S&P: Firstmac Mortgage Funding Trust No.4 Series 3-2016 RMBS Assigned Preliminary Ratings
The preliminary ratings reflect:Our view of the credit risk of the underlying collateral portfolio, including the fact that this is a closed portfolio, which means no further loans will be assigned to the trust after the closing date. Our view of the credit support that is sufficient to withstand the stresses we apply. Credit support for the rated notes comprises note subordination, excess spread and lenders' mortgage insurance (LMI) on 37.8% of the portfolio. Our expectation that the various mechanisms to support liquidity within the transaction, including a liquidity reserve equal to 1.2% of the outstanding note balance; the principal draw function; 24 months timely payment cover on 27.4% of the loans in the portfolio; and a spread reserve which builds from available excess spread to ensure timely payment of interest. The extraordinary expense reserve of A$150,000, funded from day one by Firstmac Ltd., available to meet extraordinary expenses. The reserve will be topped up via excess spread if drawn. The fixed-to-floating interest-rate swap provided by National Australia Bank Ltd. to hedge the mismatch between receipts from fixed-rate mortgage loans and the variable-rate RMBS.
A copy of S&P Global Ratings' complete report for Firstmac Mortgage Funding Trust No.4 Series 3-2016 can be found on RatingsDirect, S&P Global Ratings' Web-based credit analysis system, at http://www. globalcreditportal. com.
The issuer has not informed Standard & Poor's (Australia) Pty Limited whether the issuer is publically disclosing all relevant information about the structured finance instruments that are subject to this rating report or whether relevant information remains non-public.
REGULATORY DISCLOSURESPlease refer to the initial rating report for any additional regulatory disclosures that may apply to a transaction.