March 1, 2012 / 10:41 AM / 5 years ago

TEXT-Fitch assigns STFCL DA Sep 2011-01 final ratings

(The following statement was released by the rating agency)

March 01 - Fitch Ratings has assigned STFCL DA Sep 2011-01 - an ABS transaction - final ratings as follows:

INR1,973.2m purchaser payouts: 'Fitch AAA(SO)(ind)'; Outlook Stable

INR157.8m second loss credit facility (SLCF): 'Fitch BBB(SO)(ind)'; Outlook Stable

The used and new commercial vehicle and tractor loan pool assigned to the purchaser is originated by Shriram Transport Finance Co. Ltd. (STFCL, rated 'Fitch AA(ind)'/Stable).

The final rating of the purchaser payouts addresses the timely payment of interest and principal to the purchaser by the scheduled maturity date of May 2017, in accordance with the transaction documentation. The final rating of the SLCF addresses the ultimate payment of principal by the scheduled maturity date of May 2017, in accordance with the transaction documentation. The ratings are based on STFCL's origination, servicing, collection and recovery expertise, the legal and financial structure of the transaction and the credit enhancement provided by the originator.

The loans assigned to the purchaser at par had an aggregate outstanding principal balance of INR1,973.2m, as of the cut-off date of 31 August 2011. In this transaction, the credit enhancement for the pool is divided into a first loss credit facility (FLCF) and an SLCF, which are provided in the form of fixed deposits with ICICI Bank Ltd ('BBB-'/Stable) in the name of the originator with lien marked in favour of the purchaser. The credit enhancement is equal to 13.75% of initial principal outstanding, consisting of an FLCF of 5.75% and an SLCF of 8.0% of the initial principal outstanding.

A new issue report for this transaction will be available shortly on Fitch's websites, www.fitchratings.com and www.fitchindia.com.

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