Key Rating Drivers
Strong Credit Quality Obligors: Although the vast majority of the collateral is not rated by any
Strong Portfolio Diversification: Obligor and industry concentrations are minimal. The single most concentrated obligor represents 0.63% of the pool, while the top industry - oil and gas - represents only approximately 11.6%. However, consistent with prior transactions, there is a large concentration of light and medium duty trucks that make up approximately 81% of the pool.
Low Delinquency and Loss History: EFM's historical managed portfolio and prior transaction delinquency and loss experience is low, even during periods marked by elevated levels in other consumer and commercial asset classes due to a weak economy.
Sufficient Credit Enhancement (CE): Initial hard CE has decreased 27 basis points (bps) from the 2014-1 transaction. Nonetheless, total proposed CE is sufficient to support Fitch's 'AAAsf' stressed loss assumption of 11.4%.
Minimal Residual Risk: Approximately 97% of the 2014-2 leases are open-end, meaning the lessees bear the residual risk. The remaining 3% are closed-end leases, under which the trust will bear the wholesale market risk.
Quality Origination, Underwriting and Servicing Platform: EFM has demonstrated adequate capabilities as originator, underwriter and servicer, as evidenced by historical delinquency and loss performance of securitized trusts and the managed portfolio.
Unanticipated increases in the frequency of defaults could produce default levels higher than the projected base-case default proxy and impact available default coverage and multiples levels. Lower default coverage could impact ratings and Rating Outlooks, depending on the extent of the decline in coverage. In Fitch's initial review of the transaction, the notes were found to have limited sensitivity to changes in obligor credit profiles and recovery rates associated with the high concentration of truck collateral in the pool. Further details can be found in the presale report.
Key Rating Drivers and Rating Sensitivities are further detailed in the accompanying presale report, available at 'www.fitchratings.com' or by clicking on the above link.
Fitch's analysis of the Representations and Warranties (R&W) of this transaction can be found in
Additional information is available at www.fitchratings.com.
--'Global Structured Finance Rating Criteria' (
--'Global Rating Criteria for Corporate CDOs' (
--'Criteria for Rating U.S. Auto Lease ABS' (
-'Representations, Warranties, and Enforcement Mechanisms in Global Structured Finance Transactions' (
--'Enterprise Fleet Financing, LLC Series 2014-2' dated
--'Enterprise Fleet Financing, LLC Series 2014-2 -- Appendix' dated
Enterprise Fleet Financing, LLC Series 2014-2 (US ABS)
Enterprise Fleet Financing, LLC Series 2014-2 -- Appendix
Representations, Warranties, and Enforcement Mechanisms in Global Structured Finance Transactions
Criteria for Rating U.S. Auto Lease ABS
Global Rating Criteria for Corporate CDOs
Global Structured Finance Rating Criteria
Source: Fitch Ratings
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