KBRA Assigns Preliminary Ratings to GLS Auto Select Receivables Trust 2024-2
3 Apr 2024 | New York
KBRA assigns preliminary ratings to four classes of notes (five tranches) issued by GLS Auto Select Receivables Trust 2024-2 ("GSAR 2024-2"), an auto loan ABS transaction.
GSAR 2024-2 represents the fourth near prime term ABS securitization for Global Lending Services LLC ("GLS" or the "Company"), and the second of 2024. GSAR 2024-2 will issue four classes of notes (five tranches) totaling $289.65 million collateralized by a pool of retail automobile contracts, made to near prime obligors and secured by new and used automobiles.
The inaugural transaction for the GSAR platform closed in June 2023. Since 2014, the Company has also issued 26 securitizations under their GCAR program, collateralized by mostly subprime auto loans. The Company began originating subprime loans in 2013 and near prime loans via the "Select Program" in October 2021. The "Select Program" is a distinct product offering separate from the Company's subprime originations. The collateral in GSAR 2024-2 is comprised of "Select Program" loans only.
GLS is an auto finance company that was 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 inception. Based on financials provided by the Company, GLS has been profitable since 2017.
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 will be reviewed prior to closing.
To access rating and relevant documents, click here.
Click here to view the report.