Moody's Downgrades Long Beach MBS Classes

Three certificates from Long Beach Mortgage Loan Trust series 2006-A have been downgraded and maintained on review for possible further downgrade by Moody's Investors Service, and nine other certificates from the deal have been placed on review for possible downgrade.The downgrades were as follows: class M-7, from Baa3 to B1; class B-1, from Ba1 to B3; and class B-2, from Ba2 to Ca. The classes placed on review for possible downgrade are as follows: A-1, A-2, A-3, M-1, M-2, M-3, M-4, M-5, and M-6. "The projected pipeline loss has increased over the past a few months and may affect the credit support for the three [downgraded] certificates," Moody's said. The placing of the other nine certificates on review for possible downgrade was also based on the fact that the bonds' credit enhancement levels may be too low, in view of projected losses, for the current rating levels. The transaction is backed by subprime second-lien loans.