160 tranches from 107 transactions affected
London, 17 February 2012 -- Moody's Investors Service announced today that it has downgraded the ratings
of structured finance securities that are directly linked to the ratings
of Italy and Spain, which were downgraded by Moody's on February
13, 2012. Moody's has also announced the placement
on review for downgrade structured finance securities that are directly
linked to the ratings of certain European and US banks, which were
placed under review on February 15, 2012.
Please click on this link http://www.moodys.com/viewresearchdoc.aspx?docid=PBS_SF276836
for the List of Affected Credit Ratings. This list is an integral
part of this Press Release and identifies each affected issuer.
Today's rating actions affect 160 tranches including 3 asset backed
securities, 6 residential mortgage backed securities, 39 repackaged
securities in Europe and 112 structured notes and collateralized debt
obligations in the US.
RATINGS RATIONALE
Moody's explained that four of the rating actions taken today are the
result of the rating actions taken on the governments of Italy and Spain.
Italy and Spain were downgraded to A3 from A2 and A1, respectively
on 13 February 2012. For further information on the underlying
action see the press releases titled "Moody's adjusts ratings of
9 European sovereigns to capture downside risks" on www.moody.com
The remaining actions were driven by the placement under review of numerous
banks in Europe and the US. For further information on the underlying
action see the press releases titled "Moody's reviews ratings
of European Banks" and "Moody's reviews ratings of global
investment banks" on www.moody.com.
Each rating is essentially a pass-through of the rating of the
underlying security, guarantor or reference credit. Noteholders
are exposed to the credit risk of the underlying entity and therefore
the rating moves in lock-step in each case. Each related
underlying security, guarantor, reference entity or related
government exposure is detailed in the link at the end of this announcement.
Moody's notes that these transactions are subject to a high level
of macroeconomic uncertainty, which could negatively impact the
ratings of the notes, as evidenced by 1) uncertainties of credit
conditions in the general economy 2) the acute sovereign and banking crisis
in the euro area, which is weakening the credit profiles of banks
exposed to the currency union. This crisis accentuates challenges
facing banks globally that have accelerated since second-half 2011.
For more information please refer to two interrelated Special Reports
published on 15 February 2012: "Crisis Weakens Bank Credit
Profiles" and "How Moody's Analysis Reflects Challenges"
and 3) the recent review of European sovereigns reflecting their susceptibility
to the growing financial and macroeconomic risks emanating from the euro
area crisis. Moody's also discusses the relationship between
sovereign and structured finance ratings in its special report "Assessing
the Impact of the Eurozone Sovereign Debt Crisis on Structured Finance
Transactions," published in April 2011.
The principal methodology used in these ratings was "Moody's Approach
to Rating Repackaged Securities" published in April 2010.
Please see the Credit Policy page on www.moodys.com for
a copy of this methodology.
No additional cash flow analysis or stress scenarios have been conducted
as the rating was directly derived from the rating of the underlying security,
guarantor or reference credit.
REGULATORY DISCLOSURES
For ratings issued on a program, series or category/class of debt,
this announcement provides relevant regulatory disclosures in relation
to each rating of a subsequently issued bond or note of the same series
or category/class of debt or pursuant to a program for which the ratings
are derived exclusively from existing ratings in accordance with Moody's
rating practices. For ratings issued on a support provider,
this announcement provides relevant regulatory disclosures in relation
to the rating action on the support provider and in relation to each particular
rating action for securities that derive their credit ratings from the
support provider's credit rating. For provisional ratings,
this announcement provides relevant regulatory disclosures in relation
to the provisional rating assigned, and in relation to a definitive
rating that may be assigned subsequent to the final issuance of the debt,
in each case where the transaction structure and terms have not changed
prior to the assignment of the definitive rating in a manner that would
have affected the rating. For further information please see the
ratings tab on the issuer/entity page for the respective issuer on www.moodys.com.
Please click on this link http://www.moodys.com/viewresearchdoc.aspx?docid=PBS_SF276836
for the List of Affected Credit Ratings. This list is an integral
part of this Press Release and provides, for each of the credit
ratings covered, Moody's disclosures on the following items:
Person approving the credit rating
The rating has been disclosed to the rated entity or its designated agent(s)
and issued with no amendment resulting from that disclosure.
Information sources used to prepare the rating is the following:
public information.
Moody's did not receive or take into account a third party assessment
on the due diligence performed regarding the underlying assets or financial
instruments related to the monitoring of this transaction in the past
six months.
Moody's considers the quality of information available on the rated
entity, obligation or credit satisfactory for the purposes of issuing
this rating.
Moody's adopts all necessary measures so that the information it
uses in assigning a rating is of sufficient quality and from sources Moody's
considers to be reliable including, when appropriate, independent
third-party sources. However, Moody's is not
an auditor and cannot in every instance independently verify or validate
information received in the rating process.
Moody's Investors Service may have provided Ancillary or Other Permissible
Service(s) to the rated entity or their related third parties within the
two years preceding the credit rating action. Please see the special
report "Ancillary or other permissible services provided to entities
rated by MIS's EU credit rating agencies" on the ratings disclosure
page on our website www.moodys.com for further information.
The below contact information is provided for information purposes only.
Please see the issuer page on www.moodys.com for Moody's
regulatory disclosure of the name of the lead analyst and the office that
has issued the credit rating.
The relevant Releasing Office for each rating is identified under the
Debt/Tranche List section on the Ratings tab of each issuer/entity page
on moodys.com.
Neelam S. Desai
Senior Vice President
Structured Finance Group
Moody's Investors Service Ltd.
One Canada Square
Canary Wharf
London E14 5FA
United Kingdom
JOURNALISTS: 44 20 7772 5456
SUBSCRIBERS: 44 20 7772 5454
Annick Poulain
MD - Structured Finance
Structured Finance Group
JOURNALISTS: 44 20 7772 5456
SUBSCRIBERS: 44 20 7772 5454
Releasing Office:
Moody's Investors Service Ltd.
One Canada Square
Canary Wharf
London E14 5FA
United Kingdom
JOURNALISTS: 44 20 7772 5456
SUBSCRIBERS: 44 20 7772 5454
Moody's takes negative actions on structured finance transactions directly linked to European sovereigns and European and US banks recently downgraded or placed on review
