CHICAGO, May 8 /PRNewswire/ -- Duff & Phelps Credit Rating Co. (DCR) has
downgraded the following classes of securities:
* T&W Funding Company VII, LLC, T&W Lease-Backed Notes, Series 1997-A
Class A notes are downgraded from 'AAA' (Triple-A) to 'AA'
(Double-A). The Class B notes are downgraded from 'BBB' (Triple-B) to
'BB-' (Double-B Minus).
* Lehman Receivables III LLC, T&W Lease-Backed Notes, Series 1998-A
Class A notes are downgraded from 'AAA' (Triple-A) to 'AA'
(Double-A). The Class B notes are downgraded from 'BBB' (Triple-B) to
'B' (Single-B).
* Lehman Receivables IV LLC, T&W Lease-Backed Notes, Series 1998-B
Class A notes are downgraded from 'AAA' (Triple-A) to 'AA-'
(Double-A Minus). The Class B notes are downgraded from 'A' (Single-A)
to 'BB-' (Double-B-Minus).
* T&W Funding Company XII, LLC, T&W Lease-Backed Notes, Series 1999-A
Class A notes are downgraded from 'AAA' (Triple-A) to 'AA'
(Double-A). The Class B notes are downgraded from 'A' (Single-A) to
'BB-' (Double-B Minus).
In addition, all classes of notes remain on Rating Watch-Down pending
further information.
These rating actions reflect the dramatic deterioration of asset quality
in these transactions and the resulting loss of credit enhancement. In
particular, DCR is most concerned about a series of large, nonperforming asset
concentrations. Based on discussions with the servicer, DCR has learned that
the underlying collateral for a number of these concentrations is inconsistent
with the original representations made to us about the type of collateral
included in these transactions.
DCR first put these transactions on Rating Watch-Down on January 21, 2000,
when asset quality issues first emerged and performance triggers were hit,
which resulted in the trapping of cash and turbo payment of senior notes.
Effective February 7, 2000, servicing was transferred from T&W Financial Inc.
to FINOVA Portfolio Services, a subsidiary of FINOVA Capital Corp.
Further rating actions are possible based on the results of the resolution
of several problem accounts. DCR believes it is likely that the credit
enhancement provided by the retained interest and residuals will continue to
diminish. DCR will continue to closely monitor the situation through
discussions with the servicer, trustee and placement agent and will inform
investors of any further developments.
Please see the Fitch IBCA press release for corresponding Fitch IBCA
rating changes or contact Donna Barlow at 212-908-0637 or Kevin Duignan at
212-908-0630.
For additional research, visit DCR's Web site at http://www.dcrco.com.
DCR's research is also available on Bloomberg at DCR, FirstCall's BondCall
Direct/Research Direct at http://www.firstcall.com and http://www.multex.com,
as well as through other third-party providers.
SOURCE Duff & Phelps Credit Rating Co.
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Related links:
http://www.dcrco.com
CONTACT:
Joe Tuczak, 312-368-2083, tuczak@dcrco.com;
or Jeff Orr, 312-368-3335, orr@dcrco.com
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