KBRA Assigns Preliminary Ratings to SCF Equipment Leasing 2021-1 and SCF Equipment Leasing Canada 2021-1

NEW YORK--()--Kroll Bond Rating Agency (KBRA) assigns preliminary ratings to eight classes of notes issued by SCF Equipment Leasing 2021-1 and SCF Equipment Leasing Canada 2021-1 (“SCF 2021-1”). The notes are newly issued asset-backed securities (ABS) backed by a portfolio of equipment leases and loans.

The SCF 2021-1 transaction represents the eighth equipment ABS sponsored by Stonebriar Commercial Finance LLC. SCF 2021-1 includes nine classes of notes. Credit enhancement includes overcollateralization, a reserve account, subordination for senior classes and excess spread.

The aggregate discounted contract balance (the “ADB”) of the portfolio is approximately $1.01 billion. The portfolio is comprised of 145 contracts to 64 obligors. The average contract balance is approximately $7 million and the average exposure to an obligor is approximately $15.8 million. The maximum exposure to an obligor is approximately $222 million or approximately 22% of the ADB. The securitization is based on the projected equipment loan and lease cash flows discounted at the respective contract’s internal rate of return (“IRR”). The weighted average IRR is 8.24%.

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Disclosures

Further information on key credit considerations, sensitivity analyses that consider what factors can affect these credit ratings and how they could lead to an upgrade or a downgrade, and ESG factors (where they are a key driver behind the change to the credit rating or rating outlook) can be found in the full rating report referenced above.

A description of all substantially material sources that were used to prepare the credit rating and information on the methodology(ies) (inclusive of any material models and sensitivity analyses of the relevant key rating assumptions, as applicable) used in determining the credit rating is available in the Information Disclosure Form(s) located here.

Information on the meaning of each rating category can be located here.

Further disclosures relating to this rating action are available in the Information Disclosure Form(s) referenced above. Additional information regarding KBRA policies, methodologies, rating scales and disclosures are available at www.kbra.com.

About KBRA

Kroll Bond Rating Agency, LLC (KBRA) is a full-service credit rating agency registered with the U.S. Securities and Exchange Commission as an NRSRO. Kroll Bond Rating Agency Europe Limited is registered as a CRA with the European Securities and Markets Authority. Kroll Bond Rating Agency UK Limited is registered as a CRA with the UK Financial Conduct Authority pursuant to the Temporary Registration Regime. 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.

Contacts

Analytical Contacts

Joanne DeSimone, Senior Director (Lead Analyst)
+1 (646) 731-2306
jdesimone@kbra.com

Zara Shirazi, Senior Director
+1 (646) 731-3326
zshirazi@kbra.com

James Chiavaro, Analyst
+1 (646) 731-2383
jchiavaro@kbra.com

Rosemary Kelley, Senior Managing Director (Rating Committee Chair)
+1 (646) 731-2337
rkelley@kbra.com

Business Development Contact

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

Contacts

Analytical Contacts

Joanne DeSimone, Senior Director (Lead Analyst)
+1 (646) 731-2306
jdesimone@kbra.com

Zara Shirazi, Senior Director
+1 (646) 731-3326
zshirazi@kbra.com

James Chiavaro, Analyst
+1 (646) 731-2383
jchiavaro@kbra.com

Rosemary Kelley, Senior Managing Director (Rating Committee Chair)
+1 (646) 731-2337
rkelley@kbra.com

Business Development Contact

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