Pacific Investment Management Co.'s Pacific Coast CDO Ltd., which was brought to the market by Credit Suisse First Boston in late September 2001, received another rash of downgrades last week.

The deal, suffering from substantial exposures to the ailing manufactured housing and aircraft sectors, has been failing overcollateralization tests for it's A, B and C tranches since last February, according to Fitch Ratings.

Pacific Coast's $275.7 million class A notes were downgraded to AA' from AAA'; the $96 million class B notes were downgraded to B' from BBB-'; the $20.7 million C1 class was downgraded to C' from B-'; the $8.8 million class C2 notes were downgraded to C' from B-' and the $26 million of preferred shares were downgraded to C' from CC'. As of Sept. 30, the A and B class's overcollateralization ratio was 92.2% - below its minimum 101.7%, while its C class OC ratio was at 85.4%, versus its required 101.7%, according to Fitch.

PIMCO announced earlier this year a temporary halt in managing ABS CDOs because of risk involved in the sector, including loosened underwriting standards and insufficient credit enhancement.

(c) 2005 Asset Securitization Report and SourceMedia, Inc. All Rights Reserved.

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