S&P lowers PHH to negative

Standard & Poor's said it revised the outlook on PHH Corp. to negative from stable.

The agency also said it affirmed the company's BB- long-term issuer credit and senior unsecured ratings, along with the preliminary B subordinated debt rating, preliminary B- preferred stock rating and B short-term issuer credit rating.

The outlook revision follows news that management could separate its mortgage and fleet leasing businesses, said Jeffrey Zaun, an S&P analyst.

"If a transaction or series of transactions results in a stand-alone mortgage business, we believe that, without the steady income from its fleet leasing business, the mortgage business would be more vulnerable to mortgage market volatility and would encounter greater difficulty in funding its volatile MSR assets," Zaun said in a press release.

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