Fitch Ratings Affirms Capital Lease Funding Series 1997-CTL-1

Business Wire, August 7, 2002

Business Editors

CHICAGO--(BUSINESS WIRE)--Aug. 7, 2002

Capital Lease Funding Securitization LP corporate credit-backed pass-through certificates, series 1997-CTL-1 $2.9 million class A-1, $40.4 million class A-2, $17.8 million class A-3 and the interest only class IO are affirmed at 'AAA' by Fitch Ratings. In addition, Fitch affirms the following classes: $15.5 million class B at 'AA', $15.5 million class C at 'A', $6.1 million class D at 'BBB-', $6.8 million class E at 'BB-', $1.9 million class F at 'B-' and $1.3 million class G at 'CCC'. In conjunction with the affirmations, classes D, E and F are also removed from Rating Watch Negative. The rating affirmations follow Fitch's annual review of the transaction, which closed in January 1997.

The decision to remove classes D, E and F from Rating Watch Negative is the result of Fitch's internal evaluation of Circuit City Stores, Inc. (Circuit City) completed in June. Loans with leases guaranteed by Circuit City make up 16% of the pool by balance. The ratings of this transaction are highly sensitive to the movements of the corporate credit ratings of the underlying tenants, which Fitch closely monitors.

The transaction benefits from fully amortizing loans to credit tenants, of which 65% are investment grade rated. The transaction continues to perform with no delinquencies or specially serviced loans. Other credit tenants in the pool are CVS (20%), Blue Cross/Blue Shield of Texas (16%), Rite Aid (11%), Tandy Corp. (7%) and various others.

Fitch continues to have concerns with the concentration as only 30 loans in the pool. However each property is leased to a tenant on a triple net or double net basis, requiring each tenant to pay for the operating costs of the property. Fitch also has concerns that 35% of the underlying loans are guaranteed by leases to below investment grade tenants. The deterioration of the credits has been factored into the ratings assigned to each class.

Fitch will continue to monitor the transaction and the ratings of the underlying credit tenants.