KBRA Assigns Preliminary Ratings to SAFCO Auto Receivables Trust 2022-1
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NEW YORK--(BUSINESS WIRE)-- KBRA assigns preliminary ratings to $118.805 million of notes issued by SAFCO Auto Receivables Trust 2022-1 (“SAFCO 2022-1” or the “Issuer”), a subprime auto loan ABS transaction.
SAFCO 2022-1 will issue three classes of notes totaling $118.805 million. Credit enhancement on the notes is comprised of overcollateralization (”OC”), subordination of junior note classes, a cash reserve account, and excess spread.
This transaction is the inaugural ABS securitization for Southern Auto Finance Company, LLC (“SAFCO” or the “Company”). SAFCO is an indirect auto finance company founded in 1990 and headquartered in Pompano Beach, Florida. SAFCO specializes in auto financing for first-time buyers, as well as consumers seeking to rebuild credit and/or those with hard to verify incomes.
KBRA analyzed the transaction using the Auto Loan ABS Global Rating Methodology, as well as its Global Structured Finance Counterparty Methodology and ESG Global Rating Methodology. In applying the methodology, KBRA analyzed SAFCO’s static pool data, the underlying collateral pool and the capital structure using stressed cash flow assumptions. KBRA considered its operational review of SAFCO at the Company’s headquarters in Pompano Beach, FL, which was conducted in July 2022. Operative agreements and legal opinions will be reviewed prior to closing.
- Auto Loan ABS Global Rating Methodology
- Global Structured Finance Counterparty Methodology
- ESG Global Rating Methodology
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.
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.
Virginia Zhao, Associate Director (Lead Analyst)
+1 (646) 731-3374
Juhi Paranjape, Senior Analyst
+1 (646) 731-1340
Eric Neglia, Senior Managing Director (Rating Committee Chair)
+1 (646) 731-2456
Ted Burbage, Managing Director
+1 (646) 731-3325
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