OREANDA-NEWS. Fitch Ratings has assigned expected ratings to Series 2015-1 Harvey Trust. The transaction is a securitisation of first-ranking Australian residential mortgage loans originated by Credit Union Australia Limited (CUA), due in January 2046. The ratings are as follows:

AUD460.00m Class A notes: 'AAA(EXP)sf'; Outlook Stable;
AUD27.00m Class AB notes: not rated;
AUD10.00m Class B notes: not rated;
AUD2.25m Class C notes: not rated; and
AUD0.75m Class D notes: not rated.

The notes will be issued by Perpetual Trustee Company Limited, in its capacity as trustee of Series 2015-1 Harvey Trust. The final ratings are contingent on receipt of final documentation conforming to information already received.

KEY RATING DRIVERS 
Stable Asset Performance: Data provided to Fitch shows Harvey Trusts' arrears levels have tracked below Fitch's Dinkum Index for prime conforming RMBS.

100% Lenders' Mortgage Insurance: Lenders' Mortgage Insurance (LMI) cover is provided on all mortgages in this portfolio by QBE Lenders' Mortgage Insurance Limited (Insurer Financial Strength AA-/Stable) or Genworth Financial Mortgage Insurance Pty Limited (Insurer Financial Strength A+/Stable). The servicer is able to make a claim under the LMI policy to cover a loss.

Liquidity Support: All classes of notes will be paid interest using the invested balance. Liquidity is sought initially via excess income, followed by the excess revenue reserve, principal collections, and a liquidity facility. Liquidity will be available to all classes of notes; charge-off and/or arrears triggers will restrict all sources of liquidity to the class A, AB, B and C notes only.

Excess Reserve: 70% of excess income, to the extent that it is available, will be allocated to an excess revenue reserve up to a maximum of AUD1,000,000 from closing. The reserve will provide the first source of available liquidity after excess income.

EXPECTED RATING SENSITIVITIES
Unexpected decreases in the value of residential property or increases in the frequency of foreclosures and loss severity on defaulted mortgages could produce loss levels higher than Fitch's base case, possibly resulting in negative rating actions on the notes. Fitch has evaluated the sensitivity of the ratings assigned to Series 2015-1 Harvey Trust to increased defaults and reduced recovery rates over the life of the transaction.

Its analysis found that the Class A notes' expected ratings were not impacted under Fitch's moderate and severe default (15% and 30% increase) scenarios. The analysis of the recovery scenarios found that the Class A notes' ratings were not impacted under Fitch's moderate and severe recovery (15% and 30% decrease) scenarios. The Class A notes remained stable under a combination of increased defaults and reduced recovery rates. The Class A notes' expected ratings are also LMI independent.

Key Rating Drivers and Expected Rating Sensitivities are further discussed in the corresponding presale report entitled "Series 2015-1 Harvey Trust", published today. Included as an appendix to the report are a description of the representations, warranties, and enforcement mechanisms.