In an updated report, Fitch Ratings said that the continued drawing of reserve funds from U.K. nonconforming RMBS is a reflection of the pressure being placed on this sector by current difficult market conditions, according to a release from the rating agency.

"The continued reserve fund draws represent an additional stress for these transactions. However, while some transactions continue to draw, others have seen their reserve funds top-up due to loans reverting to higher margins after initial teaser periods," says Peter Dossett, associate director in Fitch's RMBS performance analytics team.

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