CPS Says Buyers Acquired $185M Asset-backed Notes
Consumer Portfolio Services (Nasdaq: CPSS) today announced the closing of its first term securitization of 2013. The transaction is CPS's eighth senior subordinate securitization since 2011.
In the transaction, qualified institutional buyers purchased $185,000,000 of asset-backed notes secured by automobile receivables purchased by CPS. The sold notes, issued by CPS Auto Receivables Trust 2013-A, consist of five classes. Ratings of the notes were provided by Standard & Poor's and Moody's and were based on the structure of the transaction, the historical performance of similar receivables and CPS's experience as a servicer.
Note Interest Average Standard & Moody's Class Amount Rate Life Price Poor's Rating Rating A $142.0 1.31% 1.78 years 99.98709% AA- A1 million B $16.7 1.89% 2.06 years 99.99298% A A2 million C $11.1 2.79% 2.80 years 99.98747% BBB Baa2 million D $9.2 4.41% 2.45 years 99.98130% BB Ba2 million E $6.0 6.41% 2.04 years 99.99319% B+ B2 million
The weighted average effective interest rate on the notes is approximately 1.87%.
The 2013-A transaction has initial credit enhancement consisting of a cash deposit equal to 1.00% of the original receivable pool balance. The final enhancement level requires accelerated payment of principal on the notes to reach overcollateralization of 11.50% of the then-outstanding receivable pool balance.
The transaction utilizes a pre-funding structure, in which CPS sold approximately $116.3 million of receivables today and plans to sell approximately $68.7 million of additional receivables during April 2013. This further sale is intended to provide CPS with long-term financing for receivables purchased primarily in the month of March.
The transaction was a private offering of securities, not registered under the Securities Act of 1933, or any state securities law. All of such securities having been sold, this announcement of their sale appears as a matter of record only.
About Consumer Portfolio Services, Inc.
Consumer Portfolio Services, Inc. is an independent specialty finance company that provides indirect automobile financing to individuals with past credit problems, low incomes or limited credit histories. We purchase retail installment sales contracts primarily from franchised automobile dealerships secured by late model used vehicles and, to a lesser extent, new vehicles. We fund these contract purchases on a long-term basis through the securitization markets and service the loans over their entire contract terms.
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