Fitch Places HSBC Private Label CCMNT (USA) I, 2002-1 & 2002-2 on Watch Positive.NEW YORK New York, state, United States New York, Middle Atlantic state of the United States. It is bordered by Vermont, Massachusetts, Connecticut, and the Atlantic Ocean (E), New Jersey and Pennsylvania (S), Lakes Erie and Ontario and the Canadian province of -- Fitch Ratings Fitch Ratings An international rating agency for financial institutions, insurance companies, and corporate, sovereign, and municipal debt. Fitch Ratings has headquarters in New York and London and is wholly owned by FIMALAC of Paris. has placed four tranches of subordinate notes out of the HSBC HSBC Hongkong and Shanghai Banking Corporation HSBC Humane Society of Broward County (Florida) HSBC Humane Society of Bay County (Bay County, Michigan) Private Label Credit Card Master Note Trust I on Rating Watch Positive. The Rating Watch Positive designation affects approximately $983.95 million of credit card backed securities. The notes are backed by a pool of private label revolving credit Revolving Credit A line of credit where the customer pays a commitment fee and is then allowed to use the funds when they are needed. It is usually used for operating purposes, fluctuating each month depending on the customers current cash flow needs. card accounts originated by HSBC Bank Nevada, National Association, (formerly Household Bank (SB), N.A.). The Rating Watch Positive designation results from the accumulation of cash in the principal funding account (PFA PFA Pacific Film Archive PFA Professional Footballers Association PFA Paraformaldehyde PFA Predictive Failure Analysis PFA Perfluoroalkoxy PFA Protection From Abuse PFA Parent-Faculty Association PFA Popular Flying Association ); as the PFA funds, a percentage of the bonds are backed by cash rather than receivables, which effectively reduces the exposure of the bonds to credit risk from charged-off receivables. The 2002-1 bonds were structured with a 12-month accumulation period Accumulation Period 1. The phase in an investor's life when he/she builds up his/her savings and the value of his/her investment portfolio with the intention of having a nest egg for retirement. 2. and began funding the PFA in April 2006. As of Jan. 16, 2007, the PFA balance is $403.9 million. There is a reserve account of 0.5% set up to mitigate the risk of negative carry during the accumulation period. The expected maturity for the 2002-1 series is March 15, 2007. The 2002-2 bonds were structured similarly to the 2002-1 bonds, with a 12-month accumulation period and a reserve account of 0.5% set up to mitigate the risk of negative carry during the accumulation period. Series 2002-2 began funding the PFA in April 2006. As of Jan. 16, 2007, the PFA balance is $416.1 million. The expected maturity for the 2002-2 series is March 15, 2007. Fitch will continue to closely monitor these transactions. Credit enhancement Credit Enhancement A method whereby a company attempts to improve its debt or credit worthiness. Notes: Credit enhancements take many different forms. An example of a credit enhancement would be conversion rights added on to a debt instrument in order to lower the issuing for the 'AAA' rated class A notes is provided through subordination of classes B and C, and the excess collateral amount, totaling 22% for series 2002-1 and 24.5% for series 2002-2. The 'A' rated class B notes draw on the 11.5% subordination of class C and the excess collateral amount for series 2002-1, and the 13.5% subordination of class C and the excess collateral amount for series 2002-2. The 'BBB' rated class C notes receive credit enhancement from 5.5% of excess collateral for series 2002-1, and 5.75% of excess collateral for series 2002-1. The ratings address the likelihood of investors receiving full and timely interest payments in accordance with the terms of the underlying documents and full repayment of principal by the legal final termination dates termination date, n See expiration date. . They do not address the likelihood of principal repayment by the expected note payment dates. Rating Actions: HSBC Private Label Credit Card Master Note Trust I, fixed-rate asset backed securities, series 2002-1: --$400,000,000 class A notes affirmed at 'AAA'; --$53,850,000 class B notes 'A'; placed on Rating Watch Positive; --$30,775,000 class C notes 'BBB'; placed on Rating Watch Positive. HSBC Private Label Credit Card Master Note Trust I, floating-rate asset backed securities, series 2002-2: --$400,000,000 class A notes affirmed at 'AAA'; --$58,275,000 class B notes 'A'; placed on Rating Watch Positive; --$41,050,000 class C notes 'BBB'; placed on Rating Watch Positive. Fitch's rating definitions and the terms of use Terms of Use are rules set up by the owner of an intellectual property or service to govern how they may be legally used. In many cases, terms of service are used as a contractual agreement between a company and users of a service they provide. of such ratings are available on the agency's public site, www.fitchratings.com. Published ratings, criteria and methodologies are available from this site, at all times. Fitch's code of conduct, confidentiality, conflicts of interest, affiliate firewall, compliance and other relevant policies and procedures Policies and Procedures are a set of documents that describe an organization's policies for operation and the procedures necessary to fulfill the policies. They are often initiated because of some external requirement, such as environmental compliance or other governmental are also available from the 'Code of Conduct' section of this site. |
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