Brit Alliance CDO Notes Downgraded

The class A notes from Brit Alliance ABSpoke 2005-X and 2005-XI, collateralized debt obligations tied to mortgage-backed securities, have been downgraded from AA to A-minus by Fitch Ratings.The transactions are unfunded managed synthetic CDOs that reference portfolios of various asset-backed securities, Fitch said. They are "designed to provide credit protection for realized losses on the reference portfolio[s] through a credit default swap between the issuer and the swap counterparty, Morgan Stanley Capital Services Inc.," the rating agency said. The downgrades were attributed to deterioration in the credit quality of the reference portfolios, which total $462 million of ABS assets for series 2005-X and $673 million of ABS assets for series 2005-XI. The swaps reference prime and subprime residential MBS in the case of series 2005-X, and RMBS, ABS, and commercial MBS in the case of series 2005-XI, Fitch reported.