KBRA Assigns Preliminary Ratings to Tricolor Auto Securitization Trust 2024-3
2 Oct 2024 | New York
KBRA assigns preliminary ratings to six classes of notes issued by Tricolor Auto Securitization Trust 2024-3 (“TAST 2024-3”), a subprime auto loan ABS transaction.
TAST 2024-3 will issue six classes of notes totaling $287.55 million, where credit enhancement consists of overcollateralization, subordination of junior note classes (except for the Class F notes), a cash reserve account, and excess spread. The transaction has initial credit enhancement ranging from 50.85% for the Class A notes to 20.50% for the Class F notes.
TAST 2024-3 represents the seventh rated ABS securitization for Tricolor Auto Acceptance, LLC (“Tricolor” or the “Company”) since 2018. The Company also issued five unrated securitizations from 2013 to 2020. TAST 2024-3 represents Tricolor fifth ABS aligned with the 2021 Social Bond Principles, as the Issuer intends to utilize the proceeds of the issuance for an eligible social project that provides or promotes access to essential services and/or socioeconomic advancement and empowerment.
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 static pool data and the underlying collateral pool and stressed the capital structure based upon its stress case cash flow assumptions. KBRA considered its operational review of Tricolor, as well as several business updates with the Company since that time. Operative agreements and legal opinions will be reviewed prior to closing.
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