March 14 - OVERVIEW -- We lowered our rating on class B-1A to 'CCC- (sf)' from 'B- (sf)' from Asset Securitization Corp.'s series 1996-D2, a U.S. CMBS transaction. -- In addition, we affirmed our 'BB (sf)' rating on class A-4 from the same transaction. -- The rating actions reflect our analysis of the credit characteristics of the remaining pool collateral, which consists of 10 loans and one REO asset, as well as the deal structure, and the liquidity available to the trust. The downgrades reflect credit support erosion that we anticipate will occur upon the eventual resolution of the two assets ($16.8 million, 53.9%) that are with the special servicer. March 14 - Standard & Poor's Ratings Services today lowered its rating to 'CCC- (sf)' from 'B- (sf)' on the class B-1A commercial mortgage pass-through certificates from Asset securitization Corp.'s series 1996-D2, a U.S. commercial mortgage-backed securities (CMBS) transaction. Concurrently, we affirmed our 'BB (sf)' rating on class A-4 from the same transaction. Our rating actions follow our analysis of the credit characteristics of the collateral remaining in the pool, as well as the deal structure and the liquidity available to the trust. As of the Feb. 15, 2012 trustee remittance report, 10 loans and one real estate-owned (REO) asset remained in the trust totaling $31.1 million, compared with 124 loans totaling $879.5 million at issuance. We constrained the rating on the class A-4 certificates despite its relatively high credit enhancement levels (73.68% according to the February 2012 trustee remittance report) due to a lack of diversity in the trust. The downgrade further reflects credit support erosion that we anticipate will occur upon the eventual resolution of the two assets ($16.8 million, 53.9%) that are with the special servicer. We also considered the monthly interest shortfalls affecting the trust. As of the Feb. 15, 2012, trustee remittance report, the trust experienced interest shortfalls totaling $109,424. The interest shortfalls were due to appraisal subordinate entitlement reduction (ASER) amounts totaling $81,580, subordinate class advance reduction amounts totaling $24,335 and special servicing fees of $3,509 for the two specially serviced assets. The current monthly interest shortfalls affected the class B-1B certificates, which we previously downgraded to 'D (sf)', and caused a reduction in the liquidity support available to the more senior classes. CREDIT CONSIDERATIONS As of the Feb. 15, 2012, trustee remittance report, two assets ($16.8 million, 53.9%) in the pool were with the special servicer, CWCapital Asset Management LLC (CWCapital). The Care Centers Pool-1 loan ($8.4 million, 27.0%) was transferred to special servicing on Sept. 21, 2010, due to an unauthorized change of operator and manager. The payment status is in foreclosure. The loan has a total reported exposure of $10.6 million. The loan collateral consists of three skilled nursing facilities totaling 416 beds in the Chicago market area. CWCapital has accepted a discounted payoff of the loan and expects it to go to closing in a few months. Servicer reported combined debt service coverage (DSC) was 1.79x for the 12 months ended Nov. 30, 2011. An appraisal reduction amount (ARA) of $3.5 million is in effect against this specially serviced loan. Standard & Poor's expects a moderate loss upon the eventual disposition of this loan. The Woodfin Suites REO asset ($8.4 million, 26.9%) was transferred to special servicing on Nov. 20, 2009, due to imminent monetary default and became REO on July 11, 2011. The asset, which has a total reported exposure of $10.5 million, consists of a 203-room independently operated hotel in Rockville, Md. According to CWCapital, the property is currently under contract for sale. An ARA of $3.1 million is in effect against this asset. Servicer reported occupancy was 40.0% as of Dec. 31, 2011. Standard & Poor's anticipates a moderate loss upon the eventual resolution of this asset. TRANSACTION SUMMARY As of the Feb. 15, 2012, trustee remittance report, the collateral pool balance was $31.1 million, which is 3.5% of the balance at issuance. The pool now includes 10 loans and one REO asset, down from 124 loans at issuance. There are six defeased loans ($10.0 million, 32.4%) and two specially serviced assets ($16.8 million, 53.9%), which are discussed above. The remaining three loans ($4.3 million, 13.7%) are discussed below. The trust experienced $91.4 million in principal losses from 20 assets to date. The Nags Head Inn loan ($1.8 million, 5.7%) is secured by a 100-room independently operated hotel in Nags Head, N.C. The master servicer, Pacific Life Insurance Co. (Pacific Life), reported a DSC of 0.82x and an occupancy of 48.2% for the year ended Dec. 31, 2011. The Sierra Pines Mobile Home Park loan ($1.4 million, 4.5%) is secured by a 188-pad mobile home park in Grass Valley, Calif. Pacific Life reported a DSC of 4.14x and an occupancy of 99.5% for the nine months ended Sept. 30, 2011. The Pioneer Villa Mobile Home Park loan ($1.1 million, 3.5%) is secured by a 100-pad mobile home park located in Boring, Ore. Servicer reported DSC was 1.89x and occupancy was 98.0% for the nine months ended Sept. 30, 2011. Standard & Poor's stressed the assets in the pool according to its current criteria. The resultant credit enhancement levels are consistent with our rating actions. STANDARD & POOR'S 17G-7 DISCLOSURE REPORT Sec Rule 17g-7 requires an NRSRO, for any report accompanying a credit rating relating to an asset-backed security as defined in the Rule, to include a description of the representations, warranties and enforcement mechanisms available to investors and a description of how they differ from the representations, warranties and enforcement mechanisms in issuances of similar securities. The Rule applies to in-scope securities initially rated (including preliminary ratings) on or after Sept. 26, 2011. If applicable, the Standard & Poor's 17g-7 Disclosure Report included in this credit rating report is available atRELATED CRITERIA AND RESEARCH -- Global Structured Finance Scenario And Sensitivity Analysis: The Effects Of The Top Five Macroeconomic Factors, published Nov. 4, 2011. -- U.S. Government Support In Structured Finance And Public Finance Ratings, published Sept. 19, 2011. -- Updated Defeasance Criteria For U.S. CMBS Transactions, published Aug. 16, 2011. -- U.S. CMBS Rating Methodology And Assumptions For Conduit/Fusion Pools, published Nov. 3, 2010. -- Methodology And Assumptions For Analyzing The Major Property Types In U.S. CMBS Transactions, published June 14, 2010. -- U.S. CMBS 'AAA' Scenario Loss And Recovery Application, published July 21, 2009. -- Rating U.S. CMBS In The Face Of Interest Shortfalls, published Feb. 23, 2006.