OREANDA-NEWS. Fitch Ratings has affirmed VCL Master S.A.'s notes issued under Compartment 1 as follows:

EUR39.4m Series A 2010-1 (ISIN: XS0480715464): affirmed at 'AAAsf'; Outlook Stable
EUR48.4m Series A 2010-2 (ISIN: XS0480715548): affirmed at 'AAAsf'; Outlook Stable
EUR133.9m Series A 2010-4 (ISIN: XS0480716199): affirmed at 'AAAsf'; Outlook Stable
EUR20.9m Series A 2011-2 (ISIN: XS0646441575): affirmed at 'AAAsf'; Outlook Stable
EUR14.8m Series A 2012-1 (ISIN: XS0857704976): affirmed at 'AAAsf'; Outlook Stable
EUR25.5m Series A 2012-2 (ISIN: XS0857705353): affirmed at 'AAAsf'; Outlook Stable
EUR25.5m Series A 2012-3 (ISIN: XS0857705866): affirmed at 'AAAsf'; Outlook Stable
EUR47.6m Series A 2012-4 (ISIN: XS0857706161): affirmed at 'AAAsf'; Outlook Stable
EUR25.5m Series A 2013-1 (ISIN: XS0950403229): affirmed at 'AAAsf'; Outlook Stable
EUR23.7m Series A 2013-2 (ISIN: XS0974292350): affirmed at 'AAAsf'; Outlook Stable
EUR24.3m Series A 2015-1 (ISIN: XS1309693643): affirmed at 'AAAsf'; Outlook Stable
EUR4.7m Series B 2014-1 (ISIN: XS1112835910): affirmed at 'AAsf'; Outlook Stable
EUR3.7m Series B 2014-2 (ISIN: XS1112836645): affirmed at 'AAsf'; Outlook Stable
EUR4.1m Series B 2014-3 (ISIN: XS1112837379): affirmed at 'AAsf'; Outlook Stable
EUR6m Series B 2014-4 (ISIN: XS1112837882): affirmed at 'AAsf'; Outlook Stable

The transaction is a platform for Volkswagen Leasing GmbH (VWL), a subsidiary of Volkswagen Financial Services AG, which is itself a subsidiary of Volkswagen AG (BBB+/Negative/F2), to securitise on a revolving basis German auto lease receivables originated during its ordinary course of business.

KEY RATING DRIVERS
The affirmation follows the sale of receivables from VCL Master S.A.'s Compartment 1 for EUR1.25bn. Receivables were sold by VWL on the authority granted by VCL Master Compartment 1. Following the removal of assets, the portfolio has been reduced to EUR0.45bn from EUR1.7bn. Further, the replenishing account is funded with an amount of EUR63.6m - which can be used to purchase additional assets - this cash is part of the available credit enhancement (CE).

As only performing receivables were subject to removal, the relative share of non-performing receivables in the pool has increased. However, this portfolio credit deterioration is mitigated by higher CE resulting from the redemption mechanism within the transaction. The redemption mechanism applies funds received from the sale of the receivables first to amortise the rated series of notes to a certain target level.

Only the remaining portion of the proceeds is then used to amortise the sub-loan. The target level is calculated assuming losses of 13% for performing contracts (class A) and 70% for delinquent contracts (class A); 96.5% for performing contracts (class B) and 94% for delinquent contracts (class B). For terminated contracts, the applied loss is 100% for both classes of notes. This redemption mechanism results in higher CE since the rated notes redemption amount exceeds the sub-loan redemption amount in percentage terms.

Following the removal of the assets, the total available CE has risen to 18.9% from 15.2% for class A and to 15.2% from 11.7% for class B. The CE figure consists of over-collateralisation through the sub-loan, a discount for over-collateralisation, the floor amount of a reserve fund and the funds in an accumulation account that can be used to purchase additional lease receivables. CE is sized to protect noteholders against the credit risk of the underlying lease receivables, as well as seller risks such as commingling risks.

RATING SENSITIVITIES
Rating sensitivities are described in the new issue report published on 25 September 2015 at www.fitchratings.com

DUE DILIGENCE USAGE
Fitch was provided with a third party asset portfolio assessment at transaction closing as of September 2015.

DATA ADEQUACY
Fitch reviewed the results of the third party assessment conducted on the asset portfolio information, which indicated no adverse findings material to the rating analysis. Fitch believes the sample size and relevance of the tested fields suggest that the data provided by the originator for assigning the ratings was of acceptable quality.

Fitch also conducted a review of a small targeted sample of VWL's origination files and found the information contained in the reviewed files to be adequately consistent with the originator's policies and practices and the other information to the agency about the asset portfolio.

Overall, Fitch's assessment of the asset pool information relied upon for the agency's rating analysis according to its applicable rating methodologies indicates that it is adequately reliable.

SOURCES OF INFORMATION
The information below was used in the analysis:
-Investor reports provided by originator
-Take-out calculations provided by originator

REPRESENTATIONS AND WARRANTIES
A comparison of the transaction's Representations, Warranties & Enforcement Mechanisms to those typical for the asset class is available by accessing the appendix that accompanies the initial new issue report, dated 25 September 2015 at www.fitchratings.com. In addition refer to the special report "Representations, Warranties, and Enforcement Mechanisms in Global Structured Finance Transactions" dated 2 March 2016 available on the Fitch website.