2008-05-02 23:27:07 -

- Fitch downgrades one class of notes issued by Marathon Structured Funding I, LLC (Marathon Structured Funding), and withdraws the class A-2 notes. The following rating action is effective immediately:

--$131,288,059 class A-1 notes downgraded to 'BB' from 'AAA' and remain on Rating Watch Negative;

Marathon Structured Funding is a collateralized debt obligation (CDO) that closed on March

22, 2005 and is managed by Marathon Asset Management, LLC. (MAM) Marathon Structured Funding ended its reinvestment period in January 2008. Marathon Structured funding has a portfolio comprised primarily of subprime residential mortgage-backed securities (RMBS) bonds (67.5%), structured finance (SF) (6.7%), and non-SF CDOs (18.2%) and other structured finance assets. Subprime RMBS bonds of the 2005, 2006, and 2007 vintages account for approximately 16.0%, 18.2%, and 23.5% of the portfolio, respectively. Likewise, the SF CDO exposure includes SF CDO originated in 2005 (5.2%) and 2006 (1.5%).

Fitch's rating actions reflect the significant collateral deterioration within the portfolio, specifically subprime RMBS and SF CDOs with underlying exposure to subprime RMBS. Since the beginning of 2007, approximately 57.1% of the portfolio has been downgraded with 10.6% of the portfolio currently on Rating Watch Negative. The negative credit migration is primarily attributable to credit deterioration in subprime RMBS bonds from the 2005, 2006 and 2007 vintages, coupled with significant downgrades in SF CDOs originated between 2005 and 2007. Approximately 48.4% of the portfolio is below investment grade of which 39.4% is rated CCC and below.

The class A-2 notes were issued a credit rating with a $0 balance in expectation of future issuance, no class A-2 notes were ever issued and the ability to issue class A-2 in the future no longer exists. Because the class A-2 notes will not be issued, Fitch has withdrawn the rating.

The Rating Watch Negative reflects the continued credit deterioration in subprime RMBS and SF CDOs with underlying exposure to subprime RMBS. Additionally, Fitch is reviewing its SF CDO approach and will comment separately on any changes and potential rating impact at a later date.

The rating of the class A-1 notes addresses the likelihood that investors will receive full and timely payments of interest, as per the transaction's governing documents, as well as the stated balance of principal by the legal final maturity date.

Fitch will continue to monitor and review this transaction for future rating adjustments. Additional transaction information and historical data are available on the Fitch Ratings web site at www.fitchratings.com.

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.

Fitch Ratings
Kevin Kendra, 212-908-0760 (New York)
Brian Vorderbrueggen, 212-908-9102 (New York)
Alina Pak, 312-368-3184 (Chicago)
Media Relations:
Sandro Scenga, 212-908-0278 (New York)