NEW YORK--(BUSINESS WIRE)--Kroll Bond Rating Agency (KBRA”) assigns preliminary ratings to three classes of Honor Automobile Trust Securitization 2016-1 (“HATS 2016-1”), an auto loan ABS transaction.
The collateral in HATS 2016-1 will include approximately $112.36 million of loans at closing. The preliminary ratings reflect the initial credit enhancement levels of 33.93% for the Class A notes, 20.89% for the Class B notes and 13.00% for the Class C notes. Credit enhancement consists of overcollateralization, subordination of junior notes, cash reserves and excess spread.
This transaction represents Honor Finance LLC’s (“Honor”) inaugural term securitization. Honor is an auto finance company that specializes in the acquisition and servicing of subprime, automotive retail installments contracts to borrowers. Honor was formed in 2001 by Jim Collins who is the President and Chief Executive Officer and Rob DiMeo who is the Chief Operating Officer and Compliance Manager Officer. Honor is majority-owned by CIVC Partners, a private equity firm based in Chicago. Honor benefits from a capable management team with extensive experience in the auto finance and subprime auto industry.
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 Honor’s historical static pool data. KBRA also conducted an operational assessment of Honor, 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, Honor Automobile Trust Securitization 2016-1 Pre-Sale Report, which was published today at www.kbra.com.
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Preliminary Ratings Assigned: Honor Automobile Trust Securitization 2016-1 |
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Class |
Rating |
Expected Initial Principal Balance | ||||||||||
| A | A(sf) | $76,480,000 | ||||||||||
| B | BBB(sf) | $14,660,000 | ||||||||||
| C | BB-(sf) | $8,860,000 | ||||||||||
Related Publications:
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).
