The first ever bank credit card ABS to lose its triple-A ratings stumbled again last week, when Moody's Investors Service cut the ratings of the First Consumers Credit Card Master Trust 1999-A A class to Aa2', from Aa1' and B class to Ba1', from Baa3'. Also, the 2001-A B class had its ratings cut to Baa3' from Baa2'.

For the embattled banking unit of Spiegel Inc., this is the second ratings downgrade from Moody's this year, after all three rating agencies removed their respective triple-As after the announcement that First Consumers was on the selling block prompted a review. Varying enhancement levels in the 1999-A and 2001-A structures account for the below-investment-grade ratings on the B tranche of 1999-A, according to Moody's.

Already under regulatory scrutiny, Barclay's Capital researcher Juliet Jones points to the worst-case scenario: "The decreased likelihood that the bank will be sold increased the likelihood that the bank might go under receivership. The results then would play like a NextCard movie sequel."

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