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27 Dec 2000
MOODY'S ACBP RATING ACTIONS FOR THE SEVEN DAY PERIOD ENDED DECEMBER 21, 2000
New York, December 27, 2000 -- THE FOLLOWING ABCP PROGRAM WAS ASSIGNED A PRIME-1 RATING BY MOODY'S DURING THE SEVEN DAY PERIOD ENDED DECEMBER 21, 2000:
MOODY'S RATES DEUTSCHE BANK'S SPICE TRUST IV ABCP PROGRAM PRIME-1
Moody's Investors Service assigned a Prime-1 rating to the asset-backed commercial paper (ABCP) issued by SPICE (Structured Participation Instruments with Credit Enhancement) IV (SPICE IV) sponsored by Deutsche Bank (DB). SPICE IV is the latest in a series of SPICE transactions that allow Deutsche Bank to obtain credit protection for margin loans in the Deutsche Bank Alex Brown (DBAB) portfolio. DBAB does this through a credit default swap (CDS) from SPICE IV. Due to this specialized purpose, the trust will be in existence for roughly only 4 weeks. At that time, all outstanding SPICE IV ABCP will be redeemed and the program will terminate. The Chase Manhattan Bank will act as trustee and depositary for the program. Spice IV's program amount is $3 billion.
The rating of SPICE IV is based in part on the Prime-1 rating of DB Cayman Islands Branch which provides Certificates of Deposit (CDs) which are collateral for the ABCP, and which will mature prior to the maturity of the SPICE IV ABCP. The rating is also supported by the CDS provided to SPICE IV by Prime-1-rated Credit Suisse First Boston (CSFB) which will reimburse SPICE IV for any payments it must make under its CDS to DBAB. If the CDs cannot be redeemed in full, or if the CDs are redeemed in full, but SPICE IV has to make a payment under its CDS with DBAB and is not reimbursed under its swap with CSFB, then ABCP investors could suffer a loss. Therefore, the SPICE IV investor has exposure to the credit quality of both CSFB and DB.
For further details, please see Moody's press release dated December 21, 2000.
THE RATINGS OF THE FOLLOWING ABCP PROGRAMS WERE CONFIRMED BY MOODY'S DURING THE SEVEN DAY PERIOD ENDED DECEMBER 21, 2000:
IN CLUB DEAL, ROYAL BANK OF SCOTLAND'S TAGS AND LOCH NESS FUND COMMERCIAL REAL ESTATE TRANSACTION
Thames Asset Global Securitization and Loch Ness Limited, two partially supported multiseller conduits sponsored by Royal Bank of Scotland, have entered into a £405 million transaction (approximately $600 million at current exchange rates). The ABCP is backed by a portfolio of commercial properties currently leased by a Aa-rated financial institution. Liquidity is currently provided by Prime-1-rated Royal Bank of Scotland with the possibility of syndication to other Prime-1 rated banks.
ABN AMRO'S AMSTEL PURCHASES EURO 8.245 BILLION IN ASSET-BACKED NOTES
Amstel Funding Corp., a multiseller, partially supported ABCP conduit sponsored by ABN AMRO, has purchased euro 8.245 billion the Senior, Class A, and Class B Notes issued pursuant to a securitization of rated loans originated by ABN Amro.
Although the transaction has no deal-specific credit enhancement, the notes are highly rated. The Senior and Class A Notes are rated Aaa, while the Class B Notes (amounting to euro 212.5 million) are rated Aa2. Also, the notes benefit from subordination of 3%. In the event that such enhancement falls below 1.5%, no more ABCP can be issued. Finally, if any notes are downgraded below Aa2, they will either be sold on a "no loss" basis or immediately put to liquidity. Any currency or interest rate risk is hedged pursuant to a swap provided by ABN AMRO.
No program-level credit enhancement is being added for this asset, and the authorized issuance amount for Amstel is now $10.695 billion.
ANTALIS S.A. ADDS FIVE POOLS AND INCREASES SIXTH
In Paris, Moody's confirmed the Prime-1 rating assigned to Antalis SA, the partially supported, multiseller program sponsored by Société Générale.
This follows five pool additions and one pool increase to the program. The pool additions include a euro 76 million transaction backed by trade receivables originated by a corporate entity located in the UK, a Euro 200 million transaction backed by trade receivables originated by a large French corporate involved in the electricity and engineering business, a euro 300 million transaction backed by trade receivables originated by a French corporate against some of its largest clients in the automotive industry, and a euro 67 million transaction backed by trade receivables and leases originated by a Swiss industrial technology group. Finally, Antalis added a euro 22.5 million trade receivables transaction. The sellers are two affiliates of a large steel producer. Structural protections for each portfolio consist of overcollateralization and pool specific liquidity facilities. Antalis also restructured and increased a transaction backed by trade receivables originated by a French group involved in the distribution of electric products. This is Antalis' largest transaction: Antalis can issue up to euro 410 million of commercial paper backed by receivables from this seller. All liquidity facilities supporting Antalis ABCP are provided by Société Générale for an amount of 102.5% of each pool.
In addition, Antalis' program-level credit enhancement has been increased to euro 466 million, or about 10.4% of the authorized issuance amount.
DG BANK'S AUTOBAHN FUNDING CO. LC FUNDS A $200 MILLION LOAN/FACTORED RECEIVABLES DEAL
Autobahn Funding Co. LLC, a partially supported, multiseller ABCP conduit sponsored and administered by Deutsche Genossenschaftsbank (DG Bank), recently entered into a $200 million loan/factored receivables facility for an unrated domestic financial services company. The receivables in this transaction are comprised of fixed and floating rate commercial and leveraged loans, as well as factored trade receivables. All receivables in the deal are subject to advance rates based on the type of receivable, in addition to strict obligor portfolio concentration limits. Credit enhancement is provided through overcollateralization, a $70 million (35%) receivables insurance policy provided by an A1-rated indemnity company, and excess spread.
Upon the occurrence of any termination event (after allowing for a 3-day cure period), including a borrowing base deficit, the assets will immediately be "put" to the liquidity banks, thus protecting the ABCP investor against any further deterioration in the assets. The liquidity banks will fund for the amount of non-defaulted receivables plus up to the $70 million liability limit set by the insurance policy.
Autobahn now funds a total of 14 asset pools and is authorized to issue up to approximately $1.695 billion of ABCP.
STATE STREET'S GALLEON CAPITAL CORP. ACQUIRES $50 MILLION IN AUTO-BACKED CERTIFICATES ADDS TWO EUROPEAN TRADE RECEIVABLES FACILITIES
Galleon Capital Corp., the partially supported, multiseller ABCP program sponsored by State Street Capital Markets, LLC has purchased $50 million of Class A Certificates backed by auto loan receivables. The Class A Certificates are supported by a 7.5% subordinated class of certificates and a 2.5% reserve fund.
Galleon also separately purchased two euro-denominated trade receivables facilities. The first transaction is a euro160 million facility secured by receivables generated by a German manufacturer of hair care products. The transaction is supported by 10% overcollateralization and 10% incremental program level credit enhancement in the form of a letter of credit provided by Prime-1 rated State Street Bank. The second, a euro100 million facility, is secured by receivables generated by the European operations of a global paper manufacturer. The transaction is supported by 14% overcollateralization.
Program-level credit enhancement was increased by 10% of all three of these transactions. Galleon Capital Corp. currently funds 30 transactions and is authorized to issue up to $1.112 billion of ABCP.
INDIGO FUNDING'S SERIES COGEVOLT INCREASES SIZE TO EURO 652 MILLION
In Paris, Moody's confirmed the Prime-1 rating assigned to Indigo Funding's Series Cogevolt following the series' increase in size up to Euro 652 million.
The Series Cogevolt is the second series of ABCP issued by Indigo Funding. This series was established in November of 1999. The underlying assets backing Series Cogevolt consist of future cash flows expected on contracts entered by Dalkia (a subsidiary of Vivendi) and Electricite de France (Aaa).
Series Cogevolt ABCP holders are not exposed to the credit risks of the underlying assets, because a liquidity facility provided by Bayerische Landesbank Girozentrale, Paris Branch (Aaa/Prime-1/C) fully supports the ABCP: the liquidity facility is dedicated to the ABCP of Series Cogevolt and will be available on any ABCP maturity date for the full amount of maturing ABCP, regardless of asset quality.
The sole "out " for funding of the liquidity facility is the bankruptcy of the issuer. However, Moody's considers this risk sufficiently remote to be consistent with a P-1 rating. Currently, the main risk for investors is BLB's default as liquidity provider or administrator of the program. The liquidity facility may be syndicated with other Prime-1 rated banks provided that the syndication does not adversely affect the rating of the Series Cogevolt ABCP. Indigo Funding is now authorized to issue up to Euro 3.9 billion.
LIBERTY STREET ADDS $90 MILLION TRADE DEAL, $120 MILLION CLO, AND $75 MILLION AUTOMOBILE LEASE RECEIVABLES TRANSACTION
The Bank of Nova Scotia's Liberty Street Funding Corp., a partially supported, multiseller conduit, added three new deals. These include a $90 million trade receivable transaction originated by a major subsidiary of a Baa3-rated US-based conglomerate. The division selling the receivables provides transportation planning and services. ABCP investors are protected by reserves of close to 30%, including a 10% letter of credit provided by The Bank of Nova Scotia. In addition, liquidity is required to fund ABCP immediately if certain performance triggers are breached including default and delinquency ratios and failure to have sufficient receivables to cover ABCP issuance.
Liberty Street also purchased a $120 million Aaa-rated tranche of the Citadel Hill 2000 Ltd. cash flow CLO. The Note purchased is secured by high-yield loans, partially originated by The Bank of Nova Scotia. Aaa-rated CLO assets now total close to 45% of Liberty purchase commitments, including $2.4 billion of the Aaa-rated Campobello CLO, which also securitized Bank of Nova Scotia assets. Because The Bank of Nova Scotia is providing liquidity through Liberty Street for assets which are self-originated, bank regulations preclude the bank from providing credit enhancement for either transaction. Thus, program-level credit enhancement is not available for these CLO assets.
Finally, Liberty Street funded a $75 million automobile lease receivables facility for an unrated auto rental company. ABCP proceeds will be used to purchase an interest in a variable funding note, backed by lease payments associated with the purchased vehicles. Full liquidity support will be provided by Prime-1-rated Bank of Nova Scotia.
Liberty's program-level credit enhancement is close to $300 million. Liberty Street now funds 25 transactions and is authorized to issue up to approximately $5.6 billion of ABCP.
BANK OF AMERICA'S HATTERAS ADDS $60 MILLION SYNTHETIC LEASE TRANSACTION
Hatteras Funding Corp., a fully supported, multiseller conduit sponsored by Bank of America, N.A., entered into a revolving credit facility with a Baa1-rated seller, which finances the purchase and outfitting of three corporate aircraft. The transaction is fully supported by a liquidity facility provided by Prime-1-rated Bank of America and a syndicate of other Prime-1-rated banks. Hatteras now funds a total of 19 transactions and is authorized to issue up to approximately $5.32 billion of ABCP.
MONTAUK BUYS CREDIT-LINKED CD AND SYNTHETIC LEASE FACILITY
Montauk Funding Corp., a limited post-review, partially supported, multiseller ABCP conduit administered by Prime-1-rated Westdeutsche Landesbank (WestLB), purchased a $301.7 million credit-linked certificate of deposit backed by repayment obligations of highly rated financial institutions. This transaction is partially supported by liquidity from WestLB. No incremental program-level credit enhancement was added for this transaction.
Montauk also entered into a revolving credit facility to finance the purchase of land and the construction and improvement of a corporate office building. The obligor under the synthetic lease is a speculative-grade energy company. Montauk's share of the transaction is approximately $35 million. This transaction is fully supported by liquidity facilities provided by WestLB and a syndicate of banks. Program-level credit enhancement, in the form of a letter of credit provided by WestLB, currently amounts to $192 million. Montauk is authorized to issue up to approximately $10 billion of ABCP.
CHASE'S PARCO ADDS THREE TRANSACTIONS
Park Avenue Receivables Corporation (PARCO), a partially supported, multiseller conduit sponsored by The Chase Manhattan Bank, entered into three transactions. Two are fully supported through liquidity provided by Prime-1 rated Chase Manhattan Bank, the first being a $245.2 million facility which funds the purchase of retail auto loan receivables generated by anA2/Prime-1 rated originator. This transaction is fully supported. The second is a $153 million revolving facility which finances a variable funding note backed by floorplan loans to vehicle dealers.
Finally, PARCO entered into a partially supported transaction to finance $306 million of trade receivables originated by a speculative grade seller. Both pool-specific and incremental program-level credit enhancement of 10% of the purchase commitments support this transaction.
PARCO 's program-level enhancement has a $300MM floor. PARCO is authorized to issue up to approximately $15.6 billion of ABCP.
GECC'S REDWOOD ADDS $450 MILLION TRADE DEAL
GECC'S Redwood Asset Securitization LLC, a partially supported, multiseller ABCP program sponsored by General Electric Capital Corp. (GECC), purchased a $450 million pool of short term trade receivables. The originator is a Ba3-rated distribution company involved in health care and related products. Pool-specific credit enhancement, in the form of a GECC letter of credit, is sized at 20% of the purchase commitment and increases to 27.5% under certain adverse termination scenarios. In addition ABCP investors benefit from a 15% overcollateralization reserve. The credit enhancement provided is more than adequate for this quick-turning receivables portfolio which has demonstrated low default rates over the past five years (under 1% on average). Redwood is now authorized to issue up to $2.3 billion of ABCP.
SPARC ENTERS A COMMITMENT TO PURCHASE CDO NOTES
Special Purpose Accounts Receivable Cooperative Corporation, (SPARC), a partially supported, multi-seller conduit program sponsored by the Canadian Imperial Bank of Commerce, entered into a $55 million commitment to purchase the Aa2-rated portion of a CLO. The notes are collateralized by a highly diversified pool of bank loans and high yield bonds. No program-level credit enhancement is being added for this transaction. With this commitment, SPARC is authorized to issue ABCP in an amount of up to $10.071 billion.
ABN AMRO'S TULIP ADDS TWO POOLS
Tulip Funding Corp., the fully supported, multiseller ABCP conduit administered by ABN AMRO Bank N.V. (ABN AMRO), has purchased two additional pools of receivables. The first is a $150 million trade receivables portfolio originated by a Korean container liner operator, and the second a euro 50 million portfolio of export receivables sold by a German corporate.
Tulip is fully supported through liquidity for 90% of the deal, and a program standby letter of credit for the remaining 10%, each provided by Prime-1-rated ABN AMRO. The letter of credit serves as both liquidity and credit enhancement. The authorized issuance amount for Tulip is now approximately $7.9 billion.
DEUTSCHE BANK'S TWIN TOWERS PURCHASES $175 MILLION IN AUTO RECEIVABLES WAREHOUSE FACILITY
Twin Towers Inc., a partially-supported, multiseller conduit sponsored by Deutsche Bank, purchased a $175 million interest in an auto receivables warehouse facility wrapped by a Aaa-rated surety provider. Program-level credit enhancement was not increased due to the rating of the surety provider. Twin Towers may issue up to $5 billion of ABCP; and has about $300 million in program-level credit enhancement.
For a more detailed description of these ABCP programs, see Moody's GLOBAL ASSET-BACKED COMMERCIAL PAPER MARKET REVIEW, which is published quarterly.
No Related Data.
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