Wholesale Mortgage, LLC (54.5%) as the largest contributing originator. The HELOCs are interest-only (IO) adjustable-rate mortgages, with initial draw windows of three (50.9%), five (18.7%) or ten (30.4%) years. Most loans feature 10-year or 20-year amortization terms after the IO period. IO periods range from 3 to 10 years and loan maturity terms range from 10 to 30 years. As of the June 30, 2025 cut-off date, the borrowers in the pool have drawn $282.0 million from a combined credit limit of $318.0 million for an aggregate utilization rate of 88.7%.

KBRA assigns a long-term rating of AA to the City of Jacksonville, FL Special Revenue Bonds, Series 2025. Concurrently, the long-term rating of AA on the City's outstanding Special Revenue Bonds is affirmed.

KBRA releases research on recent developments in federal student loan default collection policies and their likely impact on securitized consumer credit fundamentals.

KBRA is pleased to announce the assignment of preliminary ratings to 12 classes of Benchmark 2025-V16, a $624.7 million CMBS conduit transaction collateralized by 31 commercial mortgage loans secured by 157 properties. The collateral properties are located throughout 39 MSAs, of which the three largest are New York (34.9% of pool balance), Washington - NoVA - MD (7.4%), and North - Central New Jersey (11.4%). The pool has exposure to all major property types, with six types representing more than 10.0% of the pool balance: mixed-use (20.3%), multifamily (19.1%), retail (14.1%), industrial, (12.6%), self-storage (11.7%), and office (11.0%). The loans have in-trust principal balances ranging from $4.1 million to $60.0 million for the largest loan in the pool, ILPT 2025 Portfolio (9.6%), a portfolio of 102 primarily industrial properties located in 30 states that together comprise 18.3 million sf which is currently 82.9% leased to over 120 tenants. The five largest loans, which also include 841-853 Broadway (9.0%), Bridgemarket Retail (8.8%), The Wharf (7.2%), and Prime Storage – NCRS Portfolio (6.5%), represent 41.1% of the initial pool balance, while the top 10 loans represent 60.5%.

KBRA publishes the issuer and senior unsecured debt ratings of BBB for Bain Capital Private Credit ("BCPC" or "the company"). On November 5, 2024, these ratings were assigned on an unpublished basis. The rating Outlook is Stable.

KBRA assigns preliminary ratings to six classes of Certificates from EFMT 2025-CES4, a $281.9 million RMBS transaction, as of the cut-off date, sponsored by EFMT Sponsor LLC and consisting of 3,434 newly originated closed-end second lien mortgages (CES; 100.0%). The largest originators in the underlying pool are LoanDepot (47.8%) and Lakeview Loan Servicing (23.1%). The is characterized by fully amortizing, fixed-rate mortgages (FRMs) with predominantly 20-year (47.8%), 30-year (45.0%), 15-year (4.2%), and 10-year (2.8%) maturity terms.

KBRA assigns preliminary ratings to 63 classes of mortgage-backed notes from GS Mortgage-Backed Securities Trust 2025-PJ7 (GSMBS 2025-PJ7). The transaction is backed by primarily prime jumbo mortgages with an aggregate principal balance of approximately $311.2 million as of the cut-off date. The pool comprises 243 first-lien, fixed rate residential mortgage loans as of the July 1, 2025 cut-off date. The pool is characterized by significant borrower equity in each mortgaged property, as evidenced by the WA original LTV and WA original CLTV of 70.57% and 70.59%. The weighted average original credit score is 776, which is within the prime mortgage range.

KBRA assigns a long-term rating of AA- to the City of Houston, Texas, Airport System Subordinate Lien Revenue Bonds, Series 2025A (AMT) and Airport System Subordinate Lien Revenue Bonds, Series 2025B (Non-AMT). KBRA additionally affirms the long-term rating of AA- for the City's outstanding Airport System Subordinate Lien Revenue Bonds.

KBRA assigns preliminary ratings to 12 classes of notes issued by Pagaya AI Debt Grantor Trust 2025-5 and Pagaya AI Debt Trust 2025-5 (collectively “PAID 2025-5”), an unsecured consumer loan ABS transaction. PAID 2025-5 has initial hard credit enhancement levels of 81.69% for the Class A-1 Notes to 3.79% for the Class F Notes. Credit enhancement is comprised of overcollateralization, subordination (except for the Class F Notes), a cash reserve account funded at closing, and excess spread.

KBRA assigns preliminary ratings to Castlelake Aircraft Structured Trust 2025-2 (CLAS 2025-2), an aviation ABS transaction. CLAS 2025-2 represents the 12th public securitization sponsored by Castlelake, L.P. (the Company). The Company is comprised of 70 individuals operating out of nine offices with headquarters in Minneapolis, Minnesota. As of March 2025, the Company has invested more than $22 billion in aviation assets and has more than 250 owned and managed assets.

KBRA releases research on private credit ratings in the structured finance (SF) landscape, providing an overview of this market and detailing rating activity and performance.

KBRA assigns its BBB+ preliminary rating to the Public Finance Authority's $3.6 billion senior lien toll revenue bonds, series 2025 (Georgia SR 400 Express Lanes Project) (the private activity bonds (PAB)), which support the Georgia SR 400 Express Lanes Project. KBRA also assigns its BBB preliminary rating to SR 400 Peach Partners, LLC’s $4 billion TIFIA loan. The Outlook is Stable.

KBRA assigns preliminary ratings to 8 classes of mortgage-backed notes from New Residential Mortgage Loan Trust 2025-NQM4 (NRMLT 2025-NQM4), a $488.4 million non-prime RMBS transaction sponsored by Rithm Capital Corp. (formerly New Residential Investment Corp.), a publicly traded (NYSE: RITM) real estate investment trust (REIT). The underlying mortgages in the subject pool were originated by NewRez LLC (35.8%) and Champions Funding, LLC (25.7%). In addition, all loans will be serviced by Shellpoint Mortgage Servicing, a brand of NewRez LLC.

KBRA assigns preliminary ratings to 42 classes of mortgage pass-through certificates from J.P. Morgan Mortgage Trust 2025-6 (JPMMT 2025-6). The pool comprises 275 first-lien, fixed rate residential mortgage loans with an aggregate principal balance of $346.4 million as of the July 1, 2025 cut-off date. The pool includes both non-agency (90.7%) and agency-eligible (9.3%) loans. The weighted average original credit score is 771, which is well within the prime mortgage range.

KBRA assigns preliminary ratings to 30 classes of mortgage pass-through certificates from Provident Funding Mortgage Trust 2025-3 (PFMT 2025-3).

KBRA assigns preliminary ratings to 20 classes of mortgage-backed notes from RCKT Mortgage Trust 2025-CES7 (RCKT 2025-CES7).

KBRA assigns preliminary ratings to five classes of notes issued by American Credit Acceptance Receivables Trust 2025-3 (“ACAR 2025-3”), an ABS collateralized by a pool of auto loans.

KBRA is pleased to announce the assignment of preliminary ratings to 22 classes of BBCMS 2025-5C36, a $613.5 million CMBS conduit transaction collateralized by 31 commercial mortgage loans secured by 165 properties. The collateral properties are located throughout 40 MSAs, of which the three largest are New York (20.5% of pool balance), Los Angeles (11.9%) and Atlanta (10.3%). The pool has exposure to all major property types, with four types representing more than 10.0% of the pool balance: multifamily (45.0%), industrial (10.8%), mixed use (10.2%), and lodging (10.1%). The loans have in-trust principal balances ranging from $3.3 million to $61.0 million for the largest loan in the pool, ILPT 2025 Portfolio (9.9%), a portfolio of 102 primarily industrial properties located in 30 states that together comprise 18.3 million sf which is currently 82.9% leased to over 120 tenants. The five largest loans, which also include Equinox Sports Club LA (9.8%), 71 Spring Street (9.1%), Arrowhead Townhomes (7.3%), and The Roosevelt New Orleans (6.5%), represent 42.7% of the initial pool balance, while the top 10 loans represent 67.5%.

KBRA assigns preliminary ratings to 65 classes of mortgage pass-through certificates from Radian Mortgage Capital Trust 2025-J3 (RMCT 2025-J3), which is backed by prime mortgages with an aggregate principal balance of approximately $374.0 million as of the July 1, 2025 cut-off date. The pool comprises 398 first-lien, fixed rate residential mortgage loans. The weighted average original credit score is 774, which is in line with the prime mortgage credit score range. The underlying collateral consists of both prime jumbo (76.4%) and agency-eligible (23.6%) loans.

KBRA assigns a long-term rating of AAA with a Stable Outlook to the New York State Thruway Authority State Personal Income Tax Revenue Bonds Series 2025A (Tax-Exempt) and State Personal Income Tax Revenue Green Bonds Series 2025B (Climate Bond Certified) (Tax-Exempt). Concurrently, KBRA affirms the AAA rating and Stable Outlook on outstanding New York State Personal Income Tax Revenue Bonds issued by the Dormitory Authority of the State of New York.

KBRA assigns preliminary ratings to four classes of notes issued by Reach ABS Trust 2025-2 (“Reach 2025-2”), an unsecured consumer loan ABS transaction. Credit enhancement consists of overcollateralization, subordination of junior note classes (except for the Class D notes), a cash reserve account funded at closing, and excess spread.

KBRA is pleased to announce the assignment of preliminary ratings to 14 classes of MSBAM 2025-C35, a $597.8 million CMBS conduit transaction collateralized by 40 commercial mortgage loans secured by 65 properties. The collateral properties are located throughout 29 MSAs, of which the three largest are New York (11.6% of pool balance), Boston (11.4%), and Washington - NoVA - MD (8.8%). The pool has exposure to all major property types, with four types representing more than 10.0% of the pool balance: office (22.3%), retail (19.4%), mixed-use (18.5%), and lodging (15.3%). The loans have in-trust principal balances ranging from $1.7 million to $59.5 million for the largest loan in the pool, BioMed MIT Portfolio (10.0%), which is comprised of eight life science lab/office properties located in Cambridge, Massachusetts, directly adjacent to the Massachusetts Institute of Technology (MIT) campus. The five largest loans, which also include Marriott World Headquarters (8.8%), Extended Stay Portfolio (7.5%), Crossroads Office Park (7.1%), and 32 Old Slip - Leased Fee (6.0%), represent 39.4% of the initial pool balance, while the top 10 loans represent 61.1%.

KBRA assigns preliminary ratings to Jersey Mike's Funding, LLC, Series 2025-1 Class A-2 Notes, a whole business securitization (WBS). Jersey Mike's 2025-1 represents Jersey Mike’s Franchise Systems, LLC’s (Jersey Mike’s or the Company’s) fourth securitization following the establishment of the master trust in December 2019. In conjunction with the issuance of the Series 2025-1 Notes, KBRA anticipates affirming the ratings on the Issuer’s outstanding notes (the Existing Notes and, together with the Series 2025-1 Notes, the Notes). The ratings are consistent with the results of our cash flow analysis following the addition of the Series 2025-1 Notes.

KBRA has upgraded its issuer and senior unsecured note ratings for SmartStop OP, L.P. to BBB with a Stable Outlook from BBB- Watch Upgrade. The rating action follows parent company SmartStop Self Storage REIT, Inc.'s (NYSE: SMA) completion in April of an initial public offering (IPO), which raised approximately $874 million of net equity. KBRA has also assigned a BBB/Stable rating to SmartStop OP's recent issuance of CAD$500 million senior unsecured notes due 2028.

KBRA releases its quarterly report highlighting our Chief Strategist Van Hesser’s view on key economic indicators, as well as what he identifies as the most influential factors driving credit markets in the upcoming quarter. The report also examines credit market valuations in the context of current and future market conditions.

KBRA assigns preliminary ratings to three classes of notes issued by Sunrun Pangea Issuer 2025-2, LLC. The transaction is collateralized by a diversified pool of 63,318 leases and power purchase agreements (PPAs) associated with residential solar photovoltaic installations (PV Systems). The total Aggregate Discounted Solar Asset Balance (ADSAB) based on a discount rate of 7.3%, consisting of the discounted payments of the leases and PPAs is approximately $597.1 million.

KBRA assigns preliminary ratings to six classes of mortgage-backed notes from OBX 2025-NQM13 Trust, a $662.7 million non-prime RMBS transaction. The underlying collateral, comprising 1,208 residential mortgages, is characterized by fixed-rate mortgages (FRMs) and hybrid adjustable-rate mortgages (ARMs) making up 92.8% and 7.2% of the pool, respectively. A majority of the loans are either classified as non-qualified mortgages (Non-QM; 47.2%) or exempt (42.9%) from the Ability-to-Repay/Qualified Mortgage (ATR/QM) rule due to being originated for non-consumer loan purposes. There were no originators comprising over 10% of the pool.

KBRA assigns a long-term rating of AAA to the City of Dublin, OH (the "City") General Obligation (Limited Tax) Various Purpose Improvement and Refunding Bonds, Series 2025. Concurrently, KBRA affirms the long-term rating of AAA for the City's outstanding parity General Obligation (Limited Tax) Various Purpose Improvement and Refunding Bonds. The Outlook is Stable.

KBRA assigns preliminary ratings to 60 classes of mortgage pass-through certificates from Sequoia Mortgage Trust 2025-7 (SEMT 2025-7), a $398.6 million prime RMBS transaction. The pool is comprised of 326 first-lien, fully amortizing fixed rate mortgages with 20-year and 30-year maturity terms. The collateral is characterized by a weighted average (WA) original credit score of 779 and moderate borrower equity, with a WA original LTV of 71.9% and WA original CLTV of 71.9%.

KBRA assigns preliminary ratings to six classes of mortgage-backed certificates from Angel Oak Mortgage Trust 2025-8 (AOMT 2025-8), a $271.3 million non-prime RMBS transaction. The underlying collateral, comprised of 550 residential mortgages, is characterized by a significant concentration of loans underwritten using alternative income documentation. All the loans are either classified as non-qualified mortgages (46.3%) or exempt (53.7%) from the Ability-to-Repay/Qualified Mortgage rule due to being originated for non-consumer loan purposes. Emporium TPO originated 24.8% and Angel Oak Mortgage Solutions originated 18.4% of the pool, with no other originator comprising over 10% of the collateral.

KBRA assigns preliminary ratings to six classes of notes issued by Research-Driven Pagaya Motor Asset Trust 2025-4 and Research-Driven Pagaya Motor Trust 2025-4 (collectively “RPM 2025-4”), an auto loan ABS transaction. RPM 2025-4 has initial credit enhancement levels of 51.86% for the Class A notes to 4.12 % for the Class E notes. Credit enhancement is comprised of overcollateralization, subordination of junior note classes (except for the Class E notes), a cash reserve account funded at closing, and excess spread.

KBRA releases research examining private credit's role as a source of systemic strength, tracing its history, function, and evolving contours of risk.

KBRA releases research commenting on the Federal Housing Finance Agency's (FHFA) July 8 announcement that lenders may now use VantageScore 4.0 (VS4) for mortgages sold to government-sponsored entities (GSE) Fannie Mae and Freddie Mac.

KBRA releases the June 2025 issue of the KBRA CMBS Loss Compendium, providing updated loss estimates for all 375 KBRA-rated outstanding conduit transactions. The report, together with the accompanying spreadsheet, also includes data on lifetime realized losses for 13 conduits whose ratings have been withdrawn following payoffs.

KBRA assigns preliminary ratings to five classes of notes issued by GreenSky Home Improvement Issuer Trust 2025-2 ("GSKY 2025-2"), an asset-backed securitization collateralized by a pool of consumer loans used for home improvements.

KBRA assigns a long-term rating of AAA for the Harris County Flood Control District, TX Improvement Bonds Refunding Bonds Series 2025, Contract Tax Refunding Bonds Series 2025A, and outstanding Contract Tax Obligations. Additionally, KBRA affirms the long-term rating of AAA for the District's Limited Tax Obligations. The rating Outlook is Stable.

KBRA assigns a long-term rating of AA with a Stable Outlook to the Salt Lake City, Utah Airport Revenue Bonds, Series 2025A (AMT) and Airport Revenue Bonds, Series 2025B (Non-AMT). KBRA additionally affirms the long-term rating of AA for the City's outstanding Airport Revenue Bonds. The rating Outlook is Stable.

KBRA assigns preliminary ratings to 62 classes of mortgage-backed notes from PMT Loan Trust 2025-INV7 (PMTLT 2025-INV7), a prime RMBS transaction sponsored by PennyMac Corp. (PennyMac), an indirect, wholly-owned subsidiary of PennyMac Mortgage Investment Trust (PMT). PMTLT 2025-INV7 comprises 1,036 fixed-rate mortgages (FRMs) with an aggregate principal balance of $386.3 million as of the July 1, 2025 cut-off date. The underlying pool consists of agency-eligible loans that are collateralized by investment properties (80.3%) and second homes (19.7%). The pool is characterized by significant borrower equity in each mortgaged property, as evidenced by the WA original LTV of 73.9%. The weighted average original credit score is 776, which is well within the prime mortgage range.

KBRA assigns preliminary ratings to eight classes of mortgage-backed certificates from Morgan Stanley Residential Mortgage Loan Trust 2025-DSC2 (MSRM 2025-DSC2). MSRM 2025-DSC2 is the second RMBS transaction sponsored by Morgan Stanley Mortgage Capital Holdings LLC that is solely backed by collateral underwritten to debt-service coverage ratio (DSCR) guidelines. The underlying $399.3 million pool, consisting of 1,280 rental-property mortgages, is characterized by a moderate original combined loan-to-value (CLTV) ratio of 68.8%. All of the loans in the pool are exempt from the ATR/QM rule due to being originated for business purposes.

KBRA assigns a long-term rating of AAA to the Harris County, TX Permanent Improvement Refunding Bonds, Series 2025A and Unlimited Tax Road Refunding Bonds, Series 2025A. KBRA additionally affirms the long-term rating of AAA for the County's outstanding Limited Tax Obligations and Unlimited Tax Obligations. The rating Outlook is Stable.

KBRA assigns its BBB- preliminary rating to JFK NTO LLC’s proposed $1.367 billion special facilities revenue bonds (series 2025 bonds) for Phase A of the Terminal One redevelopment project, also called New Terminal One (NTO), at New York’s John F. Kennedy International Airport (JFK). The Outlook is Stable. The financing plan originally consisted of a single five-year term loan with two tranches totaling $6.33 billion, along with a $200 million liquidity facility, a $50 million working capital facility, and a $50 million security deposit facility to be borrowed by the New York Transportation Development Corporation, a local development corporation, as conduit issuer, and subsequently on-lent to JFK NTO LLC (the borrower). Funding also includes $2.33 billion of sponsor equity (backed by letters of credit). The series 2025 bonds will be used to refinance a portion of the outstanding term loan, which was issued in 2022.

KBRA assigns ratings of BBB- to Monroe Capital Income Plus Corporation's ("MCIP" or "the company") $42 million, 6.20% senior unsecured notes due July 10, 2028, and its $161 million, 6.57% senior unsecured notes due July 10, 2030. The rating Outlook is Stable. Proceeds will be used to repay secured debt.

KBRA releases research examining the potential impact of the recently passed One Big Beautiful Bill Act (OBBBA) on the solar asset-backed securities (ABS) market.

KBRA is pleased to announce the assignment of preliminary ratings to 14 classes of BBCMS 2025-C35, a $795.3 million CMBS conduit transaction collateralized by 33 commercial mortgage loans secured by 101 properties. The collateral properties are located throughout 35 MSAs, of which the three largest are New York (26.9% of pool balance), Washington - NoVA - MD (13.6%), and Boston (9.4%). The pool has exposure to all major property types, with four types representing more than 10.0% of the pool balance: mixed-use (31.1%), retail (28.6%), office (13.2%), and multifamily (12.0%). The loans have in-trust principal balances ranging from $996,975 to $79.0 million for the largest loan in the pool, Rentar Plaza (9.9%), a 1.5 million sf, Class-B, mixed-use industrial and retail building located in the Middle Village neighborhood of New York City’s borough of Queens. The five largest loans, which also include BioMed MIT Portfolio (9.4%), 29-33 Ninth Avenue (9.4%), Marriott World Headquarters (9.4%) and Washington Square (8.8%), represent 47.0% of the initial pool balance, while the top 10 loans represent 68.2%.

KBRA assigns preliminary ratings to NBC Funding LLC (NBC 2025-1), Series 2025-1 Class A-1 Notes and Class A-2 Notes, a whole business securitization (WBS). NBC 2025-1 represents the Issuer’s fourth issuance out of the existing master trust. In conjunction with the issuance of NBC 2025-1, the Series 2021-1 A-2 Notes and Series 2021-1 Class B Notes are expected to be refinanced at which time KBRA will withdraw the ratings. At that time KBRA also anticipates affirming the ratings on the Issuer’s outstanding Series 2021-1 A-1-VFN Notes, Series 2021-1 A-1-LR Notes, and the Series 2024-1 A-2 Notes (the Existing Notes and, together with the Series 2025-1 Notes, the Notes). The ratings are consistent with the results of our cash flow analysis following the addition of the Series 2025-1 Notes.

KBRA assigns a senior unsecured debt rating of BBB, a subordinated debt rating of BBB-, and a short-term debt rating of K3 to USCB Financial Holdings, Inc. (NASDAQ: USCB)(“the company”). Additionally, KBRA assigns deposit and senior unsecured debt ratings of BBB+, a subordinated debt rating of BBB, and short-term deposit and debt ratings of K2 to its subsidiary, U.S. Century Bank ("the bank"). The Outlook for all long-term ratings is Stable.

KBRA assigns preliminary ratings to eight classes of notes issued by Westlake Automobile Receivables Trust 2025-2 (“WLAKE 2025-2”), an asset-backed securitization collateralized by a pool of auto loans.

KBRA releases the June 2025 issue of CMBS Trend Watch.

The version of the One Big Beautiful Bill Act (OBBBA) that was passed by the U.S. Senate on July 1 did not include the taxation provisions on litigation finance originating from the Tackling Predatory Litigation Funding Act (TPLFA). As we indicated in our June 27 report, Potential OBBBA Implications for Litigation Finance ABS, if the TPLFA provisions had been passed in their proposed form, this could have had notable implications for litigation finance asset-backed securities (ABS).

KBRA announces the assignment of preliminary ratings to three classes of CENT 2025-CITY, a CMBS single-borrower securitization.