Last week AmeriCredit Corp. spurred up some immediate bank research commentary - especially on the corporate side - as the subprime lender announced it had renegotiated terms with its primary ABS bond insurer, Financial Security Assurance. For the next six months, the new terms allow for higher delinquency and loss rate triggers before excess spread is trapped for O/C build-up in the FSA wrapped deals.

From one perspective, the renegotiated terms lessens the likelihood of securitization cashflows being cut off from AmeriCredit, although corporate analysts and equity investors took the news primarily as a warning that the company will suffer from higher than expected losses in its subprime auto loan portfolios. Fitch Ratings, for example, placed AmeriCredit's BB' senior debt rating on watch for downgrade.

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