Cloverie CDO Notes Downgraded

The sole classes of notes issued by seven Cloverie PLC collateralized debt obligations have been downgraded by Fitch Ratings and removed from Rating Watch Negative. The affected transactions -- all partially funded, static, synthetic CDOs -- are Cloverie PLC 2005-78, 2005-79, 2005-80, 2005-81, 2006-1, 2006-2, and 2006-3. The 2005 series have reference portfolios consisting primarily of subprime residential mortgage-backed securities, commercial MBS, and other structured finance assets. The 2006 series have reference portfolios consisting primarily of subprime RMBS, alternative-A RMBS, and other structured finance assets. The downgrades reflect "significant collateral deterioration" in the portfolios with regard to the subprime RMBS and, in the 2006 series, the alt-A RMBS, Fitch said.