KBRA Assigns Preliminary Ratings to Notes Issued by DT Auto Owner Trust 2018-3
NEW YORK--(BUSINESS WIRE)--Oct 3, 2018--Kroll Bond Rating Agency (KBRA) assigns preliminary ratings to four classes of notes issued by DT Auto Owner Trust 2018-3 (“DTAOT 2018-3”), an auto loan ABS transaction.
DTAOT 2018-3 will issue $449.35 million of notes collateralized by approximately $550.00 million of subprime auto loan receivables. The preliminary ratings reflect the initial credit enhancement levels ranging from 61.20% for the Class A notes to 19.80% for the Class E notes, which build to 65.00% and 23.60% for the Class A and Class E notes, respectively.
This transaction represents the third term ABS securitization in 2018 for DriveTime Automotive Group, Inc. (“DriveTime” or the “Company”). This is the ninth securitization that Kroll Bond Rating Agency (“KBRA”) has rated for DriveTime.
DriveTime is a leading used vehicle retailer in the United States that focuses on both the sale and financing of vehicles within the subprime market. DriveTime’s business model consists of vehicle acquisition, reconditioning, sales, underwriting, financing, loan servicing and after-sale support. As of June 30, 2018, DriveTime owned and operated 27 inspection/ reconditioning centers, 145 dealerships in 27 states and 3 loan-servicing centers.
KBRA applied its Global Auto Loan ABS methodology as part of its analysis of the transaction’s underlying collateral pool, the proposed capital structure and DriveTime’s historical static pool data. KBRA also conducted an operational assessment on the originator and servicer, as well as a review of the transaction’s legal structure and transaction documents. KBRA will 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, , published October 3, 2018.
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 .
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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, is 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.
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Eric Neglia, Managing Director
Andrew Silverhardt, Senior Analyst
Michael Polvere, Analyst
Rosemary Kelley, Senior Managing Director
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