DBRS Provisionally Rates CCARAT II, Series 2006-1

Dominion Bond Rating Service ("DBRS") has assigned provisional ratings of AAA in respect of the Auto Loan Receivables-Backed Notes, Series 2006-1, Class A Notes (“Class A Notes”) and the VPR Loans, and a provisional rating of “A” in respect of the Auto Loan Receivables-Backed Notes, Series 2006-1, Class B Notes (“Class B Notes”) to be issued by Canadian Capital Auto Receivables Asset Trust II (the “Trust”). On closing, the Trust will acquire a co-ownership interest in a portfolio of secured auto loans from General Motors Acceptance Corporation of Canada (“GMAC Canada”) through a two-step sale. The Trust will be able to acquire additional secured auto loans that meet certain established criteria for up to 12 months following closing. The Notes are expected to provide for structured bullet payments, with VPR Loans and Subordinated VPR Loans increasing or decreasing as necessary to provide the balance of funding. The provisional ratings incorporate the following considerations:

(1) The very strong and consistent loss and delinquency performance of GMAC Canada’s owned or managed retail loan portfolio. Losses have been below 0.30% since 1999, and 90-day delinquency levels have typically been at the 0.01% level.
(2) The very high level of credit enhancement supporting the Class A Notes and VPR Loans provided by overcollateralization of 1.75%, non-amortizing cash of 0.5%, Class B Note subordination of 2.50%, and an initial annual interest spread in excess of 2.0%.
(3) The high level of credit enhancement supporting the Class B Notes provided by overcollateralization of 1.75%, non-amortizing cash of 0.5%, and an initial annual interest spread in excess of 2.0%.
(4) All loans must be in respect of new vehicles and must have been originated at special financing rates. These assets have historically performed well.

Stress tests using assumptions including servicer fees and large increases in delinquency and credit losses indicate that credit enhancement provides sufficient protection to the Class A Notes and VPR Loans to warrant the AAA ratings, and that credit enhancement provides sufficient protection to the Class B Notes to warrant the “A” rating.