Fitch Rates Household Affinity Credit Card Master Note Trust I's Series 2003-3 Notes Class A/B/C 'AAA/A/BBB'

Business Wire, August 22, 2003

Business Editors

NEW YORK--(BUSINESS WIRE)--Aug. 22, 2003

Household Affinity Credit Card Master Note Trust I (HACCMNT I), series 2003-3 $903.875 million floating rate class A asset-backed notes, $59.75 million floating rate class B asset-backed notes, and $36.375 million floating rate class C asset-backed notes are rated 'AAA', 'A', and 'BBB', respectively, by Fitch Ratings.

Series 2003-3 class A , class B, and class C noteholders will receive interest payments, based on one-month LIBOR plus 0.06%, 0.29%, and 0.98%, respectively, on the 15th of each month, beginning September 15, 2003. Following the controlled accumulation period principal is expected to be paid to all classes of noteholders on the series expected principal payment date, August 15, 2006. The series final maturity date is August 15, 2008. As a part of Group One, series 2003-3 will share excess finance charge and principal collections with other Group One series.

The ratings are based on the quality of the underlying collateral, the available credit enhancement, the servicing capabilities of Household Financial Corp (HFC), and the sound legal and cash flow structures. The trust consists of receivables in revolving credit card accounts originated or acquired by Household Bank (SB) N.A. under the General Motors affinity program.

Credit enhancement supporting the series 2003-3 class A notes is derived from the 5.75% subordination of the Class B notes, the 3.5% subordination of the class C notes and overcollateralization (O/C) equal to 3.75% of interim note principal amount. The class B notes are supported by the 3.5% subordination of the class C notes and the O/C amount noted above. The class C notes are supported by the O/C amount. The O/C amount represents a subordinated interest in the receivables allocated to this series.

Fitch determines credit enhancement levels by employing several economic stress scenarios. The scenarios simultaneously stress key performance variables, such as yield, chargeoffs, and total payment rate (MPR), to levels commensurate with each rating category. Credit enhancement is then sized to cover accumulated shortfalls in the stressed environments.

Series 2003-3 is structured with a revolving period, during which investors will receive interest only. At the conclusion of the revolving period, series 2003-3 will enter into a 12-month controlled accumulation period. The seller retains the right to extend the revolving period or postpone the start of the accumulation period. However, the accumulation period length must be at least one month prior to the class A expected principal payment date. Class B and C noteholders will not receive any principal distributions until class A noteholders have been paid in full. Class C noteholders will not receive any principal distributions until class B noteholders have been paid in full. Only after class A, B and C notes have been paid in full will investor principal collections be applied to amortize the O/C amount and then treated as shared principal collections.