Fitch Places Certain Washington Mutual Credit Card Notes on Rating Watch Negative

Business Wire, July 16, 2008

NEW YORK -- Fitch Ratings has today placed two certificates from the Washington Mutual Master Trust and two notes from Washington Mutual Master Note Trust on Rating Watch Negative, as follows:

-- Washington Mutual Master Trust, series 2004-C class E certificates rated 'BB-';

-- Washington Mutual Master Trust, series 2004-G class E certificates rated 'BB-';

-- Washington Mutual Master Note Trust, class 2005-D2 notes rated 'BB-';

-- Washington Mutual Master Note Trust, class 2005-D2-2 notes rated 'BB-'.

The rating actions are a result of a significant increase in delinquencies and charge-offs in the trusts, along with slowing monthly payment rates (MPR) and declining gross yield during the first half 2008. In particular, the four most recent servicing reports show a rapid increase in charge-offs. On a net basis, charge-offs have risen from 10.47% at the beginning of the year to 12.96% for the most recent reporting period. The percentage of accounts that are 60 or more days delinquent have also risen during this period indicating that an elevated level of chargeoffs will persist in the near future.

MPR, a measure of how quickly consumers are paying their debt, was at 9.44% in June compared to 10.78% for the same period a year ago. Given that payment rates are generally inversely correlated to delinquency rates, a rise in delinquencies could further slow the payment rate in the trusts.

Gross yield, a measure of a trust's ability to generate revenue (from interest, fees and interchange) is used to cover trust expenses such as chargeoffs, servicing fees and funding costs, has also experienced downward pressure in 2008. Gross yield has averaged 23.52% for the entire year, a 200 basis point decline compared to the same period a year ago.

Fitch's analysis included a comparison of observed performance trends over the past few months to Fitch's base case expectations for each outstanding rating category. As part of its on-going surveillance efforts, Fitch will continue to monitor the performance of these trusts.

The resolution of the Negative Watch status will incorporate future direction of trust performance. Additionally, Fitch is in the process of gathering additional information from the issuer to further explore performance trends. Fitch expects to complete its review within the next 90 days.

Fitch's rating definitions and the terms of use of such ratings are available on the agency's public site, www.fitchratings.com. Published ratings, criteria and methodologies are available from this site, at all times. Fitch's code of conduct, confidentiality, conflicts of interest, affiliate firewall, compliance and other relevant policies and procedures are also available from the 'Code of Conduct' section of this site.