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TEXT-Fitch affirms JLOC 38, LLC

(The following statement was released by the rating agency)

Oct 10 - Fitch Ratings has affirmed the ratings of JLOC 38, LLC due April 2016. The transaction is a Japanese multi-borrower type CMBS securitisation. The rating actions are as follows:

JPY3.2bn* Class C notes affirmed at 'BBBsf'; Outlook Stable

JPY3.5bn* Class D notes affirmed at 'Dsf'; Recovery Estimate revised to 85% from 60%

*as of 9 October 2012

The rating of the class C notes reflects Fitch's expectations of full redemption on the next payment date in October 2012. Since the previous rating action on 27 October 2011, six underlying loans have been paid in full and workouts on four defaulted loans have been completed. The repayment proceeds from these underlying loans were used to pay down the notes principal sequentially, leading to the class A and B notes being redeemed in full in January and April 2012, respectively.

The Recovery Estimate for class D was increased as repayment proceeds since the previous rating action were larger than expected. Fitch's valuation on the remaining properties remains unchanged.

As the class D notes, rated 'Dsf', will be the only remaining tranche after the next payment date, the rating will be withdrawn within 11 months of the next payment date.

At closing in September 2007, the notes were ultimately secured by 34 loans collateralised by 105 properties. The transaction is currently secured by three underlying loans backed by a total of four properties.

((Bangalore Ratings Team, Hotline: +91 80 4135 5898 satish.kb@thomsonreuters.com, Group id: BangaloreRatings@thomsonreuters.com, Reuters Messaging: satish.kb.thomsonreuters.com@reuters.net))