KBRA Affirms the Ratings for TCW Direct Lending Structured Solutions 2022 LLC
17 Jul 2024 | New York
KBRA affirms the ratings for two classes of notes issued by TCW Direct Lending Structured Solutions 2022 LLC (“TCW DLSS 2022”).
TCW DLSS 2022 is a $695 million middle market credit facility managed by TCW Asset Management Company LLC. The transaction originally closed October 27, 2022. The transaction was upsized in April, May, and July 2023 by a total of $245.0 million pro-rata across the Class A Notes, Class B Notes, and the Subordinated Notes. The notes are collateralized by a portfolio of primarily middle market loans to corporate borrowers and has an allowance for second lien and first lien/last out loans.
The surveillance analysis used information from the trustee report dated as of June 4, 2024, and reflects the distributions that occurred through the April 2024 payment date. As of the June 2024 trustee report, the portfolio comprises of 52 assets from 22 obligors, the aggregate principal balance of the collateral obligations is $246.9 million, there is a principal proceeds balance of $8.1 million, and there is a balance of $0.6 million in the revolver funding account. The transaction has approximately 3.3 years remaining in its reinvestment period, during which the portfolio will ramp and may experience turnover through trading and substitution. The transaction is in compliance with all coverage tests. Notes have received timely interest distributions since the transaction has closed.
The rated notes benefit from internal credit enhancement through subordination, overcollateralization, and excess spread. The structure envisages a different minimum required number of assets given different levels of portfolio amounts.
KBRA’s ratings on the Class A Notes consider timely payment of interest and ultimate payment of principal by the applicable stated maturity date. KBRA’s ratings on the Class B Notes consider ultimate payment of interest and principal by the applicable stated maturity date.
KBRA analyzed the transaction using the Structured Credit Global Rating Methodology, the Global Structured Finance Counterparty Methodology, and the ESG Global Rating Methodology.
To access rating and relevant documents, click here.
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