Rithm Capital earns S&P upgrade to ’B+’ following steady revenue diversification
S&P Global Ratings has lifted Rithm Capital Corp's credit rating from B to B+, while also boosting its senior unsecured notes rating from B- to B. The upgrade is primarily driven by the firm's successful diversification of revenue streams away from traditional mortgage operations. This shift has been propelled by the rapid growth of Rithm's asset management and private credit arms.
By mid-2026, assets under management had ballooned to approximately $61 billion, compared to $34 billion at the end of 2024. The firm's Genesis platform has also expanded, with its residential transitional loan portfolio reaching $3.8 billion, which generated $60 million in first-half pretax income alongside improved credit metrics.
Despite the challenges posed by macroeconomic headwinds, Rithm's core mortgage finance subsidiary, Newrez, continues to show solid operational performance. In the first half of 2026, Newrez generated $581 million in pretax income, up 7% year-over-year, driven by steady origination volumes and strong servicing revenue. This operational resilience holds up well against slower progress in Rithm's commercial real estate platform, Elecor, which reported a $69 million pretax loss during the same period due to property depreciation and declining office occupancy.
S&P expects Rithm's leverage, measured by debt to adjusted total equity, to stay within the target range of 4.5x to 6.5x over the medium term. At the end of the second quarter, this leverage stood at 5.7x, a slight uptick that primarily reflects increased securitization and asset-backed issuance. While Rithm's rating is somewhat constrained by its heavy reliance on secured debt and asset encumbrance, with $34.2 billion in secured financing against $1.8 billion in unsecured notes, the company's rating remains supportive.
Roughly half of this secured debt is non-recourse, and Rithm maintains a comfortable liquidity position with $1.7 billion in cash on hand, and no unsecured debt maturities until 2029.
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