Crisil has downgraded ratings of a pool backed by commercial vehicle loan receivables originated and serviced by ICICI Bank Ltd.
Crisil has revised its outstanding credit opinions on Contribution Series A1 and IO-A2 issued by Indian Retail ABS (IRABS) Trust 51 to ?BBB+(so)? equivalent from ?AA-(so)? equivalent. The revised credit opinions indicate a moderate degree of certainty regarding timely payment of financial obligations on the instruments.
The performance of the pool has been marked by a significantly higher-than-expected utilisation of the cash collateral, because collections in the 27 months following securitisation have been considerably lower than expected.
Consequently, the credit cover available to the rated contribution series has reduced, and the credit opinions on the two series
have been revised downwards.
This pool was securitised in December 2005; 27 months post securitisation, the pool has amortised by about 78 per cent. The credit collateral stipulated at the time of rating was Rs.68.2 million, of which, around 79 per cent has been utilised. This level of utilisation is much higher than Crisil?s expectations. The 90+ and 180+ delinquencies (including repossession losses) are also high at 8.6 and 6.6 %, respectively.
In case the actual performance is not up to the expectation, the credit opinions could be further revised downwards and vice versa.
