Bangkok--30 Jul--Moody's
Moody's Investors Service says -- in a new report -- that the sector outlook for Korea RMBS is stable, while that for Korea ABS and Singapore CMBS is negative.
"Korea RMBS -- which have a stable outlook -- benefit from the low LTVs of its mortgage loans and the stable state of property markets in the major cities in the country," says Jerome Cheng, a Moody's Senior Credit Officer and co-author of the report.
"Meanwhile, Korea ABS, which is backed by unsecured receivables, has a negative outlook as the receivables are susceptible to the deterioration in the macro-economic environment," says Cheng. "Singapore CMBS also carries a negative outlook because the office, retail and industrial properties in these transactions are all adversely affected by the current economic downturn."
"The rating implications of these outlooks depend on the structural features of the transactions and the available headroom within existing rating assumptions," says Cheng.
"Currently, Korea RMBS and ABS's subordination levels and structural mechanisms, and Singapore CMBS's strong cash flows and low LTVs provide sufficient protection against expected performance deterioration, and there are no rating implications for all three," adds Marie Lam, also a Moody's Senior Credit Officer and another co-author of the report.
"Moreover, Moody's sector performance outlooks for all three asset classes are unchanged from our previous update in March 2009," says Lam.
"Since Moody's March update, there have not been any rating actions as performances are still within our original assumptions. However, given the level of uncertainty in today's markets, Moody's will continue to assess macro-economic developments and asset performances, and will express our opinions in our regular performance reviews," says Lam.
The new Moody's report -- "Asia Ex-Japan RMBS, ABS & CMBS Asset Performance Outlooks, July 2009" -- is now available on www.moodys.com.