S&P Assigns Prelim Rtg to REIL Dealership Bonds

    MELBOURNE, Australia--Standard & Poor's--March 5, 2001--Standard & Poor's today assigned its single-'A'-plus preliminary rating to the A$47.71 million bonds issued by REIL Dealership Bonds Pty Ltd. (REIL).
    The preliminary rating on the bonds issued by REIL reflect its ability to pay scheduled quarterly payments in full on each quarterly payment date, and to repay nonamortized principal in full no later than the final maturity date, according to the terms and conditions of the bonds.
    Investors should note that Standard & Poor's ratings do not address the likelihood or the timing of an early redemption event, nor the risk that investors may receive a bond redemption amount less than the outstanding principal amount of the bonds.

    Key features of the transaction that support the ratings include:

--	The legal structure of the transaction, which gives REIL effective control over the collateral;
--	The lease to each dealer, guaranteed by Mitsubishi Motors Australia Ltd. (MMAL), over the 11 dealership properties, which provides lease payments to service and partly amortize the bonds, and to support the early redemption of the bonds in the event of an early termination;
--	The residual value insurance provided by QBE Insurance (Australia) Ltd. (QBE, single-'A'-plus/Stable/-) to support the bullet repayment of the bonds;
--	The initial letter of credit provided by Commonwealth Bank of Australia (CBA, double-'A'-minus/Positive/'A-1'-plus) to cover the obligations of MMAL;
--	The property management arrangements, including regular building audits and testing, to ensure the standard of the properties are maintained and the residual value insurance amount may be called in full; and
--	The surplus funds, which accumulate within the transaction, under certain stress scenarios, to ensure adequate reserves are available to repay bondholders. -- CreditWire