December 18, 2012 / 5:36 PM / 5 years ago

TEX-S&P rates NewStar Commercial Loan Funding 2012-2 notes

OVERVIEW
     -- NewStar Commercial Loan Funding 2012-2 LLC's issuance is a CLO 
securitization backed by a revolving pool consisting primarily of middle 
market senior secured loans.
     -- We assigned our 'AAA (sf)' rating to the class A notes.
     -- The 'AAA (sf)' rating reflects our view of the transaction's credit 
enhancement, its legal structure, and its overcollateralization and interest 
coverage tests, among other factors.
 
CHICAGO (Standard & Poor's) Dec. 18, 2012--Standard & Poor's Ratings Services 
today assigned its 'AAA (sf)' rating to NewStar Commercial Loan Funding 2012-2 
LLC's $190.70 million floating-rate notes (see list).

The note issuance is a collateralized loan obligation securitization backed by 
a revolving pool consisting primarily of middle market senior secured loans.

The rating reflects our view of:
     -- The credit enhancement provided to the rated notes through the 
subordination of cash flows that are payable to the subordinated notes.
     -- The transaction's credit enhancement, which is sufficient to withstand 
the defaults applicable for the supplemental tests (not counting excess 
spread), and cash flow structure, which can withstand the default rate 
projected by Standard & Poor's CDO Evaluator model, as assessed by Standard & 
Poor's using the assumptions and methods outlined in its corporate 
collateralized debt obligation (CDO) criteria (see "Update To Global 
Methodologies And AssumptionsRELATED CRITERIA AND RESEARCH

Related Criteria
     -- Counterparty Risk Framework Methodology And Assumptions, Nov. 29, 2012
     -- Global CDOs Of Pooled Structured Finance Assets: Methodology And 
Assumptions, Feb. 21, 2012
     -- Methodology For Analyzing Rating Confirmation Requests To Establish 
Subsidiary Special-Purpose Entities in CDOs, Dec. 9, 2009
     -- Update To Global Methodologies And Assumptions For Corporate Cash Flow 
And Synthetic CDOs, Sept. 17, 2009
     -- Surveillance Methodology For Global Cash Flow And Hybrid CDOs Subject 
To Acceleration Or Liquidation After An EOD, Sept. 2, 2009
     -- The Use Of Rating-Based Haircuts In Event Of Default 
Overcollateralization Tests For CDOs, March 19, 2008
     -- Qualification And Treatment Of Current-Pay Obligations In Global Cash 
Flow CLOs, July 11, 2007
     -- Structured Finance Criteria Introduced For Cayman Islands 
Special-Purpose Entities, July 18, 2002

Related Research
     -- Presale: NewStar Commercial Loan Funding 2012-2 LLC, Dec. 6, 2012
     -- CDO Spotlight: The Relationship Between Long-Dated Assets And Market 
Value Risk In U.S. Cash Flow CLOs, April 26, 2012
     -- Global Structured Finance Scenario And Sensitivity Analysis: The 
Effects Of The Top Five Macroeconomic Factors, Nov. 4, 2011
     -- CDO Spotlight: Standard & Poor's Surveillance Process For Monitoring 
U.S. Cash Flow CLO Transactions, April 14, 2011
     -- Global Cash Flow And Synthetic CDO Criteria: The CDO Product, March 
21, 2002

RATING ASSIGNED
NewStar Commercial Loan Funding 2012-2 LLC 

Class                  Rating        Amount (mil. $)
A                      AAA (sf)               190.70
B                      NR                      26.00
C (deferrable)         NR                      35.20
D (deferrable)         NR                      11.40
E (deferrable)         NR                      16.30
F (deferrable)         NR                      24.10
Subordinated notes     NR                      22.18

NR--Not rated.

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