Fitch Takes Various Rating Actions on Macquarie Equipment Funding Trust 2012-A

CHICAGO--()--Fitch Ratings has taken the following rating actions on Macquarie Equipment Funding Trust 2012-A (MEFT 2012-A):

--Class A-2 affirmed at 'AAAsf' Outlook Stable;

--Class A-3 affirmed at 'AAAsf' Outlook Stable;

--Class B upgraded to 'AAsf' from 'Asf'; Outlook Positive;

--Class C affirmed at 'BBBsf'; Outlook to Stable from Positive.

KEY RATING DRIVERS

The upgrade of the class B notes to 'AAsf' from 'Asf' reflects the increased credit enhancement (CE) available to the notes. The affirmations of the class A and C notes reflects the CE commensurate with those ratings. The transaction has performed within expectation to date as it has zero defaults to date. The Rating Outlooks on the class A and B notes reflect Fitch's expectation of future performance and continued CE growth for those classes. The Outlook revision to Stable from Positive for class C reflects Fitch's concern about increasing concentrations through the remaining transaction life relative to expected CE levels.

RATING SENSITIVITIES

Unanticipated increases in the frequency of defaults, or decreases in recovery rates, could produce loss levels higher than initial expectation and could result in potential rating actions on the notes. In its initial review, Fitch evaluated the sensitivity of the ratings assigned to unrated obligors. The transaction did show sensitivity to higher default rates, which Fitch stressed by assuming all unrated obligors carry a 'CCC' Issuer Default Rating. As a result of increased credit enhancement, the transaction currently shows minimal sensitivity to the same stress. However, a material increase in obligor concentrations may impact future sensitivities for this transaction. Initial Key Rating Drivers and Rating Sensitivities are further described in the new issue report published November 27, 2012.

Fitch's analysis of the Representations and Warranties (R&W) of this transaction can be found in 'Macquarie Equipment Funding Trust 2012-A - 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 April 17, 2012.

Additional information is available at 'www.fitchratings.com'

Applicable Criteria and Related Research:

--'Criteria for Rating U.S. Equipment Lease and Loan ABS' (Dec 19, 2013);

--'Global Rating Criteria for Corporate CDOs,' (July 25, 2014);

--'Global Structured Finance Rating Criteria' (Aug. 4, 2014);

--'Representations, Warranties, and Enforcement Mechanisms in Global Structured Finance Transactions' (April 17, 2012);

--'Macquarie Equipment Funding Trust 2012-A' (Nov. 27, 2012);

--'Macquarie Equipment Funding Trust 2012-A - Appendix' (Nov. 27, 2012).

Applicable Criteria and Related Research:

Criteria for Rating U.S. Equipment Lease and Loan ABS

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=726362

Global Rating Criteria for Corporate CDOs

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=753057

Global Structured Finance Rating Criteria

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=754389

Representations, Warranties, and Enforcement Mechanisms in Global Structured Finance Transactions

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=676496

Macquarie Equipment Funding Trust 2012-A

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=693701

Macquarie Equipment Funding Trust 2012-A -- Appendix

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=695949

Additional Disclosure

Solicitation Status

http://www.fitchratings.com/gws/en/disclosure/solicitation?pr_id=888814

ALL FITCH CREDIT RATINGS ARE SUBJECT TO CERTAIN LIMITATIONS AND DISCLAIMERS. PLEASE READ THESE LIMITATIONS AND DISCLAIMERS BY FOLLOWING THIS LINK: HTTP://FITCHRATINGS.COM/UNDERSTANDINGCREDITRATINGS. IN ADDITION, RATING DEFINITIONS AND THE TERMS OF USE OF SUCH RATINGS ARE AVAILABLE ON THE AGENCY'S PUBLIC WEBSITE '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. FITCH MAY HAVE PROVIDED ANOTHER PERMISSIBLE SERVICE TO THE RATED ENTITY OR ITS RELATED THIRD PARTIES. DETAILS OF THIS SERVICE FOR RATINGS FOR WHICH THE LEAD ANALYST IS BASED IN AN EU-REGISTERED ENTITY CAN BE FOUND ON THE ENTITY SUMMARY PAGE FOR THIS ISSUER ON THE FITCH WEBSITE.

Contacts

Fitch Ratings
Media Relations
Sandro Scenga, New York, +1-212-908-0278
sandro.scenga@fitchratings.com
or
Primary Analyst
Thomas Kaiser, CPA, +1-312-368-3338
Associate Director
Fitch Ratings, Inc.
70 W Madison St.
Chicago, IL 60602
or
Secondary Analyst
Du Trieu, +1-312-368-2091
Senior Director
or
Committee Chairperson
Bradley Sohl, +1-212-908-0792
Senior Director

Contacts

Fitch Ratings
Media Relations
Sandro Scenga, New York, +1-212-908-0278
sandro.scenga@fitchratings.com
or
Primary Analyst
Thomas Kaiser, CPA, +1-312-368-3338
Associate Director
Fitch Ratings, Inc.
70 W Madison St.
Chicago, IL 60602
or
Secondary Analyst
Du Trieu, +1-312-368-2091
Senior Director
or
Committee Chairperson
Bradley Sohl, +1-212-908-0792
Senior Director