TEXT-Fitch takes rating actions on Lombarda Lease Finance 4

Thu Oct 25, 2012 11:01am EDT

Oct 25 - Fitch Ratings has taken rating actions on Lombarda Lease Finance 4
S.r.l.'s (LLF4) notes, as follows.

Class A affirmed at 'AAAsf'; Negative Outlook
Class B upgraded to 'A+sf' from 'Asf'; Outlook Stable
Class C affirmed at 'BBBsf'; Outlook Stable

The rating actions reflect the continued de-leveraging of the notes coupled with
the increase in the credit enhancement (CE) available to the noteholders, as
well as the consistent gross excess spread level (4% on average since closing)
which, effective May 2011, has been fully trapped into the structure and used to
accelerate the repayment of the rated notes. The Negative Outlook on the class A
notes reflects the Outlook on Italy's Long-Term Issuer Default Rating.

Since H209, the Fitch cumulative gross default rate has not performed in line
with the agency's base case (3.26% as of June 2012, compared to a base case of
2.18%). However, the transaction has benefited from higher than expected
recoveries. This has resulted in a Fitch cumulative net default rate that is
substantially in line with Fitch's expectations (1.61% vs. a base case of 1.63%
for the same period of seasoning).

The real estate pool now accounts for almost 100% of the portfolio. LLF4's top
borrower, top 10 and top 20 borrowers account for 4.6%, 14.0% and 20.1%,
respectively of the outstanding pool. As these percentages will only further
increase over time as the pool continues amortising, class C remains highly
exposed to increasing obligor concentration risk.

As of July 2012, CE had increased to 59% from 32% (as of April 2011) for the
class A notes, to 38% from 19% for the class B notes and to 28% from 12% for the
class C notes. The current CE comprises the over-collateralisation created
during the life of the deal.

Since May 2011, the notes have not benefited from any cash reserve, although a
commingling reserve was funded by the servicer in November 2011. However, Fitch
has noted that the latter can only be used upon the occurrence of specific
events with respect to the servicer, rather than as a pure liquidity line.

LLF4 is a securitisation of mixed financial lease contracts originated by SBS
Leasing S.p.A. (now known as UBI Leasing S.p.A.) in Italy.


Additional information is available on www.fitchratings.com.

The ratings above were solicited by, or on behalf of, the issuer, and therefore,
Fitch has been compensated for the provision of the ratings.

Source of Information: servicer reports, payment reports and investors' reports.

Applicable criteria "Global Structured Finance Rating Criteria," dated 6 June
2012, and "EMEA Consumer ABS Rating Criteria", dated 12 July 2012, are available
at www.fitchratings.com.

Applicable Criteria and Related Research:
Global Structured Finance Rating Criteria
EMEA Consumer ABS Rating Criteria
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