Fitch Affirms 4 Sierra Timeshare Receivables Transactions; Revises Outlooks on 2011-3 and 2012-3

CHICAGO--()--Fitch Ratings has affirmed and revised the Ratings Outlooks on the notes issued by various Sierra Timeshare Receivables transactions as detailed at the end of this commentary.

KEY RATING DRIVERS

These affirmations reflect the ability of each transaction's credit enhancement to provide loss coverage consistent with the current rating levels. The Stable Rating Outlooks reflect Fitch's expectation that the notes will remain sufficiently enhanced to cover the stressed loss levels consistent with the current ratings. The Outlook revision on the 2011-3 and 2012-3 transactions from Positive to Stable is reflective of recent performance within the pools and the possibility for deterioration at the back-end of the transaction's lives, given the nature of the receivables.

RATING SENSITIVITIES

Unanticipated increases in the frequency of defaults could produce loss levels higher than the current expectations and impact available loss coverage. Lower loss coverage could affect ratings and Rating Outlooks, depending on the extent of the decline in coverage.

To date, the transactions have exhibited zero losses (due to repurchases) and default performance is consistent with Fitch's initial expectations. Default coverage and multiple levels are consistent with the current ratings. A material deterioration in performance would have to occur within the asset pools to have potential negative impact on the outstanding ratings.

DUE DILIGENCE USAGE

No third party due diligence was provided or reviewed in relation to this rating action.

For Fitch's initial Key Rating Drivers, Rating Sensitivities and the full detail analysis for these transactions, please see their New Issue reports titled, ''Sierra Timeshare 2011-3 Receivables Funding, LLC (US ABS) dated Nov. 2, 2011, 'Sierra Timeshare 2012-3 Receivables Funding, LLC (US ABS) dated Oct. 24, 2012, 'Sierra Timeshare 2013-3 Receivables Funding, LLC (US ABS)' dated Oct. 28, 2013, and ''Sierra Timeshare 2014-3 Receivables Funding, LLC (US ABS)' dated Oct. 23, 2014, which are available on Fitch's website.

Fitch's analysis of the Representations and Warranties (R&W) of this transaction can be found in 'Sierra Timeshare 2011-3 Receivables Funding, LLC - Appendix,' 'Sierra Timeshare 2012-3 Receivables Funding, LLC - Appendix,' 'Sierra Timeshare 2013-3 Receivables Funding, LLC - Appendix,' and 'Sierra Timeshare 2014-3 Receivables Funding, LLC - Appendix'. These R&W are compared to those of typical R&W for the asset class as detailed in the special report 'Representations, Warranties, and Enforcement Mechanisms in Global Structured Finance Transactions' dated June 12, 2015.

Fitch has affirmed the following ratings:

Sierra Timeshare 2011-3 Receivables Funding, LLC

--Class A notes at 'Asf'; Outlook revised to Stable from Positive

--Class B notes at 'BBBsf'; Outlook revised to Stable from Positive

--Class C notes at 'BBsf'; Outlook revised to Stable from Positive.

Sierra Timeshare 2012-3 Receivables Funding, LLC

--Class A notes at 'Asf'; Outlook revised to Stable from Positive

--Class B notes at 'BBBsf'; Outlook revised to Stable from Positive.

Sierra Timeshare 2013-3 Receivables Funding, LLC

--Class A notes at 'Asf'; Outlook Stable

--Class B notes at 'BBBsf'; Outlook Stable.

Sierra Timeshare 2014-3 Receivables Funding, LLC

--Class A notes at 'Asf'; Outlook Stable

--Class B notes at 'BBBsf'; Outlook Stable.

Additional information is available at www.fitchratings.com.

Applicable Criteria

Criteria for Rating U.S. Timeshare Loan ABS (pub. 03 Jun 2015)

https://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=866653

Global Structured Finance Rating Criteria (pub. 06 Jul 2015)

https://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=867952

Related Research

Sierra Timeshare 2011-3 Receivables Funding LLC -- Appendix

https://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=655312

Sierra Timeshare 2012-3 Receivables Funding LLC - Appendix

https://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=693295

Sierra Timeshare 2013-3 Receivables Funding LLC - Appendix

https://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=721984

Sierra Timeshare 2014-3 Receivables Funding LLC -- Appendix

https://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=798108

Additional Disclosures

Dodd-Frank Rating Information Disclosure Form

https://www.fitchratings.com/creditdesk/press_releases/content/ridf_frame.cfm?pr_id=988949

Solicitation Status

https://www.fitchratings.com/gws/en/disclosure/solicitation?pr_id=988949

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https://www.fitchratings.com/jsp/creditdesk/PolicyRegulation.faces?context=2&detail=31

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Contacts

Fitch Ratings
Andrew Tinari
Analyst
+1-312-368-3127
Fitch Ratings, Inc.
70 West Madison Street
Chicago, IL 60602
or
Committee Chairperson
Hylton Heard
Senior Director
+1 212-908-0214
or
Media Relations
Alyssa Castelli, +1 212-908-0540
alyssa.castelli@fitchratings.com

Contacts

Fitch Ratings
Andrew Tinari
Analyst
+1-312-368-3127
Fitch Ratings, Inc.
70 West Madison Street
Chicago, IL 60602
or
Committee Chairperson
Hylton Heard
Senior Director
+1 212-908-0214
or
Media Relations
Alyssa Castelli, +1 212-908-0540
alyssa.castelli@fitchratings.com