Fitch Rates C-BASS CBO XVI Ltd./Corp. 'AAA/AA/A/BBB'.

NEW YORK -- Fitch Ratings assigns the following ratings to C-BASS CBO XVI Ltd. and C-BASS CBO XVI Corp. (collectively C-BASS CBO XVI):

-- $314,800,000 class A first priority senior secured floating-rate notes due 2041 'AAA';

-- $22,500,000 class B second priority senior secured floating-rate notes due 2041 'AA';

-- $26,500,000 class C third priority secured floating-rate deferrable interest notes due 2041 'A';

-- $9,500,000 class D fourth priority secured floating-rate deferrable interest notes due 2041 'BBB'.

The ratings of the class A and class B notes address the likelihood that investors will receive full and timely payments of interest, as per the governing documents, as well as the aggregate outstanding amount of principal by the stated maturity date. The ratings of the classes C and D notes address the likelihood that investors will receive ultimate interest payments, as per the governing documents, as well as the aggregate outstanding amount of principal by the stated maturity date.

The ratings are based on the quality and mixture of portfolio assets, credit enhancement through excess spread, subordination and the sound legal structure of the transaction. The ratings on the notes also reflect the experience and capabilities of C-BASS Investment Management LLC (CIM) as the collateral manager and Litton Loan Servicing as servicer of a substantial portion of the underlying collateral.

Credit-Based Asset Servicing and Securitization LLC (C-BASS), through its wholly owned subsidiary, CIM, will select and monitor the collateral in C-BASS XVI. Employees of C-BASS previously involved with its CBO business are currently employees of CIM and will conduct the C-BASS collateralized bond obligation (CBO) business in the same manner as C-BASS previously conducted it.

C-BASS, which has been acquiring and managing mortgage assets since 1996, is a joint venture between Mortgage Guaranty Investment Corp. (MGIC; Insurer Financial Strength (IFS) rated 'AA+' by Fitch) and Radian Group Inc. (Radian; IFS rated 'AA' by Fitch). MGIC and Radian each own a 46% interest in the company with the remaining 8% owned by C-BASS management. C-BASS' total capital has grown from less than $35 million in 1996 to its current $763 million as of December 2005. C-BASS has a Fitch CDO Asset Manager Rating of 'CAM1'.

Proceeds from the issuance will be invested in a static portfolio of residential mortgage-backed securities (RMBS), asset-backed securities (ABS), commercial mortgage-backed securities (CMBS), and collateralized debt obligations (CDOs). The collateral supporting the capital structure will have a maximum Fitch weighted average rating factor (WARF) of 4.0 ('BBB/BBB-'). The collateral manager will purchase all investments for the portfolio on behalf of C-BASS CBO XVI Ltd. and C-BASS CBO XVI Corp., which are special-purpose companies incorporated under the laws of the Cayman Islands and Delaware, respectively.

For more information, please see the presale report titled 'C-BASS CBO XVI Ltd.', available on the Fitch Ratings web site at www.fitchratings.com. Additional information about the collateral manager is also available on the web site.

Fitch's rating definitions and the terms of use 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 are also available from the 'Code of Conduct' section of this site.