Bangkok--19 Jan--Moody's Investors
Moody's Investors Service says in a new report that the performance outlook for cross-border Korean transactions (RMBS, auto loan ABS, credit card ABS), Singaporean CMBS, and Asia Pacific ex-Japan balance sheet CLOs is stable.
"The outlook on the Korean assets is driven by the country's economic recovery and the low unemployment rate. Receivables performance should remain stable," notes Marie Lam, a Moody's Vice President and co-author of the report.
However, caution remains, as households are highly leveraged. Obligors are vulnerable to payment shock if interest rates continue to rise or if the macroeconomic environment deteriorates.
"Nevertheless, the 2011 outlook on Korean assets is stable; we see no rating implications given the amount of subordination and the size of the buffer between actual performance and the triggers that could set off early amortization," adds Lam.
"For Singaporean CMBS, the robust economy provides stability to the office, retail, and industrial real estate sectors -- despite the abundant supply of space in all three sectors. The CMBS deals have stable cash flow and low appraiser's loan-to-value ratios. Thus, we see no rating implications to the outstanding CMBS transactions," says Jerome Cheng, a Moody's Vice President and co-author of the report.
"For Asia Pacific ex-Japan CLOs, Moody's is also maintaining a stable outlook, driven by the stable regional outlook on key industry sectors, to which the reference portfolios are significantly exposed. With the key Asian economies recovering in 2010, portfolio defaults have been low.
These economies should continue to grow in 2011," says Elaine Ng, a Moody's Vice President and co-author of the report.
Moody's report also discusses the collateral performance, rating actions taken, issuance volumes for 2010, and its expectations for the structured finance market for 2011.
Moody's new report, entitled "Asia Ex-Japan Structured Finance: 2011 Outlook & 2010 Review", is now available on www.moodys.com.