DBRS Confirms 17 Classes of Merrill Lynch Financial Assets Inc., Series 2005-Canada 16

DBRS has today confirmed the ratings for 17 classes of Merrill Lynch Financial Assets Inc., Series 2005-Canada 16 Commercial Mortgage Pass-Through Certificates as follows:

-- Class A-1 at AAA (sf)
-- Class A-2 at AAA (sf)
-- Class B at AAA (sf)
-- Class C at AA (sf)
-- Class D-1 at A (sf)
-- Class D-2 at A (sf)
-- Class E-1 at A (low) (sf)
-- Class E-2 at A (low) (sf)
-- Class F at BBB (sf)
-- Class G at BB (high) (sf)
-- Class H at BB (low) (sf)
-- Class J at B (high) (sf)
-- Class K at B (sf)
-- Class L at B (low) (sf)
-- Class XC at AAA (sf)

All trends are Stable. DBRS notes that it has discontinued the ratings on Classes XP-1 and XP-2, which have been fully repaid. DBRS does not rate the $4.6 million first loss piece, Class M.

The rating confirmations reflect the stable performance of the transaction since issuance, with ten loans having been successfully repaid. Overall, the financial performance of the remaining 38 loans is strong, with a weighted-average debt service coverage ratio (DSCR) of 2.05 times (x) and a weighted-average loan-to-value (LTV) of 57.6%. As of the July 2012 remittance report, approximately 30.2% of the collateral has been reduced.

DBRS shadow-rates six loans in the transaction, which collectively represent 41% of the current pool balance, as investment-grade. These loans are: EPR Pooled Senior Interest (Prospectus ID#1), RioCan Mega Centre Notre Dame (Prospectus ID#3), Calloway St. Catharines (Prospectus ID#5), RONA Distribution Centre (Prospectus ID#7), International Gateway Centre (Prospectus ID#13) and Uplands Common Shopping Centre (Prospectus ID#17). DBRS has today confirmed that the performance of these loans remains consistent with investment-grade loan characteristics.

There are no loans in special servicing and there are two loans on the servicer’s watchlist, representing 1.5% of the current pool balance.

As part of its review, DBRS analyzed the top 15 loans, the shadow-rated loans and the loans on the servicer’s watchlist, which comprise approximately 84.7% of the current pool balance.

DBRS continues to monitor this transaction in its Monthly CMBS Surveillance Report to assess any material changes at the bond or collateral level that may impact ratings. The Monthly CMBS Surveillance Report also highlights any material updates in the loans on the servicer’s watchlist and any specially serviced loans.

Notes:
All figures are in Canadian dollars unless otherwise noted.

This rating is endorsed by DBRS Ratings Limited for use in the European Union.

The applicable methodologies are CMBS Rating Methodology (January 2012) and CMBS North American Surveillance (May 2011), which can be found on our website under Methodologies.