OREANDA-NEWS. Fitch Ratings has affirmed two classes of notes from Banc of America Funding 2012-R4 Trust (BAFC 2012-R4) and Banc of America Funding 2012-R5 Ltd. (BAFC 2012-R5). The Rating Outlook is Stable.

KEY RATING DRIVERS
The affirmations are attributed to the stable performance of the underlying portfolios and the continued principal amortization of the notes since Fitch's last review in July 2014, which is in line with the projections at closing.

The class A notes of BAFC 2012-R4 have received approximately \$90.9 million, or 46.5% of their previous balance, in principal redemptions over the last year. This is in line with Fitch's projections from the initial rating.

The class A notes of BAFC 2012-R5 have received approximately \$162.6 million, or 42.6% of their previous balance, in principal redemptions over the last year. This is in line with Fitch's projections at the initial rating.

Future cash flows projected under the 'AAAsf' stresses indicate sufficient coverage for both notes. Despite this, the notes ratings are capped at 'Asf' given that the collateral in the underlying CDOs is predominantly distressed or defaulted and the rating framework focused on recovery projections that are prone to volatility.

BAFC 2012-R4 is a re-securitization of 82.6% of the class A-1 notes issued by Triaxx Prime CDO 2006-1, Ltd. (Triaxx 2006-1), with the current notional value of \$543.8 million. The underlying portfolio of Triaxx 2006-1 is predominantly non-prime RMBS from 2005, 2006, and 2007 vintages.

BAFC 2012-R5 is collateralized by 96.2% of the class A-1A notes and 70.1% of the A-1B2 notes issued by Triaxx Prime CDO 2006-2, Ltd (Triaxx 2006-2). The classes' current outstanding balances are \$268.9 million and \$537.9 million, respectively. The underlying portfolio of Triaxx 2006-2 is predominantly non-prime RMBS from 2006 and 2007 vintages.

Fitch's rating analysis incorporated projected recoveries from the RMBS bonds held by the underlying SF CDOs and assessment of the structural features at the SF CDOs and repacks' level.

RATING SENSITIVITIES
The ratings of the BAFC 2012-R4 and BAFC 2012-R5 class A notes remain sensitive to any potential changes of Fitch's future recovery expectations for the underlying assets.

DUE DILIGENCE USAGE
No third party due diligence was provided or reviewed in relation to this rating action.

Fitch has affirmed the following ratings:

Banc of America Funding 2012-R4
--\$104,613,080 class A notes at 'Asf', Outlook Stable;

Banc of America Funding 2012-R5 Ltd.
--\$219,131,708 class A notes at 'Asf', Outlook Stable.

Fitch does not rate the class M certificates of BAFC 2012-R4 or the class M, M1, M2, M3 and M4 certificates of BAFC 2012-R5.