USD Notes to be issued in connection with exchange offer
London, 19 August 2010 -- Moody's Investors Service has assigned provisional ratings to the following
series of notes proposed to be issued by VB DPR Finance Company (the "Issuer")
in connection to an exchange offer:
-(P)Baa3 (sf) to the Series 2010-A USD[107,514,106]
Floating Rate Notes due June 2013;
-(P)Baa3 (sf) to the Series 2010-B USD[351,688,530]
Floating Rate Notes due June 2014; and
-(P)Baa3 (sf) to the Series 2010-C USD[89,875,958]
Floating Rate Notes due June 2014,
(together, the "New Notes"). Please note that the issuance
amounts may also change prior to close and represent only provisional
Moody's has been advised that an offer has been made to noteholders of
the below series of existing rated notes (the "Original Notes") to exchange
the Original Notes for the respective series of New Notes, as follows:
- Series 2006-A Notes due June 2013, currently rated
Baa3 (sf) in exchange for the Series 2010-A Notes;
- Series 2006-B Notes due June 2014, currently rated
Baa3 (sf) in exchange for the Series 2010-B Notes;
- Series 2006-C Notes due June 2014, currently rated
Baa3 (sf) in exchange for the Series 2010-C Notes; and
- Series 2006-D Notes due June 2014, currently rated
Baa3 (sf) in exchange for the Series 2010-B Notes.
Moody's understands that the New Notes are being offered to the existing
noteholders of the Original Notes on exactly the same terms as that of
the Original Notes except that (i) the New Notes will not benefit from
the financial guarantee insurance policies which are currently in place
in relation to the Original Notes and (ii) the New Notes will pay a higher
rate of margin than the Original Notes. The existing noteholders
of the Original Notes will have the opportunity to accept the offer during
the offer period. The amount of New Notes which would be issued
by the Issuer on the Closing Date will reflect the level of acceptance
of the offer by the existing noteholders of the Original Notes.
The Notes will be backed by rights to receive and/or retain payments made
in connection with all the existing and future US-dollar,
Euro, CHF and Sterling-denominated payment orders received
by Turkiye Vakiflar Bankasi TAO ("Vakifbank") instructing it to pay identified
recipients("diversified payment rights").
According to Moody's, the definitive ratings take into account,
(i) the financial and operational strength of Vakifbank ( Baa3 Global
Local Currency Deposit Rating ) and its importance in the Turkish banking
system (ii) the historical volumes generated by Vakifbank's electronic
remittance business (iii) the reduced likelihood of sovereign interference
in the cash flows from the underlying future receivables due to several
structural protections incorporated into the transaction (iv) the high
ratio of remittances cash flows to maximum scheduled debt service based
on strong cash flows generated mostly outside Turkey to third party beneficiaries
predominantly in Turkey (v) the robust credit quality of those of Vakifbank's
U.S. and European correspondent banks that have committed
to deposit all remittances-related cash flows to the collateral
trust account as instructed by the security trustee (vi) structural and
legal protections incorporated into the transaction, including required
minimum debt service coverage ratios which, if not met, may
trigger the early amortisation of the Notes.
Moody's considered as weaknesses of the transaction the volatile but stabilising
and improving economic environment in Turkey and the limited regulatory
oversight of Turkish banks. However this is effectively mitigated
by the high collateralisation level at closing and the early amortization
triggers during the transaction life. Moody's also highlights
that the transaction is strongly linked to Vakifbank's local currency
The principal methodology used in rating the notes issued by the Issuer
is "Moody's Approach To Rating Diversified Payment Rights Securitisations"
published in March 2009. Additional research, including the
new issue report for this transaction and reports for prior transactions,
are available at www.moodys.com. In addition,
Moody's publishes a weekly summary of structured finance credit,
ratings and methodologies, available to all registered users of
our website, at www.moodys.com/SFQuickCheck.
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.
No simulation of loss, cash flow nor stress scenario at the SPV
level has been performed, as the rating is fully linked to the rating
Date of last rating action: No prior rating action on the New Notes.
The last rating action on Original Notes was 20 November 2009.
The rating has been disclosed to the rated entity or its designated agents
and issued with no amendment resulting from that disclosure.
Information sources used to prepare the credit rating are the following:
(i) parties involved in the ratings (including the originator and the
arranger); (ii) parties not involved in the ratings (including third
party providing legal advice); (iii) confidential and proprietary
Moody's Investors Service's information (including information
relating to other classes of notes backed by DPR rated by Moody's).
Moody's Investors Service considers the quality of information available
on the issuer satisfactory for the purposes of assigning a credit rating.
Moody's Investors Service may have provided Ancillary or Other Permissible
Service(s) to the rated entity or its related third parties within the
three years preceding the Credit Rating Action. Please see the
ratings disclosure page www.moodys.com/disclosures on our
website for further information.
Moody's issues provisional ratings in advance of the final sale of securities,
but these ratings only represent Moody's preliminary credit opinion.
Upon a conclusive review of the transaction and associated documentation,
Moody's will endeavour to assign definitive ratings to the notes.
A definitive rating may differ from a provisional rating. Moody's
will disseminate the assignment of any definitive ratings through its
Client Service Desk.
The provisional ratings address the expected loss posed to investors by
the legal final maturity date of the Notes. In Moody's opinion,
the structure allows for timely payment of interest and principal at par
on or before the rated legal final maturity date. Moody's ratings
address only the credit risks associated with the transaction.
Other non-credit risks have not been addressed, but may have
a significant effect on yield to investors. To obtain a copy of
Moody's reports relevant to this transaction, please see Moody's
website www.moodys.com or contact our Client Service Desk
in London +44-20-7772 5454.
Moody's Investors Service adopts all necessary measures so that the information
it uses in assigning a credit rating is of sufficient quality and from
reliable sources; however, Moody's Investors Service does not
and cannot in every instance independently verify, audit 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.
Senior Vice President
Structured Finance Group
Moody's Italia S.r.l
Vice President - Senior Analyst
Structured Finance Group
Moody's Investors Service Ltd.
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Moody's Investors Service Ltd.
Moody's assigns provisional ratings to ABS to be issued by VB DPR Finance Company
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