More skeletons emerged from the cupboard at Allco Finance Group's specialist white label lender Mobius yesterday. Ratings agencies Moody's and Fitch downgraded the mezzanine and junior notes of Mobius ELR-01 Trust.ELR-01 is a $163 million portfolio of small-ticket equipment leases originated by four separate Australian originators. Almost a third of the portfolio was finance for electronic bill payment equipment supplied to newsagents.Moody's affirmed the Aaa rating of the $119 million class A tranche, downgraded the Class B notes from Baa1 to Baa2, the Class C notes from Ba2 to B2 and the Class D notes from B2 to Caa2. The Class B, C and D notes were retained on review for possible further downgrade.Fitch affirmed the AAA rating of the Class A notes, downgraded Class B from BBB to BB+, downgraded Class C from BB to b/DR1 and downgraded Class D from B to CCC/DR4.At the time of issue in July last year the portfolio was made up of 15,280 contracts, with an average size of $8,769, and average term to maturity of 41 months, seasoning of eight months and an average interest rate of 10.19 per cent.The originators were Enterprise Finance Solutions, Technology Business International, Technology Leasing and Iden Leasing.The lead arranger was Allco Finance Group and the lead manager Commonwealth Bank.Moody's yesterday said there was a "significant deterioration in the performance of the underlying receivables pool" in the ELR-01 trust and that the cumulative level of gross write-offs to date exceeded $8 million. Moody's said it expects further charge-offs as delinquency translates into loss despite the efforts by Mobius to mitigate these.A related issue for Mobius and investors in the trust's bonds is that, according to Moody's "a large number of receivables have been found not to comply with the eligibility criteria".Moody's noted that Mobius has to date repurchased in excess of $4 million of receivables and expected to repurchase further ineligible leases "leading to significant uncertainty with respect to the performance of the portfolio".It is the second time this year that a ratings agency has reported significant problems with a Mobius securitisation. In August Standard & Poor's reported that the loans in a Mobius issue of mortgage backed securities, NMC 03, that were 30 days past due had hit 30 per cent and those at 90 days past due were at 16 per cent.NCM 03 was the worst performing portfolio in S&P's basket of non-conforming mortgage pools and it was associated with one in which mortgage managers  had run into serious difficulties of their own.