KBRA Assigns Ratings to Westlake Automobile Receivables Trust 2024-1
14 Mar 2024 | New York
KBRA assigns ratings to eight classes of notes issued by Westlake Automobile Receivables Trust 2024-1 (“WLAKE 2024-1”), an asset-backed securitization collateralized by a pool of auto loans.
WLAKE 2024-1 issued eight classes (Class A-2 consists of A-2-A and A-2-B) of notes totaling $1,509.79 million. The ratings reflect initial credit enhancement of 47.35% for the Class A-1, Class A-2, and Class A-3 notes, through 12.30% for the Class E notes. Credit enhancement consists of subordination (except for the Class E notes), overcollateralization, a reserve account and excess spread.
This transaction represents the first term ABS securitization in 2024 for Westlake Services, LLC (“Westlake” or the “Company”). The Company has issued 33 subprime auto loan ABS securitizations since May 2010. Most of Westlake’s borrowers have experienced prior credit difficulties and generally have credit bureau scores ranging from 500 to 700. Loans are originated through independent and franchise dealers and segmented into three credit tiers (Standard, Gold and Platinum) each based on a borrower’s credit bureau score. Westlake also utilizes a proprietary model to calculate a customer factor for each loan.
KBRA applied its Auto Loan ABS Global 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 Westlake, as well as periodic due diligence calls with the Company. Operative agreements and legal opinions were reviewed prior to closing.
To access rating and relevant documents, click here.
Click here to view the report.