It looks like the Argentine government isn't out to make friends in structured finance. The administration of Cristina Kirchner last August abolished certain tax exemptions for financial trusts. This will cut the available excess spread - after losses - in some local ABS deals by 35%, according to a report from Moody's Latin America.

The agency added that the subordinated tranches of deals will bear the brunt of the drop in excess spread. As a result, the agency put on review for possible downgrade the 'Caa1' global scale, local currency and 'Ba1.ar' national scale ratings on 11 sub pieces. It also pointed out that deals that are undercollateralized at issuance and rely on excess spread to pay principal could be in jeopardy. The agency does not rate any deals that were so-called "under water" at closing.

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