Kroll Bond Rating Agency Assigns Preliminary Ratings to United Auto Credit Securitization Trust 2015-1

NEW YORK--()--Kroll Bond Rating Agency (KBRA) assigns preliminary ratings to five classes of United Auto Credit Securitization Trust 2015-1 (UACST 2015-1), an auto loan ABS transaction.

UACST 2015-1 is expected to be collateralized by approximately $153.5 million of subprime auto loan receivables at closing out of an expected collateral balance of approximately $204.6 million after completion of the prefunding period. The transaction includes a prefunding feature that allows up to approximately 25.0%, of the collateral pool to be funded after closing. The prefunding period is four months but is expected to be completed in three months. The preliminary ratings reflect the initial credit enhancement levels of 57.50% for the Class A notes, 45.50% for the Class B notes, 32.00% for the Class C notes, 19.00% for the Class D notes and 10.50% for the Class E notes. Credit enhancement consists of overcollateralization, subordination of junior notes, cash reserves and excess spread. This transaction is United Auto Credit Corporation’s (UACC) first securitization in 2015 and its eleventh securitization overall.

UACC is an experienced originator and servicer of subprime auto loans. UACC has originated and serviced subprime auto loans for over 18 years. UACC underwent a restructuring and change in management in 2008. During 2008, the company hired an experienced management team and transitioned from a decentralized retail branch network of 144 locations, to a centralized operating structure with a dedicated servicing and collection centers.

KBRA applied its U.S. Auto Loan ABS Methodology as part of its analysis of the transaction’s underlying collateral pool, the proposed capital structure and UACC’s historical static pool data. KBRA also conducted an operational assessment of UACC, as well as a review of the transaction’s legal structure and transaction documents. KBRA will also review the operative agreements and legal opinions for the transaction prior to closing.

For complete details on the analysis, please see KBRA’s Pre-Sale Report, United Auto Credit Securitization Trust 2015-1 Pre-Sale Report, which was published today at www.kbra.com.

Preliminary Ratings Assigned: United Auto Credit Securitization Trust 2015-1

Class           Rating           Expected Initial Principal Balance
A           AAA(sf)           $91,050,000
B           AA(sf)           $24,550,000
C           A(sf)           $27,620,000
D           BBB(sf)           $26,600,000
E           BB(sf)           $17,390,000

17g-7 Disclosure:

All Nationally Recognized Statistical Rating Organizations are required, pursuant to SEC Rule 17g-7, to provide a description of a transaction’s representations, warranties and enforcement mechanisms that are available to investors when issuing credit ratings. KBRA’s disclosure for this transaction can be found in the report: United Auto Credit Securitization Trust 2015-1 17g-7 Disclosure Report

Related Publications: (available at www.kbra.com)

U.S. Auto Loan ABS Rating Methodology

About Kroll Bond Rating Agency

KBRA is registered with the U.S. Securities and Exchange Commission as a Nationally Recognized Statistical Rating Organization (NRSRO). In addition, KBRA is recognized by the National Association of Insurance Commissioners (NAIC) as a Credit Rating Provider (CRP).

Contacts

Analytical:
Kroll Bond Rating Agency
Rosemary Kelley, 646-731-2337
rkelley@kbra.com
or
William Carson, 646-731-2405
wcarson@kbra.com

Contacts

Analytical:
Kroll Bond Rating Agency
Rosemary Kelley, 646-731-2337
rkelley@kbra.com
or
William Carson, 646-731-2405
wcarson@kbra.com