Kroll Bond Rating Agency Assigns Preliminary Ratings to SCF Equipment Leasing 2017-1 LLC Equipment Contract Backed Notes

NEW YORK--()--Kroll Bond Rating Agency (KBRA) assigns preliminary ratings to four note classes of SCF Equipment Leasing 2017-1 LLC Equipment Contract Backed Notes, Series 2017-1. The notes are newly issued asset-backed securities backed by a portfolio of equipment leases and loans.

The transaction is secured by: (1) a portfolio of equipment lease contracts and equipment loan contracts (together, “the Contracts”), together with interests in the related equipment; (2) certain portfolio interest certificates evidencing 100% beneficial interest in a portfolio of leases of titled motor vehicles and the related equipment; and (3) equity interests in certain limited purpose entities formed to own aircraft leases and the related aircraft. The underlying Contracts are collateralized by essential use assets in a variety of industries, such as marine, rail, transportation and energy. All of the Contracts were directly or indirectly originated by Stonebriar Commercial Finance LLC.

The aggregate discounted balance (ADB) of the portfolio is approximately $339.4 million. The portfolio is comprised of 64 contracts to 30 obligors. The average contract is approximately $5.3 million and the average exposure to an obligor is approximately $11.3 million. The maximum exposure to an obligor is approximately $25.6 million or approximately 7.5% of the ADB. The securitization is based on the projected equipment loan and lease cash flows discounted at a rate of 7.57%.

The transaction benefits from credit enhancement in the form of overcollateralization, excess spread, a reserve account and, with respect to the Class A Notes, Class B Notes and Class C Notes, subordination.

For complete details on the analysis, please see our Presale Report, SCF Equipment Leasing 2017-1 LLC Equipment Contract Backed Notes, which was published on February 2, 2017 at www.kbra.com.

    Class       Rating       Initial Principal Balance
    A Notes       A+ (sf)       $254,915,000
    B Notes       BBB (sf)       $15,784,000
    C Notes       BB (sf)       $15,614,000
    D Notes       B (sf)       $25,118,000
 

Related Reports:

Equipment Lease & Loan Methodology, published on June 30, 2012
General Corporate Rating Methodology, published on February 1, 2016

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
Cecil Smart, Jr., 646-731-2381
csmart@kbra.com
or
Anthony Nocera, 646-731-2350
anocera@kbra.com
or
Lenny Giltman, 646-731-2378
lgiltman@kbra.com

Contacts

Analytical:
Kroll Bond Rating Agency
Cecil Smart, Jr., 646-731-2381
csmart@kbra.com
or
Anthony Nocera, 646-731-2350
anocera@kbra.com
or
Lenny Giltman, 646-731-2378
lgiltman@kbra.com