Standard & Poor's Ratings Services has announced downgrades on 402 classes of U.S. RMBS backed by first-lien subprime mortgage loans issued in the first three quarters of 2005.The classes, from 138 residential mortgage-backed securities deals, total approximately $4.6 billion of original par amount. S&P said that represents 1.45% of the $320 billion original par amount of such subprime RMBS that it rated from the first to the third quarter of 2005. S&P also affirmed the ratings on securities from the same period that represent $252.4 billion original par value of first-lien subprime U.S. RMBS. The rating agency attributed the downgrades to expectations of further losses, the resulting reduction in credit support, and continued declines in home values. In addition, the transactions allow the release of credit support on certain "step-down" dates, and therefore "we believe these securities will be more vulnerable to losses going forward, as there may not be enough credit support to withstand future losses," S&P said. The rating agency can be found online at http://www.standardandpoors.com.

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