DBRS Morningstar Finalizes Publication of Three Structured Finance Methodologies

DBRS Morningstar finalized its (1) new Utility Submetering Contract Fees appendix (the New Issue Appendix) to the “Rating Canadian Structured Finance Transactions” methodology, (2) related new exhibit for utility submetering contract fees (the Operational Risk Exhibit) to the “Operational Risk Assessments for Canadian Structured Finance” methodology, and (3) new section for obligations backed by utility submetering contract fees to the “Master Canadian Structured Finance Surveillance Methodology” (the Surveillance Methodology).

The New Issue Appendix presents the criteria for which Canadian utility submetering contract fees transaction ratings are assigned and/or monitored. The “Rating Canadian Structured Finance Transactions” methodology supersedes the prior version published on April 11, 2022, and is effective as of December 13, 2022.

The Operational Risk Exhibit presents sample operational risk questions used in the review of originators and servicers of Canadian utility submetering contract fees. The “Operational Risk Assessments for Canadian Structured Finance” methodology supersedes the prior version published on April 12, 2022, and is effective as of December 13, 2022.

The Surveillance Methodology was updated to include the criteria for monitoring ratings of Canadian securitizations where the underlying assets consist of utility submetering contract fees. The Surveillance Methodology supersedes the prior version published on June 7, 2022, and is effective as of December 13, 2022.

DBRS Morningstar received no comments during the request for comment period.

Finalization of these methodologies follows the conclusion of the request for comment period that began on November 9, 2022.

All comments received during the request for comment period are published to the DBRS Morningstar website, except in cases where confidentiality is requested by the respondent.

Notes:
The DBRS Morningstar Sovereign group releases baseline macroeconomic scenarios for rated sovereigns. DBRS Morningstar analysis considered impacts consistent with the baseline scenarios as set forth in the following report: https://www.dbrsmorningstar.com/research/384482.

DBRS Morningstar methodologies are publicly available on its website www.dbrsmorningstar.com under Methodologies & Criteria.

For more information on these methodologies or on this industry, visit www.dbrsmorningstar.com or contact us at [email protected].