Accredited Home Lenders Holding Co.'s announcement today it would borrow $200 million helped its stock price -- but not its servicer rating.
The San Diego-based company received a $200 million loan commitment from entities managed by Farallon Capital Management LLC, according to an announcement this morning. The 5-year loan has a 13 percent interest rate and is secured.
In addition, Farallon will be issued 3.3 million 10-year warrants with a $10 per share exercise price, Accredited indicated.
Shares of the company, which trade under the symbol LEND, were up $1.82 today to $10.77 -- despite an investor class-action lawsuit announced today by Goldman Scarlato & Karon P.C.
"The complaint alleges that defendants issued a series of materially false and misleading statements regarding the company's business and financial results," the law firm said.
But Fitch Ratings today downgraded Accredited's residential subprime servicer rating to RPS3-, citing "the challenging operating environment in the subprime mortgage market and uncertainties over LEND's ability to maintain adequate funding and remain viable over the intermediate term."
The company has not yet implemented automated loss mitigation technology, although the tools are in place to determine the best loss mitigation strategy, Fitch reported.
Accredited serviced 58,748 loans with balances aggregating nearly $10 billion at January's end, Fitch said.