OREANDA-NEWS. Fitch Ratings has upgraded two tranches of FCT Ginkgo Compartment Personal Loans 2013-1 (Ginkgo 2013) and affirmed FCT Ginkgo Compartment Sales Finance 2012-1 (Ginkgo 2012), as follows:

Ginkgo 2012
Class A notes affirmed at 'AAAsf'; Outlook Stable
Class B notes affirmed at 'AAAsf'; Outlook Stable

Ginkgo 2013
Class A notes affirmed at 'AAAsf'; Outlook Stable
Class B notes upgraded to 'AAAsf' from 'AAsf'; Outlook revised to Stable from Positive
Class C notes upgraded to 'AAAsf' from 'Asf'; Outlook revised to Stable from Positive

The two French ABS transactions were originated by Credit Agricole Consumer Finance (CACF, A/Stable/F1). Ginkgo 2012's portfolio consists of loans advanced to individuals for the purchase of home equipment, new vehicles, used vehicles and recreational vehicles whereas Ginkgo 2013's portfolio consists of general-purpose personal loans and debt consolidation loans advanced to individuals. All the loans bear a fixed interest rate and are amortising with constant monthly instalments.

KEY RATING DRIVERS
Robust Performance
The rating actions reflect the robust performance of the underlying assets and increasing credit enhancement, as a result of the transactions' continued deleveraging since closing.

Ginkgo 2012's performance in terms of defaults is slightly better than Fitch's expectation with the cumulative default rate reaching 2.7% as of end-February 2015 compared with an expected base case of 3.6%. Ginkgo 2013 is also performing better than Fitch's base case expectations in terms of defaults. As of end-February, the cumulative default rate was 3.0% of the initial balance of the portfolio compared with the agency's expectation of 4.1%. Both transactions have benefited since closing from a significant level of gross excess spread.

Both transactions benefit from fully funded reserve funds, which represent 1.5% of their initial portfolio balance. These reserve funds are aimed at liquidity and are available to cover senior fees, swap payments and interest payments on the different rated class of notes. The general reserves may provide credit enhancement to the extent that they will be released at the legal final maturity date and will flow through the relevant priority of payments.

Credit enhancement for Ginkgo 2012's class A notes has increased to 82.2% from 24.8% initially, through amortisation of the portfolio and is provided by the subordination of the class B and C notes and the general reserve. Credit enhancement for the class B notes has increased to 63.0% from 19.0% initially and is provided by the subordination of the class C notes and the general reserve.

Credit enhancement for Ginkgo 2013's class A notes has increased to 102.4% (98.3% provided by subordination and 4.1% provided by the reserve fund) from 37.3% initially and is provided by the subordination of the class B, C and D notes and the general reserve. Credit enhancement for the class B notes has increased to 77.2% from 28.1% initially and is provided by the subordination of the class C and D notes and the general reserve. Credit enhancement for class the C notes has increased to 53.8% from 19.6% initially. It is provided by the subordination of the class D notes and the general reserve.

RATING SENSITIVITIES
Fitch has revised its original base case default expectation to 5.1% from 6.3% for Ginkgo 2012 and to 8.7% from 10.7% for Ginkgo 2013.

For Ginkgo 2012, the expected impact upon the notes' rating of increased defaults and reduced recoveries by both 25%:
Class A current rating: 'AAAsf'; expected impact: 'AAAsf'
Class B current rating: 'AAAsf'; expected impact: 'AAAsf'

For Ginkgo 2013, the expected impact upon the notes' rating of increased defaults and reduced recoveries by both 25%:
Class A current rating: 'AAAsf'; expected impact: 'AAAsf'
Class B current rating: 'AAAsf'; expected impact: 'AAAsf'
Class C current rating: 'AAAsf'; expected impact: 'AAsf'

Initial Key Rating Drivers and Rating Sensitivity of FCT Ginkgo Compartment Sales Finance 2012-1 and FCT Ginkgo Compartment Personal Loans 2013-1 are further described in the New Issue report dated 10 July 2012 and 24 May 2013, respectively, at fitchratings.com.