OREANDA-NEWS. Fitch Ratings has affirmed Scandinavian Consumer Loans IV's notes as follows:

NOK934.5m Class A notes affirmed at 'AAAsf'; Outlook Stable
NOK210m Class B notes affirmed at 'AAsf'; Outlook Stable
NOK357m Class C notes affirmed at 'Asf'; Outlook Stable
NOK210m Class D notes affirmed at 'A-sf'; Outlook Stable

The transaction is a securitisation of a revolving pool of unsecured consumer loans originated to borrowers in Norway from Sweden-based Nordax Bank AB (publ). The transaction features an initial revolving period of 24 months, due to end in June 2016, which is followed by a step-up in the notes' margins in June 2017.

KEY RATING DRIVERS
The affirmation reflects the transaction's robust performance, as demonstrated by defaults and recoveries being in line with our expectations and sufficient excess spread. After the revolving period ends in June 2016, the notes will amortise sequentially and credit enhancement (CE) will increase as the notes deleverage.

Delinquencies exceeding 30 days past due have ranged between 1.7% and 2.2%, over the last 12 months. Cumulative defaults currently stand at 3.2% compared with our lifetime expectation of 16.2%. Recoveries are 9.7%, which is low relative to our lifetime recovery assumption of 43.9% but this is due to the time lag compared with defaults. This is within our expectation and based on the historical recovery data received prior to the closing date.

The CE reserve includes a non-amortising senior amount of NOK42m and an additional junior-ranked portion, which has a variable target amount. No amounts have been drawn from the CE reserve, as excess spread has been sufficient to pay senior fees, interest on the notes, clear any principal deficiency ledger balance and top up the additional CE reserve to its target amount. The liquidity reserve is also unchanged at its target amount of NOK42m.

A step-up date is scheduled in June 2017, when the note margins will double. After this date, principal on the notes will also be paid sequentially through the interest priority of payments.

Fitch has maintained its lifetime base case assumptions at 16.2% for defaults and 43.9% for recoveries.

RATING SENSITIVITIES
Rating sensitivity to increased default rate assumptions (class A/ B/ C/ D)
Current ratings: 'AAAsf' / 'AAsf' / 'Asf' / 'A-sf'
Increase in default rate by 10%: 'AA+sf' / 'AA-sf' / 'A-sf' / 'BBB+sf'
Increase in default rate by 25%: 'AAsf' / 'Asf' / 'BBB+sf' / 'BBBsf'
Increase in default rate by 50%: 'AA-sf' / 'A-sf' / 'BBB-sf' / 'BB+sf'

Rating sensitivity to reduced recovery rate assumptions (class A/ B/ C/ D)

Current ratings: 'AAAsf' / 'AAsf' / 'Asf' / 'A-sf'
Decrease in recovery rate by 50%: 'AAAsf' / 'AA-sf' / 'A-sf' / 'BBB+sf'

Rating sensitivity to multiple factors (class A/ B/ C/ D)
Current ratings: 'AAAsf' / 'AAsf' / 'Asf' / 'A-sf'
Increase in default rate by 10%, decrease in recovery rate by 10%: 'AA+sf' / 'AA-sf' / 'A-sf' / 'BBB+sf'
Increase in default rate by 25%, decrease in recovery rate by 25%: 'AAsf' / 'Asf' / 'BBBsf' / 'BBB-sf'
Increase in default rate by 50%, decrease in recovery rate by 50%: 'A+sf' / 'BBB+sf' / 'BB+sf' / 'BB+sf'

DUE DILIGENCE USAGE
No third party due diligence was provided or reviewed in relation to this rating action.

DATA ADEQUACY
Fitch has checked the consistency and plausibility of the information it has received about the performance of the asset pool and the transaction. There were no findings that were material to this analysis. Fitch has not reviewed the results of any third party assessment of the asset portfolio information or conducted a review of origination files as part of its ongoing monitoring.

Prior to the transaction closing, Fitch reviewed the results of a third party assessment conducted on the asset portfolio information, which indicated no adverse findings material to the rating analysis.

Prior to the transaction closing, Fitch conducted a review of a small targeted sample of the origination files and found the information contained in the reviewed files to be adequately consistent with the originator's policies and practices and the other information provided to the agency about the asset portfolio.

Overall, Fitch's assessment of the information relied upon for the agency's rating analysis according to its applicable rating methodologies indicates that it is adequately reliable.

SOURCES OF INFORMATION
The information below was used in the analysis.
-Monthly servicer reports provided by Nordax Bank AB (publ) up to April 2016