BRL 120 million of certificates affected
Sao Paulo, February 07, 2011 -- Moody's América Latina (Moody's) has assigned definitive
ratings of A1.br (Brazilian National Scale) and of Ba2 (Global
Scale, Local Currency) to the first issuance of the 177th Series
of certificates issued by Brazilian Securities Companhia de Securitização
(Brazilian Securities or the issuer).
Issuer: Brazilian Secuities Companhia de Securitização
-- 177th Series
BRL 120,000,000 certificates rated Ba2 / A1.br
The certificates are ultimately backed by cédulas de crédito
bancário (CCB or Bank Loan) which document a bank loan to Gafisa
S.A. (Gafisa), one of the largest fully integrated
homebuilders in Brazil. Gafisa has a senior unsecured debt rating
of Ba2/A1.br by Moody´s.
The ratings of the certificates are based on the following factors:
- The structure of the transaction, that will fully match
payments due under the cédulas de crédito bancário
(Bank Loan or CCB) payable by Gafisa to payments due under the rated certificates;
-The ability and willingness of Gafisa, which has a senior
unsecured debt rating of A1.br (Brazilian National Scale) and Ba2
(Global Scale, Local Currency), to make payments due under
the Bank Loan; and
- The structural and legal features of the transaction, including
the events of early termination of the Bank Loan leading to early termination
of the certificates.
The certificates have a four year tenor from closing and will pay investors
eight semi-annual interest payments with full principal amortization
at maturity. Interest rate will be fixed at a spread of 1.3%
p.a. over the interbank deposit rate (CDI).
Moody´s views the certificates as being full pass through securities
of the underlying Bank Loan. The key steps to the transaction are:
1 - Gafisa issues in favor of Banco Votorantim, the CCBs
or Bank Loan, that represent the real estate financing granted for
the development of certain real estate projects;
2 -- Under the transaction's Purchase Agreement (or Contrato
de Cessão), all credit rights represented in the form of
the CCBs are sold by Banco Votorantim to the Issuer;
3 -- The Issuer, under the terms of the CCI Issuance Agreement
(Instrumento Particular de Emissão de CCIs), issues the CCI
representing all the Credit Rights;
4 -- The Issuer issues under fiduciary regime the CRI backed by the
5 -- The CRI are distributed to qualifying investors;
6 --The Issuer receives issuance proceeds, which in turn are
used to pay for the CCBs;
7 -- On each payment date, Gafisa will make principal and interest
payments under the CCBs through Cetip, the Brazilian clearing system;
8 -- Cetip makes payments directly to the Issuer, which in
turn makes CRI payments also through the Cetip clearing system.
In case of merger or acquisition of Gafisa by another company while the
CRI is outstanding, the Fiduciary Agent of the transaction must
notify investors. Investors have then the option to request early
amortization of the outstanding CRIs.
The A1.br / Ba2 ratings of the 177th Series of certificates issued
by Brazilian Securities are primarily based on Gafisa's ability
to make payments under the bank loan agreement. This is commensurate
with Gafisa's A1.br / Ba2 senior unsecured debt rating.
Any future changes to the senior unsecured debt rating of Gafisa will
lead to a change in the ratings assigned to the certificates.
Headquartered in Sao Paulo, Brazil and founded in 1954, Gafisa
is one of the largest fully integrated homebuilders in Brazil, ranking
second in terms of revenues and volumes, and also one of the most
diversified in terms of product offering to different income levels and
geographic regions, operating in 99 cities and 20 different states.
The principal methodology used in rating the certificates was Global Homebuilding
Industry rating methodology published in March 2009.
Moody's Investors Service did not receive or take into account a
third party due diligence report on the underlying assets or financial
instruments in this transaction.
Information source(s) used to prepare the credit rating are the following:
parties involved in the ratings, parties not involved in the ratings
and public information.
Moody's Investors Service considers the quality of information available
on the certificates satisfactory for the purposes of assigning a credit
Moody's adopts all necessary measures so that the information it uses
in assigning a credit 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.
Please see ratings tab on the issuer/entity page on Moodys.com
for the last rating action and the rating history.
The date on which some Credit Ratings were first released goes back to
a time before Moody's Investors Service's Credit Ratings were fully digitized
and accurate data may not be available. Consequently, Moody's
Investors Service provides a date that it believes is the most reliable
and accurate based on the information that is available to it.
Please see the ratings disclosure page on our website www.moodys.com
for further information.
Please see the Credit Policy page on Moodys.com for the methodologies
used in determining ratings, further information on the meaning
of each rating category and the definition of default and recovery.
Vice President - Senior Analyst
Structured Finance Group
Moody's America Latina Ltda.
Senior Vice President
Structured Finance Group
Moody's Investors Service
Moody's America Latina Ltda.
Moody's assigns definitive ratings of A1.br/Ba2 to the 177th Series of certificates issued by Brazilian Securities Companhia de Securitização, a Brazilian securitization of a bank loan to Gafisa S.A.
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