Solstice CDO Tranches Downgraded

Published November 04, 2005, 3:00 p.m. EST

1 Min Read

Three tranches of Solstice ABS CDO Ltd. have been downgraded by Fitch Ratings.The downgrades in the collateralized debt obligation were as follows: class B notes, from AA-minus to BB-plus; class C notes, from BBB to CC; and preference shares, from B to C. Fitch said the downgrades stemmed from "continued collateral deterioration leading to a decline in the coverage ratios." The percentage of collateral rated CCC-plus and below has increased from 9% to 24% since Aug. 31, 2004, Fitch said. Solstice consists of 40.6% residential mortgage-backed securities, 36.0% CDOs, 12.3% asset-backed securities, 5.5% corporate debt securities, 3.8% commercial MBS, and 1.8% real estate investment trusts. Fitch can be found online at http://www.fitchratings.com.

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