OREANDA-NEWS. Fitch Ratings has affirmed two classes of notes issued by Nifty Warehouse Trust No.4. The transaction is backed by a pool of Australian auto receivables originated by Nissan Financial Services Australia Pty Ltd (NFSA), and issued by Perpetual Trustee Company Limited in its capacity as trustee of Nifty Warehouse Trust No. 4.

The rating actions are listed below:

AUD350m Class A1 notes affirmed at 'AAsf'; Outlook Stable; and

AUD150m Class A2 notes affirmed at 'AAsf'; Outlook Stable.

KEY RATING DRIVERS

The affirmations reflect Fitch's view that available credit enhancement supports the notes at their current ratings, the agency's expectations of Australia's economic conditions, and that the credit quality and performance of the underlying loans have remained within the agency's expectations.

Under Fitch's counterparty criteria, the swap provider is now an eligible counterparty for 'AAAsf' rated notes. However, the class A1 and A2 notes were not upgraded due the absence of collateral posting provisions in the transaction documents, which is viewed as a credit negative under Fitch's updated counterparty criteria. In Fitch's view, provisions to allow for collateral to be posted, in the event of a downgrade of the swap provider, are a key remedial factor to address counterparties' credit-quality deterioration.

Portfolio parameters ensure the revolving pool maintains a diverse and granular mix of asset characteristics, and is geographically distributed across Australia. Excess concentration triggers are in place to mitigate risk of excessive concentration of specific asset characteristics and to maintain a well-balanced portfolio.

Gross losses and net losses have tracked below Fitch's base case to date, and excess spread has been more than sufficient to cover all losses experienced by the trust.

RATING SENSITIVITIES

The prospect of downgrades is considered remote at present given the pool's expected performance, and the existence of adequate excess spread and subordination.

If collateral postings provisions are incorporated into the transaction documents, the notes will be upgraded to 'AAAsf'.

USE OF THIRD PARTY DUE DILIGENCE PURSUANT TO SEC RULE 17G-10

Form ABS Due Diligence-15E was not provided to, or reviewed by, Fitch in relation to this rating action.

REPRESENTATIONS, WARRANTIES AND ENFORCEMENT MECHANISMS

A description of the transaction's representations, warranties and enforcement mechanisms (RW&Es) that are disclosed in the offering document and which relate to the underlying asset pool was not prepared for this transaction because it does not involve the use of offering documents. For further information, please see Fitch's Special Report titled "Representations, Warranties and Enforcement Mechanisms in Global Structured Finance Transactions," dated 31 May 2016.

DATA ADEQUACY

Fitch has checked the consistency and plausibility of the information it has received about the performance of the underlying pools and the transactions. There were no findings that were material to this analysis.