Fitch Ratings, in a recent report, updated the “Challenge Factors” (CFs) assigned to 36 emerging market countries in 2009.
The CFs are an assessment of the legal framework governing securitizations in these countries, reflecting “the likelihood that a true sale of assets may be challenged in an originator’s insolvency proceedings.”
The CFs help shape a deal’s rating by capping the number of notches between the highest possible rating of the transaction and that of the originator.
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