KBRA Assigns Preliminary Ratings to Avant Loans Funding Trust 2020-REV1

NEW YORK--()--Kroll Bond Rating Agency (KBRA) assigns preliminary ratings to four classes of notes issued by Avant Loans Funding Trust 2020-REV1 (“AVNT 2020-REV1”). This is a $200 million two-year revolving consumer loan ABS transaction that is expected to close on March 11, 2020.

This transaction represents Avant, LLC’s (“Avant” or the “Company”) 10th rated securitization collateralized by a trust certificate backed by unsecured consumer loans originated through its online marketplace lending platform (“Avant Platform”). AVNT 2020-REV1 is the first revolving transaction offered through the platform and the proceeds from the sale of the Notes will be used to fund loan purchases and the reserve account.

Founded in 2012, Avant is located in Chicago, Illinois and operates an online lending platform. Personal installment loans are offered primarily to non-prime consumers through the Avant Platform. Loans have an original term of between 24 – 60 months, an original balance between $2,000 to $35,000 and a fixed APR between 9.95% - 35.95% depending on the borrower’s risk profile and loan term. The Avant Platform charges an administration fee to borrowers ranging from 1.50% to 4.75% depending upon whether the borrower is issued a refinance product. In 2019, $1.11 billion was originated through the Avant Platform, up from $1.04 (6.4%) million in 2018. The primary purposes for the loans are for debt consolidation, emergency expense, life event, or car repair. As of December 31, 2019, approximately $6.5 billion in loans had been originated through the Avant Platform in the U.S.

Avant has a strategic partnership with WebBank, whereby WebBank, a Utah chartered industrial bank, originates loans through the Avant Platform. Avant utilizes technology and customized scoring models to assign credit grades. The Avant website is designed to provide customers with an easy interface and quick online loan decisions at competitive rates compared to traditional lending platforms.

KBRA applied its Global Consumer Loan ABS Rating Methodology for Asset-Backed Securities and its Global Structured Finance Counterparty Methodology as part of its analysis of the transaction’s underlying collateral pool, the proposed capital structure and the Avant Platform’s historical gross loss data. KBRA also conducted an operational assessment of the Avant Platform, 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.

To access ratings, reports and disclosures, click here.

Preliminary Ratings Assigned: Avant Loans Funding Trust 2020-REV1

Class

Preliminary Ratings

Principal Balance

A

A- (sf)

$115,900,000

B

BBB- (sf)

$41,260,000

C

BB- (sf)

$34,420,000

D

B (sf)

$8,420,000

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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 designated as a designated rating organization by the Ontario Securities Commission for issuers of asset-backed securities to file a short form prospectus or shelf prospectus. KBRA is also recognized by the National Association of Insurance Commissioners as a Credit Rating Provider, and is 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

Analytical Contacts:
Eric Neglia, Managing Director
+1 (646) 731-2456
eneglia@kbra.com

Melvin Zhou, CFA, Director
+1 (646) 731-2412
mzhou@kbra.com

Michael Polvere, Senior Analyst
+1 (646) 731-3339
mpolvere@kbra.com

Business Development Contact:
Ted Burbage, Managing Director
+1 (646) 731-3325
tburbage@kbra.com

Contacts

Analytical Contacts:
Eric Neglia, Managing Director
+1 (646) 731-2456
eneglia@kbra.com

Melvin Zhou, CFA, Director
+1 (646) 731-2412
mzhou@kbra.com

Michael Polvere, Senior Analyst
+1 (646) 731-3339
mpolvere@kbra.com

Business Development Contact:
Ted Burbage, Managing Director
+1 (646) 731-3325
tburbage@kbra.com