Fitch Upgrades 3 Classes of BACM 2003-2

NEW YORK--(BUSINESS WIRE)-- Fitch Ratings has upgraded three classes of Bank of America Commercial Mortgage Inc. (BACM) commercial mortgage pass-through certificates, series 2003-2. A detailed list of rating actions follows at the end of this press release.

KEY RATING DRIVERS

The upgrades are due to the increase in the number of defeased loans (95.6% of the current balance) with classes H, J and K fully covered by defeased collateral.

As of the May 2016 distribution date the pool's aggregate principal balance has been reduced by 96.54% to $58 million from $1.77 billion at issuance. Of the original 152 loans in the pool, six remain. All the remaining loans, with the exception of one specially serviced asset (3.48%), are defeased and mature in 2018. Interest shortfalls are currently affecting class L.

The specially serviced asset is the Rustic Pines (3.48%), a 131-unit manufactured housing community located in Thompson, OH. The loan was originally transferred to the special servicer in October 2013 due to maturity default after the borrower was unable to refinance the loan. The property has been real estate owned (REO) since March 2015. The special servicer has indicated that the workout of this asset is near resolution as the property is currently under contract. The sale is anticipated to close later this month.

RATING SENSITIVITIES

The Rating Outlooks on classes H, J and K remain Stable as the collateral is defeased and therefore is a direct pass-through to the rating of the U.S. government.

DUE DILIGENCE USAGE

No third party due diligence was provided or reviewed in relation to this rating action.

Fitch upgrades the following classes:

--$20.8 million class H to 'AAAsf' from 'Asf'; Outlook Stable;

--$18.9 million class J to 'AAAsf' from 'Asf'; Outlook Stable;

--$10.5 million class K to 'AAAsf' from 'Asf'; Outlook Stable.

Fitch affirms the following classes as indicated:

--$7.9 million class L at 'Dsf'; RE 80%;

--$0 class M at 'Dsf'; RE 0%;

--$0 class N at 'Dsf'; RE 0%;

--$0 class O at 'Dsf'; RE 0%.

The class A-1, A-1A, A-2, A-3, A-4, B, C, D, E, F, G, and BW Rakes certificates have paid in full. Fitch does not rate the class P and HS Rake certificates.

Fitch previously withdrew the ratings on the interest-only class XC and XP certificates.

Additional information is available at www.fitchratings.com.

Applicable Criteria

Counterparty Criteria for Structured Finance and Covered Bonds (pub. 14 May 2014)

https://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=744158

Criteria for Rating Caps and Limitations in Global Structured Finance Transactions (pub. 28 May 2014)

https://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=748781

Global Structured Finance Rating Criteria (pub. 06 Jul 2015)

https://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=867952

U.S. and Canadian Fixed-Rate Multiborrower CMBS Surveillance and U.S. Re-REMIC Criteria (pub. 13 Nov 2015)

https://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=873395

Additional Disclosures

Dodd-Frank Rating Information Disclosure Form

https://www.fitchratings.com/creditdesk/press_releases/content/ridf_frame.cfm?pr_id=1005847

Solicitation Status

https://www.fitchratings.com/gws/en/disclosure/solicitation?pr_id=1005847

Endorsement Policy

https://www.fitchratings.com/jsp/creditdesk/PolicyRegulation.faces?context=2&detail=31

ALL FITCH CREDIT RATINGS ARE SUBJECT TO CERTAIN LIMITATIONS AND DISCLAIMERS. PLEASE READ THESE LIMITATIONS AND DISCLAIMERS BY FOLLOWING THIS LINK: HTTP://FITCHRATINGS.COM/UNDERSTANDINGCREDITRATINGS. IN ADDITION, RATING DEFINITIONS AND THE TERMS OF USE OF SUCH RATINGS ARE AVAILABLE ON THE AGENCY'S PUBLIC WEBSITE 'WWW.FITCHRATINGS.COM'. PUBLISHED RATINGS, CRITERIA AND METHODOLOGIES ARE AVAILABLE FROM THIS SITE AT ALL TIMES. FITCH'S CODE OF CONDUCT, CONFIDENTIALITY, CONFLICTS OF INTEREST, AFFILIATE FIREWALL, COMPLIANCE AND OTHER RELEVANT POLICIES AND PROCEDURES ARE ALSO AVAILABLE FROM THE 'CODE OF CONDUCT' SECTION OF THIS SITE. FITCH MAY HAVE PROVIDED ANOTHER PERMISSIBLE SERVICE TO THE RATED ENTITY OR ITS RELATED THIRD PARTIES. DETAILS OF THIS SERVICE FOR RATINGS FOR WHICH THE LEAD ANALYST IS BASED IN AN EU-REGISTERED ENTITY CAN BE FOUND ON THE ENTITY SUMMARY PAGE FOR THIS ISSUER ON THE FITCH WEBSITE.

View source version on businesswire.com: http://www.businesswire.com/news/home/20160609006367/en/

Fitch Ratings
Primary Analyst
Zachary Johnson
Associate Director
+1-646-582-4815
Fitch Ratings, Inc.
33 Whitehall Street
New York, NY 10004
or
Committee Chairperson
Mary MacNeill
Managing Director
+1-212-908-0785
or
Media Relations
Sandro Scenga
+1-212-908-0278
New York
[email protected]

Source: Fitch Ratings

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