RAM Ratings reaffirms AAA/Stable rating of Cagamas MBS Berhad's CMBS 2007-1-i
RAM Ratings reaffirms AAA/Stable rating of Cagamas MBS Berhad's CMBS 2007-1-i
Ard, Islam, Mal
Ard, Islam, Mal
Transcription
- 5 /23/2016 Latest Announcement - (News ID : 2016052300020) Latest Announcement News ID : 2016052300020 Subject : Cagamas MBS Berhad 20071 Cagamas MBS Berhad 20071 Organisation Name: RAM RATING SERVICES BERHAD News Type: RATING ANNOUNCEMENT Reference Site: None Embargo Date: 23/05/2016 Embargo Time: 03:30 PM Expiry Date: 22/06/2016 Priority: Medium Summary: RAM Ratings reaffirms AAA/Stable rating of Cagamas MBS's CMBS 20071i Attachments: No attachment available. Disclaimer: The user, including a user who is also a FAST Participant, expressly agrees that the use of this website which is accessible at https://fast.bnm.gov.my/ is at the user's sole risk. The information contained in this FAST website is compiled by MyClear Sdn. Bhd. (MyClear) and is provided on an "as is" basis without any representations or warranties of any kind, either expressed or implied. While MyClear makes every effort to ensure that information contained in the FAST website are accurate and disseminated in a timely and efficient manner, the user acknowledges that delays, errors, omissions or inaccuracies may occur. MyClear disclaims any liability pertaining to the consequences of any delays, errors, omissions or inaccuracies arising out of or relating to the FAST website or information, including but not limited to, any decision made or action taken by a user in reliance upon such information, or for damages suffered, whether direct, consequential, special, punitive, indirect or otherwise, notwithstanding having been advised of the possibility of such damages. In the event of any dispute, the official records of MyClear shall prevail. MyClear, Bank Negara Malaysia or any of its affiliates, officers, directors, agents or any other party involved in creating, producing or delivering the FAST website, shall not be liable for any direct, consequential, special, punitive, indirect, incidental or other damages arising out of or in any way connected with the use or inability to use the FAST website or information, whether based on contract, tort, liability or otherwise, even if advised on the possibility of any such damages. Content https://fast.bnm.gov.my/fastweb/public/PublicInfoServlet.do?chkBox=2016052300020&mode=DISPLAY&info=NEWS&screenId=PB010400 1/2
- 5 /23/2016 Latest Announcement - (News ID : 2016052300020) RAM Ratings has reaffirmed the AAA/Stable rating of Cagamas MBS Berhad's RM2.11 billion Sukuk Musyarakah Islamic residential mortgagebacked securities (2007/2027) (CMBS 20071i). Cagamas MBS is a limitedpurpose entity incorporated for the purpose of securitising government staff housing loans and government staff Islamic homefinancing facilities (GSIHFs). The reaffirmation of the rating is based on CMBS 20071i's available credit support in the form of a 43.91% overcollateralisation (OC) ratio as at 31 July 2015. The higher OC ratio is primarily attributable to the transaction's stable cashflow. As at the same date, the OC ratio was backed by RM286.70 million of cash and permitted investments and RM1.52 billion of outstanding home financing receivables. This provides more than sufficient protection against the risks of prepayment and default on the underlying portfolio of GSIHFs under an AAA stressed scenario, as well as negative variance on investment returns. During the reviewed period, the transaction performed within our expectations; the securitised portfolio's cumulative net default rate stood at 0.52% as at 31 July 2015, against our basecase assumption of 4.87%. We note that the betterthanassumed default performance had amply eased the potential liquidity pressure arising from the underlying GSIHFs' lowerthanassumed cumulative prepayment rate of 8.65%. Moving forward, we do not expect significant changes in the prepayment levels of CMBS 20071i given the belowmarket interest rates of the GSIHFs. Default risk is further moderated by the GSIHFs' nondiscretionary repayment structure. As at 31 July 2015, the portfolio of GSIHFs comprised 22,483 accounts, with an average outstanding balance of RM67,581. The weightedaverage term to maturity of the CMBS 20071i pool stood at 13.10 years as at the same date. Following the passing of the Public Sector Home Financing Board Act 2015 on 1 July 2015, the assets and liabilities of Bahagian Pinjaman Perumahan (BPP) (a division formally within the Ministry of Finance (MoF) and the primary unit servicing this transaction) were formally vested to Lembaga Pembiayaan Perumahan Sektor Awam (LPPSA) on 1 January 2016. Accordingly, the primary servicing functions for the securitised assets have also been novated to LPPSA. Operationally, LPPSA will continue using Sistem Pinjaman Perumahan Bersepadu's module to manage the home financing collections. It plans to implement a financial management system and human resources system to introduce an accrual accounting system to its existing infrastructure and to manage staff payroll as well as other employee functions. We do not foresee major changes in the transaction's servicing quality in the immediate term, although we do not discount the possibility of some operational hiccups during this transition. Nevertheless, RAM will continue monitoring the developments on this front and the potential impact, if any, on the transaction. Media contact Irene Wong 037628 1176 irene@ram.com.my The credit rating is not a recommendation to purchase, sell or hold a security, inasmuch as it does not comment on the security's market price or its suitability for a particular investor, nor does it involve any audit by RAM Ratings. The credit rating also does not reflect the legality and enforceability of financial obligations. RAM Ratings receives compensation for its rating services, normally paid by the issuers of such securities or the rated entity, and sometimes third parties participating in marketing the securities, insurers, guarantors, other obligors, underwriters, etc. The receipt of this compensation has no influence on RAM Ratings' credit opinions or other analytical processes. In all instances, RAM Ratings is committed to preserving the objectivity, integrity and independence of its ratings. Rating fees are communicated to clients prior to the issuance of rating opinions. While RAM Ratings reserves the right to disseminate the ratings, it receives no payment for doing so, except for subscriptions to its publications. Similarly, the disclaimers above also apply to RAM Ratings' creditrelated analyses and commentaries, where relevant. Published by RAM Rating Services Berhad © Copyright 2016 by RAM Rating Services Berhad https://fast.bnm.gov.my/fastweb/public/PublicInfoServlet.do?chkBox=2016052300020&mode=DISPLAY&info=NEWS&screenId=PB010400 2/2
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