Spreads for DVI Inc. medical equipment lease ABS have widened significantly since accounting firm Deloitte & Touche announced it was stepping down as its independent auditor, which triggered ratings actions from all three rating agencies on the issuer's corporate unsecured debt. With the market asking whether this was the beginning of a blowup, or a buy opportunity, spreads on some classes of recently priced ABS widened by as much as 40 to 50 basis points on the bid side.

Spreads for DVI's most recent securitization, series 2003-1, were bid at 90 to 100 basis points over one-month Libor last week, out from pricing levels of 50 basis points over for the 2.8-year triple-A rated A3A notes. Merrill Lynch acted as lead manager for DVI XIX 2003-1.

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