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And Back To Greek Downgrade Triggers: Moody's Puts AAA Rating Of Most Greek Structured Finance Products On Downgrade Review

Tyler Durden's picture




 

Moody's has just placed $27 billion of AAA-rated bonds backed by Greek loans on review for possible downgrade due to increasing stress in the domestic economy. In essence this covers all Greek structured finance and covered bond transactions. Which is odd because Papandreou for the 1,485,384,495.4th time has just said that Greece is not looking for bailouts. Just this once, we will take Moody's word over someone else's.

Full Moody's report:

Paris, February 19, 2010 -- Moody's Investors Service today placed the Aaa ratings of all except
one Greek ABS, RMBS, CLO and covered bond transactions under
review for possible downgrade. A complete list of affected transactions
is at the end of this press release. The affected transactions
include nine ABS, eleven RMBS, two CLO and one covered bond
programme which are all backed by pools of Greek assets. There
is no Greek CMBS rated by Moody's.

 

Today's rating actions result from an initial assessment of these
highly rated Greek structured finance and covered bond transactions within
the context of the evolving sovereign situation as well as the current
economic and financial environment. This included a consideration
of the existing credit enhancement levels because, in the event
of the local economy coming under further stress, the default probability
of the assets in the underlying pools may potentially increase.
In addition certain deals are also exposed to both refinancing risk and
local banks.

 

As the Greek public finance situation has markedly deteriorated and is
likely to remain highly challenging, Moody's downgraded the
government bond rating to A2 from A1 last December and changed the outlook
to negative. Given the macroeconomic stress likely to be associated
with efforts to address the deficit we are reassessing the adequacy of
the credit supports on these transactions at their current rating levels.
Specifically, Moody's review will focus on whether the incremental
loss to the worsened environment is compatible with the Aaa ratings assigned
to the existing transactions.

 

Moody's notes that in one transaction, Karta 2005 plc,
a credit card ABS transaction, the Aaa rating of the Class A notes
has not been affected as it benefits from structural elements.
This transaction has entered into a cash accumulation period (during which
all proceeds are kept in cash rather than reinvested in assets) and the
Class A notes are currently cash collateralised at 91.4%
with cash held with a highly rated bank (Deutsche Bank, London Branch)
located in the UK. In view of the very high degree of certainty
of repayment of these notes with funds already collected by Karta APC
Ltd , Moody's has concluded that the credit risk of these
notes remains consistent with a Aaa rating.

 

In the press release issued on 4 February 2010, entitled "Moody's
reviews criteria for Greek structured finance transactions",
Moody's announced it was reviewing the potential implications of
the changing situation in Greek public finances for structured finance
ratings. Until Moody's concludes its review, the rating
agency said it will not issue any new Aaa ratings to Greek structured
finance transactions or covered bonds. Upon completion of the review,
existing and future ratings will be assessed using the new criteria.
In the meantime, Moody's will continue to monitor existing transactions,
and rating actions may be taken based on the characteristics and general
performance of these transactions in the current macro-economic
environment.

 

 

List of Affected Ratings:

 

ABS

Anaptyxi SME I: EUR 1750M A Certificates, Aaa Placed Under
Review for Possible Downgrade; previously on July 7, 2008 Assigned
Aaa

Axia III Finance Plc: EUR1670.1M A Certificate, Aaa
Placed Under Review for Possible Downgrade; previously on Aug 17,
2009 Assigned Aaa

DANEION 2007-1 PLC: EUR1587.5M Class A Certificate,
Aaa Placed Under Review for Possible Downgrade; previously on Nov
27, 2007 Assigned Aaa

Gaia Lease Plc: EUR272.6M A Notes, Aaa Placed Under
Review for Possible Downgrade; previously on Aug 14, 2009 Assigned
Aaa

IRIDA PLC: EUR261.1M A Certificate, Aaa Placed Under
Review for Possible Downgrade; previously on Dec 11, 2009 Assigned
Aaa

PRAXIS I FINANCE PLC: .EUR493M A Certificate, Aaa Placed
Under Review for Possible Downgrade; previously on Apr 30,
2009 Assigned Aaa

Praxis II Finance Plc: EUR379.2M A Certificate, Aaa
Placed Under Review for Possible Downgrade; previously on Aug 14,
2009 Assigned Aaa

Misthosis Funding Plc: EUR363.9M A Certificate, Aaa
Placed Under Review for Possible Downgrade; previously on Sep 21,
2009 Assigned Aaa

Synergatis Plc: EUR1414.5M A Certificate, Aaa Placed
Under Review for Possible Downgrade; previously on Aug 19,
2009 Assigned Aaa

 

RMBS

Estia Mortgage Finance II PLC: EUR1137.5M A Notes,
Aaa Placed Under Review for Possible Downgrade; previously on Jul
25, 2007 Definitive Rating Assigned Aaa

Grifonas Finance No. 1 Plc: EUR897.7M A Certificate,
Aaa Placed Under Review for Possible Downgrade; previously on Aug
30, 2006 Definitive Rating Assigned Aaa

Themeleion Mortgage Finance PLC: EUR693.5M A Notes,
Aaa Placed Under Review for Possible Downgrade; previously on Jun
14, 2004 Definitive Rating Assigned Aaa

Themeleion II Mortgage Finance Plc: EUR690M A Certificate,
Aaa Placed Under Review for Possible Downgrade; previously on Jun
21, 2005 Definitive Rating Assigned Aaa

Themeleion III Mortgage Finance Plc S.r.I.:
EUR900M A Certificate, Aaa Placed Under Review for Possible Downgrade;
previously on Jun 26, 2006 Definitive Rating Assigned Aaa

Themeleion IV Mortgage Finance Plc: EUR1352.9M A Certificate,
Aaa Placed Under Review for Possible Downgrade; previously on Jun
21, 2007 Definitive Rating Assigned Aaa

Themeleion V Mortgage Finance Plc: EUR957.8M A Certificate,
Aaa Placed Under Review for Possible Downgrade; previously on Feb
27, 2008 Assigned Aaa

Themeleion VI Mortgage Finance Plc: EUR1560.9M A Certificate,
Aaa Placed Under Review for Possible Downgrade; previously on Nov
19, 2008 Assigned Aaa

KATOIKIA I MORTGAGE FINANCE PLC: EUR886.6M A Notes,
Aaa Placed Under Review for Possible Downgrade; previously on May
20, 2009 Assigned Aaa

KION Mortgage Finance Plc: EUR553.8M A Certificate,
Aaa Placed Under Review for Possible Downgrade; previously on Dec
7, 2006 Definitive Rating Assigned Aaa

KION Mortgage Finance No. 2 Plc: EUR522.405M A Certificate,
Aaa Placed Under Review for Possible Downgrade; previously on Jul
18, 2008 Assigned Aaa

 

CLO

Axia II Finance PLC: EUR459M Class A Asset Backed Floating Rate
Notes due 2031 Notes, Aaa Placed Under Review for Possible Downgrade;
previously on May 7, 2009 Assigned Aaa

EPIHIRO PLC (Athena Project): EUR1623M Euro 1,623,000,000
Class A Asset Backed Floating Rate Notes due January 2035 Notes,
Aaa Placed Under Review for Possible Downgrade; previously on May
20, 2009 Assigned Aaa

 

Covered Bond

Alpha Bank Covered Bond PLC Series 1 and Series 2, Aaa Placed Under
Review for Possible Downgrade; previously on Dec 16, 2009 Confirmed
at Aaa.

 

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Fri, 02/19/2010 - 11:31 | 237524 Number 156
Number 156's picture

From AAA huh...

Why does Moodys even exist?

Fri, 02/19/2010 - 12:51 | 237654 Missing_Link
Missing_Link's picture

To misguide the foolish.

Fri, 02/19/2010 - 11:32 | 237525 Going Down
Going Down's picture

 

Yves Smith Video on Greece, Goldman and Fraud

 

http://www.foxbusiness.com/search-results/m/29096520/greece-goldman-and-...

 

A...er, on Fox.

 

Fri, 02/19/2010 - 11:35 | 237531 Trifecta Man
Trifecta Man's picture

Will somebody please downgrade Moodys to a junk ratings agency?

Fri, 02/19/2010 - 11:45 | 237549 yellow submariner
yellow submariner's picture

Only Ratíngs above A. So I can to buy these safe products.

I downgraded Moody's to D. *grin*

Fri, 02/19/2010 - 12:00 | 237574 Nout Wellink
Nout Wellink's picture

It is not Goldman + Paulson 'attacking' Greece. It is Goldman + Paulson + Moody's.

Fri, 02/19/2010 - 12:04 | 237577 Ripped Chunk
Ripped Chunk's picture

Whores

Fri, 02/19/2010 - 12:07 | 237583 buzzsaw99
buzzsaw99's picture

Moody's, that's uber-funny!

Fri, 02/19/2010 - 12:07 | 237584 AnonymousMonetarist
AnonymousMonetarist's picture

Oh my!

http://www.reuters.com/article/idUSLDE61H1IZ20100218

 

 "How does Germany have the cheek to denounce us over our finances when it has still not paid compensation for Greece's war victims?" Margaritis Tzimas, of the main opposition New Democracy party, told parliament.

"There are still Greeks weeping for their lost brothers," the conservative lawmaker said during a debate on a bill to clean up the country's discredited statistical service.

 

 

Fri, 02/19/2010 - 13:36 | 237737 4shzl
4shzl's picture

Reparations -- that's the ticket.  Oh yeah, the skinheads in the fatherland are gonna just love this.

Fri, 02/19/2010 - 12:11 | 237586 AnonymousMonetarist
AnonymousMonetarist's picture

MARK IT GYRO!

Fri, 02/19/2010 - 12:12 | 237590 Oso
Oso's picture

future bloomberg headline: "Market rises as Tiger apology eases recession fears"

Fri, 02/19/2010 - 14:47 | 237851 Arm
Arm's picture

This morning I was about to post "markets fall on Niger coup"

Fit the news to the market, and not vice versa.

Everyday I am questioning more and more the value of a Bloomberg subscription.

Fri, 02/19/2010 - 12:13 | 237591 Anonymous
Anonymous's picture

The Federal Reserve is a Den of Thieves. Filthy Fucking Thieves.

Fri, 02/19/2010 - 12:14 | 237595 Eduardo
Eduardo's picture

WOW Zero hedge no post on Tiger Woods?

I guess I should stick with bloomberg they are covering better than any congresional hearing I ever saw. You are loosing it ZH !

Fri, 02/19/2010 - 12:19 | 237602 lizzy36
lizzy36's picture

Yeah, really losing it...he sounds like he is accepting a lifetime achievement award. 

 

Fri, 02/19/2010 - 12:28 | 237616 bugs_
bugs_'s picture

Deep Shah.

Fri, 02/19/2010 - 13:17 | 237702 Oso
Oso's picture

is, what, supportive...?

 

I put on a flattener yesterday in my PA, long TLT, short SHY.  steepener is most crowded trade currently.

Fri, 02/19/2010 - 13:52 | 237762 Rusty_Shackleford
Rusty_Shackleford's picture
Yow! Greece May Have $75 Billion More Of Debt Hidden Off Its Books

http://www.businessinsider.com/yow-greece-may-have-75-billion-more-of-de...

John Carney | Feb. 19, 2010, 12:27 PM

Fri, 02/19/2010 - 14:50 | 237852 Arm
Arm's picture

Don't worry, just print some bills and the problem is fixed. 

I only wish I could get a 7% fee on that....  =)

Fri, 02/19/2010 - 20:47 | 238303 Rainman
Rainman's picture

Shit, they really are GREECEAFORNIA !!

Fri, 02/19/2010 - 15:16 | 237890 BlackBeard
BlackBeard's picture

They should insert a new chapter into all undergrad Finance/Capital Market textbooks titled: Ratings Agency Lag.

Fri, 02/19/2010 - 15:57 | 237969 carbonmutant
carbonmutant's picture

 Moody's relationship with the current administration does not permit them to downgrade the obvious.

However that may be permitted to redeem themselves by downgrading foreign debt.

Mon, 04/19/2010 - 08:06 | 307536 Tom123456
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