March 24, 2014 / 7:56 AM / 4 years ago

RPT-Fitch Affirms 22 Medallion RMBS Tranches, Upgrades 1 Tranche

(Repeat for additional subscribers)

March 24 (Reuters) - (The following statement was released by the rating agency)

Fitch Ratings has affirmed six Medallion Trust Series RMBS transactions, with 22 tranches affirmed and one tranche upgraded. These transactions are backed by pools of Australian residential mortgages originated by Commonwealth Bank of Australia (CBA; AA-/Stable/F1+), and Homepath Limited (a wholly owned subsidiary of CBA that originates home loans online). The rating actions are at the end of this commentary.

KEY RATING DRIVERS

The affirmations reflect Fitch’s view that credit enhancement levels are able to support the notes’ current ratings and the agency’s expectations of Australia’s economic conditions, with the Medallion Series Trust 2013-1 Class B notes upgraded due to a build-up of credit enhancement for the note sufficient to achieve a rating of ‘AAsf’. The credit quality and performance of the loans in the respective collateral pools remain in line with the agency’s expectations.

Medallion Trust Series 2006-1G and Medallion Trust Series 2007-1G are currently paying down on a pro-rata basis, with principal collections for these transactions being allocated across all classes of notes with the exception of the Class A-4 note in Medallion Trust Series 2007-1G. Medallion Trust Series 2011-1, 2012-1, 2013-1 and 2013-2 are each currently paying down on a sequential basis. All transactions have lender’s mortgage insurance (LMI) provided by Genworth Financial Mortgage Insurance Pty Ltd or QBE Lenders’ Mortgage Insurance Limited (AA-/Stable) with cover ranging from 14.8% to 100% of the portfolios.

RATING SENSITIVITIES

In Fitch’s rating sensitivity analysis, the likelihood of a downgrade of the senior note classes is remote, based on each respective note’s performance and structure.

Initial key rating drivers and rating sensitivities are further described in the new issue reports for Series 2012-1, 2013-1 and 2013-2 dated 20 August 2012, 10 March 2013 and 30 August 2013 respectively. A comparison of representations and warranties for these transactions to typical representations and warranties for Australian RMBS is available by accessing the respective representation and warranties appendices to the new issue reports.

The list of rating actions follows:

Medallion Trust Series 2006-1G:

USD274.5m Class A-1 affirmed at ‘AAAsf’; Outlook Stable;

AUD274.5m Class A-2 affirmed at ‘AAAsf’; Outlook Stable;

EUR61.8m Class A-3 affirmed at ‘AAAsf’; Outlook Stable; and

AUD20.3m Class B affirmed at ‘BBBsf’; Outlook Stable.

Medallion Trust Series 2007-1G:

USD32.0m Class A-1 affirmed at ‘AAAsf’; Outlook Stable;

AUD18.0m Class A-2 affirmed at ‘AAAsf’; Outlook Stable;

EUR16.5m Class A-3 affirmed at ‘AAAsf’; Outlook Stable;

AUD1,200.0m Class A-4 affirmed at ‘AAAsf; Outlook Stable; and

AUD38.6m Class B affirmed at ‘BBBsf’; Outlook Stable.

Medallion Trust Series 2011-1:

AUD865.9m Class A1 affirmed at ‘AAAsf’; Outlook Stable

AUD525m Class A2 affirmed at ‘AAAsf’; Outlook Stable

AUD108m Class AB affirmed at ‘AAAsf’; Outlook Stable

AUD54m Class AC affirmed at ‘AAAsf’; Outlook Stable

Medallion Trust Series 2012-1:

AUD681.5m Class A affirmed at ‘AAAsf’; Outlook Stable

AUD60m Class B affirmed at ‘AAsf’; Outlook Stable

Medallion Trust Series 2013-1:

AUD727.7m Class A1 affirmed at ‘AAAsf’; Outlook Stable

AUD827.1m Class A2 affirmed at ‘AAAsf’; Outlook Stable

AUD250m Class A3 affirmed at ‘AAAsf’; Outlook Stable

AUD153m Class B upgraded to ‘AAsf’ from ‘AA-sf’; Outlook Stable,

Medallion Trust Series 2013-2:

AUD1753.7m Class A1 notes affirmed at ‘AAAsf’; Outlook Stable

AUD469.0m Class A2 notes affirmed at ‘AAAsf’; Outlook Stable

AUD400m Class A3 notes affirmed at ‘AAAsf’; Outlook Stable

AUD200m Class B notes affirmed at ‘AA-sf’; Outlook Stable

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