Ballantyne Re Notes Downgraded

Three classes of notes in Ballantyne Re PLC have been downgraded by Fitch Ratings because certain reserve funds backing the transaction have material exposure to subprime residential asset- and mortgage-backed securities.The downgrades were as follows: class A-1 floating-rate notes, from A-plus to BB; class B-1 subordinated notes, from BB-plus to B; and class B-2 subordinated floating-rate notes, from BB-plus to B. The ratings have been removed from Rating Watch Negative. The downgrades reflect "material mark-to-market declines" in the value of RMBS and ABS in the asset portfolios supporting Ballantyne Re's reserves, resulting in "significant unrealized losses" in the portfolios. Ballantyne Re is a special-purpose company incorporated in Ireland.