Three Ratings Withdrawn On One Mexican RMBS Transaction Insured By MBIA Insurance Corp.

Stocks and Financial Services Press Releases Tuesday December 12, 2017 16:21
MEXICO CITY--12 Dec--S&P Global Ratings

MEXICO CITY (S&P Global Ratings) Dec. 11, 2017--S&P Global Ratings today withdrew three ratings on Hipotecaria Su Casita - Residential Mortgage-Backed Notes, a cross-border residential mortgage-backed securities transaction originated by Hipotecaria Su Casita S.A. de C.V. (not rated) and serviced by Adamantine Servicios S.A. de C.V. (not rated; see list).

We withdrew our 'CCC (sf)' long-term rating on the class A notes following the Dec. 1, 2017, withdrawal of our long-term rating on MBIA Insurance Corp., the notes' guarantor (see "MBIA Inc. And Subsidiaries Ratings Affirmed, Then Withdrawn At Issuer Request," published Dec. 1, 2017). For insured classes of notes, our rating is generally the higher of the rating on the insurer or the Standard & Poor's underlying rating (SPUR) on the tranche.

A SPUR is our opinion of the stand-alone creditworthiness of an obligation--that is, the capacity to pay debt service on a debt issue in accordance with its terms--without considering an otherwise applicable bond insurance policy. We lowered the 'CC (sf)' SPUR on class A to 'D (sf)' to reflect the fact that the portfolio has not generated sufficient cash flow to fully cover the monthly interests; therefore, the transaction has been making continuous claims to MBIA to fully meet its monthly interests payments.

We subsequently withdrew the SPUR on class A, as well as the 'D (sf)' rating on class B, based on our opinion that the default would persist in the future given the transaction's current financial position, which as of October 2017, presented an overcollateralization ratio (measured as 1 minus liabilities divided by current assets) of -308.74%.


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