OREANDA-NEWS. Fitch Ratings has affirmed Canary Wharf Finance II Plc's notes and class B3 and C2 swaps, as follows:

GBP333.8m class A1 due October 2037 (XS0112279616): affirmed at 'AAAsf'; Outlook Stable
GBP400m class A3 due October 2037 (XS0130681512): affirmed at 'AAAsf'; Outlook Stable
GBP222m class A7 due October 2037 (XS0295171341): affirmed at 'AAAsf'; Outlook Stable
GBP169.3m class B due October 2037 (XS0112281190): affirmed at 'AAsf'; Outlook Stable
GBP104m class B3 due October 2037 (XS0295172075): affirmed at 'AAsf'; Outlook Stable
GBP239.7m class C2 due October 2037 (XS0295172406): affirmed at 'Asf'; Outlook Stable
GBP125m class D2 due October 2037 (XS0295172745): affirmed at 'BBBsf'; Outlook Stable
Class B3 interest rate swap agreement dated April 2007, affirmed at 'AAsf'; Outlook Stable
Class C2 interest rate swap agreement dated April 2007, affirmed at 'Asf'; Outlook Stable

The transaction is a securitisation of a commercial mortgage loan backed by originally seven (now six) prime office buildings in London's Canary Wharf district.

KEY RATING DRIVERS
The affirmation reflects the stable performance of the collateral backing the securitised loan. Since Fitch's last rating action in January 2015, occupancy in the estate has increased to 99.4% of gross lettable area (GLA) from 99%. The reported whole-loan LTV has decreased to 49% from 51% in January, due to continuous amortisation and based on an updated valuation as of June 2015.

The estate's income profile remains dominated by financial and professional services, which represents a risk. However, the weighted average unexpired lease term to break of 10 years provides some protection, given approximately 20% of the debt will be repaid over that timeframe.

Fitch estimates 'Bsf' recoveries of around GBP2.5bn.

RATING SENSITIVITIES
As the structure is reliant on rental income for continued amortisation of the notes, downward pressure on the credit quality of the financial sector, which accounts for the largest fraction of passing rent, may negatively affect the notes' ratings.

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

DATA ADEQUACY
Fitch has checked the consistency and plausibility of the information it has received about the performance of the asset pool and the transaction. There were no findings that were material to this analysis.

Fitch did not undertake a review of the information provided about the underlying asset pool ahead of the transaction's initial closing. The subsequent performance of the transaction over the years is consistent with the agency's expectations given the operating environment and Fitch is therefore satisfied that the asset pool information relied upon for its initial rating analysis was adequately reliable.

Overall, Fitch's assessment of the information relied upon for the agency's rating analysis according to its applicable rating methodologies indicates that it is adequately reliable.

SOURCES OF INFORMATION
The information below was used in the analysis.
- Transaction reporting provided by the sponsor as at November 2015
- Rent rolls provided by the sponsor as at December 2015