In a bold move today Standard & Poor's placed 612 classes of RMBSbacked by U.S. subprime collateral on creditwatch with negative implications, subsequently affecting approximately $12.08 billion in rated securities, a move some market players have been loathing for months. The injured classes represent 2.13% of the $565.3 billion in U.S. RMBS rated by S&P between the fourth quarter of 2005 and the fourth quarter of 2006.

And S&P was not the only ratings agency to slash RMBS ratings today. In fact, Moody's Investors Servicedowngraded 399 2006 subprime RMBS and placed an additional 32 RMBS under review for possible downgrade the exact same day.

Later this afternoon, Moody's announced both positive and negative rating actions on 127 2005 vintage securities backed by subprime closed-end second lien mortgage loans. The rating actions affect securities with an original face value of $1.6 billion, which represents 7.7% of the dollar volume and 22% of the securities rated by Moody's in 2005 backed by subprime second lien loans.

Of the 127 ratings actions taken today, Moody's downgraded 52 securities (close to $393 million), of which 27 securities (about $205 million) are still on review for possible further downgrade. Moody's placed an added 23 securities (worth about $148 million) on review for possible downgrade. Most of the negative rating actions taken today impacted securities with prior ratings of 'Baa' and below, the rating agency said.

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