Moody's on Aug. 7 affirmed Ladder Capital Corp.'s corporate family rating of Ba2 and Ladder Capital Finance Holdings LLLP's senior unsecured rating of Ba3.
The outlook on the ratings remains positive.
Moody's said Ladder Capital's ratings are supported by its moderate leverage, high-quality assets, record of maintaining profitability and increasing funding diversification. The rating agency added that the company's earnings profile has improved due to a change in Ladder Capital's revenue mix to more stable sources, such as balance sheet lending and securities investing, from less stable sources, such as conduit lending. Moody's also added that the company has consistently maintained minimal credit losses in its loan portfolio since inception.
However, Moody's said the company's credit constraints include its business concentration in the commercial real estate sector and a relatively high proportion of secured debt.
The positive outlook reflects Moody's expectation that the company will improve its funding profile over the next two quarters by decreasing its reliance on secured funding through issuance of unsecured debt.