UBS Reddit Mentions | ChartExchange

**TL;DR:**
* **\[Redacted\] found a series of new potential CMBS issuances being posted to the SEC site. From my understanding, it seems that there is a series of CMBS loans under the header "BANK" that have existed since 2020. It seems to consist of 3 banks: BoFA (Bank of America), Wells Fargo, and Morgan Stanley. However, despite the name, BANK =/= BoFA everytime.**
* **Many CMBS loans are meant to mature by 2023, so this could be part of an innocuous/"harmless" process of shoving old CMBS properties into new Jenga Towers of loans...You might see this in Millenium Boston Retail, a major CMBS property that was taken from the CMBS Jenga Tower known as BAML 2013-C7 and shoved into BANK 2023-BNK45.**
* **However, this isn't the case for ALL OF THEM: Concord Mills was featured in the loan that another \[redacted\] user found...and it seems to have matured in 2022 then shoved into that 2023-made BANK loan. I have no idea just yet if there is any "fishy" situation as CMBS gets downgraded and some properties get shuffled, but was hoping for more eyes.**

Hi y'all, will get right into it.

This awesome ape called \[redacted\] or rather 8128th expensive-est two found this awesome find earlier today: [https://www.reddit.com/r/Superstonk/comments/125ebqk/attn\_wrinkles\_bank\_20xxbnkxx\_could\_be/](https://www.reddit.com/r/Superstonk/comments/125ebqk/attn_wrinkles_bank_20xxbnkxx_could_be/)

https://preview.redd.it/ge784lvn9pqa1.png?width=1170&format=png&auto=webp&v=enabled&s=a0c91d1c641f7698c4029ced0299af7170bcf7ff
>There are lots of odd filings using the nomenclature in the title, one of them just made \~4 hours ago (this is #26 below- the one that got me trying to dig into this)
>
>All seem to be CMBS, MBS, ABS, “Commercial Mortgage Pass-Through Certificates”, “Asset Backed Pass-Through Certificates”, etc
>
>Here are some examples to search of anyone knows how to dig into this:
>
>[https://www.google.com/search?q=site%3Asec.gov+BNK45](https://www.google.com/search?q=site%3Asec.gov+BNK45)
>
>[https://www.google.com/search?q=site%3Asec.gov+BNK26](https://www.google.com/search?q=site%3Asec.gov+BNK26)
>
>[https://www.google.com/search?q=site%3Asec.gov+BNK44](https://www.google.com/search?q=site%3Asec.gov+BNK44)
>
>[https://www.google.com/search?q=site%3Asec.gov+BNK43](https://www.google.com/search?q=site%3Asec.gov+BNK43)
>
>[https://www.google.com/search?q=site%3Asec.gov+BNK42](https://www.google.com/search?q=site%3Asec.gov+BNK42)
>
>[https://www.google.com/search?q=site%3Asec.gov+BNK41](https://www.google.com/search?q=site%3Asec.gov+BNK41)
Another wrinkle known as \[redacted\] or the bartender called woody found one such sample:
https://preview.redd.it/hvlap4k0apqa1.png?width=1108&format=png&auto=webp&v=enabled&s=afddc635ea6bd24fd54f908d179e24c9743ccf9b
>I found a $600MM CMBS Pass-through agreement which was made up of 30% office space. Wonder how that’s working out for them? BoA Merril , wells, Morgan.
>
>[https://www.sec.gov/Archives/edgar/data/1005007/000153949723000335/n3430\_x10-424b2.htm](https://www.sec.gov/Archives/edgar/data/1005007/000153949723000335/n3430_x10-424b2.htm)

I started digging into this a bit early, and was hoping I could have some more eyes on this as well.

From what I've seen, I have no idea if swaps are being used against these properties (as we know, Rostin Benihana and the CFTC have hid swaps through 2025). It would not surprise me if they have swaps open on these.
HOWEVER, this looks so far like the naming protocol used in most CMBS classes. I wrote about it in one of my "The Big Mall Short" posts ( "**The Big Mall Short #7: From the Window to the Walmart, till the Sweat drips down my Ballmart"** :[https://www.reddit.com/r/Superstonk/comments/t5br7k/the\_big\_mall\_short\_7\_from\_the\_window\_to\_the/](https://www.reddit.com/r/Superstonk/comments/t5br7k/the_big_mall_short_7_from_the_window_to_the/))

https://preview.redd.it/4ci7qralapqa1.png?width=965&format=png&auto=webp&v=enabled&s=6429acba0f051420acc976c31ce964fc08578ba9

>
>
>**I was able to find a small list of GameStop leases of \~130 GME stores that I was able to pull from a publicly available source. Each GameStop store is linked to a CMBS loan. (Each of these CMBS loans is searchable on a Bloomberg Terminal as each CMBS loan = Bloomberg ID.)**
>
>As of the source which published in 2019, Schostak Bros. were connected to 33 out of the 130 GME leases I found. **ALL 33 were part of Walmart Shadow Anchored Portfolios–and accordingly–CMBS loans.**
>
>**This specific GME loan in Iowa was chopped up and sent to CMBS loans WFCM 2016-C37 and WFCM 2016-LC25.** You can even see a picture of the GameStop store attached to this Fort Dodge CMBS loan on their site:

https://preview.redd.it/t1x79bxiapqa1.png?width=921&format=png&auto=webp&v=enabled&s=21ff07716f58f4d6dae1f780b3ec04e2fe8a00b4
If you notice above, there is a specific naming mechanism to these CMBS loans, it goes:
>
>
>\[BANK \] \[START YEAR OF PACKAGE\] -\[other code, including who else was involved\]

The Fort Dodge Iowa code WFCM 2016-LC25 for example might stand for this:

>**WFCM = Wells Fargo Commercial Mortgage**
>
>**2016 = year**
>
>**LC = Ladder Capital (crime infused fuckwards involved in CMBS)**

[if you're unfamiliar, Ladder Capital and UBS were featured in \\"The Intercept's The Bigger Short on CMBS fraud\\"](https://preview.redd.it/1lv930nzapqa1.png?width=921&format=png&auto=webp&v=enabled&s=15993ed2eca1563a877cda76f34bbb8518d0faee)
It's very telling that now there are now NO IDENTIFIERS on either side.

I also decided to look into what a pass-through certificate is, and I'm not entirely sure but this is what it looks like so far:

>A **large percentage of mortgages that have been issued to borrowers are sold in the** **secondary mortgage markets** **to institutional investors or government agencies that buy and package these loans into investable securities**. These securities are then offered for sale to investors who expect to receive periodic interest payments and a principal repayment upon maturity of the securities.
>
>An investor that invests in asset-backed security (ABS), such as a mortgage-backed security (MBS) is given a pass-through certificate. The pass-through certificate is the evidence of interest or participation in a pool of assets and signifies the transfer of interest payments in receivables in favor of the holders of the pass-through certificate.
>
>**A pass-through certificate does not mean that the holder owns the securities; it only means that the holder is entitled to any income earned from the securitized finance product. Mortgage-backed certificates are the most common types of pass-through certificates, in which homeowners' payments pass from the original bank through a government agency or investment bank to investors.**
Alternate definition: [https://digitalcommons.law.umaryland.edu/cgi/viewcontent.cgi?article=1292&context=jbtl](https://digitalcommons.law.umaryland.edu/cgi/viewcontent.cgi?article=1292&context=jbtl)

>There are two common types of MBS. The first type of MBS issued by Ginnie Mae, Freddie Mac, and Fannie Mae are pass-through MBS, in which investors receive a pro rata fraction of monthly principal and interest payments from the underlying loans.55 The second type of MBS, which developed as the MBS market grew, are collateralized mortgage or debt obligations....
Part of the appeal of pass-through securitization was its ability to avoid tax: [https://www.oecd.org/finance/financial-markets/41942872.pdf](https://www.oecd.org/finance/financial-markets/41942872.pdf)

>**Why was mortgage securitisation in subprime more pronounced in the USA?**
>
>**Third, the 1986 tax reform act included the Real Estate Mortgage Investment Conduit (REMIC) rules which can issue multiple-class pass through securities without an entity-level tax. This greatly enhanced the attractiveness of mortgage securitisation.**
At first glance, it seems like these are used perhaps in part when a CMBS Jenga Tower might not be fully done (many CMBS loans were going away this year in 2023 IIRC). I tried to see if there were any similar things that happened with pass-through certificates in 2008: [https://www.sec.gov/Archives/edgar/data/1653542/000153949716002662/exh3322wfctsas.htm](https://www.sec.gov/Archives/edgar/data/1653542/000153949716002662/exh3322wfctsas.htm)

https://preview.redd.it/xsaufiskbpqa1.png?width=1284&format=png&auto=webp&v=enabled&s=07b77cd9b39cc8eaf8d04e884aaf507c71a1805d
I think as many of you, the first thought I had about pass-through certificates growing was the following:

[\[redacted\] at the ratings agencies!](https://preview.redd.it/nqgkuutscpqa1.png?width=2782&format=png&auto=webp&v=enabled&s=62fc26b00af4ef11b470877f52bd904f6fc68916)
**OBLIGATORY TIMESTAMP FOR REFERENCE**: [https://www.youtube.com/watch?v=xbiDrzTd8fE&t=260s](https://www.youtube.com/watch?v=xbiDrzTd8fE&t=260s)

So again, why is this weird? All previous CMBS loans had the originator name, as in Wells Fargo did beforehand:

[wells far-go fuck yourself](https://preview.redd.it/ajjvqe22dpqa1.png?width=974&format=png&auto=webp&v=enabled&s=b3cb3e86ba041e3f0e22ea53ee0bb64b0caea58f)

>*Remember that coding for that GME loan in that Fort Dodge, IOWA storefront? WFCM 2016-C37 and WFCM 2016-LC25?*
>
>**Well, what’s WFCM? That stands for Wells Fargo Commercial Mortgage, and Wells Fargo was the originator (person who sets everything up) for alllll the GME stores that were connected to these Walmarts courtesy of the fucking liars at Ladder Capital.**
>
>“Steven Lowery, a senior vice president in Wells Fargo's Chicago office, agrees: “These retailers \[Walmart\] are very powerful and these are the types of deals that they want to do. **We see more shadow-anchored deals today than we ever have.”**
>
>**Wells Fargo has provided construction financing for four shadow-anchored deals in the past two months.** “We tend to take a look at the whole project and if we know that the shadow anchor is a strong draw, we're very comfortable providing the construction financing,” Lowery says.

The first name is the bank who ORIGINATES THE LOANS. So why the fuck is staying blank??!?!
I'm not sure, but this might relate to the following, called the "originiate-to-distribute" model:
>**"The OTD model allowed them to benefit from the** ***origination*** **fees without bearing the ultimate credit risk of the borrowers."**
So who is originating or underwriting these loans? Is no one?

If you look back at Woody's link, this is what it looks like:


https://preview.redd.it/fuq3n7wwdpqa1.png?width=2846&format=png&auto=webp&v=enabled&s=503b69933b6a769d2feaff8cd7d85d84369a4368
It seems, to have an issuing entity according to the text seen here: [http://pdf.secdatabase.com/2898/0001539497-23-000337.pdf](http://pdf.secdatabase.com/2898/0001539497-23-000337.pdf)
>On February 23, 2023, Banc of America Merrill Lynch Commercial Mortgage Inc. (the “Registrant”) caused the issuance, pursuant to a Pooling and Servicing Agreement, dated and effective as of February 1, 2023 (the “Pooling and Servicing Agreement”), among the Registrant, as depositor, Wells Fargo Bank, National Association, as master servicer, LNR Partners, LLC, as special servicer, Computershare Trust Company, National Association, as certificate administrator and as trustee, and Park Bridge Lender Services LLC, as operating advisor and as asset representations reviewer, of BANK 2023-BNK45, Commercial Mortgage Pass-Through Certificates,...
>
>
>
>**The Privately Offered Certificates were sold to BOAS, WFS, Morgan Stanley, Academy and Drexel, as initial purchasers (collectively, in such capacities, the “Initial Purchasers”), pursuant to a Certificate Purchase Agreement,** dated as of February 9, 2023, among the Registrant, BANA and the Initial Purchasers. The Privately Offered Certificates were sold in transactions exempt from registration under the Securities Act of 1933, as amended.

Again, why wouldn't BoFa (deez nuts) just use their regular name?

https://preview.redd.it/09u3pu35fpqa1.png?width=1375&format=png&auto=webp&v=enabled&s=bf402e413b6aece251d74e3cacdabf0301916e0a
Another thing that stood out is the following phrase in Woody's find: **credit enhancement.**

>**Credit enhancement** will be provided solely by certain classes of subordinate certificates that will be subordinate to certain classes of senior certificates as described under “***Description of the Certificates—Subordination; Allocation of Realized Losses***\*\*”\*\*. Each class of certificates will be entitled to receive monthly distributions of interest and/or principal on the 4th business day following the 11th day of each month (or if the 11th day is not a business day, the next business day), **commencing in March 2023.**
Soooo I Thought I already dropped a CMBS post talking about CMBSes and credit enhancement from my "The Big Mall Short" series but seems that I didn't...looked through my drafts for future posts and here's the part that's relevant:

https://preview.redd.it/vwo1kbhefpqa1.png?width=2175&format=png&auto=webp&v=enabled&s=55ad5364c661f619698ecb6949f46a8d95365056

>**4. Credit Reduction**
>
>
>
>
First, a mini-ELI5 (!) on risk-reduction in the CMBS (and even MBS world)!
**In a perfect world, credit enhancement techniques can be used to protect against potential losses in a portfolio through risk-reduction techniques.**

>
**Common techniques include subordination (allocating losses to lower rated junior bonds to protect better rated senior bonds)**, overcollateralization (having the value of your bond that might be worth $1000 in properties actually be backed up by more properties–maybe worth $1100–to help cushion blows), and excess spread (making a rainy day fund almost from the mortgage you get from a property if it pays 10% a month, while you need to pay out 5% in interest…using that 10%-5% difference to get yo rainy day fund on).
**It’s kinda of like putting a giant inflatable sex doll underneath your basket of loans, cushioning against absorbing any defaults from loan defaults or collateral loss.**

Again, this could all be boiler plate language, but for any CMBS mortgages that usually have names like COMM2023--LC92 and not this weird "BANK" stuff, I would need to compare what's going on across other of these "BANK" finds.
One initial guess I have is "harmless": that some of the loans locked up in CMBS Jenga Towers needed to be shoved into something else.

Another guess could be that some of the ORIGINAL Jenga Towers containing these loans were being downgraded, and you can hide those downgrades under NEW NAMES. Woody's find showed the following property in that BANK 2023-BNK25 Jenga Tower. For example, I found the following here to start:

>**The CX – 250 Water Street mortgage loan (7.8%) is part of a whole loan that was co-originated by Bank of America, National Association, Wells Fargo Bank, National Association, Goldman Sachs Bank USA and 3650 Real Estate Investment Trust 2 LLC**
I couldn't find much on this property, but other properties in that new BANK loan I could. Such as this property in Boston: Millenium Boston Retail.

https://preview.redd.it/xv49nak0gpqa1.png?width=1500&format=png&auto=webp&v=enabled&s=aa41f11e8a95fd896828a920d78abfe665964f00
**You can read it about it here, it used to exist on Morgan Stanley BAML Trust 2013-C7 (MSBAM 2013-C7). Notice the year is 2013, so it must have been expiring...but notice what this article says. Hint, look at the title: "Morgan Stanley BAML Trust 2013-C7 -- Moody's affirms seven and downgrades six classes of MSBAM 2013-C7":**
[https://finance.yahoo.com/news/morgan-stanley-baml-trust-2013-180606663.html?guccounter=1&guce\_referrer=aHR0cHM6Ly93d3cuZ29vZ2xlLmNvbS8&guce\_referrer\_sig=AQAAAGyMQj8L\_D7cFVfMA0-Fyz13EM0Xr0n9ZJ5Xr22nyCyFA2yFnOIwuR5IhxeGL0C5tJyKk7zJAdM3jfBxMSiFbFi9fR1fXd8lz2vaAdUbqYk32EMS9\_uHLKzRQUvmBRWo15yd\_9bcheVTVJIlGP2rIH8-4V1CdlxaLT47V45mhzd\_](https://finance.yahoo.com/news/morgan-stanley-baml-trust-2013-180606663.html?guccounter=1&guce_referrer=aHR0cHM6Ly93d3cuZ29vZ2xlLmNvbS8&guce_referrer_sig=AQAAAGyMQj8L_D7cFVfMA0-Fyz13EM0Xr0n9ZJ5Xr22nyCyFA2yFnOIwuR5IhxeGL0C5tJyKk7zJAdM3jfBxMSiFbFi9fR1fXd8lz2vaAdUbqYk32EMS9_uHLKzRQUvmBRWo15yd_9bcheVTVJIlGP2rIH8-4V1CdlxaLT47V45mhzd_)

https://preview.redd.it/qrqhpsu4gpqa1.png?width=2574&format=png&auto=webp&v=enabled&s=9e97e8b104c428d58e477d859c0de62738e3023a

>The second largest loan is the Millennium Boston Retail Loan ($93.2 million -- 9.2% of the pool), which is secured by nine commercial condominium units contained within three buildings, totaling 282,000 SF of mixed use space in the Midtown/Theater District area of downtown Boston, Massachusetts. The properties were 95% leased as of June 2020. The loan benefits from amortization, having amortized nearly 12% since securitization.
The property's largest tenants include a two-level, 19-screen \[popcorn\] Theater and a second story Sports Club/ LA - Boston health club. The \[popcorn\] Theater recently executed two five-year extensions, extending their lease to July 2031...
>
>
**Moody's Investors Service, ("Moody's") has affirmed the ratings on seven classes and downgraded the ratings on six classes in Morgan Stanley Bank of America Merrill Lynch Trust 2013-C7**, Commercial Mortgage Pass-Through Certificates as follows

So again, this old loan was in a MSBAM 2013-C7, but now listed under BANK. Why?
All of the pass-through certificates seem to feature the following:
* Bank of America
* Wells Fargo
* Morgan Stanley


https://preview.redd.it/ps2kycrpgpqa1.png?width=2842&format=png&auto=webp&v=enabled&s=84c7a0ef73fcfa92980149816dfe31dbf673b9a4
Some of these have been existing as 2020. So one thing we will need to determine for certain is--since BOFA is involved--is this putting the weight on BOFA as the main actor, or is there a reason why Morgan, BOFA, and Wells Fargo have been working together like a Megazord of CMBS loans?
The naming is not consistent per se where it's let's say JUST Bofa leading this. Here's one file: [https://www.sec.gov/Archives/edgar/data/1005007/000153949723000335/n3430\_x10-424b2.htm](https://www.sec.gov/Archives/edgar/data/1005007/000153949723000335/n3430_x10-424b2.htm)
>Banc of America Merrill Lynch Commercial Mortgage Inc. is offering certain classes of the Commercial Mortgage Pass-Through Certificates, Series 2023-BNK45 consisting of the certificate classes identified in the table below.
Here's another:
[https://www.sec.gov/Archives/edgar/data/1547361/000153949722001847/n3327\_x9-424b2.htm](https://www.sec.gov/Archives/edgar/data/1547361/000153949722001847/n3327_x9-424b2.htm)
>Morgan Stanley Capital I Inc. is offering certain classes of the Commercial Mortgage Pass-Through Certificates, Series 2022-BNK44 consisting of the certificate classes identified in the table below.

So any one have any idea what could have been found here? These 3 banks have been seemingly part of their own trifecta of CMBS issuance for at least up until 2020. It could be innocuous (again, they are just "renewing" old properties in CMBS loans).

**BUT as we saw, there are properties that are being shoved from one Jenga Tower (Millenium Retail Boston from BAML 2013-C7 into BANK 2023-BNK45).**

[Concord Mills, featuring popcorn, and other retail including bath towel](https://preview.redd.it/piraa2eqipqa1.png?width=650&format=png&auto=webp&v=enabled&s=222ea0e1916a1feff70f8de80e594908878e18d0)
However, this doesn't seem to be clean the whole way through. That BANK loan that \[redacted\] found features Concord Mills, a loan that supposedly matured in 2022 (WFRBS 2012-C10) but now is featured in that new 2023 loan: [https://www.sec.gov/Archives/edgar/data/850779/000153949712000709/n156\_fwpx3.htm](https://www.sec.gov/Archives/edgar/data/850779/000153949712000709/n156_fwpx3.htm)

https://preview.redd.it/cdhsez8nipqa1.png?width=2818&format=png&auto=webp&v=enabled&s=1de60bceace82511df4a305e46b15cd6b1fe6c2d

So even though there might be the case that SOME loans are maturing in 2023 and being shoved into another new loan right on time, that doesn't explain cases like Concord Mills above AFAIK.

Like I said, this could be "by the books" or not, but either way, hoping for some eyes. Throwawaylurker012 out!

**TL;DR:**
* **\[Redacted\] found a series of new potential CMBS issuances being posted to the SEC site. From my understanding, it seems that there is a series of CMBS loans under the header "BANK" that have existed since 2020. It seems to consist of 3 banks: BoFA (Bank of America), Wells Fargo, and Morgan Stanley. However, despite the name, BANK =/= BoFA everytime.**
* **Many CMBS loans are meant to mature by 2023, so this could be part of an innocuous/"harmless" process of shoving old CMBS properties into new Jenga Towers of loans...You might see this in Millenium Boston Retail, a major CMBS property that was taken from the CMBS Jenga Tower known as BAML 2013-C7 and shoved into BANK 2023-BNK45.**
* **However, this isn't the case for ALL OF THEM: Concord Mills was featured in the loan that another \[redacted\] user found...and it seems to have matured in 2022 then shoved into that 2023-made BANK loan. I have no idea just yet if there is any "fishy" situation as CMBS gets downgraded and some properties get shuffled, but was hoping for more eyes.**