KBRA Assigns Preliminary Ratings to Purchasing Power Funding 2018-A, LLC

NEW YORK--()--Kroll Bond Rating Agency (KBRA) assigns preliminary ratings to four classes of notes issued by Purchasing Power Funding 2018-A, LLC (“PPF 2018-A”), a consumer installment receivable asset-backed securities transaction.

This transaction, represents Purchasing Power’s second rated ABS securitization. PPF 2018-A will issue four classes of notes totaling $175.00 million. The transaction has initial credit enhancement levels of 30.75% for the Class A Notes, 23.60% for the Class B Notes, 16.50% for the Class C Notes, and 9.60% for the Class D Notes. Credit enhancement consists of overcollateralization, subordination (except for Class D) and an upfront reserve account. The transaction includes a two-year revolving period during which additional collateral may be funded in the transaction as long as it complies with certain eligibility criteria.

Purchasing Power is a leading provider of organization sponsored, payroll deduction-based employee purchase programs serving employees of large companies. The Company is a specialty, online retailer serving 289 clients, across 19 industries. The Company’s program provides over 8 million consumers access to goods and services such as electronics, home appliances, furniture, jewelry, fitness equipment, educational services and vacation packages. These programs are designed to have 100% of customer payments made through employee payroll deduction or allotment programs with their employer.

KBRA analyzed the transaction using Global Consumer Loan ABS Rating Methodology published on November 28, 2017. KBRA’s global consumer loan methodology incorporates an analysis of: (1) the underlying collateral pool, (2) the platform’s historical static pool data, segmented by characteristics including company grade and income bucket, (3) the proposed capital structure for the transaction, (4) KBRA’s operational assessment of the platform and servicer, and (5) the legal structure, transaction documents, and legal opinions. KBRA has performed an operational review of Purchasing Power in January 2018 at their Atlanta headquarters.

For details on the analysis, please see KBRA’s pre-sale report, Purchasing Power Funding 2018-A, which was published today at www.kbra.com.

 

Preliminary Ratings Assigned: Purchasing Power Funding 2018-A, LLC

       
Class     Preliminary Rating     Initial Principal Balance
A     AA (sf)     $134,510,000
B     A (sf)     $13,690,000
C     BBB (sf)     $13,590,000
D     BB (sf)     $13,210,000
 

Representations & Warranties 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 available here.

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

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About KBRA and KBRA Europe

KBRA is a full service credit rating agency registered with the U.S. Securities and Exchange Commission as an NRSRO. In addition, KBRA is recognized by the National Association of Insurance Commissioners as a Credit Rating Provider and a certified Credit Rating Agency (CRA) by the European Securities and Markets Authority (ESMA). Kroll Bond Rating Agency Europe Limited is registered with ESMA as a CRA.

Contacts

Kroll Bond Rating Agency
Analytical Contacts:
Eric Neglia, Managing Director
(646) 731-2456
eneglia@kbra.com
or
Alla Mikhalevsky, CFA, Associate Director
(646) 731-3356
amikhalevsky@kbra.com
or
Michael Polvere, Analyst
(646) 731-3339
mpolvere@kbra.com
or
Rosemary Kelley, Senior Managing Director
(646) 731-2337
rkelley@kbra.com

Contacts

Kroll Bond Rating Agency
Analytical Contacts:
Eric Neglia, Managing Director
(646) 731-2456
eneglia@kbra.com
or
Alla Mikhalevsky, CFA, Associate Director
(646) 731-3356
amikhalevsky@kbra.com
or
Michael Polvere, Analyst
(646) 731-3339
mpolvere@kbra.com
or
Rosemary Kelley, Senior Managing Director
(646) 731-2337
rkelley@kbra.com