OREANDA-NEWS. Fitch Ratings has taken various rating actions on 31 classes from 13 U.S. corporate synthetic collateralized debt obligation (CDO) transactions. Fitch affirmed 29 ratings, downgraded one, and upgraded one class of notes in this review. Additionally, the Rating Outlooks on eight classes of notes have been revised to Positive from Stable. Out of the 13 transactions, 11 have not experienced any credit events in the past 12 months.

A rating action report, 'Fitch Takes Various Rating Actions on U.S. Corporate Synthetic CDOs', dated Jan. 27, 2016, details the individual rating actions for each rated CDO. The report can be found on Fitch's website at 'www.fitchratings.com' by performing a title search or by using the link below. For further information and transaction research please refer to 'www.fitchratings.com'.

KEY RATING DRIVERS
The corporate synthetic CDO transactions have largely performed in line with Fitch's expectations since their last review in February 2015. The affirmations reflect sufficient support for the ratings driven by an adequate level of available credit enhancement, relatively stable performance of the reference entities in portfolios and decreased time to maturity.

The rating drivers for the upgrade were a decreased time to maturity and a moderate improvement in the portfolio quality since the last review, which resulted in the notes passing the higher rating stress in Fitch's Portfolio Credit Model. This transaction is scheduled to mature within the next six months. The downgraded class of notes is due to significant negative rating migration in the reference portfolio and inadequate credit enhancement to support the current rating level.

Fitch affirmed eight classes and revised their Outlooks to Positive from Stable based on the stable portfolio credit quality and decreased time to maturity. Fitch assigns Rating Outlooks to notes rated at or above the 'Bsf' rating category. Fitch's Rating Outlook indicates the likely direction of any rating change over a one- to two-year period.

For notes rated at or below 'CCCsf', Fitch has either assigned a Recovery Estimate (RE), or revised the existing RE. The REs represent Fitch's calculation of expected principal recoveries, as a percentage of current note notional outstanding. For these transactions, Fitch estimated projected losses at the 'Bsf' stress level using Fitch PCM.

RATING SENSITIVITIES
For the deals analyzed, negative migration and defaults in the portfolio beyond those projected could lead to downgrades.

This review was conducted under the framework described in the report 'Global Rating Criteria for CLOs and Corporate CDOs' using Fitch's portfolio credit model for projecting future default and recovery levels for the underlying portfolios.

A spreadsheet detailing Fitch's rating actions for the public tranches is available at 'www.fitchratings.com'.

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