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TEXT-S&P Revises Otlk On Juutaku Loan Servicer To Pos; Afms Ranking

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(The following was released by the rating agency)

OVERVIEW

-- JLS primarily provides special servicing for residentialloans that it receives from Japan Housing Finance Agency.

-- The company has a robust track record in residential loanspecial servicing.

-- The company is working to streamline operations, andcontinues to enhance internal controls.

-- The company conducts routine disaster recovery testing ofits servicing systems.

-- We have revised to positive from stable our outlook onthe servicer evaluation ranking on JLS as a residential loanspecial servicer, and have affirmed the ranking at ABOVEAVERAGE.

TOKYO (Standard & Poor's) Oct. 11, 2012--Standard & Poor'sRatings Services today said that it has revised to positive fromstable its outlook on the servicer evaluation ranking on JuutakuLoan Servicer Ltd. (JLS) as a residential loan special servicer.At the same time, we affirmed the ranking at ABOVE AVERAGE. JLSremains on Standard & Poor's Select Servicer List in the abovecategory.

JLS was established in August 2004 to conduct servicingoperations as allowed under Japan's Law Concerning SpecialMeasures for the Servicing Business (Servicer Law), which cameinto effect in February 1999. The Ministry of Justice licensedJLS as Japan's 91st servicer in December of the same year. JLS'main business activity is the special servicing of residentialloans that it receives from Japan Housing Finance Agency (JHF;AA-/Negative/A-1+).

We base today's outlook revision and ranking affirmation onour view of the following: (1) the company's robust track recordin residential loan special servicing; (2) its efforts tostreamline operations by developing and using highly versatilecomputer systems to service various kinds of assets, and itsexecution of routine disaster recovery tests of these systems;(3) the progress it has made in analyzing loan collection data,and its ability to use that data to expand its business; and (4)its continued focus on enhancing internal controls.

Our outlook revision and ranking affirmation reflect anoverall evaluation of JLS as a residential loan specialservicer, based on our analysis and assessment of variousfactors, including the following:

-- The company's track record as a residential loan specialservicer;

-- The servicing experience of its management team andstaff;

-- Its detailed internal policies and procedures; -- Its business expansion plans; -- The implementation and results of its internal audits; -- Its implementation of internal controls; -- Its internal training programs;

-- Its disaster contingency plans, including data backupsystems, and the execution of system resumption tests;

-- The quality and capacity of the computer systems thatsupport the company's day-to-day business operations;

-- Its efforts to streamline servicing operations; -- Its ability to analyze and use loan collection data;

-- Its effective setup and boarding of loans that thirdparties originated;

-- Its cash management methods;

-- Its ability to report to investors and relevant parties;and

-- Its management of delinquent and defaulted receivables.

Standard & Poor's bases its servicer evaluations on anobjective and comprehensive assessment of a servicer'soperational capabilities for servicing various types ofreceivables and obligatory rights. Based on the assessment, weassign rankings in the following five categories: STRONG, ABOVEAVERAGE, AVERAGE, BELOW AVERAGE, and WEAK.

To be included in, or to remain on, Standard & Poor's SelectServicer List, servicers must, in principle, meet the criteriafor attaining at least an AVERAGE ranking with a stable outlook.

RELATED CRITERIA AND RESEARCH

"Revised Criteria For Including RMBS, CMBS, And ABSServicers On Standard & Poor's Select Servicer List," April 16,2009

"Servicer Evaluation Ranking Criteria: U.S.," Sept. 21, 2004

Keywords: MARKETS RATINGS JUUTAKULOANSERVICER

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