Fitch Ratings: Do Headline Names Put ABCP Investors at Risk?NEW YORK -- According to a recent study completed by Fitch, most ABCP ABCP Asset-Backed Commercial Paper ABCP Associação Brasileira de Cimento Portland (Brazil) ABCP Associação Brasileira de Ciência Política ABCP American Board of Cardiovascular Perfusion ABCP Associate Business Continuity Planner programs have exposure to one or more of the companies and sectors that have dominated the business headlines over the past six months. Using its proprietary S.M.A.R.T. database, Fitch selected a number of corporate names and two structured finance sectors that have elicited the most inquiry from investors to determine the average exposure in the Fitch-rated ABCP programs they own. Selected for the analysis were corporate names GM/GMAC, Ford/Ford Motor Credit, AIG AIG addressee indicator group (US DoD) AIG American International Group, Inc AiG Answers in Genesis (religious group in defense of Scripture) AIG Artificial Intelligence Group AIG Australian Industry Group , and two structured finance sectors, residential mortgages and CDOs. The analysis revealed that one in three Fitch-rated conduits have exposure to the mortgage or CDO (Collaborative Data Objects) A programming interface from Microsoft for accessing MAPI-based e-mail, calendaring and scheduling servers. Originally called "OLE Messaging" and "Active Messaging," CDO wraps the Enhanced MAPI library into a COM object that provides the sector and approximately two out of five have exposure to both. In addition, Fitch found that nearly one in five conduits have exposure to GM or GMAC GMAC General Motors Acceptance Corporation GMAC Graduate Management Admission Council GMAC Give Me A Call GMAC Genetic Manipulation Advisory Committee GMAC Genetic Modification Advisory Committee (Singapore) GMAC Give Me A Chance through either auto-related products (loan, lease, and dealer floorplan) or mortgage ABS. Likewise, one in seven ABCP conduits has exposure to Ford-related transactions or assets. A similar percentage of conduits have exposure to AIG via credit and liquidity facilities. While Fitch is comfortable that the exposure to these names and sectors is adequately accounted for in the analysis and rating of the ABCP conduits, investors may be unaware of the absolute magnitude of exposure. During its upcoming conference on Wednesday, July 13, 2005 'Spotlight on the Short Term Market,' Fitch will gather an array of senior corporate and structured finance analysts to discuss trends in the unsecured and secured CP markets including an in-depth look at the names and sectors noted above. The conference will be held at Cafe Gray, Time Warner Center The Time Warner Center is a mixed-use skyscraper developed by The Related Companies in New York City. Its design, by David Childs and Mustafa Kemal Abadan of Skidmore, Owings & Merrill, consists of two 229 m (750 ft) towers bridged by a multi-story atrium containing upscale retail , 10 Columbus Circle 3rd Floor, in New York City New York City: see New York, city. New York City City (pop., 2000: 8,008,278), southeastern New York, at the mouth of the Hudson River. The largest city in the U.S. . To register or for more information, contact Rachel Gold 212-908-0719 or at rachel.gold@fitchratings.com. Fitch's rating definitions are available on the agency's public web site, www.fitchratings.com. Published ratings, criteria and methodologies, and 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 this site, at all times. This document will remain on the public site for seven days. |
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