To date, there has been just one or two visible instances of triple-A asset-backeds defaulting the most notable involving a multi-line surety provider's failure to honor a financial guaranty (i.e. Hollywood Funding No. 5/Lexington Insurance Co., see ASR 3/19/01).

However, the Heilig-Meyers 1998-2 A-class notes, also formerly triple-A rated, might have hit a technical default, depending on your definition, market sources said. During the February 2002 distribution period, the A-class notes fell short on about $520,000 in principal, according to Standard & Poor's.

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