DSB fulfilling its servicing duties – Moody’s

Bankrupt Dutch bank DSB has carried out its servicing duties so far, making all calculations and scheduled payments to noteholders on time, Moody’s said.

Until servicing on four ABS and RMBS deals originated by DSB is transferred, the transactions rely on DSB to provide timely information on the assets (loan balance, scheduled and actual collections, delinquencies, defaults, etc.), which are needed by the issuer administrators to make swap and note payment calculations.

The rating agency said it has been informed that as of last week, over 90% of debtors have made their monthly loan payments after DSB's bankruptcy and that more than 50% have given consent to new direct debit orders (as former orders had become void due to the bankruptcy of DSB).

"The borrowers' behavior in this respect is unexpectedly positive, which could lead to less payment disruption than expected," Moody’s said.

DSB’s transactions benefit from different back-up servicing arrangements, but none are in a "hot" form, immediately stepping in as servicer, the rating agency noted. These have now commenced due diligence but this will take time -- as long as six months, Moody’s reckon.