Moody's cuts Thornburg Mortgage

Moody's Investors Service said it downgraded the ratings of Thornburg Mortgage, Inc., including its senior debt to Ba3 from Ba2, preferred stock to B2 from B1, senior debt shelf to provisional Ba3 from provisional Ba2 and preferred stock shelf to provisional B2 from provisional B1. The ratings remain under review for possible downgrade.

These actions reflect volatility in the single-family mortgage market, coupled with Thornburg Mortgage's highly levered balance sheet and reliance on short-term financing, Fitch said.

The company has used leverage to boost its equity returns, leading to limited financial flexibility, the agency added. The ratings remain on downgrade review due to continued volatility in the mortgage market.

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