KBRA Assigns Preliminary Ratings to Foursight Capital Automobile Receivables Trust 2018-1

NEW YORK--()--Kroll Bond Rating Agency (KBRA) announces the preliminary ratings to eight classes of notes issued by Foursight Capital Automobile Receivables Trust 2018-1 (“FCRT 2018-1”), a subprime auto asset-backed securities transaction.

FCRT 2018-1 will issue eight classes of notes in an aggregate principal amount of $278.20 million with an estimated closing date of March 21, 2018. The preliminary ratings reflect the initial credit enhancement levels ranging from 36.25% for the Class A notes to 5.35% for the Class F notes, which build to 38.25% and 7.35% for the Class A and Class F notes, respectively. As of the February 28, 2018 cutoff date, FCART 2018-1 contains $245.2 million of receivables out of an expected collateral balance of approximately $290.9 million after completion of the prefunding period. The prefunding may represent up to 15% of the collateral pool. The prefunding period is four months and needs to be completed by July 14, 2018.

This transaction, Foursight Capital Automobile Receivables Trust 2018-1 (“FCRT 2018-1”), represents the fifth rated term ABS securitization for the Company, the first rated term ABS securitization of 2018 and the third rated by KBRA.

Foursight Capital LLC (“Foursight”) is a Utah based automobile finance company that has been in business since 2012. Foursight provides automobile loans primarily to prime, near-prime and subprime borrowers who have experienced prior credit difficulties or have limited credit histories with credit bureau scores typically ranging from 580 - 700. Foursight was formed in Q4 2012 by an experienced senior management team that previously led Franklin Capital Corporation (“Franklin Capital”) and is a wholly-owned subsidiary of Leucadia National Corporation (“Leucadia”), a publicly listed holding company (NYSE: LUK).

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 Foursight’s historical static pool data. KBRA also conducted an operational assessment of the Company, 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, Foursight Capital Automobile Receivables Trust 2018-1 Pre-Sale Report, which was published today at www.kbra.com.

       

Preliminary Ratings Assigned: Foursight Capital Automobile Receivables Trust 2018-1

Class     Preliminary Rating     Expected Initial Principal Balance
A-1     K1+ (sf)     $34,000,000
A-2     AAA (sf)     $100,000,000
A-3     AAA (sf)     $54,340,000
B     AA+ (sf)     $32,580,000
C     A+ (sf)     $18,900,000
D     BBB+ (sf)     $11,630,000
E     BB+ (sf)     $11,630,000
F     BB (sf)     $15,120,000
 

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

KBRA
Analytical Contacts:
William Carson, 646-731-2405
Senior Director
wcarson@kbra.com
or
Haksun Kim, 646-731-2412
Director
hkim@kbra.com
or
Andrew Silverhardt, 646-731-2492
Senior Analyst
asilverhardt@kbra.com
or
Rosemary Kelley, 646-731-2337
Senior Managing Director
rkelley@kbra.com

Contacts

KBRA
Analytical Contacts:
William Carson, 646-731-2405
Senior Director
wcarson@kbra.com
or
Haksun Kim, 646-731-2412
Director
hkim@kbra.com
or
Andrew Silverhardt, 646-731-2492
Senior Analyst
asilverhardt@kbra.com
or
Rosemary Kelley, 646-731-2337
Senior Managing Director
rkelley@kbra.com