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The following is a press release from Moody's Investors Service: JPY10.0billion of trust certificates affected Tokyo, June 09, 2010 -- Moody's Investors Service has assigned provisional ratings to the trust certificates, which will be issued through a master trust program backed by installment sales receivables originated by SOFTBANK MOBILE Corp. The ratings address the expected loss posed to investors by the final maturity date. The structure allows for timely payment of dividends (in scheduled amounts, on scheduled payment dates) and interest and ultimate payment of principal by the final maturity date. Moody's issues provisional ratings in advance of the final sale of securities. These ratings, however, represent Moody's preliminary credit opinions only. Upon a conclusive review of the transaction and associated documentation, Moody's will endeavor to assign definitive ratings to the securities. Definitive ratings may differ from provisional ratings. The provisional ratings are based on information received as of June 8, 2010. The ratings and transaction are summarized below: Deal Name: SBM Handset Installment Receivables Securitization Series 2010-6 Total Issue Amount: JPY10.0 billion Class, Amount, Dividend, Payment Frequency, Final Maturity Date, Rating Investor Trust Certificates, JPY10.0 billion, Floating, Monthly,* January 5, 2015, (P)Aaa The Class A Senior Trust Certificates and the Trust ABL back the Investor Trust Certificates. Deal Name: HI-2010-6 Class A Senior Trust Certificates, JPY0.1billion, Floating, Monthly,* January 5, 2015, (P)Aaa Trust ABL, JPY9.9 billion, Floating, Monthly,* January 5, 2015, (P)Aaa * First payment date is October 4, 2010. Seller/Servicer: SOFTBANK MOBILE Corp. ("SBM") Asset Trustee: Mizuho Trust & Banking Co., Ltd. ("Mizuho Trust") Specified Money Trustee: Mizuho Trust Back-up Servicer: Japan Collection Service Co., Ltd. Cap Provider: TBD Arranger: Citibank Japan Ltd., Daiwa Securities Capital Markets Co.Ltd., Mizuho Corporate Bank, Ltd., and RBS Securities Japan Limited Underlying Asset: handset installment sales receivables Series 2010-6 Scheduled date for entrustment of the assets: June 24, 2010 Scheduled date for entrustment of the proceeds: June 29, 2010 Scheduled first principal & dividend payment date for the Investor Trust Certificates: October 4, 2010 STRUCTURE OVERVIEW SBM will entrust a pool of installment sales receivables and cash to the Asset Trustee, Mizuho Trust, in accordance with A Series Trust Supplementary Agreement, and will receive the Class A and B Senior Trust Certificates. The amounts of the Class A through C Seller's Trust Certificates and the Subordinated Trust Certificates will be adjusted accordingly. Entrustment of the installment sales receivables by SBM will be perfected against third parties pursuant to the Perfection Law (the Law Prescribing Exceptions, Etc. to the Civil Code Requirement for Setting Up Against a Third Party to an Assignment of Claims [Law No. 104, 1998]). Perfection against obligors will not be made until certain events occur. Mizuho Trust, in its capacity as the Specified Money Trustee, will raise funds by issuing trust certificates ("Investor Trust Certificates") The Specified Money Trustee will use the funds raised, after deducting the amount necessary to acquire the Class A Senior Trust Certificate, to extend an asset-backed loan, with limited recourse to the entrusted installment sales receivables ("Trust ABL"), to the Asset Trustee. The Asset Trustee will use the proceeds from the Trust ABL to redeem the Class B Trust Certificates. The Specified Money Trustee will use the remaining funds to acquire the Class A Senior Trust Certificates from SBM. The transfer of the Class A Senior Trust Certificates to the Specified Money Trustee will be perfected against obligors and third parties under the Civil Code, Article 467.2. The Asset Trustee will purchase an interest rate cap from an eligible cap provider to hedge its interest rate risk. Credit enhancement is provided by the senior/subordinated structure. Subordination is approximately 20.31% of the total amount of the Investor's "portion" (the sum of the Investor Trust Certificates and Investor ABL of all the Series) and the Subordinated Trust Certificates. In preparation for servicer replacement, the transaction features an upfront cash reserve to provide liquidity and a trigger mechanism (servicer replacement preparation events) to provide additional enhancement. Commingling risk is covered by the advance payment of collections from the assets and the subordinated trust certificates. RATING OPINION SUMMARY Moody's assumes that the risk of interruption to cash flow from the assets due to the seller's or the Asset Trustee's bankruptcy is considered sufficiently minimal to achieve the rating assigned. The assets are handset installment sales receivables originated by SBM and are diversified, because the obligors are consumers and the average outstanding amount is low, at only JPY30,000 to JPY40,000. Having factored in the receivables' attributes, historical data on the seller's entire pool, ongoing performance data on existing securitization pools, and telecommunications charges, Moody's estimates the annual default rate at 2.2% to 2.7%. Moody's believes that each credit enhancement of the Investor Trust Certificates, the Class A Senior Trust Certificates and the Trust ABL is sufficient enough to assign Aaa rating to the transaction. (These parameters are that Moody's input into the model to analyze and may differ from the seller's definition.) Moody's examined the seller and considers the company sufficiently capable of servicing the underlying pool as SBM, as initial Servicer, has substantial experience in the mobile telecommunications carrier industry. Moody's has rated SBM's existing whole business securitizations and monitors the transactions on an ongoing basis. Seller/Servicer SOFTBANK MOBILE Corp., headquartered in Minato-ku, Tokyo, is a Japanese mobile telecommunications operator that launched services in 1994. In October 2001, the three J-PHONE operating companies became part of Vodafone Group Plc, the world's largest operator of mobile telecommunications networks. In November 2001, J-PHONE Co., Ltd. was formed through the merger of three J-PHONE operating companies and J-PHONE Co., Ltd., the holding company. In October 2003, J-PHONE Co., Ltd. changed its name to Vodafone K.K. In April 2006, Vodafone K.K. was acquired by SOFTBANK CORP., and became a SOFTBANK group company. Vodafone K.K. changed its name to SOFTBANK MOBILE Corp. in October, 2006. SBM reported operating revenue of JPY841.9 billion, operating income of JPY146.9 billion, and total consolidated assets of JPY3,341.2 billion, for the first half of the fiscal year ending March 31, 2010. With 22.34million subscribers as of the end of May 2010, the company is the third-largest mobile telecommunications operator in Japan after NTT DoCoMo, Inc., and KDDI Corporation. V Score The V Score for this transaction is Low/Medium. Moody's has assigned ratings to the Originator's handset installment sales receivables ABS since June 2007. Moody's conducted its analysis using historical data, including that which Moody's had received in those past transactions, and that of telecommunication contracts whose history is longer than handset installment sales receivables. Moody's V Scores provide a relative assessment of the potential variability of various inputs in a rating determination. The V Score ranks transactions by the potential for significant rating changes owing to uncertainty on the assumptions due to data quality, historical performance, the level of disclosure, transaction complexity, modeling, and the transaction governance that underlie the ratings. V Scores apply to the entire transaction (rather than to individual tranches). Parameter Sensitivities If the assumed annual default rate used in determining the initial rating were changed to either 5.2% or 6.4%, the quantitative or model-indicated Parameter Sensitivities for the Senior Beneficial Interest in these two scenarios would be a zero notch down for the 5.2% default rate and one notch down for the 6.4% default rate. Parameter Sensitivities are not intended to measure how the rating of the security might migrate over time; rather they are designed to provide a quantitative calculation of how the initial rating might change if key input parameters used in the initial rating process differed. The analysis assumes that the deal has not aged, and does not factor structural features such as sequential payment effect. Parameter Sensitivities reflect only the ratings impact of each scenario from a quantitative/model-indicated standpoint. Qualitative factors are also taken into consideration in the ratings process, so the actual ratings that would be assigned in each case could vary from the information presented in the Parameter Sensitivity analysis. Reference to relevant methodology The principal methodology used in rating this transaction was "Moody's Approach to Rating Japanese Installment Sales Loan Receivables ABS," published in February 2010, which can be found at www.moodys.com in the Research & Rating directory, in the Rating Methodologies subdirectory. Other methodologies and factors that may have been considered in the process of rating this transaction can also be found in the Rating Methodologies subdirectory. In addition, Moody's publishes a weekly summary of structured finance credit, ratings and methodologies, available to all registered users of our website, at (MORE TO FOLLOW) Dow Jones Newswires June 09, 2010 03:42 ET (07:42 GMT)