Thursday, July 10, 2008

Moody's puts Athilon ratings on review for downgrade

New York, July 09, 2008 -- Moody's Investors Service announced today that it has put the counterparty and debt ratings associated with Athilon Asset Acceptance Corp. ("AAA Corp.") and Athilon Capital Corp. ("Athilon") on review for downgrade...

Athilon Acceptance Corp. is the wholly-owned subsidiary of Athilon Capital Corp. and is an operating company whose primary business activity is providing credit protection in the form of credit default swaps (CDS).

According to Moody's, the rating actions are the result of significant deterioration in the credit quality of two asset-backed collateral debt obligations (ABS CDOs) against which AAA Corp. has written protection. As a result of the increased credit risk, Athilon's capital may be insufficient to limit expected losses to levels commensurate with its current ratings. The remainder of the portfolio of AAA Corp. is comprised of static bespoke tranches referencing corporate and sovereign entities.

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