Moody's to review mortgage investments
Tuesday February 5, 2008
Credit agency Moody's announced on Monday that it would be reviewing the investment ratings on up to $83 billion in loans.
The mortgage loans are insured by two American insurers PMI and Genworth.
This is a direct result of the global credit crunch caused by the sub-prime fiasco.
The result of Moody's announcement could see more pressure on the lending market which will result in the banks losing more money which they will have to recoup by lifting rates as they did recently, without an official interest rate rise by the Reserve Bank of Australia.