(The following statement was released by the rating agency)SYDNEY, January 20 (Fitch) Fitch Ratings has affirmed the ratings of three Illawarra Series RMBS transactions. The transactions are securitisations of first-ranking Australian residential mortgages originated by IMB Limited (IMB). The rating actions are listed at the end of this commentary.KEY RATING DRIVERSThe affirmations reflect Fitch's view that available credit enhancement is sufficient to support the notes' current ratings, and can withstand deterioration of economic conditions in Australia in line with the agency's expectations. The credit quality and performance of the loans in the collateral pools have remained in line with Fitch's expectations, and all transactions benefit from lenders' mortgage insurance (LMI) and excess spread levels.As per the APAC Residential Mortgage criteria, the default model was not run for this rating action, as a review of pre-determined performance triggers indicates that the transactions display stable asset performance.As at end-December 2015, 30+ days arrears levels for all three Illawarra RMBS transactions were below Fitch's 30+days Dinkum Index of 0.91%. Illawarra Series 2006-1 RMBS Trust had the highest level of arrears at 0.45%, while Illawarra Series 2010-1 RMBS Trust recorded no loans in 30+ days arrears. LMI is provided by QBE Lenders' Mortgage Insurance Limited (Insurer Financial Strength Rating: AA-/Stable), Genworth Financial (N:GNW) Mortgage Insurance Pty Ltd (Insurer Financial Strength Rating: A+/Stable), and Housing Loan Insurance Corporation. The transactions have experienced low levels of losses, with all losses being covered by LMI or excess spread.RATING SENSITIVITIESSequential pay-down has increased credit enhancement for the senior notes of all the transactions, with the 'AAAsf' rated notes able to withstand multiples of the latest reported arrears. The ratings are not expected to be affected due to any foreseeable change in performance.The Class A and AB notes are independent of downgrades to the LMI providers' ratings. Negative rating actions would be considered if there was an unexpected increase in losses above expected levels that reduced excess spread and resulted in charge-offs.DUE DILIGENCE USAGE No third party due diligence was provided or reviewed in relation to this rating action.DATA ADEQUACY Fitch conducted a file review of 10 sample lease files focusing on the underwriting procedures conducted by IMB Limited compared to its credit policy at the time of underwriting. Fitch has checked the consistency and plausibility of the information and no material discrepancies were noted that would impact Fitch's rating analysis.A comparison of the transaction's representations, warranties and enforcement mechanisms (RW&Es) to those of typical RW&Es for this asset class is available by accessing the reports and/or links given under Related Research below.Illawarra Series 2006-1 RMBS Trust:AUD45.8m Class A (ISIN AU3FN0000139) notes affirmed at 'AAAsf'; Outlook Stable; andAUD12.5m Class B (ISIN AU3FN0000147) notes affirmed at 'BBsf'; Outlook Stable.Illawarra Series 2010-1 RMBS Trust:AUD63.3m Class A (ISIN AU3FN0010468) notes affirmed at 'AAAsf'; Outlook Stable; andAUD4.0m Class AB (ISIN AU3FN0010476) notes affirmed at 'AAAsf'; Outlook Stable.Illawarra Series 2013-1 RMBS Trust:AUD115.1m Class A (ISIN AU3FN0018784) notes affirmed at 'AAAsf'; Outlook Stable.Contacts: Lead Surveillance Analyst Hai Duong LeAssociate Director+61 2 8256 0358Fitch Australia Pty Ltd., Level 15, 77 King St, Sydney, NSW 2000, AustraliaCommittee Chairperson
Alison HoSenior Director+852 2263 9937Media Relations: Leni Vu, Sydney, Tel: +61 2 8256 0304, Email: leni.vu@fitchratings.com.Additional information is available at www.fitchratings.com.Sources of Information:The source of information used to assess these ratings was the servicer, IMB Limited. The issuer has informed Fitch that not all relevant underlying information used in the analysis of the rated notes is public.Applicable Criteria APAC Residential Mortgage Criteria (pub. 23 Jun 2015)https://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=867437Counterparty Criteria for Structured Finance and Covered Bonds (pub. 14 May 2014)https://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=744158Counterparty Criteria for Structured Finance and Covered Bonds: Derivative Addendum (pub. 14 May 2014)https://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=744175Global Criteria for Lendersâ Mortgage Insurance in RMBS (pub. 23 Jun 2015)https://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=865195Global Structured Finance Rating Criteria (pub. 06 Jul 2015)https://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=867952Related Research Illawarra Series 2010-1 RMBS Trust https://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=508805Illawarra Series 2013-1 RMBS Trust https://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=708435Illawarra Series 2013-1 RMBS Trust - Appendixhttps://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=708436Representations, Warranties and Enforcement Mechanisms in Global Structured Finance Transactions https://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=875850Additional Disclosures Dodd-Frank Rating Information Disclosure Form https://www.fitchratings.com/creditdesk/press_releases/content/ridf_frame.cfm?pr _id=998139Solicitation Status https://www.fitchratings.com/gws/en/disclosure/solicitation?pr_id=998139Endorsement Policy https://www.fitchratings.com/jsp/creditdesk/PolicyRegulation.faces?context=2&det ail=31ALL FITCH CREDIT RATINGS ARE SUBJECT TO CERTAIN LIMITATIONS AND DISCLAIMERS. PLEASE READ THESE LIMITATIONS AND DISCLAIMERS BY FOLLOWING THIS LINK: HTTP://FITCHRATINGS.COM/UNDERSTANDINGCREDITRATINGS. IN ADDITION, RATING DEFINITIONS AND THE TERMS OF USE OF SUCH RATINGS ARE AVAILABLE ON THE AGENCY'S FREE WEB SITE AT WWW.FITCHRATINGS.COM. PUBLISHED RATINGS, CRITERIA, AND METHODOLOGIES ARE AVAILABLE FROM THIS SITE AT ALL TIMES. FITCH'S CODE OF CONDUCT, CONFIDENTIALITY, CONFLICTS OF INTEREST, AFFILIATE FIREWALL, COMPLIANCE, AND OTHER RELEVANT POLICIES AND PROCEDURES ARE ALSO AVAILABLE FROM THE CODE OF CONDUCT SECTION OF THIS SITE. FITCH MAY HAVE PROVIDED ANOTHER PERMISSIBLE SERVICE TO THE RATED ENTITY OR ITS RELATED THIRD PARTIES. DETAILS OF THIS SERVICE FOR RATINGS FOR WHICH THE LEAD ANALYST IS BASED IN AN EU-REGISTERED ENTITY CAN BE FOUND ON THE ENTITY SUMMARY PAGE FOR THIS ISSUER ON THE FITCH WEBSITE. Fitch Australia Pty Ltd holds an Australian financial services licence (AFS licence no. 337123) which authorises it to provide credit ratings to wholesale clients only. Credit ratings information published by Fitch is not intended to be used by persons who are retail clients within the meaning of the Corporations Act 2001.