Fitch Rates Enterprise Fleet Financing LLC, Series 2015-2

CHICAGO--()--Fitch Ratings rates Enterprise Fleet Financing LLC, Series 2015-2 as follows:

--$216,000,000 class A-1 notes 'F1+sf';

--$503,000,000 class A-2 notes 'AAAsf'; Outlook Stable;

--$131,200,000 class A-3 notes 'AAAsf'; Outlook Stable.

KEY RATING DRIVERS

Strong Credit Quality Obligors: Although the vast majority of the collateral is not rated by any nationally recognized statistical rating organization (NRSRO), EFM's portfolio has experienced minimal delinquencies and net losses. In its analysis, Fitch assumed a 'B' rating for unrated obligors.

Strong Portfolio Diversification: Obligor and industry concentrations are minimal. The single most concentrated obligor represents 0.66% of the pool, while the top industry -- oil and gas--represents only approximately 11.2%. However, consistent with prior transactions, there is a large concentration of light and medium duty trucks, which comprise approximately 83% of the pool.

Low Delinquency and Loss History: EFM's historical managed portfolio and prior transaction delinquency and loss experience has been low, even during periods marked by elevated levels in other consumer and commercial asset classes due to a weak economy.

Sufficient Credit Enhancement (CE): Initial hard CE is virtually unchanged from the 2015-1 transaction (not rated by Fitch). Total initial CE (8.65%) is sufficient to support Fitch's 'AAAsf' stressed loss assumption of 11.92%.

Minimal Residual Risk: Approximately 97% of the 2015-2 leases are open-end leases, meaning the lessees bear the residual risk. The remaining 3% are closed-end leases, under which the trust will bear the wholesale market risk.

Quality Origination, Underwriting and Servicing Platform: EFM has demonstrated adequate capabilities as originator, underwriter and servicer, as evidenced by historical delinquency and loss performance of securitized trusts and the managed portfolio.

RATING SENSITIVITIES

Unanticipated increases in the frequency of defaults could produce default levels higher than the projected base case default proxy and impact available default coverage and multiples levels. Lower default 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 changes in obligor credit profiles and recovery rates associated with the high concentration of truck collateral in the pool. Further details can be found in the presale report.

Key Rating Drivers and Rating Sensitivities are further detailed in the accompanying presale report, available at 'www.fitchratings.com' or by clicking on the above link.

DUE DILIGENCE USAGE

Fitch was provided with third-party due diligence information from Ernst & Young LLP. The third-party due diligence focused on comparing or recalculating certain information with respect to 150 leases from the final data file. Fitch considered this information in its analysis and the findings did not have an impact on our analysis. A copy of the ABS Due Diligence Form-15E received by Fitch in connection with this transaction may be obtained through the link contained on the bottom of the related rating action commentary.

Fitch's analysis of the Representations and Warranties (R&W) of this transaction can be found in Enterprise Fleet Financing, L.L.C. Series 2015-1 - 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 June 12, 2015.

Additional information is available at www.fitchratings.com.

Applicable Criteria

Counterparty Criteria for Structured Finance and Covered Bonds (pub. 14 May 2014)

https://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=744158

Criteria for Rating U.S. Auto Lease ABS (pub. 24 Apr 2015)

https://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=864500

Global Rating Criteria for Corporate CDOs (pub. 25 Jul 2014)

https://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=753057

Global Structured Finance Rating Criteria (pub. 06 Jul 2015)

https://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=867952

Related Research

Enterprise Fleet Financing, LLC Series 2015-2 -- Appendix

https://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=868148

Additional Disclosures

Dodd-Frank Rating Information Disclosure Form

https://www.fitchratings.com/creditdesk/press_releases/content/ridf_frame.cfm?pr_id=988691

ABS Due Diligence Form 15E

https://www.fitchratings.com/creditdesk/press_releases/content/ridf15E_frame.cfm?pr_id=988691&flm_nm=15e_988691_1.pdf

Solicitation Status

https://www.fitchratings.com/gws/en/disclosure/solicitation?pr_id=988691

Endorsement Policy

https://www.fitchratings.com/jsp/creditdesk/PolicyRegulation.faces?context=2&detail=31

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Contacts

Fitch Ratings
Primary Analyst
Thomas Kaiser, CPA
Associate Director
+1-312-368-3338
Fitch Ratings, Inc.
70 West Madison Street
Chicago, IL 60602
or
Secondary Analyst
Du Trieu
Senior Director
+1-312-368-2091
or
Committee Chairperson
John Bella
Managing Director
+1-212-908-0243
or
Media Relations:
Sandro Scenga, +1 212-908-0278
sandro.scenga@fitchratings.com

Contacts

Fitch Ratings
Primary Analyst
Thomas Kaiser, CPA
Associate Director
+1-312-368-3338
Fitch Ratings, Inc.
70 West Madison Street
Chicago, IL 60602
or
Secondary Analyst
Du Trieu
Senior Director
+1-312-368-2091
or
Committee Chairperson
John Bella
Managing Director
+1-212-908-0243
or
Media Relations:
Sandro Scenga, +1 212-908-0278
sandro.scenga@fitchratings.com