The Consumer & Business Lending Initiative will expand the initial reach of the Term Asset-Backed Securities Loan Facility to now include commercial mortgage-backed securities (CMBS). In addition, the Treasury will continue to consult with the Federal Reserve regarding possible further expansion of the TALF program to include other asset classes, such as non-Agency residential mortgage-backed securities (RMBS) and assets collateralized by corporate debt.
84 Lumber Co. has talked with the state’s Department of Community and Economic Development, as the company looks for assistance with debt financing after its sales fell by $1 billion last year, a state spokesman said Monday.
…
Last week, 84 Lumber said its 2008 sales had fallen about 32 percent, to $2.1 billion from $3.1 billion in 2007. The 2007 sales total was down 20.5 percent from $3.9 billion in sales recorded in both 2006 and 2005.
Since early 2007, 84 Lumber has closed at least 78 stores nationwide, and laid off 113 employee at its headquarters in Eighty Four. It has shuttered seven components plants. Total stores today stand at 319 versus 450 in 2006, while the number of components plants totals six, down from 13 in April. The employee is 4,900, down from 9,500 in 2007, according to ProSales magazine.
…
Talking to the state about possible financial assistance isn’t a new idea, particularly given the recession. In November, Gov. Ed Rendell announced a plan in which the state secured a $35 million loan to help Reading-based department store chain Boscov’s Inc. as it exited bankruptcy protection.
Last week Moody’s Investors Service announced it was mounting an effort to review its ratings on $300 billion in CMBS bonds. It has now downgraded $6.2 billion in bonds as a result of these ongoing efforts.
The ratings agency last year said it expected cumulative losses of 2% on the commercial bonds issued between 2006 and 2008, but it now has increased these loss estimates to 5% on average.
Moody’s, which on Monday downgraded 44 classes and affirmed another 27, expects a significant decline in future property cash flows on higher tenant defaults, bankruptcies and a sharp decline in lease-renewal rates.
The affected ratings detailed Monday included 13 downgraded classes worth $2.6 billion for Bank of America Corp. BAC, 17 downgraded classes worth $2 billion for Credit Suisse Group CS and 14 downgraded classes worth $1.6 billion for Bear Stearns Cos., which was sold to J.P. Morgan Chase & Co. JPM last year.
