Securitization Risk Rising as Standards Ease, Moody’s Says

The riskiness of new securities backed by assets from car loans to commercial mortgages is rising from the lows seen after Lehman Brothers Holdings Inc.’s 2008 collapse, according to Moody’s Investors Service.

Easing underwriting standards and “untested” issuers and assets are contributing to the trend, along with structural features of transactions that can boost risk, the New York-based ratings firm said today in a report. Greater dangers are likely to follow, analysts Claire Robinson and Joseph Snailer wrote.