CAS's major challenges remain the uncertainty over the continuation of its servicing contracts for the NPL portfolios owned by Lehman Brothers-related entities (from which the majority of CAS's revenue is generated), as well as its ability to secure new servicing business. At present, the aforementioned portfolios are in the process of being sold, while still being serviced by CAS. Despite the upcoming change in the portfolios' owner, Fitch believes that CAS has a high possibility of continuing its service for the portfolios, due to its servicing expertise and long experience with the portfolios as well as the scarcity of servicers for third-party investors in Thailand. Nonetheless, should the new owner discontinue the servicing by CAS and the latter is unable to secure new business, CAS's RSS rating is likely to face a negative rating action.
Established in Thailand in 2000, CAS is the second-largest subsidiary of the Capital Services Holding Corporation (CSHC), a holding company offering real estate and loan asset management services through its subsidiaries. CAS added two large residential NPL portfolios to its servicing portfolios in late 2007. As of March 2010, its total servicing NPL portfolios included approximately 8,700 loans with unpaid principal balance of THB12.8bn and approximately 740 real-estate owned properties.
Fitch rates primary, special, and master servicers in Thailand, based on their asset types, and on a scale of one through five, with one being the highest rating. In addition, Fitch may attach a plus (+) or minus (-) sign to the rating, indicating a relative position within each rating category. 'tha' appears in Thai ratings to reflect their relevance in Thailand's legal, economic and social context.