DBRS Publishes Updated Operational Risk Methodology for EU Structured Finance Servicers

DBRS Ratings Limited (DBRS) has today published an updated version of its methodologies for the operational risk assessment of European Structured Finance servicers. This version contains minor improvements for clarity and content and consolidates the methodologies that were previously entitled “Operational Risk Assessment for European RMBS Servicers” and “Operational Risk Assessment for European ABS and SME CLO Servicers”. No material changes were made to the methodology and no rating actions shall be taken on any outstanding ratings. This methodology, effective as of the date of this press release, supersedes the previous methodologies dated June 2011.

In this methodology, DBRS outlines its procedures used to evaluate the quality of the parties that service or conduct backup servicing on the loans (or leases as applicable) that are about to be securitized or have previously been securitized in a transaction rated by DBRS. While DBRS does not assign formal ratings to these processes, it does conduct operational risk reviews to determine if a servicer is acceptable and incorporates the results of the review into the rating process for new transactions and into the surveillance process for outstanding transactions rated by DBRS.

The DBRS methodology covers the following asset types:

o Residential mortgages
o SME CLO loans
o Consumer/unsecured loans
o Auto finance and leases
o Commercial leases
o Credit cards
o Student loans
o Premium finance
o Covered bonds

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