Bluestone loans performing in New Zealand 22 June 2009 4:31PM Philip Bayley S&P raised its ratings on all rated subordinated classes of RMBS issued by Sapphire II NZ Series 2005-1 and Sapphire VI Series 2004-2. The 'AAA' ratings on the class A notes of both transactions were affirmed. The rating upgrades reflect the significant build-up in credit support to rated tranches as the underlying mortgage portfolios amortise and excess spread covers prior losses. The transactions are considered able to withstand further deterioration in portfolio performance before impacting any rated tranches, after S&P allowed for the impact of poor economic conditions and financially stressed borrowers remaining in the mortgage portfolios due to refinancing difficulties.