TEXT-Fitch affirms Scandinavian Consumer Loans III

Wed Dec 5, 2012 10:12am EST

Dec 5 - Fitch Ratings has affirmed Scandinavian Consumer Loans III's (SCL
III) notes backed by Swedish unsecured consumer loan receivables ratings as
follows: 

SEK1,082m class A notes: 'AAAsf'; Outlook Stable 

SEK96.0m class B notes: 'AAsf'; Outlook Stable

SEK193.0m class C notes: 'Asf'; Outlook Stable

SEK560.0m class D notes: Not rated

The rating action reflects the transaction's robust performance as supported by 
low pool delinquencies and defaults. 

SCL III is incorporated in Sweden as a special purpose vehicle with limited 
liability and is wholly owned by Nordax Finans AB Publ (Nordax, the originator, 
seller, servicer, and cash manager). The securities are backed by a revolving 
pool of unsecured consumer loans originated in Sweden. 

Some discrepancies in reported performance data, in particular performance 
linked to the asset balance, came to light during the review. Nordax 
investigated the issue and detected two errors in their reporting system which 
had led to an incorrect allocation of funds and a declining collateral balance 
in previous periods, leaving the transaction under-collateralised. Nordax 
meanwhile confirmed in a public announcement that it has rectified the technical
errors and has, as per 3 December 2012, posted an amount of approximately SEK64m
in cash into the issuer's account to close the under-collateralisation. This 
amount will be used to purchase receivables in the coming periods. Due to the 
reporting corrections underway, Fitch will have a focus on the upcoming monthly 
reports and will review the transaction again in the next four months.

Aside from the above mentioned discrepancies, and after investigating the 
reporting errors, Nordax confirmed that all other performance data provided so 
far are accurate. The delinquency rate has been quite stable over time and as 
per the latest reporting date (November 2012) equalled 1.43% of the outstanding 
portfolio. The cumulative default rate has been 1.46% which is below the 
agency's initial base case assumption at the same point in seasoning (4.0%). 
Overall, asset performance is in line or even better than initially anticipated 
by Fitch.

The deal closed on the 8 December 2011 and has a 36 month revolving period that 
will end in December 2014, unless terminated earlier following an early 
amortisation event. After the revolving period has ended, the notes will start 
amortising in sequential order. A step-up date will occur 12 months after the 
notes have started amortising whereby the note margins will double.


Additional information is available at 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.

The source of information used to analyse this transaction was Nordax Finanz AB 
in its capacity as servicer for the transaction.

Applicable criteria, "Global Structured Finance Rating Criteria", dated 02 
August 2012, "Counterparty criteria for Structured Finance Transactions", dated 
30 May 2012 and "EMEA Consumer ABS Rating Criteria", dated 12 June 2012, are 
available at www.fitchratings.com.

Applicable Criteria and
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