Wells Fargo Bank, N.A. -- Moody's affirms Wells Fargo Bank, N.A.'s SQ assessments

Announcement - Servicer: Moody's affirms Wells Fargo Bank, N.A.'s SQ assessmentsGlobal Credit Research - 10 Feb 2021U.S. Residential Mortgage Servicer Assessment ActionNew York, February 10, 2021 -- Moody's Investors Service ("Moody's") has affirmed the servicer quality ("SQ") assessments for Wells Fargo Bank, N.A. at SQ2 as a servicer of prime loans and SQ2+ as a subprime servicer. The mortgage servicing functions for the prime and subprime servicing portfolio are managed by Wells Fargo Home Mortgage (WFHM), which is a division of Wells Fargo Bank, N.A.ASSESSMENT RATIONALEWe view WFHM's collection abilities as above average. The company's collection roll rate performance was above average compared to peers. Since our prior review, the company continued its expansion of alternative borrower contact strategies including customer service chat capabilities. Although call center metrics for the company were stressed in the second quarter of 2020 due to COVID-19, the metrics normalized during subsequent months.We assess WFHM's loss mitigation abilities as above average. The company's performance metrics are above average when compared with peers. For borrowers affected by COVID-19, WFHM provided self-service options for customers seeking payment assistance via their website as well as the IVR. In addition, the company's website provides COVID-19 guidelines and educational videos to assist borrowers.We view WFHM's foreclosure and REO timeline management as above average. The company completes an independent second level review of all foreclosure referrals and pending sales. During, the review period, loans in foreclosure and REO were placed on hold to comply with regulatory moratoriums related to COVID-19.We view the company's loan administration functions to be above average based on solid investor reporting, loan boarding and payment processing protocols. The company successfully implemented investor reporting changes due to COVID-19.We view the company's servicing stability as above average. Wells Fargo Bank, N.A. long term deposit rating is Aa1 on negative outlook. The negative outlook is mainly driven by the company's slower than anticipated pace in resolving its legacy governance, oversight, compliance and operational risk management deficiencies. The company is the largest mortgage servicer in the U.S. WFHM has an experienced senior management team and continues to invest in technology. In response to the COVID-19 pandemic, the company successfully transitioned the majority of servicing employees to a remote working environment. The framework used in this analysis was "Servicer Quality Assessments for Servicers of Residential Mortgages" published in December 2019 and available at https://www.moodys.com/viewresearchdoc.aspx?docid=PBS_1122183. Alternatively, please see the Framework list at https://www.moodys.com/research/List-of-NCRA-Frameworks--PBC_1178235 for a copy of this framework. Please see www.moodys.com for any updates on changes to the lead rating analyst and to the Moody's legal entity that has issued the rating.This publication does not announce a credit rating action. For any credit ratings referenced in this publication, please see the ratings tab on the issuer/entity page on www.moodys.com for the most updated credit rating action information and rating history. Francis Wissman Vice President - Senior Analyst Structured Finance Group Moody's Investors Service, Inc. 250 Greenwich Street New York, NY 10007 U.S.A. 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