APOLLO Series 2018-1 Trust Prime RMBS Assigned Ratings

Stocks and Financial Services Press Releases Thursday April 26, 2018 16:50
MELBOURNE--26 Apr--S&P Global Ratings

MELBOURNE (S&P Global Ratings) April 26, 2018--S&P Global Ratings today assigned its ratings to six of the seven classes of prime residential mortgage-backed securities (RMBS) issued by Perpetual Trustee Co. Ltd. as trustee for APOLLO Series 2018-1 Trust (see list). APOLLO Series 2018-1 Trust is a securitization of prime residential mortgages originated by Suncorp-Metway Ltd. (Suncorp).

The ratings assigned to the notes issued reflect:
  • Our view of the credit risk of the underlying collateral portfolio, including the fact that this is a closed portfolio, which means no further loans will be assigned to the trust after the closing date.
  • Our view that the credit support is sufficient to withstand the stresses we apply. Credit support for the rated notes is provided by subordination and lenders' mortgage insurance (LMI) cover on 20.1% of the loans in the portfolio.
  • Our expectation that the various mechanisms to support liquidity within the transaction, including an excess revenue reserve funded by available spread, the principal draw function, and a liquidity facility to be provided by Suncorp equal to 1.0% of the performing mortgage loan balance, are sufficient under our stress assumptions to ensure timely payment of interest.
  • The availability of a A$150,000 liquidity reserve funded upfront by Suncorp, available to meet extraordinary expenses. The reserve will be topped up with available excess spread if drawn.
  • The benefit of a fixed-rate swap to be provided by Suncorp to hedge the mismatch between receipts from any fixed-rate mortgage loans and the variable-rate RMBS.
A copy of S&P Global Ratings' complete report for APOLLO Series 2018-1 Trust can be found on RatingsDirect, S&P Global Ratings' web-based credit analysis system, at http://www.capitaliq.com.
RATINGS ASSIGNED
Class Rating Amount (mil. A$)
A1 AAA (sf) 1,150.000
A2 AAA (sf) 46.250
AB AAA (sf) 8.750
B AA (sf) 18.750
C A (sf) 12.500
D BBB (sf) 5.625
E NR 8.125
NR--Not rated.

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