Fitch Affirms Classes of GreatAmerica Leasing Receivable Funding 2014-1; Revises Outlooks

CHICAGO--()--Fitch Ratings has affirmed and revised the Outlook on the following classes of GreatAmerica Leasing Receivable Funding 2014-1 as indicated:

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

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

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

--Class B at 'AAsf'; Outlook to Positive from Stable;

--Class C at 'Asf'; Outlook to Positive from Stable.

KEY RATING DRIVERS

The affirmations to all outstanding classes reflect credit enhancement (CE) levels commensurate with their respective ratings. The transaction has experienced solid performance to date with 0.41% in cumulative net losses as of the January 2015 reporting period. These levels are tracking below Fitch's initial base case proxy of 2.75%.

The Positive Outlook for the class B and C notes reflects the possibility for positive rating actions in the next 12 to 18 months if current performance trends continue. All other classes have a Stable Outlook reflecting Fitch's expectation of stable performance and growing CE levels. Fitch will continue to monitor this transaction and may take additional rating actions in the event of changes in performance and credit enhancement measures.

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 transaction, the notes were found to have limited sensitivity to 1.5x and 2.5x Fitch's base case loss expectations.

To date, the transaction has exhibited solid performance with losses within Fitch's initial expectations, resulting in rising CE and loss coverage levels. As such, continued strong performance for this transaction would result in stable to 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.

Initial key rating drivers and rating sensitivities are further described in the New Issue Report titled 'GreatAmerica Leasing Receivables Funding, L.L.C., Series 2014-1', dated February 18, 2014. Fitch's analysis of the Representations and Warranties (R&W) can be found in 'GreatAmerica Leasing Receivables Funding, L.L.C Series 2014-1 - 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 Oct. 31, 2014.

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

Applicable Criteria and Related Research:

--'Criteria for Rating U.S. Equipment Lease and Loan ABS' dated Dec. 23, 2014;

--'Global Structured Finance Rating Criteria' dated Aug. 4, 2014;

--'Representations, Warranties, and Enforcement Mechanisms in Global Structured Finance Transactions' dated Oct. 31 2014;

--'GreatAmerica Leasing Receivables Funding, L.L.C Series 2014-1' dated Feb. 18, 2014;

--'GreatAmerica Leasing Receivables Funding, L.L.C Series 2014-1 - Appendix' dated Feb. 18, 2014.

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=830328

Global Structured Finance Rating Criteria

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=754389

Representations, Warranties and Enforcement Mechanisms in Global Structured Finance Transactions

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=799248

GreatAmerica Leasing Receivables Funding, L.L.C., Series 2014-1 Presale

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=736776

GreatAmerica Leasing Receivables Funding, L.L.C., Series 2014-1 -- Appendix

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=736798

Additional Disclosure

Solicitation Status

http://www.fitchratings.com/gws/en/disclosure/solicitation?pr_id=979366

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Contacts

Fitch Ratings
Primary Analyst
Andrew Tinari
Analyst
+1-312-368-3127
Fitch Ratingd, Inc.
70 W Madison St.
Chicago, IL 60602
or
Secondary Analyst
Peter Manofsky
Director
+1-312-368-2068
or
Committee Chairperson
Hylton Heard
Senior Director
+1-212-908-0214
or
Media Relations
Sandro Scenga, +1 212-908-0278
sandro.scenga@fitchratings.com

Contacts

Fitch Ratings
Primary Analyst
Andrew Tinari
Analyst
+1-312-368-3127
Fitch Ratingd, Inc.
70 W Madison St.
Chicago, IL 60602
or
Secondary Analyst
Peter Manofsky
Director
+1-312-368-2068
or
Committee Chairperson
Hylton Heard
Senior Director
+1-212-908-0214
or
Media Relations
Sandro Scenga, +1 212-908-0278
sandro.scenga@fitchratings.com