(Repeat for Additional Subscribers)
May 3 (The following statement was released by the rating agency)
Fitch Ratings has affirmed Hyundai Capital Auto Funding VIII Limited (Hyundai VIII) and
Hyundai Capital Auto Funding IX Limited (Hyundai IX). The transactions are securitisations of
auto loans in South Korea originated by Hyundai Capital Services Inc. (HCS, rated
The rating actions are as follows:
USD214.2m class A notes due 2016 affirmed at 'AAAsf'; Outlook Stable
USD200m class A1 notes due 2017 affirmed at 'AAAsf'; Outlook Stable
USD200m class A2 notes due 2017 affirmed at 'AAAsf'; Outlook Stable
Key Rating Drivers
The affirmations reflect adequate credit enhancement (CE) and stable portfolio
performance with low delinquencies and defaults since the previous rating action
in June 2012. Delinquencies and defaults may increase marginally over the next
12 months due to pressure from high household debt levels in South Korea.
However, Fitch does not expect the current ratings of each transaction will be
affected as the current CE levels are sufficient to absorb potential asset
The three-month average delinquency ratio of each transaction has remained low
at less than 0.06% since the previous rating action at June 2012, far below the
three-month average delinquency trigger of 1.5%. The three-month average default
ratio was less than 0.01% as of March 2013 for both Hyundai VIII and Hyundai IX,
compared with the trigger at 1.3%.
Hyundai VIII entered the controlled amortisation period in October 2012 and the
Class A balance has amortised to 71% of its initial balance. Hyundai IX is still
in the revolving period, which is due to end in August 2013.
Fitch evaluated the rating sensitivities of each transaction under an increased
default rate scenario. An increase of the base-case default rate by 108% and 46%
for Hyundai VIII and Hyundai IX, respectively, may lead to a downgrade of the
rated notes. The recovery rates, time to recovery and prepayment rates were
unchanged since closing in this sensitivity analysis.
Initial key rating drivers and rating sensitivity are described further in the
new issue reports for Hyundai VIII, dated 10 November 2010 and for Hyundai IX,
dated 25 August 2011.