OREANDA-NEWS. Fitch Ratings has upgraded the following five classes of floating- and fixed-rated secured notes issued by SVG Diamond Private Equity II plc (SVG II):

--EUR76,500,000 class B-1 to 'BBBsf' from 'BBsf'; Outlook Stable;
--\\$40,000,000 class B-2 to 'BBBsf' from 'BBsf'; Outlook Stable;
--\\$47,800,000 class C to 'BBsf' from 'Bsf'; Outlook Stable;
--EUR43,000,000 class M-1 to 'Bsf' from 'CCCsf'; assigned Outlook Stable;
--\\$20,300,000 class M-2 to 'Bsf' from 'CCCsf'; assigned Outlook Stable.

SVG II is a securitization of existing limited partnership interests and future commitments to private equity funds that is managed by SVG Aberdeen. SVG II is currently in its amortization phase and the class A notes were paid in full in March 2015, substantially de-leveraging the transaction.

KEY RATING DRIVERS
--Continued stabilization of the fund's net asset value (NAV) from 2009 lows;
--Significant improvement in credit enhancement (subordination) levels to all remaining classes due to class A note repayment;
--Adequate near-term liquidity relative to unfunded commitments.

NET ASSET VALUE
The upgrades reflect a stabilized NAV since Fitch's last review in September 2014, as well as adequate near-term liquidity relative to unfunded commitments. Between July 31, 2013 and July 31, 2015, SVG II's NAV, as reported by the ratio of net assets to preferred equity share, increased to 1.57 from 1.13, according to the respective trustee reports, as the fund continued its rebound from mid-2009 valuation lows. The NAV performance since the September 2014 review was in line with Fitch's expectations.

LIQUIDITY PROFILE
According to the July 31, 2015, trustee report, SVG II's unfunded commitment exposure was reduced by EUR5.0 million from the prior review to an outstanding balance of EUR48.9 million. This amount was covered by cash/liquid investments of EUR105.4 million. SVG's cash reserve accounts have now been built up to a point where they have replaced the fund's liquidity facilities. Minimum reserves are sized at 78.57% of unfunded commitments and six months of senior expenses. The increase in reserve account amounts reflects the strong performance of the fund's incoming cash flow distributions from its underlying private equity funds.

RATING SENSITIVITIES
Going forward, the assigned ratings may be sensitive to material changes in the values of the underlying private equity fund investments and the impact these have on SVG II's overall NAV and liquidity relative to the rated liabilities. Furthermore, ratings may be influenced by the rate at which unfunded commitments are drawn, the rate at which gains (or losses) on existing private equity investments are realized, overall economic conditions, and Fitch's assessment of how these factors may influence performance for a given point in time as well as on a going-forward basis. A material adverse deviation from Fitch guidelines for any key rating driver could cause the rating to be lowered by Fitch. For additional information about Fitch ratings guidelines for market value structures, please review the criteria referenced below, which can be found on Fitch's website.

Fitch seeks monthly portfolio holdings information and semi-annual financial statements for the fund from The Bank of New York Mellon (trustee) and Aberdeen SVG, respectively, to conduct surveillance against ratings guidelines and maintain its ratings.

DUE DILIGENCE USAGE
No third party due diligence was reviewed in relation to this rating action.