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Moody’s reviews Courts Singapore’s ABS deal for possible downgrade

Hong Kong, January 03, 2011 -- Moody's Investors Service has placed the 
Aa3 (sf) rating of the Senior Interest issued by Courts Receivables 
Acquisition Trust (the "issuer") on review for possible downgrade. 

The collateral of the Senior Interest consists of a portfolio of 
highly-diversified consumer installment loan receivables granted by 
Courts (Singapore) Pte Ltd. The originator transfers the receivables from 
time to time to Assetrust Pte. Ltd., the trustee of the issuer.

Issuer: Courts Receivables Acquisition Trust

Senior Interest, Aa3 (sf) Place Under Review for Possible Downgrade,
previously on March 22, 2010 Definitive Rating Assigned Aa3 (sf)

The review was prompted by (a) the transfer of the extended warranty 
service for the deal from American Home Assurance Company, Singapore 
branch (AHA, rated Aa3) to Chartis Singapore Pte Ltd. (Chartis Singapore, 
unrated by Moody's) on January 1, 2011, and (b) the proposal to fund a 
maximum of 20% of such extended warranty insurance premium when 
determining the amount of Senior Interest that can be issued. 

Under the extended warranty insurance policy, obligors need to pay
monthly insurance premiums. These premiums are part of the securitized

When determining the amount of Senior Interest that can be funded on each
monthly settlement date, the transaction documents stipulate a maximum
exposure of 20% on the extended warranty premium if the rating of the 
extended warranty provider is Aa3 or above, and 3% if the rating is below 
Aa3. When AHA was the extended warranty provider prior to the transfer on 
January 1, 2011, the total outstanding premiums amounted to 14% of the 
eligible receivables. 

Currently, with the extended warranty provider being Chartis Singapore,
and the maximum exposure is still at 20%, the amount of Senior Interest 
will not be changed. However, when and if Chartis Singapore fails to 
provide the extended warranty service to the obligors, the transaction 
will be exposed to the risk that the obligors may stop paying the 

During the review period, we will evaluate the issuer's restructuring
proposal and determine the potential risk posed to the Senior Interest
from the extended warranty provider.

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