Fitch Affirms & Revises Outlook on CNH Equipment Trust 2013-B

CHICAGO--()--Fitch Ratings takes the following rating actions on CNH Equipment Trust 2013-B (CNH 2013-B):

Class A-2 affirmed at 'AAAsf'; Outlook Stable;

Class A-3 affirmed at 'AAAsf'; Outlook Stable;

Class A-4 affirmed at 'AAAsf'; Outlook Stable;

Class B affirmed at 'Asf'; Outlook to Positive from Stable;

KEY RATING DRIVERS

The affirmation of all outstanding classes in CNH 2013-B is reflective of credit enhancement levels that are consistent with the ratings and strong collateral performance to date. As of the April 2014 reporting period, only 4 bps of cumulative net losses have been experienced, which is lower than Fitch's initial expectations for the pool.

The Positive Outlook designation for the class B notes reflects Fitch's expectation for loss coverage to continue improving as the transaction amortizes and credit enhancement levels continue to build. The Positive Outlook designation on the notes reflects Fitch's view that the notes will continue to perform well and may warrant a review for potential positive rating action in the next 12 - 18 months.

RATING SENSITIVITIES

Unanticipated increases in the frequency of defaults and loss severity could produce loss levels higher than the current projected base case loss proxy, which would impact available loss coverage. Lower loss coverage could impact ratings and rating outlooks, depending on the extent of the decline in coverage. In Fitch's initial review of the transactions, the notes were found to have limited sensitivity to 1.5x and 2.5x higher of Fitch's base case loss expectations. Initial Key Rating Drivers and Rating Sensitivities are further described in Presale Report dated May 20, 2013.

To date, the transaction has exhibited strong performance with losses well within Fitch's initial expectation, and rising loss coverage and multiple levels. As such, continued strong performance for the transaction would most likely result in further positive rating actions. Conversely, a material deterioration in performance would have to occur within the asset pool to have potential negative impact on the outstanding ratings.

Fitch's analysis of the Representations and Warranties (R&W) of these transactions can be found in the reports titled CNH Equipment Trust 2013-B - Appendix.' These R&W are compared to those of typical R&W for the asset class as detailed in the special report 'Representations, Warranties, and Enforcement Mechanisms in Global Structured Finance Transactions' dated April 17, 2012.

Additional information is available at 'www.fitchratings.com'

Applicable Criteria and Related Research:

--'Criteria for Rating U.S. Equipment Lease and Loan ABS' (Dec. 19, 2013);

--'Global Structured Finance Rating Criteria' (May 24, 2013);

--'Representations, Warranties, and Enforcement Mechanisms in Global Structured Finance Transactions' (April 17, 2012);

--'CNH Equipment Trust 2013-B' (May 20, 2013);

--'CNH Equipment Trust 2013-B - Appendix' (May 20, 2013).

Applicable Criteria and Related Research:

Criteria for Rating U.S. Equipment Lease and Loan ABS

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=726362

Global Structured Finance Rating Criteria

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=708661

Representations, Warranties, and Enforcement Mechanisms in Global Structured Finance Transactions

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=676496

CNH Equipment Trust 2013-B -- Appendix

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=708962

CNH Equipment Trust 2013-B (US ABS)

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=708938

Additional Disclosure

Solicitation Status

http://www.fitchratings.com/gws/en/disclosure/solicitation?pr_id=829501

ALL FITCH CREDIT RATINGS ARE SUBJECT TO CERTAIN LIMITATIONS AND DISCLAIMERS. PLEASE READ THESE LIMITATIONS AND DISCLAIMERS BY FOLLOWING THIS LINK: HTTP://FITCHRATINGS.COM/UNDERSTANDINGCREDITRATINGS. IN ADDITION, RATING DEFINITIONS AND THE TERMS OF USE OF SUCH RATINGS ARE AVAILABLE ON THE AGENCY'S PUBLIC WEBSITE '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 MAY HAVE PROVIDED ANOTHER PERMISSIBLE SERVICE TO THE RATED ENTITY OR ITS RELATED THIRD PARTIES. DETAILS OF THIS SERVICE FOR RATINGS FOR WHICH THE LEAD ANALYST IS BASED IN AN EU-REGISTERED ENTITY CAN BE FOUND ON THE ENTITY SUMMARY PAGE FOR THIS ISSUER ON THE FITCH WEBSITE.

Contacts

Fitch Ratings
Primary Analyst
Andrew Tinari
Analyst
+1-312-368-3127
Fitch Ratings, Inc.
70 W Madison Street
Chicago, IL 60602
or
Secondary Analyst
Du Trieu
+1-312-368-2091
or
Committee Chairperson
Kevin Corrigan
Senior Director
+1-212-908-1156
or
Media Relations:
Sandro Scenga, +1-212-908-0278 (New York)
sandro.scenga@fitchratings.com

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Contacts

Fitch Ratings
Primary Analyst
Andrew Tinari
Analyst
+1-312-368-3127
Fitch Ratings, Inc.
70 W Madison Street
Chicago, IL 60602
or
Secondary Analyst
Du Trieu
+1-312-368-2091
or
Committee Chairperson
Kevin Corrigan
Senior Director
+1-212-908-1156
or
Media Relations:
Sandro Scenga, +1-212-908-0278 (New York)
sandro.scenga@fitchratings.com