Fitch: Australian SF Ratings Stable in 3Q15

Fitch Ratings says that structured finance (SF) transactions in Australia and New Zealand remained stable in 3Q15 with a total of 67 tranches from 27 transactions affirmed as a result of continued stable and strong asset performance. There were no upgrades, downgrades or outlook revisions during 3Q15.

The strong asset performance reflected the local economic environment. Both the Australian and New Zealand housing markets remained strong and property price appreciation has been significant over the past couple of years. Stable interest rates have also helped to reduce volatility in mortgage performance.

Australian prime RMBS ratings accounted for most of the affirmations (42), followed by New Zealand credit card ABS (8), New Zealand prime RMBS (7), New Zealand auto ABS (6), and Australian non-conforming RMBS (4).

The transactions reviewed during the quarter made up approximately 15% of the 182 Fitch publicly-rated Australian and New Zealand SF transactions outstanding at end-2Q15.

Three notes from Flexi ABS Trust 2014-1 (Class C, D, and E) have had Positive Outlooks assigned since 2Q15, reflecting the build-up of credit enhancement and the transactions' performance. Three notes on Interstar Millennium Series 2005-3E Trust been on Rating Watch Negative since 2Q15 reflecting the downgrade of The Royal Bank of Scotland plc (RBS, BBB+/Stable/F2) - a currency swap provider for the transaction - on 19 May 2015. The Outlooks on all other SF ratings in Australia and New Zealand remain Stable.