UPDATE 2-Nigeria tests waters for possible broad naira devaluation
* Nigeria hit by dollar shortage due to low oil price, FX curbs
Nov 30 - Fitch Ratings has affirmed Home Obligors Mortgage Enhanced Securities Series 1 (Pty) Ltd (Homes), as follows: ZAR 431.3m Class B2 notes: affirmed at 'AAA(zaf)'; Outlook Stable ZAR 386.4m Class B3 notes: affirmed at 'AAA(zaf)'; Outlook Stable ZAR 141.0m Class B5 notes: affirmed at 'AAA(zaf)'; Outlook Stable ZAR 28.3m Class B6 notes: affirmed at 'AAA(zaf)'; Outlook Stable ZAR 1,569m Class B7 notes: affirmed at 'AAA(zaf)'; Outlook Stable ZAR 320m Class B8 notes: affirmed at 'AAA(zaf)'; Outlook Stable ZAR 40m Class B9 notes: affirmed at 'AAA(zaf)'; Outlook Stable ZAR 130m Class C2 notes: affirmed at 'AA(zaf)'; Outlook Stable ZAR 184m Class C3 notes: affirmed at 'AA(zaf)'; Outlook Stable ZAR 30m Class C4 notes: affirmed at 'AA(zaf)'; Outlook Stable ZAR 30m Class C5 notes: affirmed at 'AA(zaf)'; Outlook Stable ZAR 73m Class D2 notes: affirmed at 'A(zaf)'; Outlook Stable ZAR 70m Class D3 notes: affirmed at 'A(zaf)'; Outlook Stable ZAR 22m Class D4 notes: affirmed at 'A(zaf)'; Outlook Stable ZAR 18m Class D5 notes: affirmed at 'A(zaf)'; Outlook Stable ZAR 41m Class E2 notes: affirmed at 'BBB(zaf)'; Outlook Stable ZAR 46m Class E3 notes: affirmed at 'BBB(zaf)'; Outlook Stable ZAR 29m Class E4 notes: affirmed at 'BBB(zaf)'; Outlook Stable ZAR 19m Class F2 notes: affirmed at 'BBB(zaf)'; Outlook Stable ZAR 18m Class G2 notes: affirmed at 'BBB(zaf)'; Outlook Stable The affirmation follows the satisfactory annual review and reflects the large credit enhancement (CE) and structural protection supporting the notes. For its review, Fitch applied its South African RMBS criteria, last updated in March 2012. CE is provided by overcollateralisation and note subordination, and as of August 2012 totalled 36.9% for the class B (most senior) notes, 29.1% for the class C notes, 25.2% for the class D notes, 22.8% for the class E notes, 22.4% for the class F notes and 22.0% for the class G notes. In addition, the transaction features significant overcollateralisation of interest, resulting from the junior position in the priority of payments of the interest payable under the subordinated loan, which represents 19.2% of the transaction's liabilities. The transaction's performance has been solid, with arrears lower than the average of South African issuers. However, it has been supported by ABSA Bank Limited's (ABSA, 'A-/Stable/'F2'; 'AA+(zaf)'/Stable/'F1+(zaf)') repurchase of distressed loans, for a cumulative 5.20% of the transaction closing balance to date; the most recent repurchase was performed in May 2012 and cleared the transaction of most of its delinquent loans. A number of notes across all classes reached their scheduled maturity date on 19 July and, as such, are currently paid down with principal portfolio collections. In Fitch's view, the repayment of the matured junior notes ahead of non-matured senior ones will not erode the notes' CE. This is because the subordinated loan is not to be repaid or any principal collections to be released until the full redemption of the notes. Principal collections may still be used to purchase new loans once the matured notes are fully redeemed. The transaction is also supported by the redraw and liquidity facilities provided by FirstRand Bank Limited (FirstRand, 'BBB+/F2/Negative', 'AA(zaf)/Stable/'F1+(zaf)'), which represent 0.5% and 4.5% of the outstanding note and subordinated loan balances. In the context of its review Fitch was provided with updated legal opinions, relating in particular to the compliance of the mortgage loans to the National Credit Act (NCA) and Consumer Protection Act (CPA). The legal opinions indicated that number of clauses in the documentation of the mortgage loans were potentially in breach of these regulations arising from, most noticeably, rights given to the lender to step in outside the context of a borrower default, or the exclusion of the bank's liability for gross negligence. According to the legal opinion, these contraventions might result in the imposition of fines, claims for damages or the severance of provisions, while the agreements of around 9.6% of the loan portfolio might in theory be ruled as invalid by a court. Fitch has taken the view that in practice, given the nature of the breaches any court ruling on these matters should have only limited adverse consequences, with loan invalidity as the most unlikely outcome. However, no relevant case law exists on the matter and legal opinions express no particular view as to the severity of observed contraventions to the CPA. The affirmation of the notes reflects this legal uncertainty as the asset performance could otherwise have justified an upgrade for some of the junior notes. Homes is a securitisation of South African mortgage loans originated by ABSA closed in August 2007. The transaction features an "evergreen" revolving period, meaning that the principal portfolio collections can be used to purchase new loans for as long as certain conditions are fulfilled regarding the performance of the portfolio and provided that no outstanding note has reached its scheduled maturity. 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. In its analysis of the transaction Fitch used information extracted from investor reports as well as information provided by ABSA, either in the context of the update of the agency's criteria, or for the purpose of this surveillance review more specifically. Applicable criteria, "EMEA RMBS Master Rating Criteria" dated 7 June 2012 and "EMEA Criteria Addendum - South Africa", dated 2 March 2012 are available at www.fitchratings.com. Applicable Criteria and Related Research: EMEA RMBS Master Rating Criteria EMEA Criteria Addendum - South Africa - Mortgage and Cashflow Assumptions
* Nigeria hit by dollar shortage due to low oil price, FX curbs
BRUSSELS, Feb 20 The next disbursement of financial aid to Greece from its euro zone lenders may not be imminent as talks are still complicated, the head of euro zone finance ministers said on Monday, adding that the target was to secure a deal as soon as possible.
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