--Class A-1 'F1+sf';
--Class A-2 'AAAsf'; Outlook Stable;
--Class A-3 'AAAsf'; Outlook Stable;
--Class A-4 'AAAsf'; Outlook Stable;
--Class B 'AAsf'; Outlook Stable.
KEY RATING DRIVERS
Stable Collateral Quality: The pool is consistent with recently issued HALST pools, with a strong weighted average (WA) Fair Isaac Corp. (FICO) score of 741 and seasoning of nine months. Notably, the residual composition of the pool decreased substantially to 62.4% as a percent of the securitization value (SV), mainly due to the increase in leases with a term greater than 36 months.
Adequate CE Structure: Initial hard credit enhancement (CE) for the class A and B notes totals 16.95% and 13.50%, respectively, consistent with 2014-A. Initial excess spread is 4.07%. Loss coverage is adequate to support Fitch Ratings' 'AAAsf' and 'AAsf' stressed assumptions.
Stable Loss Performance: Credit and residual losses on HCA's portfolio have begun to stabilize from low levels seen in 2010 and 2011. This is a result of increased origination volume and a stabilizing wholesale used vehicle market. Fitch's credit loss proxy is 1% of the SV.
Stable RV Performance Despite Increased Volume: Fitch lessoned its residual haircut intended to account for HCA's substantial origination growth as HCA has begun exhibiting residual performance consistent with market trends despite increased residual maturity volume.
Unanticipated decreases in the value of returned vehicles and/or increases in the frequency of defaults and loss severity on defaulted receivables could produce loss levels higher than the base case. This would likely result in declines of credit enhancement and loss coverage levels available to the notes. Hence, Fitch conducts sensitivity analyses by increasing the transaction's initial base case RV and credit loss assumptions and examining the rating implications on all classes of issued notes. The increases to the base case losses are applied such that they represent moderate (1.5x) and severe (2.5x) stresses, respectively, and are intended to provide an indication of the rating sensitivity of notes to unexpected deterioration of a trust's performance.
The presale report is available at 'www.fitchratings.com' or by clicking on the above link.
Additional information is available at 'www.fitchratings.com'.
--'Global Structured Finance Rating Criteria' (
--'Criteria for Rating U.S. Auto Lease ABS' (
--'Structured Finance Tranche Thickness Metrics' (
Global Structured Finance Rating Criteria
Criteria for Rating U.S. Auto Lease ABS
Structured Finance Tranche Thickness Metrics
Source: Fitch Ratings
Most Popular Stories
- Prosecutor to Investigate Walmart Police Shooting
- GM to Announce New Jobs in Tennessee
- Smith & Wesson Misses Target
- Emirates Hit Libyan Targets With Airstrikes
- Michael Brown Funeral: Can Americans Change the Script of Violence?
- Mark Sanchez Suddenly a Hot QB Commodity
- American Killed With ISIS Fighters in Syria
- Marco Rubio Warns Obama on Deportations
- Ford Hires 300 at Louisville Lincoln Plant
- Surf's Up! SoCal Prepares for Big Storm Surf