KBRA Assigns Preliminary Ratings to Oportun Issuance Trust 2025-A
7 Jan 2025 | New York
KBRA assigns preliminary ratings to five classes of notes issued by Oportun Issuance Trust 2025-A (“OPTN 2025-A”), a $301.167 million consumer loan ABS transaction. OPTN 2025-A is a revolving ABS securitization collateralized by unsecured and secured consumer installment loans originated by Oportun Financial Corporation (“Oportun” or the “Company”). During the 12-month revolving period, eligible loans can be acquired into the securitization trust so long as they comply with the transaction's concentration limits and eligibility criteria.
OPTN 2025-A has initial credit enhancement levels ranging from 62.55% for the Class A notes to 3.35% for the Class E notes. Credit enhancement consists of overcollateralization, excess spread, a non-declining cash reserve account and subordination (except for the Class E notes). As of the Statistical Calculation Date, the current collateral balance is $310.0 million, with secured personal loans comprising approximately 6.5% of the pool.
Oportun is a publicly traded, California based consumer finance company listed on the NASDAQ that provides financial services, including both unsecured and secured personal installment loans, to borrowers who do not have a credit score or who may have a limited credit history. The Company has been issuing unsecured consumer loans for 17 years and began offering a secured personal installment loan, which are partially secured by an automobile title, in 2020.
KBRA applied its Consumer 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 portfolio pool data, underlying collateral pool and capital structure. KBRA considered its operational reviews of Oportun, as well as periodic update calls with the Company. Operative agreements and legal opinions will be reviewed prior to closing.
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