DBRS Confirms the Ratings on Rayo Finance Ireland (No. 1) Limited

DBRS Ratings Limited (“DBRS”) has reviewed Rayo Finance Ireland (No. 1) Limited and has confirmed the rating of the Series 5 Notes at ‘A’ (high) (sf).

Based on the DBRS Spanish 2005 Electricity Tariff Methodology, the ratings of the above transaction is limited to a two notch increase above the Sovereign rating of the Kingdom of Spain. DBRS Sovereign Group confirmed the Kingdom of Spain Long-Term Issuer Rating at A (low), Negative Trend (see press release issued on April 11, 2014 “DBRS Confirms the Kingdom of Spain at A (low), Negative Trend).

This is a securitisation of Spanish electricity tariff deficit receivables. Series 5 Notes are backed by receivables that consist of an amount equal to 16.47% of the total recognized amount of the 2005 Tariff Deficit. The Tariff Deficit is the right to compensation for the income deficit in the settlement of some regulated activities in the Spanish electricity sector between 1 January 2005 and 31 December 2005. The originator of the transaction is Banco Santander, S.A.
The Bank of New York Mellon is the Account Bank for the transaction. The DBRS private rating of The Bank of New York Mellon is at least equal to the Minimum Institution Rating given the rating assigned to the Series 5 Notes, as described in the DBRS Legal Criteria for European Structured Finance.

Notes:
All figures are in Euro unless otherwise noted.
The principal methodology applicable is the Spanish 2005 Electricity Tariff Methodology. Other methodologies and criteria referenced in this transaction are listed at the end of this press release.

This can be found on www.dbrs.com at:
http://www.dbrs.com/about/methodologies

For a more detailed discussion of sovereign risk impact on Structured Finance ratings, please refer to DBRS commentary “The Effect of Sovereign Risk on Securitisations in the Euro Area” on: http://www.dbrs.com/industries/bucket/id/10036/name/commentaries/.

The sources of information used for this rating include payment reports provided by Banco Santander S.A. DBRS considers the information available to it for the purposes of providing this rating was of satisfactory quality.

DBRS does not audit the information it receives in connection with the rating process, and it does not and cannot independently verify that information in every instance.

The last rating action on this transaction took place on 13 September 2013, when DBRS confirmed the ratings assigned to the Series 5 Notes at A (high) (sf).

Information regarding DBRS ratings, including definitions, policies and methodologies are available on www.dbrs.com.

For further information on DBRS historic default rates published by the European Securities and Markets Administration (“ESMA”) in a central repository, see:
http://cerep.esma.europa.eu/cerep-web/statistics/defaults.xhtml.

Ratings assigned by DBRS Ratings Limited are subject to EU regulations only.

Initial Lead Analyst: Paolo Conti
Initial Rating Date: 23 March 2012
Initial Rating Committee Chair: Claire Mezzanotte

Lead Surveillance Analyst: Elisa Scalco
Rating Committee Chair: Diana Turner

DBRS Ratings Limited
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The rating methodologies and criteria used in the analysis of this transaction can be found at: http://www.dbrs.com/about/methodologies

• Legal Criteria for European Structured Finance Transactions.
• Spanish 2005 Electricity Tariff Methodology.
• Master European Structured Finance Surveillance Methodology.
• Operational Risk Assessment for European Structured Finance Servicers.
• Unified Interest Rate Model for European Securitisations.