DBRS Publishes Final Rating Methodology for Rating Global Film Rights Transactions

DBRS has published its final rating methodology for global film rights transactions. The final methodology does not have any substantive changes from the proposed global film rights methodology which was published on March 30, 2010 with a request for comments.

Unlike financial assets that have long dominated securitization, film rights are operating assets (also referred to as future flow assets). As such, the impact of the operating company generating the assets (in this case the studio) on asset performance can be significant.

DBRS rates film securitization transactions based upon the expected and stressed cash flows to be produced from film rights by assessing, among other key factors:

•The strengths and weaknesses of the studio producing the films (the “originator”)
•The portfolio of film rights being purchased and securitized (the “assets”)
•The strengths and weaknesses of the Distributor (the “servicer”); and
•The transaction structure and how it aligns the studio’s and the Distributor’s interests with the securitization transaction.

DBRS criteria and methodologies are publicly available on its website www.dbrs.com under Methodologies.

For more information on this credit or on this industry, visit www.dbrs.com or contact us at info@dbrs.com.