KBRA Assigns Ratings to GLS Auto Receivables Issuer Trust 2024-1
14 Feb 2024 | New York
KBRA assigns ratings to five classes of notes (seven tranches) issued by GLS Auto Receivables Issuer Trust 2024-1 (“GCAR 2024-1”), an auto loan ABS transaction.
GCAR 2024-1 represents the first term ABS securitization under their GCAR program for Global Lending Services, LLC (“GLS” or the “Company”) in 2024 and the 26th overall. GCAR 2024-1 issued five classes of notes (seven tranches) totaling $488.36 million collateralized by a pool of retail automobile contracts, made to subprime obligors and secured by new and used automobiles.
GLS is an auto finance company founded in 2011 and is majority-owned by funds managed by Sound Point Capital Management, L.P. (“Sound Point”), an alternative asset manager. Funds managed by Sound Point and legacy funds formerly managed by BlueMountain Capital Management have invested $135 million since GLS’ inception. Based on financials provided by the Company, GLS has been profitable since 2017. As of December 31, 2023, the Company reported positive unaudited year-to-date net income of approximately $40.4 million, had total assets of over $5.52 billion, total members’ equity of $169.3 million, loss absorbing capital of approximately $482.28 million, and an aggregate managed portfolio balance of $6.07 billion.
KBRA applied its Auto Loan ABS Global Rating Methodology as well as its Global Structured Finance Counterparty Methodology and ESG Global Rating Methodology as part of its analysis of the transaction’s underlying collateral pool, the proposed capital structure, and GLS’s historical static pool data. KBRA considered its operation review of GLS, as well as periodic due diligence calls with GLS. Operative agreements and legal opinions were reviewed prior to closing.
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