Moody's Investors Service downgraded, to Baa3’ from Baa2’, the credit ratings on 22 tranches in four Turkish future receivables transactions to reflect lower global local currency ratings of the Turkish banks that originated the receivables used as collateral.
Under Moody's rating methodology, the rating assigned to a future receivables transaction is linked to the originator's local-currency rating. The downgraded banks include: Akbank TAS, Turkiye Garanti Bankasi, Turkiye Vakiflar Bankasi, Yapi ve Kredi Bankasi and Turkiye IS Bankasi AS.
DPRs are a future-flows asset class linked to all the electronic money that flows through a bank, including payments for exports, remittances from nationals working abroad, and foreign direct investment.
Some of the diversified payment rights transactions that were downgraded as a result include tranches wrapped by insurer MBIA (rated B2’ by Moody's). Moody's noted in its report that “the guarantor rating is lower than the underlying rating on the notes.”
However the notes wrapped by Assured Guaranty Corp. (rated A3’ by Moody’s) in the Yapi Kredi Diversified Payment Rights Finance program were affirmed by the ratings agency “since the guarantor rating is higher than the underlying rating on the note”.
Assured announced during its first quarter 2014 earnings call in May that it planned to resume offering insurance on future flow securitizations. On May 14, the gurantor annpunced that it wrapped $200 million of notes from Turkey’s Garanti Bank's 2014-C DPR transaction. The last time Assured wrapped a Turkish DPR deal was in 2006.