EEMEA Gains A Foothold In The Global Securitization Market ...

Future flow transactions are currently the most prevalentFuture flow transactions have been the most common structured transactions in theEEMEA region. Financial and export future flow transactions have proven popular bothwith foreign investors and with emerging market issuers possessing title over a flow offoreign currency receipts. The structure gives credit only to international cash flows fromforeign sources (such as offtakers for exported goods and products), thereby mitigatingtransfer and convertibility risks. Other risks of sovereign interference in a future flowtransaction are assessed on a case-by-case basis. Future flow transactions make up themajority of EEMEA securitizations that we have rated. A typical future flow transactionstructure is shown in chart 4.Emerging market originators benefit from the ability to borrow in hard currency againsthard-currency receivables for a longer term than they could achieve by issuing unsecureddebt securities, and potentially at a lower cost — provided the lower coupon is notoutweighed by the cost of structuring the securitization and providing sufficient creditenhancement. Furthermore, with risk-mitigating structural features in place that reducethe ability of the originator or the originator's government to interfere with the cash flowstream, issuers can potentially gain access to investors limited to purchasing investmentgradeobligations.Standard & Poor’s Page 4 of 20

Turkey has been the most active country in the region issuing numerous future flowtransactions backed by future DPRs and future credit card receivables (for moreinformation read "Diversified Payment Right Securitization Market to Tap Vast Potential"detailed in "Appendix III"). Egypt has issued transactions backed by future credit cardmerchant vouchers (Banque Misr's Misr Card Finance Co. Ltd., September 2002) and oilexport receivables (Egyptian General Petroleum Corp.’s Petroleum Export Ltd., July2005). Russia gave a boost to EEMEA's structured issuance in 2004 with a $1.25 billionfuture gas export receivable transaction (Gazprom International S.A., July 2004).Existing-asset securitizations are becoming more feasibleExisting-asset transactions are not as common as future flow ones since somejurisdictions lack either the domestic legal environment to support securitization, havedifficulty in obtaining currency swaps, or lack a strong domestic investor base. Crossborder existing-asset transactions are therefore increasingly being used. This structure stillinvolves the securitization of domestic currency receivables generated by domesticoriginators but often uses an offshore SPE and foreign-currency denominated notes,which are generally sold to international investors. Chart 5 shows an example of thestructure of an emerging market existing-asset securitization.Standard & Poor’s Page 5 of 20

South Africa has led the region in terms of existing-asset securitizations, seeing numerouson-shore and offshore existing-asset transactions backed by various asset types (see"Appendix II" for a full list of transactions closed since January 2001). There is arelatively established local market for securitizations in South Africa and transactions areusually rated using a national rating scale. This allows the whole spectrum of ratings to beused, not just those below the country rating, in order for investors to compare the creditquality of different South African-based transactions. While we do not currently have anational rating scale for South Africa, we do have national rating scales in the Ukraine,Kazakhstan, and Russia.Several existing-asset transactions have taken place in Central Europe and Russia. Theseinclude a cross-border existing-asset credit card transaction in the Czech Republic (HCFFunding No. 1 B.V., September 2003), along with an RMBS issuance out of Latvia(Baltic-American Mortgage Trust LLC 2004-1, December 2004), a CMBS transaction outof Poland (Polish Retail Properties Finance PLC, November 2003), and an auto loanreceivables transaction in Russia (Russian Auto Loans Finance B.V., July 2005).Financial guarantees and political risk insurance provide credit protectionAn additional tool used by a growing number of emerging-market issuers in cross-bordertransactions to further improve ratings and lower borrowing costs is financial guarantees,such as "wraps". Numerous securitizations, primarily future flow DPRs, coming out ofTurkey and two from Egypt, have been backed by a financial guaranty, i.e., wrapped.This enables the notes in the enhanced transaction to gain a 'AAA' credit rating.Political risk insurance provides less comprehensive protection by covering clearlydefined sovereign risks, including expropriation, currency inconvertibility and nontransferability,and war risk insurance. Political risk insurance is predominantly used inexisting-asset structures. A transaction cannot be rated higher than the local currencyrating on the insurance company providing the political risk insurance. A future flowtransaction should not require political risk insurance for transferability and convertibilitysince the structure is designed to mitigate these risks.In our rating analysis, we look at the adequacy of the coverage provided by the insurance,the process for obtaining claims payments, as well as the ability and willingness of theinsurer to pay claims. In some circumstances a financial enhancement rating (FER) isrequired, which provides an explicit assessment of an insurance company's willingnessand capacity to meet its credit-enhancement insurance obligations and includes a reviewof the policies regarding the processing of claims drawn against credit enhancementinsurance policies. Political risk insurance should not be viewed as a guarantee, as theclaims procedure for political risk insurance carries a heavier administrative burden than aguarantee. Political risk insurance can certainly reduce the risk in a transaction, but eachpolicy must be evaluated on a case-by-case basis.Standard & Poor’s Page 6 of 20

What Have Been The Sources Of EEMEA Issuance To Date?There has been approximately €14.2 billion worth of ABS issuance out of the EEMEAregion since 2001, comprising 82 transactions. Turkey and South Africa have been themost active issuers contributing 43% and 33% of all EEMEA issuance, respectively (seechart 6).Examining the breakdown of issuance by asset class reveals that future flows havecontributed 62% by volume and 63% by number of transactions, rising to 92% and 91%,respectively, when the South African transactions — which are all existing-assetsecuritizations — are excluded (see charts 7 and 8). We have rated future flowtransactions issued out of South Africa, but this was before 2001.To date, we have rated 35 ABS transactions in the EEMEA region, 32 future flow andthree existing-asset transactions (CMBS, RMBS, and credit cards). Of the rated futureflow transactions, 27 came from Turkey, four from Egypt, and one from Russia (see"Appendix II" for a list of closed transactions and the ratings on their notes). In December2005 we have assigned ratings to five DPR future flow securitizations, two Turkish seriesissued by TIB Card Receivables Funding Ltd. (which closed Dec. 1, 2005) and threeKazakhstani series issued by Kazkommerts DPR Co. (due to close Dec. 8, 2005).Standard & Poor’s Page 7 of 20

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Where Does The Potential For Growth In Issuance Volumes Lie?The increasing number of enquiries regarding existing-asset transactions highlights theextent of development in using securitization techniques and points to the potential for thefurther development of the securitization market in the EEMEA region. Factors fuellingthis growth potential include:• The current volume of existing-assets in the region;• General growth in credit lending (consumer and commercial);• Growth in these assets fuelled by lower inflation and interest rates;• Emerging market banks' desires to diversify and lower the cost of their fundingsources; and• Increased investor appetite for new asset types in the current tight spreadenvironment.By providing these new funding sources to companies, banks, and government entities, aswell as by offering new opportunities for investors, securitization can benefit and deepena country's capital market. The pace of economic growth, tourism, and trade in the region,on the other hand, drives growth in EEMEA future flow transactions.Retail banking could provide impetus for consumer asset issuanceWith retail banking taking off in many of the 10 recent entrants to the EU (Cyprus, theCzech Republic, Estonia, Hungary, Latvia, Lithuania, Malta, Poland, Slovakia, andSlovenia joined the EU in May 2004) and to a lesser extent in Russia, volumes ofconsumer assets (mortgages, auto loans, consumer loans, etc.) could reach levels wheresecuritization becomes a more sought after financing tool. Chart 9 highlights that retaillending as a proportion of GDP has been steadily growing in the Czech Republic,Hungary, Poland, Russia, Bulgaria, Slovenia, and Slovakia over the past seven years andthere is still plenty of scope for further growth before it comes close to rivaling the levelsseen in the eurozone.Standard & Poor’s Page 9 of 20

In Eastern Europe, the Czech Republic, Hungary, Poland, and Slovakia are consideredamong the countries with the most potential, as there is some of the requisite legislation inplace as well as an interest in securitization. The EU candidate countries (Bulgaria,Romania, Croatia, and Turkey) could also help drive growth. While there have beenseveral countries where the authorities have been so focused on legislation related to EUmembership that securitization legislation has taken a back seat, it is widely believed thatEU membership will not only support the development of securitization, but will alsoprovide investors with more confidence regarding the interpretation of existing ownershipand property rights laws.RMBS provides the greatest potential for issuance in RussiaThe asset class with the potential to be the greatest source of issuance in Russia in thefuture is RMBS and there are currently transactions in the pipeline. The current gapbetween the average long-term rating on Russian banks ('B-') and the credit quality oftheir assets creates huge incentives for them to securitize — not only for balance-sheetmanagement reasons but also for arbitrage. At the same time, the low ratings on banksand corporates in Russia make future flow securitizations more difficult. The largestrating elevation allowed (for future flow transactions) between an originator's rating andits survivability/performance risk assessment is three notches. This would result in a noninvestmentgrade rating, for which there is not much investor demand. Currently,domestic market securitizations in Russia are one-tranch pass-through certificates as thepossibility of issuing multi-tranch and/or pay-through RMBS issues is still limited bylegal hurdles.There has also been interest shown in other existing-asset classes in Russia, namely autoloans, consumer loans, and leasing securitization, while interest in future flowtransactions has been thinner on the ground. Future flow transactions have begun to comeout of Kazakhstan, and there is potential interest in RMBS coming from both Kazakhstanand Ukraine.A significant amount of the €3.5 billion spike in EEMEA future flow issuance in 2004came from Russia's Gazprom export future flow transaction, Gazprom International S.A.(notes rated 'BBB'), which contributed €1.04 billion. The transaction benefited fromGazprom's long history in the reliable delivery of gas to Western European customerscombined with significant incentives for continuing to do so. These factors allowed us togain comfort with an overall probability of full and timely payment of debt service on therated notes that is consistent with the assigned rating, despite the potential limitations onthe security of the assets under Russian law. However, while Russia made a big impact inits first year, the Russian securitization market is not expected to repeat such issuancenumbers in 2005; in the first eleven months of the year issuance has totaled just €98million.While there has been a lot of talk about securitization and the market participants arebecoming more comfortable, the legal impediments still pose material difficulties andserious investor/arranger concerns arise from the uncertainty and the lack of precedent.Furthermore, the relatively high quality of assets in Russia/CIS — particularly auto loans,mortgages, and consumer loans — is not sustainable if the current credit expansioncontinues. For example, the rapid growth in household debt in 1999-2002 eventuallymanifested itself in explosive dynamic delinquencies in 2002-2003. In Russia, forexample, aggressive expansion of Home Credit and Finance Bank LLC (B-/Stable/C) hadresulted in growth of the gross non-performing loan (NPL) ratio to 24.1% in the first halfof 2005 from 12.0% in the same period a year earlier. While this may well be an isolatedincident, it underlines our concern over the long-term asset quality of emerging marketretail lending banks.Standard & Poor’s Page 10 of 20

DPRs kick-start development of securitization market in TurkeyTurkey has been the most frequent issuer of securitizations from the EEMEA region,predominantly issuing transactions backed by DPRs. DPR cash flows are created as aresult of foreign payers wishing to send funds to an entity in another country and are oneof the most logical choices for an emerging market financial institution to securitize as itleverages existing export client relationships. In addition, flows are typically sent frominvestment-grade countries, denominated in hard currencies, use existing globalstandardized systems for transferring funds, and can be captured offshore to mitigatesovereign intervention in the funds. DPRs securitization is expected to start being used byother EEMEA countries (in November 2005 we assigned preliminary ratings to a DPRtransaction from Kazakhstan — Kazkommerts DPR Co.) as it can be used as a steppingstonefor the development of a full-scale securitization market (domestic and crossborder),as we have seen occur in Mexico and Brazil.Turkey's total market issuance in 2004 of €1.4 billion was a great leap from the €578million that was issued in 2003 and has jumped up again to €3.4 billion in the first elevenmonths of 2005 (illustrated in chart 10). This higher issuance level is evidence of bothTurkey's improving credit quality as a whole and the market's acceptance of structuredfinance — boding well for future issuance volumes. In addition to further DPRstransactions, expressions of interest have been indicated in a future airport leasereceivables transaction and a trade receivables one.In North Africa we have seen a wrapped future flow export transaction out of Egypt(Petroleum Export Ltd., July 2005) already this year and there is potential for furtherstructured activity, both future flow and existing-asset securitizations.Standard & Poor’s Page 11 of 20

SECTION II: BENEFITS AND LIMITATIONS OF EEMEASECURITIZATIONSWhat Benefits Does Securitization Provide EEMEA Participants?The heightened interest in securitization from the EEMEA region primarily stems fromthe opportunities provided to the parties involved. Through securitization, issuers(companies, banks, and governments) can diversify their financing options by targetingdifferent investors and procuring longer-term funds. In some circumstances securitizationcan provide a cheaper source of funding — particularly when the rating on the issuednotes is higher than that on the originator or even the sovereign rating on the country inwhich the originator is located — but the high transactional fees involved often more thancompensate for savings on the spread. Further incentives include capital efficiency andlimiting credit exposure to the assets.Furthermore, securitization typically leads to a better understanding of the assets by theoriginator, thereby potentially improving credit risk management, operating efficiency,and product and customer focus. In order to comply with the standards necessary toobtain a rating and gain investor acceptance, there is an operational level — e.g.,underwriting, servicing, information technology, and treasury — that needs to be attained.The benefits to the investor include access to previously unavailable markets (oftendomestic) and receiving a higher return than comparably rated government, bank, andcorporate bonds. Asset-backed transactions have historically performed better in terms ofdefaults and downgrades than rated corporate debt. Another more general advantage is thepotential deepening of domestic capital markets, arguably fostering growth in theunderlying assets, e.g., home ownership and potentially providing local and regionalgovernments with financing for large projects.What Are The Main Risks Facing EEMEA Securitization?There are several potential impediments that could hamper the growth of existing-assetsecuritization in EEMEA. These include the uncertainty and untested nature of the legalenvironment in the countries new to securitization; the need for pioneers in these newcountries to truly want to diversify their funding sources; the amount of developmentand/or the initial costs of doing a transaction for the first time; and the danger that thecurrent quality of assets will not be sustainable in a rapidly expanding consumer creditenvironment (as mentioned in the "RMBS provides the greatest potential for issuance inRussia" section above).Standard & Poor’s Page 12 of 20

SECTION III: WHAT ARE THE KEY CONSIDERATIONS IN RATINGEMERGING MARKET SECURITIZATIONS?On top of the standard analysis we carry out to assess the credit risk involved in anysecuritization, such as whether the cash flow is strong enough to support the debt, thereare some risks that are exacerbated when the transaction involves emerging markets.Outlined below is our approach to rating future flow transactions (the approach is thesame for any country, emerging or not, but the structure is generally not used indeveloped countries due to the high cost involved) and then the concerns that must beaddressed when using an existing-asset structure, particularly those accentuated orheightened in an emerging market.What Are The Main Analytical Assessments When Rating FutureFlow Transactions?There are three main analytical assessments we conduct when reviewing a future flowtransaction. Please refer to a report on these assessments, entitled "The Three BuildingBlocks of an Emerging Markets Future Flow Transaction Rating" (see "Appendix III" fordetails). To summarize, the first step is to conduct a business line risk assessment toevaluate the originator's ability and willingness to remain in business, and, morespecifically, to remain in the business line responsible for generating the flow ofreceivables being securitized.The second step is to carry out a structural risk assessment to determine if the structure ofthe transaction provides enough protection for the originator to obtain the desired ratingon the notes. The structure does not mitigate all risks, so the target rating must becommensurate with the remaining risks, i.e., if the originator involved has a 'BB'performance assessment, the structure alone cannot enhance the rating on the notes above'BB' without third-party support.The third element captures sovereign interference risk by assessing the government'swillingness to interfere, directly or indirectly, in a structured transaction. It should benoted that this is very different from the assessment of whether a sovereign will default onits debt obligations, as a government does not necessarily need to default in order tosuccessfully interfere with a transaction. Given the different circumstances of specificoriginators, industries, and assets within a country, this assessment may not be uniformacross all structured transactions within a country.What Are The Concerns Specific To Existing-Asset Transactions?In the securitization market, participants often seek to structure transactions such that themost senior class of notes can achieve a 'AAA' rating. However, emerging marketcountries typically have a sovereign rating far removed from the 'AAA' level (see theimage below for the foreign currency sovereign ratings on key EEMEA countries) andwhile it can be possible to achieve a rating higher than the sovereign ratings in somecases, the rating elevation may be limited since it is dependent on perceived sovereignrisk and credit enhancement requirements.Standard & Poor’s Page 13 of 20

It is difficult to rate an existing-asset transaction higher than the foreign currency ratingon the country in which the assets are located. This is due to the fact that the value ofdomestic assets, which are by their very nature denominated in local currency, gets wipedout by the severe depreciation on devaluation that usually accompanies a sovereigndefault. Obtaining a higher rating than the foreign currency rating suggests the underlyingassets in the structured transaction will continue performing even when the sovereign isdefaulting on its foreign currency obligations.In addition, under such a scenario, liquidity pressures, reduced borrower purchasingpower stemming from inflation, and potential policy measures implemented by thegovernment during an economic crisis can severely affect borrowers' willingness and/orability to remain current on their debt, as described in more detail in the followingparagraphs. However, should the depreciation or devaluation be mitigated, the other mainissue an existing-asset ABS has to address is the risk of the sovereign imposing transferand convertibility controls. For more information on that risk, please refer to "RatingAssociated With Risk Of Foreign Exchanges Controls Raised In 27 Countries" (publishedon Nov. 3, 2005).When rating a domestic existing-asset structured finance transaction in an emergingmarket country, while the standard ABS rating criteria apply there are a number of otheradditional factors that must be taken into consideration. Currency issues, such as inflationand depreciation, liquidity risk, and political risks all affect the performance of loansunderlying structured finance transactions in any existing-asset structure, but these can beexacerbated in an emerging market economy.Standard & Poor’s Page 14 of 20

Pressure on liquidityAn economic crisis can lead to a liquidity crisis, and governments may take actionsincluding freezing bank accounts to prevent a run on banks. A "flight to quality" results asconsumers and investors seek safer havens for their funds. The liquidity pressures and theconsequent stress on the financial system create difficulties for borrowers seeking torefinance a loan. Moreover, borrowers' ability to repay debts is affected given the scarcityof funds. Clearly, the performance of any structured transactions backed by these loanswill deteriorate under such conditions.Risk of inflation and currency depreciationIn addition to liquidity pressures, borrowers are often faced with a potentially very severedecline in their purchasing power. An economic crisis often brings with it high inflationand currency depreciation, prompting central banks to hike interest rates in an effort tosupport the currency. Borrowers with floating-rate loans, which is the case for most ofEastern Europe, would face difficulty servicing their debts as their payments rise in linewith rate increases, an important point considering the majority of consumer loans inEEMEA are floating-rate loans. A weakening currency also raises the cost of consumergoods (given the increase in production costs), as well as increasing the amount of localcurrency that borrowers would need to service any foreign currency debt.Threat of government interventionA government faced with an economic crisis may implement certain policy measures,such as freezing bank accounts, or restricting currency conversion as mentioned above, toattempt to restore the country's economic condition. A government can also modify theterms and conditions of loans to help its citizens or prevent the banking sector foreclosingon assets. In addition, in order to meet conditions imposed by international financialinstitutions to receive financial assistance, the government might implement austere fiscalpolicies, such as a tax increase or a freeze on wages. These conditions can decrease aborrower's ability to service its debts, negatively affecting structured transactions backedby these loans.Lack of depth in domestic marketOnshore existing-asset securitizations also rely on the presence of a domestic market forABS and the development of such a market depends on the presence of a strong long-termcapital debt market, the development of derivative products to hedge interest rate risks,and sufficient liquidity. Furthermore, local investors must be willing to develop a goodunderstanding of securitization structures and acquire a working knowledge of theperformance of the underlying assets, credit protection, cash flow mechanisms, and therole of the independent third parties. This is where the involvement of the rating agency iskey in fostering the nascent securitization markets in emerging economies, by enablingdomestic investors to assess the credit risks involved and directly comparing these withthose of more conventional or well-established investments.What Are The Key Securitization Requirements The LegalFramework Must Meet?The legal framework in an emerging market country must also be assessed to ensure thelegal system meets the requirements for a securitization to take place. Such requirementsinclude the ability to transfer assets by way of a true sale, effect assignments ofreceivables without notifying the borrower, enforce the security, mitigate comminglingrisk, appoint a trustee, and pledge the securitized assets, as well as any relevant bankaccounts. In addition, the establishment of a bankruptcy-remote SPE is a vital element fora securitization. Finally, these transactions should be tax-neutral, and the legal systemneeds to allow for that. While a workable alternative or solution can be found for some ofthese legal requirements, the establishment of a bankruptcy remote SPE — including therequisite non-petition language — is imperative.Along with the absence of an adequate legal framework, the lack of precedent ofsecuritization and unfamiliarity of judges in emerging markets with complex financingStandard & Poor’s Page 15 of 20

techniques is one of the key hurdles to overcome. While the substance of the law is ofcourse critical, the implementation of laws is just as important, and the untested nature ofcertain laws and the lack of precedent raise concerns about implementing laws that werenot specifically designed to deal with securitization. Several European countries haveadopted specific securitization laws, but in the EEMEA region, only South Africa haslegislation designed for securitization and the corresponding legal protections necessaryfor investors. Russia has passed a law on RMBS in 2003, but no securities have beenissued so far due to deficiencies of the bill and a lack of implementing regulations. Polandhas taken steps to amend its laws to facilitate securitization, though a completeframework for securitization is still under discussion. There is legislation in the pipelinein Russia, Kazakhstan, and Turkey aimed at creating a framework for domestic existingassetsecuritization.What Procedures And Information Are Crucial When Seeking AStandard & Poor's Rating?We require certain information regarding a proposed transaction and the participants in itin order to assess the feasibility of providing a rating. From a legal perspective, a true saleopinion, a tax opinion, a political risk insurance contract in certain jurisdictions, as well asinformation regarding the security/foreclosure process for an RMBS transaction are allrequired (other asset classes will require similar security information). Structural features,such as a currency exchange and/or interest rate hedging mechanisms and creditenhancement, are also crucial.Information about the pool of loans acting as collateral for the transaction is alsoimperative, as are details about the originator, such as underwriting criteria, servicingstandards, systems, and back-up servicer information. Consistent underwriting and poolperformance tracking is key and is something originators in emerging markets areunlikely to be doing if they are not considering pursuing a securitization. Therefore, evenbefore a transaction has been structured, the originator must pull together various parts ofits organization, including underwriting, servicing, information systems, and treasurydepartments, to prepare itself to produce these specialized reports. Furthermore, servicingprocedures may need to be tightened.Originators and arrangers considering a new securitization in the EEMEA region shouldcontact us early in the process to receive a fuller understanding of our ratingrequirements.APPENDIX I: KEY STANDARD & POOR'S CONTACTSFor EEMEA future flow transaction enquiriesDiane Audino, New York (1) 212-438-2388, diane_audino@standardandpoors.comGary Kochubka, New York (1) 212-438-2514, gary_kochubka@standardandpoors.comFor EEMEA existing-asset transaction enquiriesChris Such, London, (44) 20-7176-3529, chris_such@standardandpoors.comBrian Kane, London, (44) 20-7826-3530, brian_kane@standardandpoors.comAlain Carron, Paris (33) 1-4420-7337, alain_carron@standardandpoors.comFor all sovereign enquiriesKristel Richard, London (44) 20-7176-7107, kristel_richard@standardandpoors.comStandard & Poor’s Page 16 of 20

APPENDIX II: EEMEA ABS TRANSACTIONS SINCE 2001Transaction name Product Originator Class Standard& Poor'sratingClosing dateVolume(Mil.)Czech RepublicHCF Funding No. 1 B.V. Credit cards Home Credit Finance a.s. A A Sept. 29, 2003 Ckr4,150.00EgyptMisr Card Finance Co. Ltd. Future flows Banque Misr 2002-A AAA Sept. 18, 2002 $250.00Petroleum Export Ltd. Future flows Egyptian General Petroleum Corp. A1 AAA July 20, 2005 $500.00Petroleum Export Ltd. Future flows Egyptian General Petroleum Corp. A2 AAA July 20, 2005 $250.00Petroleum Export Ltd. Future flows Egyptian General Petroleum Corp. A3 BBB July 20, 2005 $903.60KazakhstanHalyk Remittances Finance Co. Ltd. Future flows Halyk Savings Bank of Kazakhstan NR Oct. 1, 2003 $100.00Kazkommerts DPR Co. Future flows JSC Kazkommertsbank 2005A AAA; To close Dec. 8, $200.00BBB(SPUR)2005Kazkommerts DPR Co. Future flows JSC Kazkommertsbank 2005B BBB To close Dec. 8, $50.002005Kazkommerts DPR Co. Future flows JSC Kazkommertsbank 2005C BBB To close Dec. 8,2005$50.00LatviaBaltic-American Mortgage Trust LLC 2004-1 RMBS The Baltic-American Enterprise Fund A NR Dec. 9, 2004 $60.06B NR Dec. 9, 2004 $3.57PolandPolish Retail Properties Finance PLC CMBS R20 Limited Ltd. A BBB (paiddown)Nov. 12, 2003 €74.00RussiaGazprom International S.A. Future flows OJSC Gazprom BBB July 29, 2004 $1,250.00Russia International Cards Finance S.A. Future flows OJSC United Card Services NR Nov. 8, 2004 $225.00Russia International Cards Finance S.A - Tap Future flows OJSC United Card Services NR Feb. 10, 2005 $75.00Russian Auto Loans Finance B.V. Auto loans Bank Soyuz A1 NR July 29, 2005 $43.73B NR July 29, 2005 $3.98TurkeyAk Receivables Corp. Future flows Akbank T.A.S. 2001-A AAA March 31, 2001 $100.00Akbank Remittances Trust Securitization Future flows Akbank T.A.S. NR April 11, 2001 $175.00Akbank Remittances Trust Securitization Future flows Akbank T.A.S. 3 NR Oct. 26, 2001 $200.00Akbank Remittances Trust Securitization Future flows Akbank T.A.S. 4 NR June 26, 2002 $150.00Akbank Remittances Trust Securitization Future flows Akbank T.A.S. 5 NR Sept. 29, 2003 $225.00Akbank Remittances Trust Securitization Future flows Akbank T.A.S. 6 NR Sept. 29, 2003 $100.00Garanti Diversified Payment Rights Finance Co. Future flows Turkiye Garanti Bankasi A.S. 2003-A AAA; BBB- Oct. 10, 2003 $200.00(SPUR)Garanti Diversified Payment Rights Finance Co. Future flows Turkiye Garanti Bankasi A.S. 2003-B NR Nov. 14, 2003 $150.00TIB Card Receivables Funding Co. Ltd. Future flows Turkiye Is Bankasi A.S. 1 NR Jan. 28, 2004 $150.00Garanti Diversified Payment Rights Finance Co. Future flows Turkiye Garanti Bankasi A.S. 2004-B AAA June 24, 2004 $175.00Garanti Diversified Payment Rights Finance Co. Future flows Turkiye Garanti Bankasi A.S. 2004-C AAA June 24, 2004 $150.00Akbank Remittances Trust Securitization Future flows Akbank T.A.S. 7 NR Oct. 4, 2004 $100.00Finans Capital Finance Ltd. ABS NR Oct. 7,2004 $200.00TIB Diversified Payments Rights Finance Co. Future flows Turkiye Is Bankasi A.S. 2004-A AAA; BBB- Nov. 22, 2004 $250.00(SPUR)TIB Diversified Payment Rights Finance Co. Future flows Turkiye Is Bankasi A.S. 2004-B AAA; BBB- Nov. 22, 2004 $250.00(SPUR)TIB Diversified Payment Rights Finance Co. Future flows Turkiye Is Bankasi A.S. 2004-C BBB- Nov. 22, 2004 $100.00Bosphorus Financial Services Ltd. Future flows Finansbank A.S. 2004-A NR Nov. 22, 2004 $225.00Bosphorus Financial Services Ltd. Future flows Finansbank A.S. 2004-B NR Nov. 22, 2004 $125.00Bosphorus Financial Services Ltd. Future flows Finansbank A.S. 2005-A NR March 15, 2005 $500.00Garanti Diversified Payment Rights Finance Co. Future flows Turkiye Garanti Bankasi A.S. 2005-A AAA; BBB- May 20, 2005 $300.00(SPUR)TIB Diversified Payment Rights Finance Co. Future flows Turkiye Is Bankasi AS 2005-A AAA; BBB- June 1, 2005 $250.00(SPUR)TIB Diversified Payment Rights Finance Co. Future flows Turkiye Is Bankasi A.S. 2005-B AAA; BBB- June 1, 2005 $100.00(SPUR)TIB Diversified Payment Rights Finance Co. Future flows Turkiye Is Bankasi A.S. 2005-C AAA; BBB- June 1, 2005 $150.00Standard & Poor’s Page 17 of 20

(SPUR)TIB Diversified Payment Rights Finance Co. Future flows Turkiye Is Bankasi A.S. 2005-D BBB- June 1, 2005 $200.00Akbank Remittances Trust Securitization Future flows Akbank T.A.S. 8 AAA; BBB- July 1, 2005 $150.00(SPUR)Akbank Remittances Trust Securitization Future flows Akbank T.A.S. 9 NR July 1, 2005 $150.00Akbank Remittances Trust Securitization Future flows Akbank T.A.S. 13 NR July 1, 2005 $60.00Akbank Remittances Trust Securitization Future flows Akbank T.A.S. 14 NR July 1, 2005 $40.00Akbank Remittances Trust Securitization Future flows Akbank T.A.S. 15 NR July 1, 2005 $100.00Akbank Remittances Trust Securitization Future flows Akbank T.A.S. 2005-A (10) AAA; BBB- July 1, 2005 $250.00(SPUR)Akbank Remittances Trust Securitization Future flows Akbank T.A.S. 2005-B (11) AAA; BBB- July 1, 2005 $290.00(SPUR)Akbank Remittances Trust Securitization Future flows Akbank T.A.S. 2005-C (12) AAA; BBB- July 1, 2005 $160.00(SPUR)Akbank Remittances Trust Securitization Future flows Akbank T.A.S. 16 BBB- July 1, 2005 $50.00DFS Funding Corp. Future flows Denizbank A.S. 2005-A NR July 15, 2005 $150.00DFS Funding Corp. Future flows Denizbank A.S. 2005-B NR July 15, 2005 $80.00DFS Funding Corp. Future flows Denizbank A.S. 2005-C NR July 15, 2005 $70.00Garanti Diversified Payment Rights Finance Co. Future flows Turkiye Garanti Bankasi A.S. 2005-B AAA; BBB- Sept. 30, 2005 $150.00(SPUR)Garanti Diversified Payment Rights Finance Co. Future flows Turkiye Garanti Bankasi A.S. 2005-C AAA; BBB- Sept. 30, 2005 $150.00(SPUR)Garanti Diversified Payment Rights Finance Co. Future flows Turkiye Garanti Bankasi A.S. 2005-D AAA; BBB- Sept. 30, 2005 $165.00(SPUR)Garanti Diversified Payment Rights Finance Co. Future flows Turkiye Garanti Bankasi A.S. 2005-E BBB- Sept. 30, 2005 $25.00Garanti Diversified Payment Rights Finance Co. Future flows Turkiye Garanti Bankasi A.S. 2005-F AA; BBB- Sept. 30, 2005 $110.00(SPUR)Garanti Diversified Payment Rights Finance Co. Future flows Turkiye Garanti Bankasi A.S. 2005-G AAA; BBB- Nov. 30, 2005 $150.00(SPUR)Garanti Diversified Payment Rights Finance Co. Future flows Turkiye Garanti Bankasi A.S. 2005-H AAA; BBB- Nov. 30, 2005 $250.00(SPUR)Garanti Diversified Payment Rights Finance Co. Future flows Turkiye Garanti Bankasi A.S. 2005-I BBB- Nov. 30, 2005 $125.00TIB Card Receivables Funding Co. Ltd. Future flows Turkiye Is Bankasi A.S. 2005-A BBB- Dec. 1, 2005 $225.00TIB Card Receivables Funding Co. Ltd. Future flows Turkiye Is Bankasi A.S. 2005-B AAA; BBB-(SPUR)Dec. 1, 2005 $125.00UAEENSeC Home Finance Pool I Ltd. RMBS Tamweel LLC A AAA May 17, 2005 $350.00South AfricaThe Thekwini Fund 1 (Proprietary) Ltd. RMBS South African Home Loans Ltd. A NR Nov. 29, 2001 R1,150.00B NR Nov. 29, 2001 R100.00Procul Ltd. Auto loans Wesbank Fltg NR May 1, 2002 R300.00Fxd NR May 1, 2002 R1,000.00OntheCards Investments Credit cards Edgars Consolidated Stores Ltd. A NR July 30, 2002 R1730.00B NR July 30, 2002 R200.00SubLoan NR July 30, 2002 R370.00Fintech Receivables 1 (Proprietary) Ltd. Equipment Fintech A NR Nov. 14, 2002 R600.00B NR Nov. 14, 2002 R30.00The Thekwini Fund 2 (Proprietary) Ltd. RMBS South African Home Loans Ltd. A NR Nov. 20, 2002 R1,000.00B NR Nov. 20, 2002 R55.20C NR Nov. 20, 2002 R27.06Private Mortgages 1 (Proprietary) Ltd. RMBS Investec Bank Ltd. A NR Dec. 12, 2002 R923.00B NR Dec. 12, 2002 R77.00Eagle Bonds One (Proprietary) Ltd –1 Aircraft None T1 NR June 10, 2003 R305.45T2 NR June 10, 2003 R315.62T3 NR June 10, 2003 R308.93Auto Loan Investments Ltd. Auto loans BMW Financial Services Ltd. A-1 NR Aug. 20, 2003 R200.00A-2 NR Aug. 20, 2003 R250.00A-3 NR Aug. 20, 2003 R300.00A-4 NR Aug. 20, 2003 R250.00The Thekwini Fund 3 (Proprietary) Ltd. RMBS South African Home Loans Ltd. A1 NR Oct. 27, 2003 R1,366.00A2 NR Oct. 27, 2003 R305.00A3 NR Oct. 27, 2003 R195.00B NR Oct. 27, 2003 R105.00C NR Oct. 27, 2003 R29.00Collateralised Auto Receivables SecuritisationAuto loans ABSA Bank Ltd. A1 NR Nov. 3, 2003 R1,000.00(Proprietary) Ltd. – CARS1A2 NR Nov. 3, 2003 R1,775.00B NR Nov. 3, 2003 R75.00C NR Nov. 3, 2003 R90.00Standard & Poor’s Page 18 of 20

Private Mortgages 2 (Proprietary) Ltd. RMBS Investec Bank Ltd. A NR Nov. 20, 2003 R1,336.00B NR Nov. 20, 2003 R79.00C NR Nov. 20, 2003 R55.00D NR Nov. 20, 2003 R111.00Auto Loan Investments II Ltd. Auto loans BMW Financial Services Ltd. A-1 NR Dec. 4, 2003 R300.00A-2 NR Dec. 4, 2003 R250.00A-3 NR Dec. 4, 2003 R250.00A-4 NR Dec. 4, 2003 R200.00Eagle Bonds One (Proprietary) Ltd. – 2 Aircraft Standard Bank of South Africa Ltd. 1 NR April 2, 2004 R223.532 NR April 2, 2004 R207.47OntheCards Investments – Micawber 280 Ltd. Credit cards Edgars Consolidated Stores Ltd. A2 NR June 7, 2004 R800.00B2 NR June 7, 2004 R95.00The Thekwini Fund 4 (Proprietary) Ltd. RMBS South African Home Loans Ltd. A1 NR June 11, 2004 R1,585.00A2 NR June 11, 2004 R643.00A3 NR June 11, 2004 R107.00B NR June 11, 2004 R115.00C NR June 11, 2004 R50.00Auto Loan Investments III Ltd. Auto loans BMW Financial Services Ltd. A-1 NR July 29, 2004 R300.00A-2 NR July 29, 2004 R250.00A-3 NR July 29, 2004 R250.00A-4 NR July 29, 2004 R200.00Prime Realty Obligors Packaged Securities CMBS ABSA Bank Ltd. A1 NR Nov. 2, 2004 R234.00A2 NR Nov. 2, 2004 R334.00B1 NR Nov. 2, 2004 R39.00B2 NR Nov. 2, 2004 R55.00C1 NR Nov. 2, 2004 R39.00C2 NR Nov. 2, 2004 R55.00D1 NR Nov. 2, 2004 R18.00D2 NR Nov. 2, 2004 R26.00Auto Loan Investments IV Ltd. Auto loans BMW Financial Services Ltd. A1 NR Nov. 23, 2004 R250.00A2 NR Nov. 23, 2004 R250.00A3 NR Nov. 23, 2004 R350.00A4 NR Nov. 23, 2004 R350.00The Thekwini Fund 5 (Proprietary) Ltd. RMBS South African Home Loans Ltd. A1 NR Feb. 21, 2005 R1,795.00A2 NR Feb. 21, 2005 R787.00A3 NR Feb. 21, 2005 R253.00B NR Feb. 21, 2005 R105.00C NR Feb. 21, 2005 R60.00Account On Us (Proprietary) Ltd. Credit cards Woolworths (Proprietary) Ltd. A1 NR Feb. 28, 2005 R300.00A2 NR Feb. 28, 2005 R400.00A3 NR Feb. 28, 2005 R550.00A4 NR Feb. 28, 2005 R650.00Auto Series Investment Ltd. Auto loans BMW Financial Services Ltd. AS0510 NR April 15, 2005 R310.00AS0601 NR April 15, 2005 R130.00AS0604 NR April 15, 2005 R110.00AS0610 NR April 15, 2005 R190.00AS0704 NR April 15, 2005 R180.00AS0710 NR April 15, 2005 R200.00AS0804 NR April 15, 2005 R110.00AS0810 NR April 15, 2005 R170.00Micawber 280 ltd, OnetheCards Investments Credit cards Edgars Consolidated Stores Ltd. A7 NR June 30, 2005 R865.00A8 NR June 30, 2005 R865.00B7 NR June 30, 2005 R100.00B8 NR June 30, 2005 R100.00OntheCards Investments Credit cards Edgars Consolidated Stores Ltd. A7 NR Aug. 15, 2005 R375.00A8 NR Aug. 15, 2005 R375.00B7 NR Aug. 15, 2005 R45.00B8 NR Aug. 15, 2005 R45.00Private Mortgages 3 (Proprietary) Ltd. RMBS Investec Bank Ltd. A1 NR Aug. 29, 2005 R1,943.50A2 NR Aug. 29, 2005 R115.00B NR Aug. 29, 2005 R103.50C NR Aug. 29, 2005 R138.00Accelerator Fund 1 Auto loans Standard Bank of South Africa Ltd. A1 NR Sept. 19, 2005 R412.00A2 NR Sept. 19, 2005 R848.00A3 NR Sept. 19, 2005 R1,512.00SPUR-Standard & Poor's Underlying Rating.Standard & Poor’s Page 19 of 20

APPENDIX III: RELATED RESEARCH• "Sovereign Interference Risk In Export Future Flow Financing And CorporateSecuritizations" (expected to be published on Dec. 6, 2005).• "Presale: Kazkommerts DPR Co." (published on Nov. 21, 2005).• "Rating Associated With Risk Of Foreign Exchanges Controls Raised In 27Countries" (published on Nov. 3, 2005).• "Emerging Market Credit Quality Reaches New Heights" (published on Oct. 21,2005).• "Assessing The Political Risk When Sovereigns Meet Structured Finance"(published on Oct. 4, 2005).• "Diversified Payment Right Securitization Market To Tap Vast Potential"(published on Sept. 15, 2005).• "Surveillance: Garanti Diversified Payment Rights Finance Co. (TurkiyeGaranti Bankasi)" (published on March 31, 2005).• "Structured Finance Issuance Spikes In EEMEA, Surpassing Latin America"(published on Feb. 22, 2005).• "Overcoming Obstacles to Building MBS in Global Emerging Markets"(published on Sept. 14, 2004).• "Future Flow Structured Finance Transactions in the Russian Federation: ARisky Business?" (published on Dec. 1, 2004).• "The Three Building Blocks of an Emerging Markets Future Flow TransactionRating" (published on Nov. 16 2004).• "New Issue: Gazprom International S.A." (published on Nov. 12, 2004).• "Russian Retail Banking--Following the Footsteps of Central Europe?"(published on May 27, 2004).• "Using Transfer and Convertibility Insurance to Enhance Issue Ratings"(published in Nov. 2000).• "Learning the Basics, Issuers Prepare for Securitization" (published on Nov. 28,2000).• "Political Risk Insurance May Enhance Emerging Market StructuredTransactions" (published on Nov. 2, 1999).All criteria and related articles are available on RatingsDirect, our Web-based creditanalysis system, at www.ratingsdirect.com. The criteria can also be found on our Web siteat www.standardandpoors.com.Published by Standard & Poor's, a Division of The McGraw-Hill Companies, Inc. Executive offices: 1221 Avenue of the Americas, New York, NY 10020. Editorial offices: 55Water Street, New York, NY 10041. Subscriber services: (1) 212-438-7280. Copyright 2005 by The McGraw-Hill Companies, Inc. Reproduction in whole or in part prohibitedexcept by permission. All rights reserved. Information has been obtained by Standard & Poor's from sources believed to be reliable. However, because of the possibility ofhuman or mechanical error by our sources, Standard & Poor's or others, Standard & Poor's does not guarantee the accuracy, adequacy, or completeness of any informationand is not responsible for any errors or omissions or the result obtained from the use of such information. Ratings are statements of opinion, not statements of fact orrecommendations to buy, hold, or sell any securities.Standard & Poor’s Page 20 of 20